Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2026

Valuation of Financial Instruments that are Marked-to-Market on Recurring Basis

The following table summarizes the valuation of our financial instruments that are marked-to-fair value on a recurring basis.


	Fair Value Measurements on a Recurring Basis
	September 30, 2026								December 31, 2025
(Dollars in thousands)	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total

Assets:
Trading investments	$	—	$	—	$	41,308	$	41,308	$	—	$	—	$	49,250	$	49,250
Available-for-sale investments	—		2,845,845		1,264		2,847,109		—		1,756,178		1,892		1,758,070

Derivative instruments	—		1		—		1		—		—		—		—
Total	$	—	$	2,845,846	$	42,572	$	2,888,418	$	—	$	1,756,178	$	51,142	$	1,807,320

Liabilities:
Derivative instruments	$	—	$	—	$	—	$	—	$	—	$	(8)	$	—	$	(8)
Total	$	—	$	—	$	—	$	—	$	—	$	(8)	$	—	$	(8)

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The following table summarizes the change in balance sheet carrying value associated with Level 3 financial instruments carried at fair value on a recurring basis.


	Nine Months Ended September 30,
	2026						2025
	Investments						Investments
(Dollars in thousands)	Available-For-Sale - Debt Securities		Trading - Residual Interests		Total		Available-For-Sale - Debt Securities		Trading - Residual Interests		Total
Balance, beginning of period	$	1,892	$	49,250	$	51,142	$	2,689	$	53,262	$	55,951
Total gains/(losses):
Included in earnings (or changes in net assets)(1)	(15)		(7,662)		(7,677)		16		1,748		1,764
Included in other comprehensive income	(6)		—		(6)		(3)		—		(3)
Settlements	(607)		(280)		(887)		(638)		(3,047)		(3,685)
Transfers into Level 3	—		—		—		—		—		—
Transfers out of Level 3	—		—		—		—		—		—
Balance, end of period	$	1,264	$	41,308	$	42,572	$	2,064	$	51,963	$	54,027

Change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period	$	(6)	$	—	$	(6)	$	(3)	$	—	$	(3)
Change in unrealized gains or losses for the period included in earnings (or changes in net assets) for assets held at the end of the reporting period(2)	$	—	$	(7,662)	$	(7,662)	$	—	$	1,748	$	1,748

(1) Included in earnings (or changes in net assets) is comprised of the amounts recorded in the specified line item in the consolidated statements of operations:


	Nine Months Ended September 30,
(Dollars in thousands)	2026		2025
Interest Income - Investments	$	(15)	$	16
Losses on securities, net	(7,662)		1,748
Total	$	(7,677)	$	1,764

(2) Recorded in "losses on securities, net" in the consolidated statements of operations.

Fair Value Measurement Inputs and Valuation Techniques

The following table presents the significant unobservable inputs used in the recurring valuations of the Level 3 financial instruments detailed above.

As of September 30, 2026
(dollars in thousands)

Fair Value

Valuation Technique

Unobservable Input

Range (Average)

Debt Securities

1,264

Discounted cash flow

Constant Prepayment Rate

7.0%-10.9% (8.3%)

Probability of default

2.9%-17.9% (10.3%)

Residual Interests

41,308

Discounted cash flow

Constant Prepayment Rate

7.0%-10.9% (8.3%)

Probability of default

2.9%-17.9% (10.3%)

Total

42,572

Fair Values of Financial Assets and Liabilities, Including Derivative Financial Instruments

The following table summarizes the fair values of our financial assets and liabilities, including derivative financial instruments.


	September 30, 2026						December 31, 2025
(Dollars in thousands)	Fair Value		Carrying Value		Difference		Fair Value		Carrying Value		Difference
Earning assets:
Loans held for investment, net:
Private Education Loans	$	22,736,469	$	20,626,170	$	2,110,299	$	23,198,134	$	20,332,124	$	2,866,010


Loans held for sale	1,455,605		1,442,105		13,500		947,078		933,256		13,822
Cash and cash equivalents	2,165,175		2,165,175		—		4,241,265		4,241,265		—
Trading investments	41,308		41,308		—		49,250		49,250		—
Available-for-sale investments	2,847,109		2,847,109		—		1,758,070		1,758,070		—
Accrued interest receivable	1,733,869		1,680,595		53,274		1,662,640		1,562,811		99,829

Derivative instruments	1		1		—		—		—		—
Total earning assets	$	30,979,536	$	28,802,463	$	2,177,073	$	31,856,437	$	28,876,776	$	2,979,661
Interest-bearing liabilities:
Money-market and savings accounts	$	10,290,813	$	10,346,208	$	55,395	$	11,187,471	$	11,182,022	$	(5,449)
Certificates of deposit	10,281,049		10,413,512		132,463		9,830,811		9,877,945		47,134
Short-term borrowings	898,729		898,729		—		489,802		498,415		8,613
Long-term borrowings	5,447,200		5,535,923		88,723		5,376,909		5,362,494		(14,415)
Accrued interest payable	85,358		85,358		—		97,524		97,524		—
Derivative instruments	—		—		—		8		8		—
Total interest-bearing liabilities	$	27,003,149	$	27,279,730	$	276,581	$	26,982,525	$	27,018,408	$	35,883

Excess of net asset fair value over carrying value					$	2,453,654					$	3,015,544

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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