Sallie Mae 2007 Annual Report Download - page 148

3. Student Loans (Continued)
The estimated weighted average life of student loans in the Company’s portfolio was approximately
9.0 years and 9.7 years at December 31, 2007 and 2006, respectively. The following table reflects the
distribution of the Company’s student loan portfolio by program.
Ending
Balance
%of
Balance
Average
Balance
Average
Effective
Interest
Rate
December 31,
2007
Year Ended
December 31, 2007
FFELP Stafford and Other Student Loans,
net
(1)
............................. $ 35,726,062 29% $ 31,293,956 6.59%
FFELP Consolidation Loans, net ........... 73,609,187 59 67,918,046 6.39
Private Education Loans, net .............. 14,817,725 12 12,506,662 11.65
Total student loans, net
(2)
................ $124,152,974 100% $111,718,664 7.04%
Ending
Balance
%of
Balance
Average
Balance
Average
Effective
Interest
Rate
December 31,
2006
Year Ended
December 31, 2006
FFELP Stafford and Other Student Loans,
net
(1)
............................. $ 24,840,464 26% $ 21,151,871 6.66%
FFELP Consolidation Loans, net ........... 61,324,008 64 55,119,011 6.43
Private Education Loans, net .............. 9,755,289 10 8,585,270 11.90
Total student loans, net
(2)
................ $ 95,919,761 100% $ 84,856,152 7.04%
(1)
The FFELP category is primarily Stafford loans, but also includes federally insured PLUS and HEAL loans.
(2)
The total student loan ending balance includes net unamortized premiums/discounts of $1,791,153 and $1,198,404 as of Decem-
ber 31, 2007 and 2006, respectively.
4. Allowance for Loan Losses
The Company’s provisions for loan losses represent the periodic expense of maintaining an allowance
sufficient to absorb incurred losses, net of recoveries, in the student loan portfolios. The evaluation of the
provisions for student loan losses is inherently subjective as it requires material estimates that may be
susceptible to significant changes. The Company believes that the allowance for student loan losses is
appropriate to cover probable losses incurred in the student loan portfolios.
The following tables summarize the total loan provisions for the years ended December 31, 2007, 2006
and 2005.
2007 2006 2005
Years Ended December 31,
Private Education Loans ............................ $ 883,474 $257,983 $176,782
FFELP Stafford and Other Student Loans ................ 89,083 13,907 10,911
Mortgage and consumer loans ........................ 42,751 15,072 15,313
Total provisions for loan losses ....................... $1,015,308 $286,962 $203,006
F-27
SLM CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share amounts, unless otherwise stated)