Condensed Consolidated Statements of Income
Three months ended
June 30, March 31, June 30,
2007 2007 2006
(unaudited) (unaudited) (unaudited)
(dollars in thousands, except share data)
Interest income:
Loan interest $439,720 $418,113 $383,867
Amortization of loan premiums and
deferred origination costs (22,634) (21,059) (21,125)
Investment interest 18,783 21,425 24,249
Total interest income 435,869 418,479 386,991
Interest expense:
Interest on bonds and notes payable 367,893 350,495 300,844
Net interest income 67,976 67,984 86,147
Less provision for loan losses 2,535 2,753 2,190
Net interest income after
provision for loan losses 65,441 65,231 83,957
Other income (expense):
Loan and guarantee servicing income 31,610 30,466 28,926
Other fee-based income 38,262 40,029 16,074
Software services income 5,848 5,748 4,018
Other income 2,937 6,879 2,906
Derivative market value, foreign
currency, and put option
adjustments 5,547 (12,130) 29,080
Derivative settlements, net 5,196 4,240 6,702
Total other income (expense) 89,400 75,232 87,706
Operating expenses:
Salaries and benefits 59,761 61,704 54,753
Other expenses 54,394 52,887 40,720
Amortization of intangible assets 6,491 6,638 5,817
Total operating expenses 120,646 121,229 101,290
Income before taxes 34,195 19,234 70,373
Income tax expense 13,306 7,264 26,038
Income before minority interest 20,889 11,970 44,335
Minority interest in net earnings of
subsidiaries --- --- ---
Income from continuing operations 20,889 11,970 44,335
Income (loss) from discontinued
operations, net of tax (6,135) 2,810 1,418
Net Income $14,754 $14,780 $45,753
Earnings (loss) per share, basic and
diluted
Income from continuing operations $0.42 $0.23 $0.81
Income (loss) from discontinued
operations, net of tax (0.12) 0.06 0.03
Net Income $0.30 $0.29 $0.84
Weighted average shares outstanding 49,452,960 50,982,187 54,297,230
Six months ended
June 30, June 30,
2007 2006
(unaudited) (unaudited)
(dollars in thousands, except share data)
Interest income:
Loan interest $857,833 $731,389
Amortization of loan premiums and
deferred origination costs (43,693) (42,987)
Investment interest 40,208 43,726
Total interest income 854,348 732,128
Interest expense:
Interest on bonds and notes payable 718,388 559,793
Net interest income 135,960 172,335
Less provision for loan losses 5,288 11,808
Net interest income after
provision for loan losses 130,672 160,527
Other income (expense):
Loan and guarantee servicing income 62,076 59,216
Other fee-based income 78,291 34,229
Software services income 11,596 7,427
Other income 9,816 4,893
Derivative market value, foreign
currency, and put option adjustments (6,583) 68,343
Derivative settlements, net 9,436 11,446
Total other income (expense) 164,632 185,554
Operating expenses:
Salaries and benefits 121,465 104,252
Other expenses 107,281 79,143
Amortization of intangible assets 13,129 11,115
Total operating expenses 241,875 194,510
Income before taxes 53,429 151,571
Income tax expense 20,570 56,080
Income before minority interest 32,859 95,491
Minority interest in net earnings of
subsidiaries --- (242)
Income from continuing operations 32,859 95,249
Income (loss) from discontinued
operations, net of tax (3,325) 2,570
Net Income $29,534 $97,819
Earnings (loss) per share, basic and
diluted
Income from continuing operations $0.66 $1.75
Income (loss) from discontinued
operations, net of tax (0.07) 0.05
Net Income $0.59 $1.80
Weighted average shares outstanding 50,213,349 54,269,440
Condensed Consolidated Balance Sheets and Financial Data
As of As of As of
June 30, December 31, June 30,
2007 2006 2006
(unaudited) (unaudited)
(dollars in thousands)
Assets:
Student loans receivable, net $26,174,958 $23,789,552 $22,404,492
Cash, cash equivalents, and
investments 1,367,257 1,773,751 1,971,740
Goodwill 191,256 191,420 145,950
Intangible assets, net 146,542 161,588 171,942
Assets of discontinued operations --- 27,309 34,232
Other assets 993,361 853,253 825,076
Total assets $28,873,374 $26,796,873 $25,553,432
Liabilities:
Bonds and notes payable $27,791,146 $25,562,119 $24,327,855
Liabilities of discontinued
operations --- 7,732 13,182
Other liabilities 471,050 555,172 460,206
Total liabilities 28,262,196 26,125,023 24,801,243
Shareholders' equity 611,178 671,850 752,189
Total liabilities and
shareholders' equity $28,873,374 $26,796,873 $25,553,432
Return on average total assets 0.21% 0.27% 0.81%
Return on average equity 9.5% 9.6% 27.4%
Shareholders' equity to total
assets 2.12% 2.51% 2.94%
(code #: nnif)