þ	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

¨	TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE

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•	Enrollments at public and private not-for-profit four-year institutions increased by approximately 9 percent from academic years (“AYs”) 2004-2005 through 2007-2008. Enrollment increased especially during the recession of 2007-2009, which created high unemployment. Enrollment has been stable post-recession.

•	According to the U.S. Department of Education’s projections released in February 2014, the high school graduate population is projected to remain relatively flat from 2015 to 2022.2

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Average published tuition and fees (exclusive of room and board) at four-year public and private not-for-profit institutions increased at compound annual growth rates of 5.5 percent and 4.4 percent, respectively, from AYs 2005-2006 through 2015-2016. Growth rates have been more modest the last two AYs, with average published tuition and fees at public and private four-year not-for-profit institutions increasing 2.9 percent and 3.8 percent, respectively, between AYs 2013-2014 and 2014-2015 and 2.9 percent and 3.6 percent, respectively, between AYs 2014-2015 and 2015-2016.3 Tuition and fees are likely to continue to grow at the more modest rates of recent years.

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Borrowing through federal education loan programs increased at a compound annual growth rate of 10 percent between AYs 2004-2005 and 2011-2012.6 Federal borrowing increased considerably during the recession, with borrowing increasing 26 percent between AYs 2007-2008 and 2008-2009 alone. A major driver of this activity was the Higher Education Reconciliation Act of 2005, which in AY 2007-2008 raised annual Stafford loan limits for the first time since 1992 and expanded federal lending with the introduction of the Graduate PLUS loan. In response to the financial crisis in AY 2008-2009, The Ensuring Continued Access to Student Loans Act of 2008 raised unsubsidized Stafford loan limits for undergraduate students again by $2,000.4 Federal education loan program borrowing peaked in AY 2011-2012. Since then it declined by 4 percent in AY 2012-2013, 1 percent in AY 2013-2014, and another 5 percent in AY 2014-2015. We believe these declines are principally driven by enrollment declines in the for-profit schools sector.4 Between AYs 2004-2005 and 2014-2015, federal grants increased 164 percent to $46.2 billion.5

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These increases in federal lending for higher education had a significant impact on the market for Private Education Loans. Annual originations of Private Education Loans peaked at $21.1 billion in AY 2007-2008 and declined to $6.0 billion in AY 2010-2011. Contributing to the decline in Private Education Loan originations was a significant tightening of underwriting standards by Private Education Loan providers, including Sallie Mae. Private Education Loan originations increased to an estimated $9.0 billion in AY 2014-2015, up 7.0 percent over the previous year.6

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•	We estimate total spending on higher education was $412 billion in the AY 2014-2015, up from $336 billion in the AY 2009-2010. Private Education Loans represent just 2 percent of total spending on higher education. Modest growth in total spending can lead to meaningful increases in Private Education Loans in the absence of growth in other sources of funding.7

•	Over the AY 2009-2015 period, increases in total spending have been born primarily through increased family contributions. If household finances continue to improve, we would expect this trend continue.

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•	various laws governing unfair, deceptive or abusive acts or practices;

•	the federal Truth-In-Lending Act and Regulation Z issued by the CFPB, which govern disclosures of credit terms to consumer borrowers;

•	the Fair Credit Reporting Act and Regulation V issued by the CFPB, which govern the use and provision of information to consumer reporting agencies;

•	the Equal Credit Opportunity Act (“ECOA”) and Regulation B issued by the CFPB, which prohibit creditor practices that discriminate on the basis of race, religion and other prohibited factors in extending credit;

•	the Servicemembers Civil Relief Act (“SCRA”), which applies to all debts incurred prior to commencement of active military service (including education loans) and limits the amount of interest, including fees, that may be charged;

•	the Truth in Savings Act and Regulation DD issued by the CFPB, which mandate certain disclosures related to consumer deposit accounts;

•	the Expedited Funds Availability Act, Check Clearing for the 21st Century Act and Regulation CC issued by the Federal Reserve Bank (“FRB”), which relate to the availability of deposit funds to consumers;

•	the Right to Financial Privacy Act, which imposes a duty to maintain the confidentiality of consumer financial records and prescribes procedures for complying with federal government requests for and subpoenas of financial records;

•	the Electronic Funds Transfer Act and Regulation E issued by the CFPB, which govern automated transfers of funds and consumers’ rights related thereto;

•	the Telephone Consumer Protection Act, which governs communication methods that may be used to contact customers; and

•	the Gramm-Leach-Bliley Act, which governs the ability of financial institutions to disclose nonpublic information about consumers to non-affiliated third-parties.

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•	Home equity loans or other borrowings available to families to finance their education costs;

•	Pre-paid tuition plans, which allow students to pay tuition at today’s rates to cover tuition costs in the future;

•	Section 529 plans, which include both pre-paid tuition plans and college savings plans that allow a family to save funds on a tax-advantaged basis;

•	Education IRAs, now known as Coverdell Education Savings Accounts, under which a holder can make annual contributions for education savings;

•	Government education loan programs such as the DSLP; and

•	Direct loans from colleges and universities.

•	demographic trends in the United States result in a decrease in college-age individuals,

•	demand for higher education decreases,

•	the cost of attendance of higher education decreases, or

•	public resistance to increasing higher education costs strengthens.

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•	prescribe minimum capital requirements,

•	limit the rates of growth of our business,

•	impose limitations on the business activities in which we can engage,

•	limit the dividend or distributions the Bank can pay to us,

•	restrict the ability of institutions to guarantee our debt,

•	limit proprietary trading and investments in certain private funds,

•	impose certain specific accounting requirements on us that may be more restrictive and

•	result in greater or earlier charges to earnings or reductions in our capital than generally accepted accounting principles.

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•	Persistent and prolonged disruption or volatility in the capital markets or in the education loan ABS sector specifically;

•	Our inability to generate sufficient Private Education Loan volume;

•	Degradation of the credit quality or performance of the Private Education Loans we sell or finance through securitization trusts, or adverse rating agency assumptions, ratings or conclusions with respect to those trusts or the education loan-backed securitization trusts sponsored by other issuers;

•	Material breach of our obligations to purchasers of our Private Education Loans, including securitization trusts;

•	The timing, pricing and size of education loan asset-backed securitizations other parties issue, or the adverse performance of, or other problems with, such securitizations;

•	Challenges to the enforceability of Private Education Loans based on violations of, or changes to, federal or state consumer protection or licensing laws and related regulations, or imposition of penalties or liabilities on assignees of Private Education Loans for violation of such laws and regulations; or

•	Our inability to structure and gain market acceptance for new products or services to meet new demands of ABS investors, rating agencies or credit facility providers.

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Pursuant to a tax sharing agreement, Navient has agreed to indemnify us for $283 million in deferred taxes that the Company will be legally responsible for but that relate to gains recognized by the Company’s predecessor on debt repurchases made prior to the Spin-Off. The remaining amount of this indemnification receivable at December 31, 2015 is $170 million. In addition, Navient has agreed to indemnify us for uncertain pre-Spin-Off tax positions.

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Separate and apart from Navient's direct responsibility for its own actions and those of its subsidiaries, Navient will indemnify the Company and the Bank for any liabilities, costs or expenses they may incur arising from any action or threatened action related to the servicing, operations and collections activities of pre-Spin-Off SLM and its subsidiaries with respect to Private Education Loans and FFELP Loans that were assets of the Bank or Navient at the time of the Spin-Off; provided that written notice is provided to Navient prior to the third anniversary date of the Spin-Off, April 30, 2017. Navient will not indemnify for changes in law or changes in prior existing interpretations of law that occur on or after April 30, 2014.

•	Navient has responsibility to assume new or ongoing litigation matters relating to the conduct of most pre-Spin-Off SLM businesses and servicing and collection activities operated or conducted prior to the Spin-Off.

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Under the terms of the Separation and Distribution Agreement, Navient is responsible for funding all liabilities, costs and expenses under the FDIC Consent Order and the DOJ Consent Order, other than fines directly levied against the Bank in connection with these matters. Under the DOJ Consent Order, Navient is solely responsible for reimbursing SCRA benefits and related compensation on behalf of both its subsidiary, Navient Solutions, Inc., and the Bank.

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•	Actual or anticipated fluctuations in our operating results;

•	Our smaller market capitalization as compared to pre-Spin-Off SLM;

•	Changes in earnings estimated by securities analysts or our ability to meet those estimates;

•	Our policy of paying no common stock dividends;

•	The operating and stock price performance of comparable companies;

•	News reports relating to trends, concerns and other issues in the student loan industry or other parts of the financial services industry, including regulatory actions against other financial institutions;

•	Perceptions in the marketplace regarding us and/or our competitors;

•	New technology used, or services offered, by competitors;

•	Significant acquisitions or business combinations, strategic partnerships, joint ventures or capital commitments by or involving us or our competitors;

•	Changes to the regulatory and legal environment under which we and our subsidiaries operate;

•	Our ability to securitize our Private Education Loans; and

•	Domestic and worldwide economic conditions.

•	Significant sales of our preferred stock, or the expectation of significant sales;

•	Lack of credit agency ratings;

•	Movements in interest rates and spreads that negatively affect return; and

•	Call and redemption features.

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Item 3.	Legal Proceedings

Item 4.	Mine Safety Disclosures

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Item  5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

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(1)	All shares purchased are pursuant to the shares of our common stock tendered to us to satisfy the exercise price in connection with cashless exercise of stock options, and tax withholding obligations in connection with exercise of stock options and vesting of restricted stock and restricted stock units.

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Item 6.	Selected Financial Data.

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Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations

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•	Completed the adoption of the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) with respect to our internal controls over financial reporting.

•	Continued the build-out of our Enterprise Risk Management (“ERM”) program and established the foundation for our 2016 Dodd-Frank Act Stress Testing (“DFAST”) submission and, in connection therewith, took steps to enhance our model risk management process.

•	Implemented a new enterprise-wide governance framework and launched a manager’s risk and control self -assessment methodology.

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Strengthened our Internal Audit function by adding eight additional professional staff, implementing several new automated systems, and significantly increasing the professional certifications of Internal Audit's staff members. We also received a favorable opinion from an independent accounting firm engaged to conduct an external quality assessment of the Internal Audit function, in accordance with internal audit industry standards.

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Made changes and enhancements to our compliance management system and program and related consumer protection processes and procedures. Our redesigned SCRA process and procedures have now received the approval of the DOJ. In 2014, we engaged a third-party firm to conduct independent audits of consumer protection processes and procedures, including our own compliance management system. At this time, that engagement is ongoing and we are beginning our second full cycle of those audits. To date, we have received no high-risk findings.

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•	Procedures followed and technology used by our customer service agents;

•	Online functionality available to our customers; and

•	Communications to our customers.

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Net interest income increased by $124 million primarily due to a $2.3 billion increase in average Private Education Loans outstanding and a 22 basis point increase in net interest margin. Net interest margin increased primarily as a result of an increase in the ratio of higher yielding Private Education Loans relative to our other interest earning assets, which more than offset a 14 basis point increase in our cost of funds. Cost of funds increased primarily as a result of the use of higher cost funding such as our ABCP Facility and the issuance of $631 million in term ABS financing to third-parties in July 2015 (which term ABS financing has a significantly longer average life and higher cost than deposit funding). Costs of funds were also higher in 2015 because several interest rate swaps that were not designated for hedge accounting treatment for seven months of 2014 were designated for the full year of 2015. Therefore, all interest costs associated with these hedges were included in the cost of funds in 2015, as opposed to only five months of interest costs in 2014.

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Provisions for credit losses increased $5 million compared with the year-ago period. This increase was primarily as a result of a $1.3 billion increase in Private Education Loans in repayment and a $206 million increase in Private Education Loans classified as TDRs (where we provide for life-of-loan losses). The impact on provision expense from loan sales in 2014 compared with 2015 was greater because we sold $306 million more in credit impaired loans in 2014 than in 2015. When we sell a credit impaired loan at a loss, the loss is recorded as additional provision expense. Also included in 2014 provision expense was a $14 million benefit from the change in our charge-off policy.

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Gains on sales of loans, net, increased $14 million. In 2015, we sold $1.5 billion of loans through Private Education Loan sales and a securitization transaction with third-parties. As a result, we recorded gains of $135 million. In 2014, we sold $1.9 billion of loans through Private Education Loan sales and a securitization transaction with third-parties and recorded gains of $121 million. Gains on sales of loans, net, were higher in the current period as these loans were sold at a higher price.

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Gains (losses) on derivatives and hedging activities, net, resulted in a net gain of $5 million in 2015 compared with a loss of $4 million in the year-ago period. The primary factors affecting the change were interest rates and whether derivatives qualified for hedge accounting treatment. In 2015, we used more derivatives to economically hedge risk that qualified for hedge accounting treatment than we did in the year-ago period.

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Operating expenses were $349 million compared with $275 million in the year-ago period. The year-over-year increase in operating expenses was primarily the result of increased personnel costs related to being a stand-alone company and an increase in loans serviced for the Company and third-parties. In addition, we made investments in our servicing platform to improve customer service, such as expanding weekend service hours and improved response times. Operating expenses in 2014 benefited from an $8 million reversal of reserves for remediation costs relating to the FDIC Consent Order.

•	Restructuring and other reorganization expenses were $5 million compared with $38 million in the year-ago period. The decrease was primarily the result of the wind-down of our separation efforts related to the Spin-Off.

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The effective tax rate decreased to 37.5 percent in 2015 from 41.9 percent in 2014. The decrease in the effective tax rate for 2015 was primarily the result of additional reserves recorded in fourth-quarter 2014 related to uncertain historical tax positions and the release of reserves for uncertain tax positions and lower state tax rates in 2015, as a result of the favorable outcome of several state matters.

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•	Net interest income increased by $116 million primarily due to a $1.6 billion increase in average Private Education Loans outstanding and a 20 basis point increase in net interest margin. Net interest margin increased 20 basis points primarily as a result of an increase in the proportion of higher yielding Private Education Loans in our loan portfolio.

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Provisions for credit losses increased $16 million compared with 2013 primarily as a result of a $13 million increase in charge-offs during 2014, an increase in the amount of TDRs entered into during 2014 (where we provide for life-of-loan losses), an increase in the percentage of loans in full principal and interest repayment and the effect of fewer loan sales. These amounts were partially offset by a $14 million benefit from the net effect of a change in our loss emergence period from two years to one year and a change in our charge-off policy that was recorded in the second quarter of 2014.

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Gains on sales of loans, net, decreased $76 million. In 2014, we sold $1.9 billion of loans through Private Education Loan sales and a securitization transaction with third-parties. As a result, we recorded gains of $121 million. In 2013, we recorded $197 million in gains from the sale of $2.4 billion of loans to an entity that is now a subsidiary of Navient. Gains on sales of loans, net, were higher in 2013 as a result of a larger volume of loans sold and those loans were sold to an entity that is now a subsidiary of Navient at a higher price.

•	Gains on sales of securities, net decreased $64 million in 2014 compared with 2013 because there were no sales in 2014 and a $585 million sale of securities in 2013.  The securities sold in 2013 were ABS backed by FFELP Loans and were originally contributed by the Company to the Bank in 2008.

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Gains (losses) on derivatives and hedging activities, net, resulted in a net loss of $4 million in 2014 compared with a gain of $1 million in 2013. The primary factors affecting the change were interest rates and whether the derivative qualified for hedge accounting treatment. In 2014, we had more derivatives used to economically hedge risk that did not qualify for hedge accounting treatment than we did in 2013.

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Operating expenses were $275 million in 2014 compared with $270 million in 2013. Operating expenses increased in 2014 due to increased servicing and marketing costs as well as increased personnel and other costs related to being a stand-alone company. In addition, in 2013 we recorded an $11 million reserve for estimated remediation costs relating to the FDIC Consent Order.  In 2014, we reversed approximately $8 million of that reserve based upon the final determination of the Bank’s liability.

•	Restructuring and other reorganization expenses in 2014 were $38 million compared with $1 million in 2013. The increase was primarily the result of costs related to the Spin-Off.

•	The increase in 2014's effective tax rate to 41.9 percent from 38.2 percent in 2013 was primarily the result of additional reserves related to uncertain tax positions and additional state tax expense as a result of the Spin-Off.

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(1)	For the year ended December 31, 2015, includes the average balance of our secured borrowings and amortization expense of transaction costs related to our ABCP Facility.

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(1)	Changes in income and expense due to both rate and volume have been allocated in proportion to the relationship of the absolute dollar amounts of the change in each. The changes in income and expense are calculated independently for each line in the table. The totals for the rate and volume columns are not the sum of the individual lines.

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(1)	Interest only, fixed pay and deferred describe the payment option while in school or in grace period. See Item 1. “Business - Our Business - Private Education Loans” for further discussion.

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(1)	Prior to the Spin-Off, we sold all loans greater than 90 days delinquent to an entity that is now a subsidiary of Navient Corporation, prior to being charged-off. Consequently, many of the pre-Spin-Off, historical credit indicators and period-over-period trends are not comparable and may not be indicative of future performance.

(2)	Represents fair value adjustments on loans sold.

(3)	Represents the recorded investment of loans classified as troubled debt restructuring.

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(1)	Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on their loans (e.g., residency periods for medical students or a grace period for bar exam preparation).

(2)	Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures.

(3)	The period of delinquency is based on the number of days scheduled payments are contractually past due.

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(1)	Prior to the Spin-Off, we sold all loans greater than 90 days delinquent to an entity that is now a subsidiary of Navient Corporation, prior to being charged-off. Consequently, many of the pre-Spin-Off, historical credit indicators and period-over-period trends are not comparable and may not be indicative of future performance.

(2)	Represents fair value adjustments on loans sold.

(3)	Loans in repayment include loans on which borrowers are making interest only and fixed payments as well as loans that have entered full principal and interest repayment status.

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1.

Derivatives - When determining the fair value of derivatives, we take into account counterparty credit risk for positions where we are exposed to the counterparty on a net basis by assessing exposure net of collateral held. The net exposure for each counterparty is adjusted based on market information available for that specific counterparty, including spreads from credit default swaps. Additionally, when the counterparty has exposure to us related to our derivatives, we fully collateralize the exposure, minimizing the adjustment necessary to the derivative valuations for our own credit risk. A major indicator of market inactivity is the widening of the bid/ask spread in these markets. In general, the widening of counterparty credit spreads and reduced liquidity for derivative instruments as indicated by wider bid/ask spreads will reduce the fair value of derivatives.

2.

Education Loans - Our Private Education Loans and FFELP Loans are accounted for at cost or at the lower of cost or fair value if the loan is held-for-sale. The fair values of our education loans are disclosed in Notes to Consolidated Financial Statements, Note 15, “Fair Value Measurements.” For both Private Education Loans and FFELP Loans accounted for at cost, fair value is determined by modeling loan level cash flows using stated terms of the assets and internally developed assumptions to determine aggregate portfolio yield, net present value and average life. The significant assumptions used to project cash flows are prepayment speeds, default rates, cost of funds, the amount funded by deposits versus equity, and required return on equity. Significant inputs into the models are not generally market-observable. They are either derived internally through a combination of historical experience and management’s expectation of future performance (in the case of prepayment speeds, default rates, and capital assumptions) or are obtained through external broker quotes (as in the case of cost of funds). When possible, market transactions are used to validate the model and, when appropriate, the model is calibrated to these market transactions. During 2015, we had several sales of Private Education Loans through securitization transactions. We were able to use the market data from these sales to validate the model and, when appropriate, calibrated the model to these market transactions.

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•	Further embedding of the ERM program and its attendant policies, processes and infrastructure throughout the organization.

•	The launch of the Manager’s Assessment of Risk and Control, to provide a consistent methodology for risk self-assessment across the enterprise;

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•	The re-engineering of the model risk management framework within the business to ensure the integrity of our model inventory, particularly as it relates to the DFAST; and

•	Continued investment in the ERM infrastructure and staffing to ensure the program can appropriately address the challenges facing our business and industry.

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•	the obligation of each party to indemnify the other against liabilities retained or assumed by that party pursuant to the Separation and Distribution Agreement and in connection with claims of third-parties;

•	the allocation among the parties of rights and obligations under insurance policies;

•	the agreement of the Company and Navient (i) not to engage in certain competitive business activities for a period of five years, (ii) as to the effect of the non-competition provisions on post-spin merger and acquisition activities of the parties and (iii) regarding “first look” opportunities; and

•	the creation of a governance structure, including a separation oversight committee of representatives from the Company and Navient, by which matters related to the separation and other transactions contemplated by the Separation and Distribution Agreement will be monitored and managed.

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Pursuant to a tax sharing agreement, Navient has agreed to indemnify us for $283 million in deferred taxes that the Company will be legally responsible for but that relate to gains recognized by the Company’s predecessor on debt repurchases made prior to the Spin-Off. The remaining amount of this indemnification at December 31, 2015 is $170 million. In addition, Navient has agreed to indemnify us for tax assessments incurred related to identified uncertain tax positions taken prior to the date of the Spin-Off. At December 31, 2015, we have recorded a receivable of $16 million related to this indemnification.

•	Navient has responsibility to assume new or ongoing litigation matters relating to the conduct of most pre-Spin-Off SLM businesses operated or conducted prior to the Spin-Off.

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Separate and apart from Navient's direct responsibility for its own actions and those of its subsidiaries, Navient will indemnify the Company and the Bank for any liabilities, costs or expenses they may incur arising from any action or threatened action related to the servicing, operations and collections activities of pre-Spin-Off SLM and its subsidiaries with respect to Private Education Loans and FFELP Loans that were assets of the Bank or Navient at the time of the Spin-Off; provided that written notice is provided to Navient prior to the third anniversary date of the Spin-Off, April 30, 2017. Navient will not indemnify for changes in law or changes in prior existing interpretations of law that occur on or after April 30, 2014.

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At the time of this filing, the Bank remains subject to the FDIC Consent Order. The FDIC Consent Order replaces a prior cease and desist order jointly issued in August 2008 by the FDIC and the UDFI which was terminated on July 15, 2014. Specifically, on May 13, 2014, the Bank reached settlements with the FDIC and the DOJ regarding disclosures and assessments of certain late fees, as well as compliance with the SCRA. The DOJ Consent Order was approved by the U.S. District Court for the District of Delaware on September 29, 2014. Under the FDIC Consent Order, the Bank agreed to pay $3.3 million in fines and oversee the refund of up to $30 million in late fees assessed on loans owned or originated by the Bank since its inception in November 2005. Navient is responsible for funding all liabilities, restitution and compensation under orders such as these, other than fines directly levied against the Bank.

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Item 7A.	Quantitative and Qualitative Disclosures about Market Risk

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(1)	Funding (by index) includes all derivatives that qualify as hedges.

(2)	Assets include restricted and unrestricted cash equivalents and other overnight type instruments. Funding includes liquid retail deposits and the obligation to return cash collateral held related to derivatives exposures.

(3)	Assets include receivables and other assets (including premiums and reserves). Funding includes unswapped time deposits, liquid MMDA's swapped to fixed rates and stockholders' equity.

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†	Management Contract or Compensatory Plan or Arrangement

*	Filed herewith

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1.	Organization and Business

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2.	Significant Accounting Policies

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•	In the consolidated balance sheet with changes in fair value recorded in the consolidated statement of income;

•	In the consolidated balance sheet with changes in fair value recorded in the accumulated other comprehensive income section of the consolidated statement of changes in equity;

•	In the consolidated balance sheet for instruments carried at lower of cost or fair value with impairment charges recorded in the consolidated statement of income; and

•	In the notes to the consolidated financial statements.

•	Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access at the measurement date. The types of financial instruments included in level 1 are highly liquid instruments with quoted prices.

•	Level 2 — Inputs from active markets, other than quoted prices for identical instruments, are used to determine fair value. Significant inputs are directly observable from active markets for substantially the full term of the asset or liability being valued.

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•	Level 3 — Pricing inputs significant to the valuation are unobservable. Inputs are developed based on the best information available. However, significant judgment is required by us in developing the inputs.

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•	Owning the equity certificates of certain trusts.

•	The servicing of the student loan assets within the securitization trusts, on both a pre- and post-default basis.

•	Our acting as administrator for the securitization transactions we sponsored.

•	Our responsibilities relative to representation and warranty violations.

•	The option to exercise the clean-up call and purchase the student loans from the trust when the pool balance is 10 percent or less of the original pool balance.

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(1)	Prior to the Spin-Off, we sold all loans greater than 90 days delinquent to an entity that is now a subsidiary of Navient Corporation, prior to being charged-off. Consequently, many of the pre-Spin-Off, historical credit indicators and period-over-period trends are not comparable and may not be indicative of future performance.

(2)	Represents fair value adjustments on loans sold.

(3)	Loans in repayment include loans on which borrowers are making interest only and fixed payments as well as loans that have entered full principal and interest repayment status.

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(1)	Prior to the Spin-Off, we sold all loans greater than 90 days delinquent to an entity that is now a subsidiary of Navient Corporation, prior to being charged-off. Consequently, many of the pre-Spin-Off, historical credit indicators and period-over-period trends are not comparable and may not be indicative of future performance.

(2)	Represents fair value adjustments on loans sold.

(3)	Loans in repayment include loans on which borrowers are making interest only and fixed payments as well as loans that have entered full principal and interest repayment status.

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(1)	Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation).

(2)	Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures.

(3)	Loans in repayment include loans on which borrowers are making interest only and fixed payments as well as loans that have entered full principal and interest repayment status.

(4)	The period of delinquency is based on the number of days scheduled payments are contractually past due.

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(1)	Balance represents gross Private Education Loans.

(2)	Number of months in active repayment (whether interest only payment, fixed payment, or full principal and interest payment status) for which a scheduled payment was due.

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(1)	Deferment includes customers who have returned to school or are engaged in other permitted educational activities and are not yet required to make payments on the loans (e.g., residency periods for medical students or a grace period for bar exam preparation).

(2)	Loans for customers who have requested extension of grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors, consistent with established loan program servicing policies and procedures.

(3)	The period of delinquency is based on the number of days scheduled payments are contractually past due.

(4)	Loans in repayment include loans on which borrowers are making interest only and fixed payments as well as loans that have entered full principal and interest repayment status.

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(1)

Fair values reported are exclusive of collateral held and pledged and accrued interest. Assets and liabilities are presented without consideration of master netting agreements. Derivatives are carried on the balance sheet based on net position by counterparty under master netting agreements, and classified in other assets or other liabilities depending on whether in a net positive or negative position.

(2)	The following table reconciles gross positions with the impact of master netting agreements to the balance sheet classification:

(1)	Cash collateral amount calculations include outstanding accrued interest payable/receivable.

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(1)	Amounts included in "gains (losses) on derivatives and hedging activities, net."

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(1)	Amounts included in “realized losses recorded in interest expense” in the “Impact of Derivatives on the Consolidated Statements of Income” table.

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(1)	Comprises shares withheld from stock option exercises and vesting of restricted stock for employees’ tax withholding obligations and shares tendered by employees to satisfy option exercise costs.

(2)	Common shares issued under our various compensation and benefit plans.

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(1)	Includes the potential dilutive effect of additional common shares that are issuable upon exercise of outstanding stock options, restricted stock, restricted stock units, and the outstanding commitment to issue shares under the ESPP, determined by the treasury stock method.

(2)	For the years ended December 31, 2015, 2014 and 2013, securities covering approximately 2 million, 3 million and 3 million shares, respectively, were outstanding but not included in the computation of diluted earnings per share because they were anti-dilutive.

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(1)	The aggregate intrinsic value represents the total intrinsic value (the aggregate difference between our closing stock price on December 31, 2015 and the exercise price of in-the-money options) that would have been received by the option holders if all in-the-money options had been exercised on December 31, 2015.

(2)	The total intrinsic value of options exercised was $13.7 million, $11.4 million, and $8.5 million for the years ended December 31, 2015, 2014 and 2013, respectively.

(3)	No cash was received from option exercises for the year ended December 31, 2015. The actual tax benefit realized for the tax deductions from option exercises totaled $3.7 million for the year ended December 31, 2015.

(4)	For net-settled options, gross number is reflected.

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(1)	The total fair value of shares that vested during the years ended December 31, 2015, 2014 and 2013 was $0.5 million, $0.4 million and $0.6 million, respectively.

(2)	As of December 31, 2015, there was $0.4 million of unrecognized compensation cost related to restricted stock net of estimated forfeitures, which is expected to be recognized over a weighted average period of 0.5 years.

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(1)	The total fair value of RSUs/PSUs that vested and converted to common stock during the years ended December 31, 2015, 2014 and 2013 was $18.9 million, $12.6 million and $6.4 million, respectively.

(2)	As of December 31, 2015, there was $13.8 million of unrecognized compensation cost related to RSUs net of estimated forfeitures, which is expected to be recognized over a weighted average period of 1.9 years.

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•	the obligation of each party to indemnify the other against liabilities retained or assumed by that party pursuant to the Separation and Distribution Agreement and in connection with claims of third-parties;

•	the allocation among the parties of rights and obligations under insurance policies;

•	the agreement of the Company and Navient (i) not to engage in certain competitive business activities for a period of five years, (ii) as to the effect of the non-competition provisions on post-spin merger and acquisition activities of the parties and (iii) regarding “first look” opportunities; and

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•	the creation of a governance structure, including a separation oversight committee of representatives from the Company and Navient, by which matters related to the separation and other transactions contemplated by the Separation and Distribution Agreement will be monitored and managed.

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Pursuant to a tax sharing agreement, Navient has agreed to indemnify us for $283 million in deferred taxes that the Company will be legally responsible for but that relate to gains recognized by the Company’s predecessor on debt repurchases made prior to the Spin-Off. The remaining amount of this indemnification at December 31, 2015, is $170 million. In addition, Navient has agreed to indemnify us for tax assessments incurred related to identified uncertain tax positions taken prior to the date of the Spin-Off. At December 31, 2015, we have recorded a receivable of $16 million related to this indemnification.

•	Navient has responsibility to assume new or ongoing litigation matters relating to the conduct of most pre-Spin-Off SLM businesses operated or conducted prior to the Spin-Off.

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Separate and apart from Navient's direct responsibility for its own actions and those of its subsidiaries, Navient will indemnify the Company and the Bank for any liabilities, costs or expenses they may incur arising from any action or threatened action related to the servicing, operations and collections activities of pre-Spin-Off SLM and its subsidiaries with respect to Private Education Loans and FFELP Loans that were assets of the Bank or Navient at the time of the Spin-Off; provided that written notice is provided to Navient prior to the third anniversary date of the Spin-Off, April 30, 2017. Navient will not indemnify for changes in law or changes in prior existing interpretations of law that occur on or after April 30, 2014.

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At the time of this filing, the Bank remains subject to a Consent Order, Order to Pay Restitution and Order to Pay Civil Money Penalty dated May 13, 2014 issued by the FDIC (the “FDIC Consent Order”). The FDIC Consent Order replaces a prior cease and desist order jointly issued in August 2008 by the FDIC and the UDFI which was terminated on July 15, 2014. Specifically, on May 13, 2014, the Bank reached settlements with the FDIC and the Department of

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