Thank You. Dan Feshbach CEO

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1 The MeasureOne Private Student Loan Performance Report 2015 Authors: Dan Feshbach Chief Executive Officer Rushali Parikh Managing Director Products and Operations Rima Patel Analyst Nicole Mitchell - Analyst Contact:

2 Thank You MeasureOne thanks the six participants for their willingness to participate in this study and their ongoing efforts to increase transparency in the trillion-dollar student loan market. We welcome feedback and encourage others to join the ongoing effort to expand transparency to better enable data-driven decision-making. Dan Feshbach CEO The information provided in this document is strictly private and confidential. This document may not be made available, in whole of in part, without the prior written consent of MeasureOne LLC 2

3 TABLE OFCONTENTS 1. Introduction 2. PerformanceImprovementintheLastFiveYears 3. TheStudentLoanMarket:OutstandingBalances 4. DelinquencyTrendsbyQuarter(AsaPercentageofLoansinRepayment) 5. DelinquencybyProgram Type(byQuarter) 6. DistributionbyProgram Type(byQuarter) 7. BalancebyProgram Type(byQuarter) 8. DistributionbyLoanStatus(byQuarter) 9. LoanStatusbyQuarter 10. GrossCharge-ofRatesbyQuarter 11. DelinquencybyAcademicYearofOrigination(byQuartersSinceOrigination) 12. GrossCharge-ofsbyAcademicYearofOrigination 13. RepaymentTrendsbyAcademicYearofOrigination 14. OriginationVolumeandDistributionbyProgram TypebyAcademicYearofOrigination 15. Cosignedvs.Non-CosignedLoanDistributionbyAcademicYearofOrigination 16. SchoolCertificationbyAcademicYearofOrigination 17. GlossaryofTerms 18. MeasureOneMethodologyforDataColectionandValidation

4 INTRODUCTION Background TheMeasureOnePrivateStudentLoanReportisasemi-annualupdateonthestatusofthePrivateStudentLoanMarket.ThisreportservesasanupdatetotheSeptember2014 report,andaddsdatafor2014and2015. ThisreportisbasedondatacontributedbythesixlargestmarketparticipantsthatcompriseMeasureOne sdataconsortium.theseparticipantsincludecitizensbank,n.a.; DiscoverBank;Navient,PNCBank,N.A.;SalieMaeBankandWelsFargoN.A.,andarethesixlargestprivatestudentlendersandholdersinthemarkettoday.Cumulatively, theseparticipantsrepresentthemajorityofoutstandingprivatestudentloans,andanevengreatershareofneworiginations. Together,thesixConsortium participantsprovideacomprehensivepictureoftoday sprivatestudentloanmarket. ExecutiveSummary TheMeasureOnePrivateStudentLoanReport,sinceitsfirstissuanceinDecember2013,hasdemonstratedthatprivatestudentloans,characterizedbycredit-basedunderwriting, adocumentedabilitytorepay,andahighpercentageofcosigners,showstrongpositivetrendsintermsofrepayment,delinquencies,andcharge-ofs.thisinstalmentofthe reportcontinuestohighlightthesepositivetrends. KeyObservations -Year-over-yeardelinquenciescontinuedtoexhibitasignificantdownwardtrend. -Overal,delinquencyratesarethelowestsincebeforethe2008economiccrisis.Delinquencieshavedroppedwhilelenderscontinuetouseforbearancejudiciously,withonly 2.2% ofloansinforbearanceasof2015.earlyandlatestagedelinquencyratesaveraged3. and2.3%,respectively,forlatestfourquartersandbothshowyear-over-year declineofapproximately13%. -Charge-ofratesarelowat2.7% for2015,theyear-over-yearcharge-ofdeclineis14.5%. -Loanperformancecontinuestoimprovewitheachsubsequentoriginationvintage.Delinquenciesandcharge-ofshavegeneralydeclinedforeachsuccessivevintageineach quarterafterorigination. -Asof2015,totalbalancesofthesixConsortium Participantsedgedup2.1% year-over-yearto$65.0bilion,reflectingmodestgrowthinoriginationsforundergraduateloans for4-yearprograms. -Thepercentageofloansindiferentrepaymentstatuseshasremainedstablesince2011,withabout75% ofloansinactiverepaymentatanygiventime. SizeofPrivateStudentLoanMarket Theoutstandingbalancefortheentireprivatestudentloanmarketisestimatedtobe$91.0bilion,or7.2% ofthe$1.27trilioninoutstandingbalancesfortheentirestudentloan market.thesixparticipantsrepresentapproximately71% oftheentireprivatestudentloanmarketandthevastmajorityofneworiginations.whileaggregateoriginationsforthe sixparticipantsaregrowingmodestlyeachyear,theprivatestudentloanmarketoveralappearstobecontractingslightly.thisreductionisduetothefactthattheportfoliosof formermarketparticipantsarepayingdowngradualy. 1

5 PERFORMANCE IMPROVEMENT IN THE LAST FIVE YEARS LongTerm TrendsRevealSubstantialImprovementinPerformanceOverTime. Togetacompletesenseofthepositiveperformancetrendsintheprivatestudentloanmarket,itisnecessarytoconsideralongertimehorizon.Thecumulativeimpactofincremental, year-over-yearimprovementsisconsiderable. Toaccountforseasonalvariation,wecomparefirstquarterperformancetofirstquarterperformanceoverthepast5years. PerformanceOverPast5Years CurentBalance $52.78B $57.65B $59.94B $61.80B $63.65B $65.00B Repayment($) 30-89(% ofrepay) 90+(% ofrepay) AnnualizedCharge-ofs(% ofrepay) Repayment(% oftotal) Forbearance(% oftotal) $32.14B 5.84% 5.12% 5.68% % $39.08B 5.27% 3.87% 4.84% 67.78% 2.94% $43.01B 4.63% 3.51% 3.53% 71.76% 2.85% $45.79B 3.61% 2.92% 3.48% 74.09% 2.36% $46.90B 2.99% 2.54% 3.17% 73.68% 2.42% $49.22B 2.61% % 75.73% 2.22% YearOverYear%Change % 3.97% % 2.12% 19.16% 21.58% 10.07% 6.45% 2.42% 4.95% % -9.76% % % % % % % % % 30.28% % % -1.42% -8.91% % 10.55% % 3.25% -0.55% 2.78% % % -3.06% % 2.54% -8.26% ChangeOver5Years % 53.12% % % % 24.35% % 2015figuresshowbalancesinrepaymentnowtotaljustover$49bilion,a53% changesince2010.thegrowthinrepaymentbalancesismorethantwicethe23% increasein curentbalance.thisindicatesthatwhilethetotalbalanceofloansincreasedatrateof$2bilionperyearonaverage,theshareofthoseloansinrepaymentincreasedmorerapidly. Curentbalanceandrepaymentbalancegrewatahighrateimmediatelyfolowingthefinancialcrisis.Thatgrowthhasslowed,butrepaymentbalancecontinuestoincreaseata fasterratethancurentbalance. Asof2015,earlystagedelinquencyasapercentofloansinrepaymentisdown55% from 2010,andlatestagedelinquencyisdown57% from 2010.Today,76% ofal loansareinrepaymentstatus,comparedto61% in2010,anincreaseof24%.theincreaseinrepaymentpercentagecanbeatributedtotheuseofin-schoolrepaymentplans aswelaslowerratesofcharge-ofs,forbearance,anddeferment. 2010charge-ofswereat5.7% asapercentofrepayment;at2.7%,2015charge-ofsare52% lowerthan2010,andtheyrepresentthelowestcharge-ofsfiguresince beforethefinancialcrisis.injustthepastyear,delinquencyandcharge-ofsshowedtoyoyimprovementrangingfrom 12% to15%. Forbearancedroppedsubstantialybetween2009and2013,andisnowatalowof2.2% in2015.overal,forbearanceis37% lowertodaythan

6 THE STUDENT LOAN MARKET:OUTSTANDING BALANCES Theprivatestudentloanmarketis7.2% ofthe$1.27trilionstudentloanmarket TotalStudentLoanMarketOutstandingBalance(Bilion$) PrivateStudentLoansOutstandingBalance(Bilion$) 70 $65.0B 71.4% Federal $1,174.4B 92.8% Private $91.0B 7.2% OutstandingBalance($Bilions) $15.5B 17. $10.6B 11.6% 0 SixParticipants OtherSecuritized Private(Publicly Reported) OtherPrivate Lenders Source: FederalLoans:htps:/studentaid.ed.gov/about/data-center/student/portfolio;OutstandingfederalloansasofMarch2015. SixParticipants:Includesthesixparticipatinglenders/holders. OtherSecuritizedPrivateLoans:MeasureOnestandardizedstudentloansecuritiesdatausingpubliclyavailableremitancereports,whichincludesdatafrom AccessGroup,FirstMarblehead,KeyCorp,andothernon-profit issuers.itdoesnotincludedatafrom thesixparticipantsinthereport. OtherPrivateLenders:MeasureOneSurveythatincludesdatafrom banks,creditunions,andstudentloanrefinancecompanies;includingcommonbondanddrb. Note:Thisreportdoesnotcoverloansmadebyinstitutionsofhighereducation. Theentirestudentloanmarketiscomprisedoftwomajorcomponents:(1)thefederalstudentloanmarket,and(2)theprivatestudentloanmarket.Theoutstandingbalanceforthe entireprivatestudentloanmarketisestimatedtobe$91.0bilionor7.2% ofthe$1.27trilioninoutstandingbalancesfortheentirestudentloanmarket.thesixparticipantsinthis reportrepresentapproximately71% oftheentireprivatestudentloanmarketandthevastmajorityofalnewprivateloans. WhileConsortium balanceshavegrownmodestlyeachyear(seepg.14),theprivatestudentloanmarkethascontractedslightlyfrom thetimeofourlastreportfrom $91.8Bin 2014to$91.0Bin2015.Thisisbecausetheportfoliosofformermarketparticipantsarepayingdowngradualy. 3

7 DELINQUENCY TRENDS BY QUARTER (AS A PERCENTAGE OFLOANS IN REPAYMENT) Privatestudentloandelinquenciesforthesixparticipantshavecontinuedthedecliningtrendinthelasttwoquarters.Earlyandlatestagedelinquencies areapproximately13% loweroverlastyear. Quarter (% of Repay) % 6.69% 4.63% 5.49% 6.84% 5.84% 4.75% 4.83% 6.13% 5.27% 4.18% 4.58% 5.56% 4.63% 4.25% 4.07% 4.76% 3.61% 3.39% 3.96% 3.36% 90+(% of Repayment(% Repay) oftotal) 3.04% 3.27% 5.12% 5.72% 5.03% 4.89% 5.12% 4.89% 4.41% 4.07% 3.87% 3.71% 3.78% 3.61% 3.51% % 3.37% 2.92% 2.64% 3.07% 3.18% 48.53% 56.48% 55.09% 58.26% 55.83% 61.68% % 63.24% 68.59% 67.78% 70.64% 69.04% 73.02% 71.76% 74.27% 72.63% 75.63% 74.09% % 75.55% 2.99% 2.54% 73.68% 2.88% 2.07% 75.63% % 3.13% 2.61% 2.39% 2.51% % 76.98% 75.73% Delinquencies(% ofrepayment) Repayment(% oftotal) 6% 4% 2% Delinquencies(%ofOutstandingBalanceinRepayment) 30-89(% ofrepay) 90+(% ofrepay) Repayment(%ofTotalOutstandingBalance) Fordelinquencyratesforloansinrepayment,measuredonayear-over-yearbasis,downwardtrendsarecontinuing: 6.8% declinein30-89daydelinquencies(asa% ofrepayment)from 3.36% in2013to3.13% in % declinein30-89daydelinquencies(asa% ofrepayment)from 2.99% in2014to2.61% in % declinein90+daydelinquencies(asa% ofrepayment)from 3.18% in2013to2.51% in % declinein90+daydelinquencies(asa% ofrepayment)from 2.54% in2014to2.2 in2015 Theoveralrepaymentbalanceasapercentageofthetotaloutstandingbalanceremainedstablenear75% forthepasttwoyears,withsomeseasonalvariation.generalylow defermentandforbearanceandtheuseofin-schoolrepaymentplanscontinuestodrivehighrepayment.someseasonalvariationinbothrepaymentand30-89daydelinquency ratessuggestthatyear-over-yearmeasuresarethemoreappropriatemeasuresofrecenttrendsthanquarter-over-quartermeasuresbecausethelatermayreflectenrolmentand program completionpaternsratherthanlong-term trends. 4

8 DELINQUENCY BY PROGRAM TYPE (BY QUARTER) PerformancecontinuedtoimproveforbothundergraduateandgraduateprogramsonaYoYbasis:bothearlyandlatestagedelinquenciesare12-17% lowerin2015comparedto DaysDelinquent(%ofOutstandingBalanceinRepayment) 90+DaysDelinquent(%ofOutstandingBalanceinRepayment) 1 Program Type Undergraduate 1 Program Type Undergraduate 30-89(% ofrepay) 5% Graduate 90+(% ofrepay) 5% Graduate Undergraduate 6.2% 8.7% % % % % % % 30-89DaysDelinquent(asa% ofbalanceinrepayment) % % % % % Graduate 2.2% 3.3% 3.6% 2.5% 3.1% 3.9% 3.7% % 3.8% 3.4% 2.8% 3.1% 3.4% 3.1% % 2.5% 2.3% 2.8% 2.3% 2.1% % 2.2% 1.8% % % % % % % % % % % % % % % Undergraduate 4.1% 4.2% % % % % DaysDelinquent(asa% ofbalanceinrepayment) % % % % % Graduate 0.9% 1.1% 1.9% 2.4% 2.3% 2.5% 2.6% 2.6% 2.5% 2.4% 2.2% 2.1% 2.2% 2.2% 2.1% 2.1% 2.4% 2.1% 1.8% 1.6% 1.9% % 1.4% 1.5% 1.6% 1.4% % % % % % % % % % % % % % 30-89DayDelinquencies(EarlyStage) Continuingadownwardtrendindelinquencyrates,undergraduateloanearlystagedelinquenciesdecreasedfrom 3.3% in2014to2.9% in2015,ayoychangeof-12%. Graduateloanearlystagedelinquenciesdecreasedfrom 2.1% in2014to1.8% in2015,ayoychangeof-14%. 90+DayDelinquencies(LateStage) Latestagedelinquenciesexhibitadownwardtrendparaleltoearlystagedelinquencies.Undergraduateloanlatestagedelinquenciesdecreasedfrom 3. in2014to2.5% in2015,ayoychangeof-17%.graduateloanlatestagedelinquenciesdecreasedfrom 1.6% in2014to1.4% in2015,ayoychangeof-13%. ByProgram Type Graduateloandelinquencyratesareconsistentlylowerthanundergraduaterates. Thespreadbetweenundergraduateandgraduateloandelinquencyrateshasgradualynarowedsince2008duetoimprovedundergraduateloanperformance. 5

9 DISTRIBUTION BY PROGRAM TYPE (BY QUARTER) Totalloanbalancesforthesixparticipantlendersincreasedto$65.0Bin2015. DistributionbyProgram Type(%ofTotalOutstandingBalance) AsofQuarterEnd2015 Undergraduate 85.29% Trend:Increasing Graduate 14.71% Trend:Decreasing 1 Asmalpercentageofotherprivatestudentloansoriginatedbythesixparticipantsinclude consolidationloansandloansthatwerenotcodedbythesixlenders,whichhavenotbeenincludedinthe chartabove. 1 Quarter Undergraduate Graduate OtherProgram Type $33.468B $34.550B $35.881B $36.030B $37.330B $38.124B $39.290B $39.339B $42.124B $42.612B $43.554B $43.332B $44.379B $44.702B $45.708B $45.360B $46.516B $46.478B $47.552B $47.082B $48.241B $48.134B $49.294B $48.779B $49.696B $49.521B $50.605B $7.890B $8.011B $8.124B $8.197B $8.319B $8.368B $8.446B $8.468B $8.673B $8.659B $8.686B $8.650B $8.702B $8.669B $8.698B $8.643B $8.733B $8.651B $8.717B $8.653B $8.759B $8.673B $8.771B $8.729B $8.780B $8.677B $8.727B $4.918B $4.947B $4.962B $4.905B $4.966B $4.972B $5.048B $4.999B $5.336B $5.348B $5.413B $5.392B $5.448B $5.477B $5.537B $5.503B $5.524B $5.504B $5.531B $5.482B $5.528B $5.530B $5.582B $5.562B $5.655B $5.624B $5.665B Total $46.276B $47.508B $48.967B $49.132B $50.615B $51.464B $52.784B $52.806B $56.133B $56.618B $57.653B $57.374B $58.529B $58.848B $59.944B $59.505B $60.773B $60.633B $61.801B $61.217B $62.529B $62.337B $63.646B $63.070B $64.130B $63.822B $64.997B Outstandingloanbalancesincreasedslightlyto$65.0bilionin2015,a2.1% increasefrom 2014.Continuingthetrendfrom ourlastreport,growthslowedcontinuously throughoutthereportingperiodbutisstilpositive.previousannualgrowthrateswere9.2% from 2010to2011,4. from 2011to2012,3.1% from 2012to 2013,3. from 2013to2014and2.1% from 2014to

10 BALANCE BY PROGRAM TYPE (BY QUARTER) Growthinundergraduateloanbalancesaccountformostoftheincreaseintotalbalances($50.6bilion,or77.9% oftheoveraloutstandingbalancesasof 2015),withgraduateloanbalancesremainingstablenear$8.7bilion. OutstandingBalancebyProgram Type 60B 50B 40B 30B 20B 10B 0B CurentBalance Undergraduate Graduate OtherProgram Type 1 1 Otherprogram typeprivateloansincludeconsolidationloansandloansthatwerenotcodedbythesixparticipants. UndergraduateBalances Loanbalancesheldbyundergraduateborowersincreasedto$50.6Bin2015,representing85.3% ofbalancesheldbyeitherundergraduatesorgraduates,or77.9% ofloanbalancesoveral.this reflectsanincreaseof$1.3b(2.7%)from theprioryear,withthelongerterm trendreflectingslowergrowthinmorerecentyears,consistentwithoveraltrends. GraduateBalances Loanbalancesheldbygraduateborowersarestableat$8.7Bin2015,onlyaveryslightincreasefrom theyearbefore.moregeneraly,graduateloanbalanceshavebeenstablesincethemiddle of2011.sinceundergraduatebalanceshavecontinuedtoincrease,graduateloansarerepresentingasmalershareofthemarketeachyear. OtherBalances Balancesfrom otherloansrepresentedjustover$5.7bofthemarketin2015andhavebeenstableataroundthatlevelthroughoutthereportingperiod.consolidationloansareincludedinthis category,butthebreakoutsarenotavailabletofurtherdefinethe"otherprogram Type"category. 7

11 DISTRIBUTION BY LOAN STATUS (BY QUARTER) Asof2015,morethan75% oftheoutstandingprivatestudentloanbalancesforthesixparticipatinglenderswereinrepaymentstatus. At2.2% ofoveralbalances,forbearancehasdecreasedslightlyoverlastyear,butremainswelwithinthe2-3% rangeseenoverthepast4years. DistributionbyLoanStatus(%ofTotalOutstandingBalance) AsofQuarterEnd % Repayment 20.03% Deferment 2.03% Grace 2.22% Forbearance CurrentBalance(%ofTotalOutstandingBalance) Quarter Repayment Deferment Grace Forbearance % % 5.52% % 55.09% 58.26% 55.83% 61.68% % 63.24% 68.59% 67.78% 70.64% 69.04% 73.02% 71.76% 74.27% 72.63% 75.63% 74.09% % 75.55% 73.68% 75.63% 74.27% 76.98% 75.73% 33.26% 35.48% 28.89% 30.72% 29.52% % 25.69% 24.42% 25.67% % 20.73% 22.54% 18.14% 19.82% 19.29% 21.26% 17.56% 19.31% % 17.87% % 20.03% % 8.86% 9.89% 5.12% 4.47% 7.53% 8.51% 4.16% 3.61% 6.11% 6.88% 3.38% 2.85% 4.91% 5.45% % 4.21% 4.62% 2.11% 2.03% 4.19% 4.52% % 3.97% % 3.68% 3.53% 3.34% 2.56% 2.84% 2.94% 2.95% 2.76% 2.87% 2.85% 2.68% % 2.36% 2.32% 2.16% 2.23% 2.42% 2.31% 2.41% 2.19% 2.22% Thebalanceofloans Inrepaymentwas$49.2Bin2015,representing75.7% ofoveralbalances. Indefermentwas$13Bin2015,representing20. ofoveralbalances. Inagraceperiodwas$1.3Bin2015,representing2. ofoveralbalances. Inforbearancewas$1.4Bin2015,representing2.2% ofoveralbalances. YoYchangeinloanstatus,2014to2015- Repaymentincreasedslightly,withYoYchangeof2.8%. Defermentdecreased,withYoYchangeof-8.4%. Graceremainedstableoverlastyear. Forbearancedecreased,withYoYchangeof-8.3%. 8

12 LOAN STATUS BY QUARTER Thepercentageofloansindiferentstatuseshasremainedrelativelystablesince2012,withrepaymenthoveringnear75%,defermenthoveringnear2,andgraceand forbearanceeachfluctuatingbutconsistentlyremainingbelow 5%.Thesesmalchangesreflectnormalseasonalvariation. 10 CurrentBalancebyLoanStatus(%ofTotalOutstandingBalance) Balance(% oftotal) Repayment Deferment Grace Forbearance LoanStatus Repayment Deferment Grace Forbearance Total $32.1B $33.9B $35.5B $38.8B $39.1B $40.5B $40.4B $43.0B $43.0B $44.2B $44.1B $45.9B $45.8B $46.5B $46.2B $47.1B $49.2B $46.9B $47.7B $47.6B $49.1B $16.4B $13.2B $14.4B $13.8B $14.8B $11.6B $12.5B $12.2B $13.5B $10.8B $12.0B $11.7B $13.1B $10.8B $12.1B $12.5B $13.0B $13.9B $11.3B $12.1B $11.9B $2.4B $4.0B $4.8B $2.4B $2.1B $3.5B $4.0B $2.0B $1.7B $2.9B $3.3B $1.6B $1.4B $2.6B $2.9B $1.3B $1.3B $1.3B $2.6B $2.9B $1.4B $1.9B $1.8B $1.4B $1.6B $1.7B $1.7B $1.6B $1.7B $1.7B $1.6B $1.3B $1.5B $1.5B $1.4B $1.4B $1.4B $1.4B $1.5B $1.5B $1.5B $1.4B $52.8B $52.8B $56.1B $56.6B $57.7B $57.4B $58.5B $58.8B $59.9B $59.5B $60.8B $60.6B $61.8B $61.2B $62.5B $62.3B $65.0B $63.6B $63.1B $64.1B $63.8B Thepercentofloansinrepaymenthasbeenrelativelysteadysince2012,thoughYoYgrowthinrepaymentbalancestiloutpacesthegrowthrateoftotalbalances.(Seepage2,Performance ImprovementintheLastFiveYears.)Thistranslatesintoamodestannualincreaseinactualloanbalancesinrepayment,withaYoYchangefrom 2014to2015of$2.3bilion,ora4.9% YoY increase. Thepercentofloansindeferment(astatusthattypicalyindicatesaborowerisinschool)hashoveredbetween17% and22% since2011.outstandingbalanceindefermenthasdeclined6.5% inthe lastyearinlinewithpastvariation. Forbearancebalancesheldsteadynearcurentlevelssince2012.Thepercentofloansinforbearancethuscontinuesapaternwhereforbearancerepresentsbetween2% and3% ofoveralbalances andvariesslightlyaroundthataveragefrom yeartoyear.forexample,theyoydecreasefrom 2014to2015was$99milion(6.7% YoYdecreaseandan8.3% decreaseasashareoftotal balance). Thepercentofbalancesingraceregularlyfluctuatesfrom quartertoquarter,reflectingenrolmentandprogram completionpaterns.gracelevelstendtobehighestinthe3rdquarterandalsohighinthe 2nd,andlowerinthe1stand4th,and2015continuesthispatern.However,bothinpercentageandabsolutevalueterms,therehasbeenanoticeabledownwardtrendofbalancesingracesince 2013,with2015beingthelowestvaluefora1stquarterfortheentirereportingperiod.Thisisdrivenbytheuseofinschoolrepaymentplans,causingsomeloanstobeinrepaymentthatwould otherwisebeindefermentorgracestatus. 9

13 GROSS CHARGE ŌFFRATES BY QUARTER Grosscharge-ofratesareattheirlowestlevelsincebeforethecreditcrisis.Thecurent2015rateof2.7% isa14.5% YoYdeclinefrom 2014anda52.3% declinefrom Quarter Annualized Charge-ofs (% ofrepay) AnnualizedCharge-ofs(% ofrepay) 9% 8% 7% 6% 5% 4% % 3.44% 4.36% 7.41% 9.41% 6.18% 5.68% 6.23% % 4.63% 4.61% 4.45% 3.53% 3.72% 3.83% 4.78% 3.48% 3.22% 3.1 3% % 2.57% 2.42% % % Periodicgrosscharge-ofrates Areattheirlowestvaluesincethecreditcrisisandneartheirlowestlevelsforanyquarter. Generalydeclinedsincethepeakin2009. Cumulative5yeardecreaseof52% from 2010to YoYdeclineis19.4%;from 3.4% in2013to2.7% in YoYdeclineis14.5%;from 3.2% in2014to2.7% in2015. Notethatgrosscharge-ofsaredefinedasthetotaldolaramountoftheloansatthetimeofcharge-ofduringthequarterdividedbythequarterendbalanceinrepayment.Toobtainannualized charge-ofsasapercentofrepayment,wemultiplythequarterlycharge-ofrateby4. 10

14 DELINQUENCY BY ACADEMIC YEAR OFORIGINATION (BY QUARTERS SINCE ORIGINATION) Privatestudentloandelinquenciesdecreasedwitheachsuccessiveoriginationcohort,drivenprimarilybyunderwritingenhancementsand alsobygeneralimprovementsintheeconomyovertime DaysDelinquent(%ofOutstandingBalanceinRepayment) ByQuartersSinceOrigination 90+DaysDelinquent(% ofoutstandingbalanceinrepayment) ByQuartersSinceOrigination 5% 5% 4% 4% 30-89(% ofrepay) 3% 2% 90+(% ofrepay) 3% 2% 1% 1% /2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY Thesechartsmeasuredelinquenciesbygroupingloansbyoriginationvintage,meaningthatloansoriginatedduringthesameacademicyeararegroupedtogether.Performanceofeachvintageis evaluatedrelativetotheperformanceofloansofsimilarageoriginatedduringdiferentacademicyears. Theimprovementbyoriginationvintageisextremelyclear;early-stagedelinquenciesdecreasedforeverysinglesuccessivecohortsinceorigination.Forexample,early-stagedelinquenciesat4quarters afteroriginationwentfrom 4.5% to2.3% to1.5% to1.2% to1.1% to1% fortheay2008/09throughay2013/14vintages.thisanalysisimpliesthatthedecliningtrendsofdelinquenciesarelikelyto acceleratebecauseloansoriginatedinmorerecentacademicyearsshowlowerdelinquencyratesthanthosefrom previouscohortsatthesamestageofrepayment,andthosecohortswilbealarger proportionoftheoveralmarketinrepaymentaswemoveforwardintime.late-stagedelinquenciesshowalmostthesameexactpatern,demonstratingthatthedeclineinlate-stagedelinquenciesisa sustainedtrendandnotashort-term phenomenon. In2014,early-stagedelinquenciesforAY2012/13weremarginalyhigherthanAY2011/12.ThesehavefaleninthelasttwoquartersandarenowbelowAY2011/12,consistentwiththeobservation thateverynewacademicvintageperform hasperformedbeterthantheprioroneduringtheoveralreportingperiod. 11

15 GROSS CHARGE ŌFFS BY ACADEMIC YEAR OFORIGINATION Aswithdelinquencies,charge-ofshavestronglydecreasedwitheachsuccessiveoriginationcohort,improvingtobelow pre-economiccrisislevelssincethe AY2009/10originationvintage.Again,thisisdrivenprimarilybyunderwritingenhancementsandalsobygeneralimprovementintheeconomyovertime. AnnualizedCharge-ofs(% ofoutstandingbalanceinrepayment) ByQuarterSinceOrigination 5% AnnualizedCharge-ofs(% ofrepay) 4% 3% 2% 1% /2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY Generaly,charge-ofspeakaround4yearsafterorigination,andthishasremainedthecaseacrossoriginationvintages.However,charge-ofsbyquartersinceorigination consistentlydecreasedforeachsuccessiveoriginationvintageacrossalquartersafterorigination,averystrikingpatern.forexample,charge-ofs7quartersafteroriginationwent from 4. to2. to1.4% to1.1% to1.2% from theay2008/09throughay2012/13vintages. 12

16 REPAYMENT TRENDS BY ACADEMIC YEAR OFORIGINATION Therateofentryofprivatestudentloansintorepaymentstatus,bothwhileinschoolandafterprogram completion,hasremainedsteadyforthepast3 originationvintages,afterreachingpeaklevelswiththeay2010/11originationvintage. 9 Repayment(% oftotaloutstandingbalance) ByQuartersSinceOrigination 8 7 Repayment(% oftotal) /2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY From AY2008/09throughtheAY2010/11originationvintages,thebalanceofloansinrepaymentrelativetotheoveralcurentbalanceincreasedsteadilyineachquarterafter origination.thisreflectedabehavioraltrendinwhichagrowingpercentageofborowerschosetomakeregularlyscheduledpaymentswhileinschool,andatthesametimethe privateloanmarketstartedtoprovideborowerswithfinancialincentivestomakesuchpaymentswhilein-school. However,repaymentpaternshavestabilizedsinceAY2010/2011.Forexample,repaymentratesfortheAY2011/12,AY2012/13,andAY2013/14vintages4quartersafterorigination were44%,42%,and4 forthesethreevintages,respectively,suggestingthatrepaymentratesarestabilizing. 13

17 ORIGINATION VOLUME AND DISTRIBUTION BY PROGRAM TYPE BY ACADEMIC YEAR OFORIGINATION Forthesixparticipants,thevolumeofnewlyoriginatedprivatestudentloans declinedfrom theay2008/09originationvintagetotheay2010/11 vintage,buthasgeneralygrownsincethen. OriginationVolumebyAcademicYear OriginalBalance($Bilions) /2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY 2 % oftotaloriginations 10 5 OriginationVolumebyProgram Type (%oftotaloriginations) 2008/2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY 1 2 AcademicYear Undergraduate Graduate 2008/2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY OriginationVolumebyProgram Type (%oftotaloriginations) % 86.28% 86.95% 86.52% % 11.46% 13.72% 13.05% 13.48% % 2014/2015AY 87.65% 12.35% Undergraduate Graduate 1 Otherprivatestudentloansoriginatedbythesixparticipantsincludeconsolidationloansandloansthatwerenotcodedbythesixlenders,whichhavenotbeenincludedinthetableandchartbyProgram Typeabove. 2 Theoriginationvolumeforthe2014/2015AYisonlythrough2015,whichisonlythreequartersandnotafulacademicyear. At$6.87bilion,originationsforthePrivateStudentLoanConsortium Participantsgrew5.5% from AY2012/13toAY2013/14and20.7% from theirlowestpointinay2010/11.the $6.7bilionoriginationvolumefigureforAY2014/15onlyincludesthefirstthreequartersoftheacademicyear,butsuggeststhatoriginationsforAY2014/15areontracktoexceed AY2013/14.Forcomparison,totaloriginationvolumewas$6.24bilionattheendof2014inAY2013/14. 14

18 COSIGNED VS.NON-COSIGNED LOAN DISTRIBUTION BY ACADEMIC YEAR OFORIGINATION Cosignerratesconsistentlyremainedhighacrossalvintages,withratesrisingfrom 74% fortheay2008/09vintage,andthenremainingabove85% from thatpointonward. Undergraduate Graduate % oftotaloriginations % oftotaloriginations OriginationVolumebyCosignedvs.Non-Cosigned(%ofTotalOriginations) /2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY 1 Cosigned Non-Cosigned AcademicYear Cosigned Undergraduate Non-Cosigned 2008/2009AY 76.72% 23.28% 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 2014/2015AY 90.76% 90.83% 92.05% % 93.83% 9.24% 9.17% 7.95% % 6.17% OriginationVolumebyCosignedvs.Non-Cosigned(%ofTotalOriginations) Cosigned 56.87% 60.77% 61.26% 65.64% 61.45% 56.73% 55.01% Graduate Non-Cosigned 43.13% 39.23% 38.74% 34.36% 38.55% 43.27% 44.99% OtherProgram Type Cosigned 74.81% 82.44% 74.59% 71.39% 81.14% 78.09% 80.08% Non-Cosigned 25.19% 17.56% 25.41% 28.61% 18.86% 21.91% 19.92% 1 Theoriginationvolumeforthe2014/2015AYisonlythrough2015,whichisonlythreequartersandnotafulacademicyear. Cosigned 74.47% 86.33% 85.87% 86.97% 86.52% 85.55% 88.33% Total Non-Cosigned 25.53% 13.67% 14.13% 13.03% 13.48% 14.45% 11.67% Theprimarydriverofthegrowingtrendincosignerratesisthestrongincreaseinthepercentageofcosignedloansforundergraduateprograms,whichhasremainedabove9 sinceay2009/10.conversely,theproportionofcosignedgraduateloansdecreasedforthemostrecentcohort(ay2014/15).asgraduateloansmakeupasmalshareofthemarket comparedtoundergraduateloans,thisdecreaseingraduatecosignerrateshasminimalimpactonthetrendoveral. Cosignersplayavitalroleinensuringthatstudentshaveaccesstofinancing.Cosignersenablelenderstoextendcredittheyotherwisewouldnotextend,basedonadocumented abilitytorepay,andsupportrepaymentoftheloanobligation.cosignerrates,then,areassociatedwithhigherloanperformanceoutcomes. 15

19 SCHOOLCERTIFICATION BY ACADEMIC YEAR OFORIGINATION Therehasbeenvirtualyuniversaladoptionofschoolcertificationforprivatestudentloans 10 % oftotaloriginations SchoolCertified NotSchoolCertified Other /2009 AY 2009/2010 AY 2010/2011 AY 2011/2012 AY 2012/2013 AY 2013/2014 AY 2014/2015 AY 2 AcademicYear SchoolCertified NotSchoolCertified Other 2008/2009AY 2009/2010AY 2010/2011AY 2011/2012AY 2012/2013AY 2013/2014AY 90.08% 92.02% 91.38% 92.18% 95.73% 94.26% 2014/2015AY 94.62% 0.95% 4.43% 1 Otherprivateloansincludeconsolidationloansandloansthatwerenotcodedbythesixparticipatinglenders. 2 Theoriginationvolumeforthe2014/2015AYisonlythrough2015,whichisonlythreequartersandnotafulacademicyear. Schoolcertificationmeansthattheschoolcertifiestheamountofastudent sneedandreceivesloanproceedsdirectlyfrom thelender.thus,certificationactsasanimportant protectionagainstoverborowingbymatchingcoststofunding.theactiveoriginatinglendersintheconsortium universalyrequireschoolcertificationasacorepartoftheirprivate loanprogramsforbothundergraduateandgraduatestudents,whichcomprisethevastmajorityofthemarket.asaresult,schoolcertificationrateshaveconsistentlybeenabove9 fortheentirereportingperiod.inthemostrecentacademicyearsschoolcertificationratehashoveredaround95%. Consolidationloans,refinancingloans,barexam loans,andresidencyloansareexamplesofloanswhereschoolcertificationisnotapplicable,andthisexplainstheremaining2-8% ofloansthatarenotschoolcertified. 7.78% 4.71% 3.12% 2.22% 0.79% 1.07% 2.14% 3.28% 5.49% % 4.67% 1 16

20 GLOSSARY OFTERMS 30-89(% ofrepay):balanceofloansthatare30to89dayspastdueonpaymentsasofquarterend,dividedbybalanceofloansinrepayment(loanstatus)asofquarterend. 90+(% ofrepay):balanceofloansthatare90ormoredayspastdueonpaymentsasofquarterend,dividedbybalanceofloansinrepayment(loanstatus)asofquarterend. 90+DaysDelinquent:Aloanthatis90ormoredayspastdueonpaymentsandbeforeitisreportedascharged-oftocreditreportingagencies.Alsoreferedtoasa seriously delinquentloan. AcademicYear:AloanisdefinedtobeoriginatedinanAcademicYear,ifitsfirstdisbursementisbetweenJuly1ofayearthroughJune30ofthefolowingcalendaryear. AnnualizedCharge-ofs(% ofrepay):grosscharge-ofsforaquarterdividedbythequarterendbalanceinrepayment(loanstatus),multipliedby4(orannualized). CosignedLoan:ALoanwithacosigner. DelinquentLoan:Aloanthatisinacashflowingstatus,paymentsarerequiredtobemade,andtheborowerislateinmakingthosepayments. DirectLoans:EducationalloansprovidedbytheWiliam D.FordFederalDirectLoanProgram,tostudentsandparentborowersdirectlythroughtheU.S.DepartmentofEducation, ratherthanthroughabankorotherlender. FederalLoans:FFELP,DirectandPerkinsloans. FFELP:TheFederalFamilyEducationLoanProgram,aprogram thatwasdiscontinuedinjuly2010. GraduateLoans:LoansmadetoborowersenroledatleasthalftimeinGraduateprograms. GrossCharge-ofs:Thetotaldolaramountoftheloanatthetimeofcharge-ofduringtheQuarter. LoanStatus:Atypicalprivatestudentloanlifecycleconsistsofnumerouscashflowingandnon-cashflowingstatuses: 1. Repayment:forpurposesofthisReport,repaymentincludesborowersinschoolwitharepaymentobligation(i.e.,interestonlypayments); 2. Deferment:paymentsarenotrequiredduringtheinitialin-schoolperiod,andduringsubsequentperiodswhenaborowerreturnstoschool; 3. Grace:paymentsarenotrequiredduringashortperiodoftimefolowingwithdrawal/graduationfrom school(typicalyatleast6months);and 4. Forbearance:paymentsaretemporarilynotrequiredforborowersfacingfinancialhardship. OriginalBalance:Totalamountdisbursedontheloan. OtherProgram Type:Consolidationloansorloanswithanuncodedprogram type. Program Type:Program ofstudyforwhichtheloanwasobtained. Quarter:BalancesaredefinedasofQuarterendwhilecharge-ofsarethosethatoccuredduringtheentireQuarter.ThisreportcoversReportingQuartersstartingfrom 2008to Repayment(% oftotal):balanceofloansinrepayment(loanstatus)asofquarterend,dividedbytotaloutstandingbalanceofalloansasofquarterend. SchoolCertifiedLoan:Aloanforwhichtheschoolatendedbythestudentcertifiestheamountofthestudent sneedandreceivesloanproceedsdirectlyfrom thelender. UndergraduateLoans:LoansmadetoborowersenroledatleasthalftimeinUndergraduateprograms.Thesecouldbe>2yearor<=2yearUndergraduateprograms. 17

21 MEASUREONE METHODOLOGY FOR DATA COLLECTION AND VALIDATION 1) MeasureOneemployedarigorousdatadefinition,colectionandvalidationprocesstoensurethatthedataandrelatedmetricsprovidedinthePrivateStudentLoanPerformance Reportareaccurateandconsistentacrossparticipatinglenders. 2) Uponinitiationoftheproject,MeasureOneandthesixparticipantsformedadatacommiteecomposedofbothdataprofessionalsandbusinessleadersfrom theparticipants. Thiscommiteebothensuredtechnicalaccuracyofthedataandprovidedkeydecisionmakersanopportunitytovalidatetheresultsforreasonableness. 3) MeasureOnewentthoughadetailed,multi-stepdatacolectionprocess: a. MeasureOneandparticipantsdiscussedandagreedondatafieldstobeprovided,includingagreementonappropriatedefinitions. b. MeasureOneprovidedamockdatafilelayouttoparticipants. c. Participantsagreedontheformulastobeusedtocalculateeachfieldandmetric. d. ParticipantssuppliedthebaseinputnumbersthatMeasureOnerequiredinordertocalculateeachmetric. 4) EachparticipantvalidatedMeasureOne scalculationsofeachmetric,includingtheinputsintoeachcalculation. 5) Oncethedataexpertsfrom eachparticipantvalidatedtheirdataset,measureonesenttheinformationtoparticipant sbusinessleaders,whoreviewedthenumbersforaccuracy relativetootherinternaldatasources. 6) Aftereachparticipant sdatasetwasvalidated,measureoneaggregatedtheparticipant sdataintoacombineddataset,andthedataexpertsandbusinessleadersfrom the participantsreviewedthecombineddataset. 7) WhentheparticipantscompletedtheirreviewoftheCombinedDataSet,MeasureOnerequiredeachparticipanttosignandcertifytheaccuracyofthedataviaadocumentcaled themeasureonedatavalidationandcertification.participantsrepresentedinwritingthat: a. TheparticipantcarefulyreviewedtheirspecificDataSetandtheCombinedDataSet,andexplicitlyconfirmedthateachdatasetwasmaterialyaccurate. b. TheparticipantexplicitlyapprovedincorporationoftheirdatasetintotheMeasureOneCombinedDataSetforfinalinclusionintheReportandReport sdatasupplement. 8) OtherSecuritizedPrivateLoans:MeasureOnestandardizedstudentloansecuritiesdatabuiltusingpubliclyavailableremitancereports,whichincludesdatafrom AccessGroup, FirstMarblehead(thenon144AsecuritizedportfoliosthatFirstMarbleheadnolongerhaslegalcontroloftherelatedtrusts),KeyCorpandothernon-profitissuers.Itdoesnot includedatafrom thesixparticipantsinthereportandotherbankprivatestudentloanholdersthatdidnotparticipateinthisreport,suchasjpmorganchasebank,n.a.and USBancorp. 9)Inordertoreportthemostup-to-datefiguresineachPrivateStudentLoanReport,MeasureOnechecksthehistoricaltimeseriesdataforeachreleaseofthereportandthemost up-to-datefiguresarereported.asaresult,historicalfiguresinthisreportmayshowslight,nonmaterialdiferencesfrom previousreports. 18

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