SLM
#The portfolio is performing, as I said earlier, pretty much well within our expectations.
Seeing increases in charge-offs of the magnitude that we did, 0.83% to 1.08% and for the full P&I from 1.9% to 2.2%, given the amount of loans that we have now in full P&I, it's up 65% from a year ago, and 35% from the prior quarter.
That's significant growth and seasoning.
The provision miss, as <UNK> explained was principally due to the over discounting of the seasonality and roll aways.
If anything, we're factoring in, probably, superior performance than what we are seeing here in the portfolio's performance, as expected.
No.
Again, it grew from 0.93% to 1.03%, it's going to be obviously be higher than that over the course of the year.
I don't want to throw out a specific number at this point in time.
It is the case that we are constantly looking at the performance by school, and in particular, the for-profits.
Over the course of three years, have culled that down significantly.
And the schools that we currently have in our portfolio of new sales, are schools where they have big graduation rates, good placement of students after.
The percentage of our total volume that is related to for-profits is less than 10%.
As a category, we are lending to that category.
As a school, it is dependent on their proposition with students and their results.
When we share our forecast with regulators, we have, for the last two years in a row, done simulated stress tests, knowing that the DFAS requirement is not upon us until July of 2016.
We have used the assumptions that are the assumptions in DFAS, so far as environmental change, consistent with the Federal Reserve guidelines.
We have showed that to our regulators in all cases, for any stress level, for any year, we had very good results.
We continue to make money.
We continue to have capital ratios that are well above well-capitalized.
So, what we have tried to do, is to make the events of July 16, when they occur, to simply be the next turning page in regard to this type of analysis, which we've been doing for two years, now.
We are trying to make that, and we believe it will be, a non-event.
<UNK>, you might be well served to look at the default emergence curve that we put out one year ago today, or maybe it was in the second or third quarter earnings call.
But, typically, you see, I want to say 60% of the defaults are going to emerge from the portfolio, in really, the first 2.5 years to 3 years.
Charge-offs are going to be ---+ to put a handle on it above 2% in the first year or two, and then decline significantly, and fall below 1% in pretty short order.
There is significant front loading of defaults in any repayment cohort.
That's correct.
We have an allowance for one year of expected reserves.
Thank you, and thanks for your attention, and for your questions.
This is a very good day for us, as it announces that we are moving to a different level of maturity as a new company.
It is the case that we've maintained all of the virtues that got us here, including a very good market share, a terrific group of people who are our national sales force, a great brand that is a core brand for the entire industry, our products fit our audience well.
We have opportunity in adjacencies.
Our credit is unchanging, and of very high quality.
I'll remind people that 748 through the door of FICO for approvals is an excellent number.
We're starting to see, now, in our projections, that the franchise is leverageable, as the improvement that we are forecasting in the efficiency rate, clearly, given the entire tone of this conversation, we had very good and valued relationships with our regulators.
We have, as we model it forward, and already built into our market share and the development thereof, excellent growth prospects for the P&L going forward, with concomitant excellent returns.
The lower volatility, that chapter that we're moving into here from the funding standpoint, will take significant noise out of our communications going forward.
So, it's a very good day.
Thank you all for your attention.
Thanks for your faith and staying with us over these first couple of years, and we look forward to the next chapter.
Thank you.
