Cuộc họp công bố kết quả kinh doanh Q3 2026 của Sallie Mae (SLM): Hạ triển vọng EPS khi doanh số cho vay mới đạt kỷ lục

Sallie Mae (NASDAQ: SLM) đã báo cáo mức giải ngân khoản vay giáo dục tư nhân kỷ lục theo quý trong quý 3 năm 2026, nhưng đã hạ dự báo EPS cả năm sau khi quyết định không hoàn tất thương vụ bán trọn gói khoản vay theo kế hoạch trong điều kiện thị trường biến động. Công ty cũng nâng dự báo khoản xóa nợ ròng do áp lực tiếp diễn liên quan đến các hoạt động xử lý nợ của bên thứ ba.

Những điểm chính

• Giá trị giải ngân khoản vay trong quý 3 đạt mức kỷ lục 3,4 tỷ USD, tăng 15% so với cùng kỳ năm ngoái. Giá trị giải ngân khoản vay cho sinh viên cao học tăng 119%.
• Thu nhập lãi ròng giảm 34 triệu USD so với cùng kỳ năm ngoái xuống 339 triệu USD, trong khi thu nhập khác tăng 15 triệu USD lên 46 triệu USD.
• Sallie Mae đã hạ dự báo EPS cả năm 2026 xuống mức 1,95 - 2,05 USD, chủ yếu do công ty không còn dự kiến thực hiện thương vụ bán khoản vay cuối cùng theo kế hoạch trong năm.
• Dự báo khoản xóa nợ ròng cả năm tăng lên 400 triệu - 420 triệu USD so với khoảng 345 triệu - 385 triệu USD trước đó. Ban quản lý cho biết việc điều chỉnh này hoàn toàn do vấn đề xử lý nợ của bên thứ ba.
• Sixth Street đã cam kết mua ít nhất 1,5 tỷ USD các khoản vay giáo dục tư nhân mới giải ngân hàng năm theo thỏa thuận hợp tác ban đầu có thời hạn 3 năm, bao gồm danh mục hạt giống gồm các khoản vay đã qua một thời gian giải ngân trị giá 600 triệu USD trong năm đầu tiên.
• Sallie Mae đã mua lại 5,1 triệu cổ phiếu trong quý và 18,1 triệu cổ phiếu từ đầu năm đến nay, tương đương 9% số cổ phiếu đang lưu hành vào đầu năm.

Dữ liệu tài chính chính

Hoạt động kinh doanh và vận hành

Nhu cầu trong mùa cao điểm đã thúc đẩy quy mô giải ngân đạt mức kỷ lục. Giá trị giải ngân cho sinh viên cao học tăng 119% và điểm FICO trung bình của nhóm này cao hơn 9 điểm so với mức trung bình chung của các khoản vay mới giải ngân. Ban quản lý cho biết các gói hỗ trợ tài chính và quy trình xác nhận của trường học bị chậm trễ đã kéo dài mùa cao điểm sang tháng 10. Số tiền giải ngân từ đầu tháng 10 đến nay đã tăng 35% so với cùng kỳ năm ngoái.

Sallie Mae tiếp tục đa dạng hóa mô hình huy động vốn thông qua các quan hệ đối tác chiến lược. Theo thỏa thuận mới với Sixth Street, đối tác này sẽ mua ít nhất 1,5 tỷ USD khoản vay giáo dục tư nhân mới giải ngân hàng năm trong thời hạn ban đầu 3 năm. Năm đầu tiên bao gồm một danh mục khoản vay đã qua một thời gian giải ngân trị giá 600 triệu USD. Ban quản lý cho biết sự hợp tác với KKR và Sixth Street giúp mở rộng khả năng giải ngân, cung cấp nguồn vốn hiệu quả về mặt vốn và tạo ra doanh thu phí quản lý chương trình và dịch vụ định kỳ.

Công ty cũng kéo dài thời hạn bình quân có trọng số của các khoản tiền gửi lên 37 tháng từ mức 23 tháng vào cuối năm 2025. Ban quản lý cho biết điều này giúp khớp thời hạn nguồn vốn tốt hơn với tỷ lệ khoản vay lãi suất cố định ngày càng tăng và giúp Sallie Mae ở vị thế rủi ro lãi suất trung tính hơn.

Vào ngày 1 tháng 10, Sallie Mae đã triển khai kế hoạch tái cấu trúc nhằm căn chỉnh nguồn lực với các ưu tiên chiến lược và cải thiện hiệu quả hoạt động. Ban quản lý cho biết các chi phí phát sinh có thể được hấp thụ trong phạm vi dự báo chi phí cả năm hiện tại.

Dự báo của ban quản lý

Ban quản lý cho biết họ vẫn kỳ vọng sẽ sử dụng hầu hết hạn ngạch mua lại cổ phiếu hiện tại vào cuối năm. Quyết định giữ lại các khoản vay thay vì bán chúng dựa trên việc mức thặng dư giá bán đưa ra đã giảm xuống dưới ngưỡng tối thiểu chấp nhận được của công ty. Sallie Mae dự kiến sẽ đạt được biên lãi ròng khoảng 5% đối với các khoản vay được giữ lại theo thời gian.

Công ty cho biết quyết định này không đại diện cho sự thay đổi vĩnh viễn đối với chương trình bán khoản vay của mình. Ban quản lý hiện kỳ vọng các đợt bán khoản vay đáng kể vẫn sẽ là một phần trong kế hoạch năm 2027 và các năm tiếp theo, tùy thuộc vào điều kiện thị trường và mức thặng dư giá bán chấp nhận được.

Rủi ro và các yếu tố cần theo dõi

Các hoạt động xử lý nợ của bên thứ ba vẫn là mối quan ngại tín dụng chính. Sallie Mae đã tăng mức ảnh hưởng ước tính năm 2026 đến khoản xóa nợ ròng từ các hoạt động này lên 45 triệu USD từ mức 25 triệu USD. Ban quản lý cho biết những khách hàng đã ở giai đoạn quá hạn trễ hơn áp dụng các tùy chọn thu hồi nợ sửa đổi của công ty chậm hơn so với dự kiến ban đầu.

Các chỉ số vận hành sớm đã có sự cải thiện. Ban quản lý báo cáo mức giảm 50% từ đầu tháng đến nay trong tháng 10 về số lần người vay đề cập đến các bên thứ ba và hoạt động liên quan. Công ty cũng cho biết các khoản thu hồi ban đầu từ những người vay bị ảnh hưởng cho thấy tỷ lệ thu hồi cao hơn đáng kể, mặc dù quy mô mẫu vẫn còn rất nhỏ.

Lãi suất cao hơn và thị trường vốn biến động đã làm giảm mức thặng dư giá bán đối với các thương vụ bán trọn gói khoản vay. Ban quản lý chỉ ra rằng thời gian kéo dài của môi trường thị trường không thuận lợi vẫn chưa chắc chắn, mặc dù họ xem các điều kiện hiện tại là tạm thời chứ không mang tính cấu trúc.

Tóm tắt phần Hỏi & Đáp với chuyên gia phân tích

• Thương vụ bán khoản vay theo kế hoạch: Ban quản lý cho biết thương vụ bán trọn gói khoản vay bị hủy trong năm 2026 có quy mô khoảng 1 tỷ USD. Công ty vẫn chưa lựa chọn hoặc phân loại lại danh mục cho giao dịch đó.
• Quy mô bảng cân đối kế toán năm 2027: Trong kịch bản cơ sở khi điều kiện bán khoản vay cải thiện, ban quản lý cho biết bảng cân đối kế toán có thể giữ nguyên hoặc tăng trưởng ở mức một chữ số. Đối tác chiến lược thứ hai và tiềm năng từ quy mô dòng tiền khoản vay cho sinh viên cao học sẽ cung cấp thêm sự linh hoạt về nguồn vốn.
• Áp lực tín dụng: Ban quản lý làm rõ rằng toàn bộ mức tăng trong dự báo khoản xóa nợ ròng đều liên quan đến vấn đề xử lý nợ của bên thứ ba. Họ kỳ vọng tác động trong năm 2027 sẽ thấp hơn đáng kể so với năm 2026, nếu không có sự thay đổi lớn trong hành vi của bên thứ ba.
• Giao dịch với Sixth Street: Dự báo EPS đã sửa đổi bao gồm khoản lãi từ việc bán nợ thuộc quan hệ đối tác chiến lược thứ hai. Một phần của danh mục hạt giống trị giá 600 triệu USD đã hoàn tất gần cuối quý 3, phần còn lại dự kiến hoàn tất vào đầu quý 4.
• Các khoản vay nắm giữ để bán: Ban quản lý cho biết số dư lớn hơn chủ yếu phản ánh việc giải ngân theo mùa, các cam kết dòng vốn tương lai (forward-flow) của KKR và danh mục hạt giống Sixth Street—chứ không phải thương vụ bán trọn gói khoản vay truyền thống bị hủy.
• Biên lãi ròng: Ban quản lý cho biết mức thấp nhất ở quý trước phần lớn là do thanh khoản dư thừa sau đợt bán khoản vay được đẩy nhanh trong quý 1. Việc tài trợ cho các khoản giải ngân trong mùa cao điểm đã giúp NIM bình thường hóa trong quý 3.

Toàn văn cuộc họp báo cáo kết quả kinh doanh

Toàn văn cuộc gọi công bố kết quả kinh doanh

Phần trình bày của ban lãnh đạo

Operator

Welcome to the Sallie Mae Third Quarter 2026 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Kate deLacy, Vice President, Investor Relations. Please go ahead.

Kate deLacy

Thank you, Leslie. Good evening, and welcome to Sallie Mae's Third Quarter 2026 Earnings Call. It is my pleasure to be here today with Jon Witter, our CEO; Pete Graham, our Co-President and CFO; and Melissa Bronaugh, Managing Vice President and Deputy CFO. After the prepared remarks, we will open the call for questions.

Our discussion will contain predictions, expectations and forward-looking statements. Actual results in the future may be materially different from those discussed here due to a variety of factors. Listeners should refer to the discussion of those factors in the company's Form 10-Q and other filings with the SEC. For Sallie Mae, these factors include, among others, results of operations, financial conditions and/or cash flows, as well as any potential impacts of various external factors on our business. We undertake no obligation to update or revise any predictions, expectations or forward-looking statements to reflect events or circumstances that occur after today, Thursday, October 22, 2026. Thank you. And I'll now turn the call over to Jon.

Jonathan Witter

Thank you, Kate and Leslie. Good evening, everyone. Thank you for joining us to discuss Sallie Mae's third quarter 2020 results. The third quarter was a strong one for Sallie Mae, reflecting solid operating performance and continued execution against our strategy. Tonight, we'll discuss our results, changes in the market environment, how our outlook has evolved and why we remain confident in the long-term trajectory of the company.

Let me begin with an update on our strategy. Over the last several years, we have been building a more diversified and flexible funding model. Last year, we launched our strategic partnerships business with our inaugural partner KKR, adding a third funding channel alongside our bank balance sheet and home loan sales. Tonight, we are pleased to announce that we have completed a strategic partnership with Sixth Street for an initial 3-year term. Sixth Street has committed to purchase a minimum of $1.5 billion in newly originated private education loans annually, with the first year inclusive of an initial seed portfolio of $600 million in seasoned loans. This transaction is substantially similar to our first strategic partnership. We look forward to providing additional detail about our strategic partnerships business in the near future, following the completion of the sales.

Adding a second partner further validates our strategic partnerships model. Together, our strategic partnerships with KKR and Six Street enable growth by expanding our origination capacity with access to scalable and capital efficient funding, makes us less dependent on short-term capital market conditions, and generates recurring and predictable program management and servicing fees. Our next priority in this area will be developing flow capability for our graduate loan products, now that we are completing our first peak season following reform.

With that strategic context, let me turn to peak season. Loan originations for the third quarter were $3.4 billion, representing 15% growth over the year ago quarter and the highest quarterly origination volume in our history. We are particularly pleased with the growth we have seen in. You will remember that we invested significantly in building new products, credit programs, marketing strategies and other capabilities to compete aggressively to serve these customers post plus reform. In Q3, graduate originations were up 119% year-over-year with an average FICO score of 9 points higher than the overall average of new originations in the portfolio.

This peak season has been elongated. Last-minute changes to federal rule making, systems challenges and other factors caused school delays in delivering financial aid packages, and the resulting certification process. As a result, peak season activity has continued well into October and is arguably still underway today. For October month-to-date, we have seen a 35% increase in disbursements year-over-year. We believe that stronger than normal volume will continue into the fourth quarter and that by year-end, our full year originations will be in line with our guidance of 12% to 14% growth.

We have said consistently that this first peak season would an important learning opportunity. We now have a more complete view of federal rulemaking, firsthand experience about how both schools and students will respond to the updated federal program and more insight into the actual mix of student loans demanded. We are currently in the early stages of processing and analyzing that data, and we'll certainly continue to learn more about the nature of the PLUS opportunity. We look forward to sharing our insights with you as appropriate later this fall and continue to be excited about the potential for future originations growth.

Let me turn to the existing portfolio. Private education loan net charge-offs were $90 million in the third quarter. These results were modestly above our expectation with the increase concentrated within the segment of borrowers affected by the misaligned third-party debt resolution practices we have previously discussed. Results within our nonaffected segment were in line with or slightly better than our expectations. Furthermore, as you can see on Slide 9 in our earnings presentation, our loan modification program continues to outperform expectations.

Let me provide an update on the impacted segment we discussed earlier this year. As previously communicated, we implemented a number of changes to create a more customer-aligned recovery approach. We are beginning to see the positive impact of those strategies. For example, using AI, we've reviewed all relevant collection and recovery and observed a 50% decline in mentions by borrowers of relevant players and practices during the month to date in October. While we are pleased with the general performance of these strategies, adoption by customers already in the later stages of delinquency and more fully engaged with these debt resolution providers has been slower than we initially expected.

As such, we are now estimating net charge-offs for the year will be moderately higher than we believe last quarter. Last quarter, we estimated an approximately $25 million impact of these practices to our 2026 net charge-offs driven by a decision to suspend many recovery efforts. At that time, we believed we could absorb the increase into our original guidance range of $345 million to $385 million although likely at the upper end. We now expect to see modest additional pressure on gross charge-offs from these customers, leading us to increase our estimated impact in the year from $25 million to $45 million. As such, we are increasing our full year net charge-off guidance to $400 million to $420 million, with a midpoint $45 million higher than that of our original range.

As we have said, we believe that customers who are charging off as a result of these questionable practices have a significantly higher ability to repay than a historically charged off customer. We have started to see our first few recoveries from this population through our enhanced strategies. And while it is a very small sample, we are seeing meaningfully higher recovery rates. Assuming this trend continues, this bodes well for future performance. Pete will now take you through some additional financial highlights of the quarter. Pete?

Peter Graham

Thank you, Jon. Good evening, everyone. For the third quarter of 2026, we generated $339 million of net interest income and $46 million of other income. Compared with the prior year quarter, net interest income decreased by $34 million, while other income increased by $15 million, driven by growth in recurring program management fees from our strategic partnership and year-over-year. Net interest margin was 4.85% for the quarter, up 10 basis points from the prior quarter. While interest rate volatility and higher long-term rates created some headwinds during the period, Actions that we purposefully and proactively took earlier this year helped to offset a portion of that pressure.

Specifically, we extended the duration of our funding to better align with the growing proportion of fixed rate loans in our portfolio. Those actions increased the weighted average life of our deposits to 37 months from 23 months at the end of 2025 and moved us into a more neutral interest rate risk position. Private education loans delinquent 30 days or more were 4.2% of loans and repayment, an increase from 4% in the year ago quarter. Our reserve rate was 5.89% at the end of the quarter, down 4 basis points from the prior year period, reflecting disciplined underwriting and ongoing work to optimize loss mitigation strategies.

Provision for credit losses was $214 million in the third quarter, primarily reflecting the impacts of significant originations growth in the period. Noninterest expenses were $221 million, up $40 million from the year ago quarter. The increase was driven largely by investments made to support peak season and position the company for growth in the changing federal student lending environment. At the same time, we've been laser-focused on noninterest expense management during the year. and have been performing better than our original expectations year-to-date.

On October 1, we executed a restructuring plan to better align resources with the company's strategic priorities and improved operating efficiency. Our year-to-date and expected future outperformance will allow us to absorb these restructuring charges within our full year guidance range. Without these onetime expenses, noninterest expense would have come in at the low end of the range, but will now be closer to the high end of the range. This restructuring aligns resources to our long term strategy and combined with our continued focus on disciplined expense management should help us return operating expense growth to more normalized levels as we move into 2027. Even recognizing that we expect to achieve continued significant originations growth during that time.

We continue to return capital to shareholders during the third quarter, repurchasing 5.1 million shares at an average price of $25.69. And since the beginning of the year, we have repurchased 18.1 million shares at an average purchase price of $23.02, representing 9% of the shares outstanding.

Finally, our liquidity and capital positions remain solid. We ended the quarter with liquidity of 15% of total assets. Total risk-based capital was 12.5% and common equity Tier 1 capital was 11.2%. We continue to believe in our strategy and the foundation it provides to support sustainable growth and return capital to shareholders. I'll now turn the call back to Jon.

Jonathan Witter

Thanks, Pete. Let me close with a discussion of recent market trends and how they have caused us to change some nearer-term plans and the resulting financial outlook. As many of you have undoubtedly tracked over the last month, interest rates have moved significantly higher and capital market conditions have become more volatile and challenging. Consequently, as we both gauge external indications of interest and ran our own internal valuation models, we came to believe that the likely premium we would receive on any loan sale in this environment would be below our minimum acceptable threshold.

Generally, our strategy has been to engage in regular way seasoned loan sales only when they represented an attractive economic trade versus our other alternatives. However, in this instance, we determined that we could create more shareholder value by retaining the loans on our balance sheet and earning at roughly 5% NIM over time rather than selling at the current indicated premium levels. The low-cost match funding of our bank, together with the flexibility afforded by our strategic partnership model creates a distinct strategic advantage. This positioning allows us to remain selective rather than be compelled to pursue actions dictated by market conditions.

Given that the markets remain elevated and volatile, at this time, we do not anticipate executing our final loan sale for the year, which was previously planned for October. We appreciate that this could create an in-year EPS impact for 2026. However, we are committed to being a disciplined capital allocator and believe this change in plans will drive a meaningfully greater shareholder value creation in the future.

It's important to note several things. First, we do not expect this change in loan sale plans to substantially impact our 2026 share buyback activity. We still expect to exhaust most of our current share repurchase authorization before the end of the year. Second, this does not reflect a permanent change to our loan sale program expectations as we see several factors that could potentially allow us to earn above threshold premiums even in a higher for longer future. While we certainly cannot project future market conditions, we currently believe that meaningful loan sales will be a part of our 2027 plan and beyond. We've outlined a number of moving pieces that impact our full year outlook.

In summary, primarily as a result of our decision not to execute an additional loan sale, we are lowering our full year 2026 EPS guidance to $1.95 to $2.05 a share. As mentioned earlier, we are raising our full year net charge-off guidance range to $400 million to $420 million. We are reaffirming our noninterest expense and origination guidance.

In conclusion, I know we've given you a lot of information this evening. So let me try to sum up the key takeaways. First, we continue to be excited about the plus opportunity and believe the investments we have made and performance this quarter position us well for future originations growth. Second, our loss mitigation and credit strategies, including loan modifications, are generally performing as intended, if not better, and position us well to manage credit performance going forward. Third, we've been good stewards of our expense dollars and spent wisely in 2026. We expect to land within our noninterest expense guidance range for the year, even after absorbing onetime restructuring expenses and believe we are set up to return to a more normalized expense growth rate going forward.

And finally, we have built a true strategic advantage in our flexible funding strategy and are positioned well to maximize shareholder value creation across a variety of macroeconomic environments. We believe all of this sets us up for continued growth and long-term shareholder value creation into the future. With that, Pete, why don't we go ahead and open up the call for some questions.

Operator

[Operator Instructions] Our first question comes from Jeff Adelson, Morgan Stanley.

Phần hỏi đáp

Jeffrey Adelson

Just given the current market environment, obviously, that's why you're taking the EPS guide down -- can you just help us understand how much of a whole loan sale that you were thinking originally was going to be in this year in the back half of the year? And I know it's so early and you haven't put it out yet, but -- can you maybe help everyone understand how you're thinking about 2027 in terms of early indications should we be assuming you do another similar pace of whole loan sales next year on top of the partnerships? Are you including any plans for a third partnership to be announced? And just I think would appreciate a better sense of what 2027 looks like? And should we look at the investor forum path as maybe some sort of indication of how you're thinking about that?

Peter Graham

Yes. Thanks for the question. There's a lot in there. So I'll maybe take it in stages. I think in context of the size of the loan sale, you'll recall when we pulled forward earlier in the year, pulled forward into the $2 billion loan sale to take advantage of market dislocation and launch the ASR, we said kind of on balance, we felt like that would have roughly $1 billion to our total loan sale sort of plan for the year. So it's in sort of that kind of a ZIP code.

The other thing that always goes into the factor of the size of our loan sales in any given year is sort of the equation of the level of originations that coupled with our commitments to partners and the balancing feature in our bank's balance sheet. And we came into this year thinking we would likely be flat balance sheet to slightly down. And we aspire to add a second partner, which Jon announced earlier on the call. So I think in the context of sizing kind of in that $1 billion range is probably the right way to think about that.

The second part of your question really was like what does this mean for the future? I think, again, we feel like the current environment is sort of a temporary thing as in any given quarter, there can be conditions in the market that make it. We think we're in that kind of a situation now with the sort of peak rates, a high degree of volatility in terms of the near-term outlook. And we believe that will stable also next year.

In the context of what does that mean for next year? I think our base case is we return to an environment that allows for premiums that are above sort of a minimum threshold level. And in that type of scenario, we're probably looking at a flat balance sheet to maybe single-digit growth of the balance sheet. We'll meet our commitments to partners, which we've now added a second significant flow commitment from State Street that we need to think about as we plan for funding of our originations profile. And then we'll use the loan sales, as we always do, to sort of manage capital and create capital for return to shareholders, at the same time, managing the growth of our balance sheet.

Jeffrey Adelson

Okay. And if I could just follow up on the net charge-off guidance I appreciate the color around the third-party issue. You expect to see a modest additional pressure on gross charge-offs. I think you cited an increase of about a $20 million impact there from $25 million to $45 million, but then you took the full year guide up at the midpoint by 45. So could you help us understand maybe where the rest of that , I think it's $25 million difference is coming from if it's not the third-party issue.

Jonathan Witter

Yes, Jeff, we tried to lay that out as clearly as we could for you. I think when we had originally updated guidance back in the second quarter, it was really in reflection of sort of the $25 million estimate that we had put out largely through pausing of certain recovery efforts. And I think what we said at that time is we thought we could cover that within our original range, but it would be at the higher end. And so that's going to put us up closer to that higher end of the initial range.

And I think as we went ahead and reset guidance, we felt like it was appropriate with the additional 20 just to reset that midpoint to midpoint. So I don't think there's anything else in what you are asking about. I think it's just the reflection of last quarter, us believing we can stay in the range, albeit at the high end and us now sort of recognizing that we have crept out of that and feeling like we should sort of reset it in a more traditional way.

Peter Graham

I was just going to say, to be clear, it's all related to this third-party issue. SP29093187 That's right. .

Operator

Our next question comes from Sanjay Sakhrani with KBW.

Sanjay Sakhrani

Appreciate you guys doing what's right in terms of the loan sales. I guess, as we think about what an acceptable rate would be -- can that happen like if rates are still in flux as we get out to next year? And I'm just curious, like how much capacity do you guys have to balance sheet loans into next year in terms of the equity?

Peter Graham

Yes. Thanks for the question, Sanjay. I think if you think about -- even in higher for longer scenario, which there were some recent articles around that and surveys of economists, even in those sort of longer-term outlooks, they had the 10-year treasury at a lower point in the second half of next year than where it currently sits. We don't obviously price off a 10-year treasury, but I think that's an indication that even kind of like the most bare case scenario for loan sales, they'll be relief from here.

I think there's more to it than just interest rates, although that's certainly a piece of it. I think there's also the aspect of just sort of uncertainty about where we're going from here. And the fact that in the current environment also, there's a lot of other activity in the ABS space and sort of pulling investor demand into higher-yielding product, think about all-day ABS that's funding the AEI trains at this point. So again, I think there's a lot of things unique to this quarter that create that the market conditions that we feel is generally appropriate. But I don't think that's a permanent thing. We see a path to that being a more stable environment for us going into next year.

Sanjay Sakhrani

And just to be clear, Pete, just on the capacity that you have to grow, like would you have to pull down like originations if given the capital levels or how much flexibility do you have on CET1 to sort of aid that growth that you have to balance sheet it?

Peter Graham

Yes, I think the balance sheet is in great shape. Again, the capital buffers that we carry to sort of all the regulatory thresholds are pretty substantial. I think that the addition of a second partner here gives us some additional sort of funding capacity in terms of flow originations. As Jon sort of said in his prepared remarks, the next thing we're working on, and we've already started dialogue around it is additional flow capacity for graduate originations. So I think the building of capacity there gives us an additional lever in addition to growing the balance sheet.

Operator

Our next question is from Terry Ma with Barclays. .

Terry Ma

I guess first, I just want to make sure I have the right pieces to the revised EPS guide. Can you just confirm whether or not the gain on sale from that second partnership is included in this guide? Or is that a first quarter '27 thing? And then like, obviously, credit costs are factored into the revised EPS guide. But like any sense you can kind of give us on how long that third-party collection issues should kind of impact credit costs? Like is there anything else you can do to kind of help ring-fence the issue?

Jonathan Witter

Yes. Terry, let me start with the third-party debt collection issue, and then I'll turn it over to Pete to talk a little bit more about your guide question. Look, I think it's obviously a little bit hard to say with certainty how long that matter is going to last because unlike things like pure credit trends, there are active players in the sort of industry participants on the other side, and they may change their strategies, they may change their approaches, and we will obviously have to adapt. With that said, I think we're really pleased with what we are seeing so far.

We have -- as I said in my prepared notes, we have put in place actions that we think are really forceful and effective actions. We think they create a much more aligned structure with our customers and help us address the situation. we are seeing really positive early indicators of success of those actions and our operational data. I think I mentioned on my prepared remarks, sort of the volume reduction we are seeing in our call listening. But there are others that I won't go into for a variety of reasons that I think give us confidence that this is starting to get real traction.

By the way, anecdotally, I think we are starting to see some change in behavior, positive changes in a way that is constructive and supportive. And I think all of that leads us to believe that absent some material change and sort of their strategic posture that we are on the downward slope of this I'd be hesitant to sort of put out there an exact number and exact timing of it. But I certainly think we expect next year's impact to be meaningfully less than what we saw this year.

Peter Graham

And I think the other thing I'd add there is the recovery profile of these borrowers, as Jon said, is much different than our normal charge-offs. And so that that's going to be additive to the recovery curve as we move into next year and 8.8. The second part of your question was around whether our updated guidance range included the gain on sale from the second strategic partnership with. Yes, that's included in our guidance for this year.

Terry Ma

Got it. Okay. That's helpful. And then maybe just on the restructuring, help us maybe reconcile like almost a year ago and early this year, you guys indicated incremental investment dollars to address the grad PLUS opportunity. So obviously, very optimistic around that. Now you're kind of restructuring kind of shrinking, like maybe just help us understand that and just confirm that you still view the TAM expansion as a real opportunity.

Jonathan Witter

Yes. Terry, we absolutely still see the TAM expansion as a real opportunity. And I think in the numbers that Pete described was an expectation of continued investments in things like marketing and probably at a lower pace, still some product and system and capability enhancements going into next year. But I would encourage you to go back and look at our OpEx trajectory over the last 5 or 7 years. I think we've managed that really, really well in terms of annual growth. It's been a source of sort of pride for us. Obviously, we felt it was important last year to get out in front of this opportunity, both from a capability perspective but also a marketing spend effectiveness or a marketing spend perspective, I think we did that.

I think you see the results of that in our peak season volumes. But that was never the end of the game for us. We know we have a business that we can continue to refine and optimize. We know we have ability to continue to find efficiencies in what we do every day. And we knew as we continue to build and evolve our strategy there were resources that maybe didn't fit as much going forward with our new priorities as they did with our previous priority. So we do a certain amount of this every year. I think this year for a variety of reasons, ended up being a bit more consequential than what we have seen in the past. But we think it sort of demonstrates our commitment to being great stewards of our expense budget, and we also think it gives us what we need to continue to invest in growth going forward.

Operator

[Operator Instructions] Our next question comes from Don Fandetti with Wells Fargo. .

Donald Fandetti

Can you talk a little bit about your near-term NIM expectations. It looked like the broker deposit rate went up a good bit this quarter. We've heard some competitors talk about just more competition for deposits. If you could just dig in a little bit on that.

Peter Graham

Yes, sure. I think in the discussion of NIM, I think it's important to sort of reflect on what's changed in our environment over the course of this year and how that impacts NIM. So one of the big drivers on NIM this year was the fact that we pulled forward that big loan sale in the first quarter. We were carrying a lot of excess liquidity in the time period in the year when we have very low originations. And that caused us to have sort of a dramatic low point for NIM in the second quarter. And at that time, we said our expectation was that as we funded peak season originations that would draw that down and we normalization. So that's the biggest factor on NIM in the current year.

I think at the margins, some of the extension of our duration in the portfolio, certainly has somewhat of an impact, but I feel good about that, right? Like off of the peak season last year that had been very heavily focused on fixed rate originations. And so we needed to make sure that we match the duration of that profile accordingly. And so we extended duration on our deposits over the course of the first half of the year roughly to close down the interest rate exposure that we had interest rates. And I feel pretty good about the timing of when we did that in the context of overall market volatility.

Donald Fandetti

Got it. I guess my follow-up, I just wanted to clarify, I think on the new fund, there's like a seed seasoned loan sale of $600 million. When would that take place? And would those have kind of good historical margins? And then if you can just talk held-for-sale.

Peter Graham

Yes. So a portion of the portfolio closed just at the end of the quarter, and the remainder will close in the early part of the fourth quarter. In the context of the held-for-sale portfolio, keep in mind that there will be the sort of regular commitments to the forward flow under the KKR deal in addition to these new held for sale associated with the seed portfolio.

Operator

Our next question comes from Rick Shane with JPMorgan.

Richard Shane

I need to get my questions in before Don because he asked pretty much what I wanted to focus on. But I just want to make sure we understand one thing. The held for sale portfolio is substantially larger than it's been. Some of that has to do with the Six Street transfer. Some of that has to do with the KKR flow. But I am wondering if there's a timing issue here, you guys thought you were going to sell loans in the fourth quarter. Presumably, you have to sort of assume that you didn't know that on September 30. Is there going to be some migration from the held for sale or the available-for-sale portfolio to held for investment in the fourth quarter? And what are the implications of that?

Peter Graham

Thanks for the question, Rick. I think the thing to keep in mind about the flow agreements they've got an overall commitment for the year. But because of the seasonality in our business, it's not a ratable amount each month or each quarter. And so they will fluctuate according to the -- obviously, third quarter we just had, as John said on the call, the highest originations in our company's history, and that's the driver of why that held for sale number is bigger at into the third quarter.

Richard Shane

Got it. So it doesn't have anything to do with deciding not to do a traditional nonflow sale and some weird timing issue there?

Peter Graham

Not at all. Not at all.

Operator

Thank you. Our next question comes from Giuliano Anderes Bologna, Compass Point. .

Giuliano Anderes-Bologna

Maybe hopefully not going over too much that's already been asked. But when I look at that, call it the large kind of held-for-sale portfolio. Is your expectation that you would complete to sell a large portion of that maturity of that held-for-sale portfolio in the fourth quarter where we're going to talk about leak into next year. And then kind of related to that, if you go about the seeding season portfolio, has that all been moved to held for sale already? Or is there more that would be moved to held for sale in the fourth quarter and have some reserve reversals?

Peter Graham

Yes. Let me take that question in 2 parts. With regard to sort of the mechanics of how our flow portfolio transactions, we generally will make sales from our bank into our warehouse on a monthly basis and then generally have a takeout sale to the partner in the subsequent month end after the quarter. And so the held for sale at the end of the third quarter will clear out when we make those sales to the to KKR in this case for the third quarter.

Additionally, in that held for sale is the $600 million of seasoned seed portfolio. A portion of that closed in the third quarter, and the remainder of that will close in the fourth quarter. So hopefully, that gives you the answer to that.

With regard to the portfolio sale that we had planned that we discussed that we weren't going to move forward with. We had not gone through a process of selecting a portfolio yet. We typically will gauge indication of interest in the market by getting sort of indicative bids from time to time. And that helps us gauge where we think a loan process might come out. But we have not gone through a process of selecting a portfolio would be -- which would be a prerequisite for us putting anything into a different designation of the held for investment.

Giuliano Anderes-Bologna

That's helpful. And then as a side follow-up, I think -- the way that it seems like kind of over implied was about a 2% gain on sale upfront for the strategic partnership sales. And single digits in the 10-Q when I think about that, the large held-for-sale book, is that still the right range to use in the 2% range? Or would that come down a little bit from the 2% ballpark?

Peter Graham

The disclosures in the Q would be in 2 parts. One would be we have on disclosure of fair value, which is on a broad sort of the valuation of our total portfolio. And then we have a separate valuation on the held for sale, and that's a combination of both the flow commitments to KKR that's in the warehouse as well as the $600 million of seed portfolio. It's a combination of both.

Giuliano Anderes-Bologna

And so I guess roughly call it $4 billion or $1.4 billion of loans held for sale as of the end of September at September 30 -- so we should expect the full gain on sale for the forward flow to be realized in the fourth quarter on that chunk of the portfolio.

Peter Graham

Correct.

Operator

Thank you. This concludes the Q&A portion of today's call. I would now like to turn the floor over to Mr. Jon Witter for closing remarks.

Jonathan Witter

Thank you, everyone, for your time and engagement this evening. I know we've given you a lot of information to work through in understanding our Q3 performance and outlook. In its simplest form, we are excited about the origination growth opportunity ahead of us. We're pleased with the performance of our various loss mitigation programs, and we believe we're managing expense as well. We're grateful for the strategic flexibility and the competitive advantage of having a well-capitalized deposit-funded bank now complemented through our emerging strategic partnerships business. We're building a more resilient, predictable and profitable Sallie Mae. While we would prefer a different macroeconomic environment, times like this demonstrate the power of our franchise, the strength of our strategy, and the quality of our execution. Sallie Mae, Investor Relations team to stand by to answer your more detailed questions. With that, I'll turn the call over to Kate for some concluding business.

Kate deLacy

Thanks, Jon. Thank you all for your time and questions today. A replay of this call and the presentation will be available on the Investors page at salliemae.com. If you have any further questions, feel free to contact me directly. This concludes today's call.

Operator

Thank you. This concludes today's Sallie Mae Third Quarter 2026 Earnings Conference Call and Webcast. Please disconnect your lines at this time, and have a wonderful evening.