Sallie Mae 2013 Annual Report Download - page 231
Download and view the complete annual report
Please find page 231 of the 2013 Sallie Mae annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
1 -
2
-
3
-
4
-
5
-
6
-
7
-
8
-
9
-
10
-
11
-
12
-
13
-
14
-
15
-
16
-
17
-
18
-
19
-
20
-
21
-
22
-
23
-
24
-
25
-
26
-
27
-
28
-
29
-
30
-
31
-
32
-
33
-
34
-
35
-
36
-
37
-
38
-
39
-
40
-
41
-
42
-
43
-
44
-
45
-
46
-
47
-
48
-
49
-
50
-
51
-
52
-
53
-
54
-
55
-
56
-
57
-
58
-
59
-
60
-
61
-
62
-
63
-
64
-
65
-
66
-
67
-
68
-
69
-
70
-
71
-
72
-
73
-
74
-
75
-
76
-
77
-
78
-
79
-
80
-
81
-
82
-
83
-
84
-
85
-
86
-
87
-
88
-
89
-
90
-
91
-
92
-
93
-
94
-
95
-
96
-
97
-
98
-
99
-
100
-
101
-
102
-
103
-
104
-
105
-
106
-
107
-
108
-
109
-
110
-
111
-
112
-
113
-
114
-
115
-
116
-
117
-
118
-
119
-
120
-
121
-
122
-
123
-
124
-
125
-
126
-
127
-
128
-
129
-
130
-
131
-
132
-
133
-
134
-
135
-
136
-
137
-
138
-
139
-
140
-
141
-
142
-
143
-
144
-
145
-
146
-
147
-
148
-
149
-
150
-
151
-
152
-
153
-
154
-
155
-
156
-
157
-
158
-
159
-
160
-
161
-
162
-
163
-
164
-
165
-
166
-
167
-
168
-
169
-
170
-
171
-
172
-
173
-
174
-
175
-
176
-
177
-
178
-
179
-
180
-
181
-
182
-
183
-
184
-
185
-
186
-
187
-
188
-
189
-
190
-
191
-
192
-
193
-
194
-
195
-
196
-
197
-
198
-
199
-
200
-
201
-
202
-
203
-
204
-
205
-
206
-
207
-
208
-
209
-
210
-
211
-
212
-
213
-
214
-
215
-
216
-
217
-
218
-
219
-
220
-
221 -
222 -
223 -
224 -
225 -
226 -
227 -
228 -
229 -
230 -
231 -
232
 |
 |
Graphic Depiction of Floor Income:
Floor Income Contracts — We enter into contracts with counterparties under which, in exchange for an
upfront fee representing the present value of the Floor Income that we expect to earn on a notional amount of
underlying student loans being economically hedged, we will pay the counterparties the Floor Income earned on
that notional amount over the life of the Floor Income Contract. Specifically, we agree to pay the counterparty
the difference, if positive, between the fixed borrower rate less the SAP (see definition below) spread and the
average of the applicable interest rate index on that notional amount, regardless of the actual balance of
underlying student loans, over the life of the contract. The contracts generally do not extend over the life of the
underlying student loans. This contract effectively locks in the amount of Floor Income we will earn over the
period of the contract. Floor Income Contracts are not considered effective hedges under ASC 815, “Derivatives
and Hedging,” and each quarter we must record the change in fair value of these contracts through income.
GAAP — Generally accepted accounting principles in the United States of America.
Guarantor(s) — State agencies or non-profit companies that guarantee (or insure) FFELP Loans made by
eligible lenders under The Higher Education Act of 1965 (“HEA”), as amended.
HCERA — The Health Care and Education Reconciliation Act of 2010.
Private Education Loans — Education loans to students or their families that are non-federal loans and
loans not insured or guaranteed under the FFELP. The Private Education Loans we make are largely to bridge the
gap between the cost of higher education and the amount funded through financial aid, federal loans or
borrowers’ resources. Private Education Loans include loans for higher education (undergraduate and graduate
degrees) and for alternative education, such as career training, private kindergarten through secondary education
schools and tutorial schools. Certain higher education loans have repayment terms similar to FFELP Loans,
whereby repayments begin after the borrower leaves school while others require repayment of interest or a fixed
pay amount while the borrower is still in school. Our higher education Private Education Loans are not
dischargeable in bankruptcy, except in certain limited circumstances.
G-3