Loans held for sale are carried at the lower of fair value and amortized cost and loans at fair value are carried at fair value. The $121 million fair value adjustment in connection with the held for sale portfolio represents the write-off related to the $1.4 billion of Legacy Private Education Loans that were classified as held for sale as of September 30, 2026. When loans are first classified as held for sale, if the fair value is lower than the carrying value then the expected losses related to credit are first recorded as provision for loan losses and the allowance for loan losses associated with those items is written off, establishing a new cost basis

4. Allowance for Loan Losses – Education Loans

Allowance for Loan Losses Roll Forward


	Three Months Ended September 30,
	2026									2025
(Dollars in millions)	Private Education Loans			FFELP Loans			Total			Private Education Loans			FFELP Loans			Total
Beginning balance	$	263		$	163		$	426		$	348		$	182		$	530
Total provision		210			13			223			155			13			168
Charge-offs:
Gross charge-offs		(68	)		(11	)		(79	)		(112	)		(9	)		(121	)
Expected future recoveries on current period gross charge-offs		9			—			9			16			—			16
Net charge-offs(1)		(59	)		(11	)		(70	)		(96	)		(9	)		(105	)
Write off in connection with classification of loans as held for sale(2)		(121	)		—			(121	)		—			—			—
Decrease in expected future recoveries on previously fully charged-off loans(3)		6			—			6			(1	)		—			(1	)
Allowance at end of period	$	299		$	165		$	464		$	406		$	186		$	592
Net charge-offs as a percentage of average loans in repayment(4)		1.49	%		.20	%					2.50	%		.15	%
Ending total loans(4)	$	12,979		$	26,063					$	15,862		$	29,138
Average loans in repayment(4)	$	12,613		$	22,022					$	15,259		$	24,527
Ending loans in repayment (4)	$	12,519		$	21,872					$	15,221		$	24,136

(1)

Charge-offs are reported net of expected recoveries. For Private Education Loans, we charge off the estimated loss of a defaulted loan balance by charging off the entire defaulted loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as "expected future recoveries on previously fully charged-off loans." For FFELP Loans, the recovery is received at the time of charge-off.

(2)

Three months ended September 30, 2026 includes $121 million of write-offs related to $1.4 billion of Legacy Private Education Loans that were classified as held for sale as of September 30, 2026. When loans are first classified as held for sale, if the fair value is lower than the carrying value then the expected losses related to credit are first recorded as provision for loan losses and the allowance for loan losses associated with those items is written off, establishing a new cost basis.

(3)

At the end of each month, for Private Education Loans that are 212 days past due, we charge off the estimated loss of a defaulted loan balance by charging off the entire loan balance and estimating recoveries on a pool basis. These estimated recoveries are referred to as “expected future recoveries on previously fully charged-off loans.” If actual periodic recoveries are less than expected, the difference is immediately reflected as a reduction to expected future recoveries on previously fully charged-off loans. If actual periodic recoveries are greater than expected, they will be reflected as a recovery through the allowance for Private Education Loan losses once the cumulative recovery amount exceeds the cumulative amount originally expected to be recovered. The following table summarizes the activity in the expected future recoveries on previously fully charged-off loans.


	Three Months Ended September 30,
(Dollars in millions)	2026			2025
Beginning of period expected future recoveries on previously fully charged-off loans	$	163		$	172
Expected future recoveries of current period defaults		9			16
Recoveries (cash collected)		(9	)		(9	)
Charge-offs (as a result of lower recovery expectations)		(6	)		(6	)
End of period expected future recoveries on previously fully charged-off loans	$	157		$	173
Change in balance during period	$	(6	)	$	1

(4)

Third-quarter 2026 excludes $2.4 billion of Private Education Loans that were classified as held for sale as of September 30, 2026 and $235 million of In-School Education Loans carried at fair value, and their corresponding charge-offs.

4. Allowance for Loan Losses – Education Loans (Continued)

Allowance for Loan Losses Roll Forward


	Nine Months Ended September 30,
	2026									2025
(Dollars in millions)	Private Education Loans			FFELP Loans			Total			Private Education Loans			FFELP Loans			Total
Beginning balance	$	364		$	173		$	537		$	441		$	180		$	621
Total provision		245			30			275			207			29			236
Charge-offs:
Gross charge-offs		(233	)		(38	)		(271	)		(287	)		(23	)		(310	)
Expected future recoveries on current period gross charge-offs		31			—			31			39			—			39
Net charge-offs(1)		(202	)		(38	)		(240	)		(248	)		(23	)		(271	)
Write off in connection with classification of loans as held for sale(2)		(121	)		—			(121	)
Decrease in expected future recoveries on previously fully charged-off loans(3)		13			—			13			6			—			6
Allowance at end of period	$	299		$	165		$	464		$	406		$	186		$	592
Net charge-offs as a percentage of average loans in repayment(4)		1.65	%		.23	%					2.16	%		.13	%
Ending total loans(4)	$	12,979		$	26,063					$	15,862		$	29,138
Average loans in repayment(4)	$	12,450		$	22,571					$	15,368		$	25,036
Ending loans in repayment (4)	$	12,519		$	21,872					$	15,221		$	24,136

(1)

(2)

Nine months ended September 30, 2026 includes $121 million of write-offs related to $1.4 billion of Legacy Private Education Loans that were classified as held for sale as of September 30, 2026. When loans are first classified as held for sale, if the fair value is lower than the carrying value then the expected losses related to credit are first recorded as provision for loan losses and the allowance for loan losses associated with those items is written off, establishing a new cost basis.

(3)


	Nine Months Ended September 30,
(Dollars in millions)	2026			2025
Beginning of period expected future recoveries on previously fully charged-off loans	$	170		$	179
Expected future recoveries of current period defaults		31			39
Recoveries (cash collected)		(29	)		(30	)
Charge-offs (as a result of lower recovery expectations)		(15	)		(15	)
End of period expected future recoveries on previously fully charged-off loans	$	157		$	173
Change in balance during period	$	(13	)	$	(6	)

(4)

Nine months ended September 30, 2026 excludes $2.4 billion of Private Education Loans that were classified as held for sale as of September 30, 2026 and $235 million of In-School Education Loans carried at fair value, and their corresponding charge-offs.

4. Allowance for Loan Losses – Education Loans (Continued)

Private Education Loans

The key credit quality indicators are credit scores (FICO scores), loan status, loan seasoning, certain loan modifications, the existence of a cosigner and school type. The FICO score is the higher of the borrower or co-borrower score and is updated at least every six months while school type is assessed at origination. The other Private Education Loan key quality indicators are updated quarterly.


	Private Education Loan Credit Quality Indicators by Origination Year
	September 30, 2026
(Dollars in millions)	2026		2025			2024			2023			2022			Prior			Total			% of Total
Credit Quality Indicators
FICO Scores:
640 and above	$	2,249	$	1,481		$	586		$	295		$	762		$	6,253		$	11,626			90	%
Below 640		14		34			45			32			87			1,141			1,353			10
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
Loan Status:
In-school/grace/ deferment/forbearance	$	60	$	51		$	35		$	18		$	33		$	263		$	460			4	%
Current/90 days or less delinquent		2,201		1,458			590			302			804			6,890			12,245			94
Greater than 90 days delinquent		2		6			6			7			12			241			274			2
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
Seasoning(1):
1-12 payments	$	2,224	$	756		$	14		$	4		$	3		$	17		$	3,018			23	%
13-24 payments		—		735			328			17			12			31			1,123			8
25-36 payments		—		—			271			162			36			69			538			4
37-48 payments		—		—			—			135			194			154			483			4
More than 48 payments		—		—			—			—			591			7,011			7,602			59
Loans in-school/ grace/deferment		39		24			18			9			13			112			215			2
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
Certain Loan Modifications(2):
Modified	$	—	$	23		$	45		$	43		$	119		$	3,221		$	3,451			27	%
Non-Modified		2,263		1,492			586			284			730			4,173			9,528			73
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
Cosigners:
With cosigner(3)	$	273	$	197		$	80		$	31		$	1		$	2,110		$	2,692			21	%
Without cosigner		1,990		1,318			551			296			848			5,284			10,287			79
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
School Type:
Not-for-profit	$	2,262	$	1,515		$	622		$	315		$	831		$	6,812		$	12,357			95	%
For-profit		1		—			9			12			18			582			622			5
Total	$	2,263	$	1,515		$	631		$	327		$	849		$	7,394		$	12,979			100	%
Allowance for loan losses																			(299	)
Total loans, net(4)																		$	12,680

Charge-Offs	$	—	$	(5	)	$	(6	)	$	(7	)	$	(9	)	$	(175	)	$	(202	)

(1)

Number of months in active repayment for which a scheduled payment was received.

(2)

Loan Modifications represents the historical definition of a troubled debt restructuring (TDR) prior to the implementation of ASU No. 2022-02 on January 1, 2023. Any loan that meets the historical definition of a TDR retains that classification for the life of the loan (including loans that meet that definition subsequent to January 1, 2023). This includes loans given rate modifications, term extensions or forbearance greater than 3 months in the prior 24-month period. This classification is not intended to reconcile in any way to the modification disclosures required under ASU No. 2022-02.

(3)

Excluding Refinance Education Loans, the cosigner rate was 65% for total loans at September 30, 2026.

(4)

Excludes $2.4 billion of Private Education Loans that were classified as held for sale as of September 30, 2026 and $235 million of In-School Education Loans carried at fair value, and their corresponding charge-offs.

4. Allowance for Loan Losses – Education Loans (Continued)


	Private Education Loan Credit Quality Indicators by Origination Year
	September 30, 2025
(Dollars in millions)	2025		2024			2023			2022			2021			Prior			Total			% of Total
Credit Quality Indicators
FICO Scores:
640 and above	$	1,566	$	1,082		$	592		$	1,109		$	2,853		$	6,688		$	13,890			88	%
Below 640		25		50			48			104			166			1,579			1,972			12
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
Loan Status:
In-school/grace/ deferment/forbearance	$	73	$	94		$	53		$	46		$	75		$	300		$	641			4	%
Current/90 days or less delinquent		1,517		1,032			577			1,150			2,919			7,593			14,788			93
Greater than 90 days delinquent		1		6			10			17			25			374			433			3
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
Seasoning(1):
1-12 payments	$	1,527	$	595		$	25		$	19		$	9		$	26		$	2,201			14	%
13-24 payments		—		458			330			37			33			36			894			6
25-36 payments		—		—			243			336			80			75			734			5
37-48 payments		—		—			—			791			1,443			131			2,365			15
More than 48 payments		—		—			—			—			1,418			7,848			9,266			58
Loans in-school/ grace/deferment		64		79			42			30			36			151			402			2
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
Certain Loan Modifications(2):
Modified	$	—	$	14		$	32		$	104		$	213		$	4,933		$	5,296			33	%
Non-Modified		1,591		1,118			608			1,109			2,806			3,334			10,566			67
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
Cosigners:
With cosigner(3)	$	318	$	329		$	212		$	129		$	66		$	4,017		$	5,071			32	%
Without cosigner		1,273		803			428			1,084			2,953			4,250			10,791			68
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
School Type:
Not-for-profit	$	1,500	$	1,069		$	604		$	1,148		$	2,842		$	7,185		$	14,348			90	%
For-profit		91		63			36			65			177			1,082			1,514			10
Total	$	1,591	$	1,132		$	640		$	1,213		$	3,019		$	8,267		$	15,862			100	%
Allowance for loan losses																			(406	)
Total loans, net																		$	15,456

Charge-Offs	$	—	$	(4	)	$	(4	)	$	(10	)	$	(19	)	$	(211	)	$	(248	)

(1)

Number of months in active repayment for which a scheduled payment was received.

(2)

(3)

Excluding Refinance Education Loans, the cosigner rate was 67% for total loans at September 30, 2025.

4. Allowance for Loan Losses – Education Loans (Continued)


	Private Education Loan Delinquencies
	September 30, 2026						December 31, 2025						September 30, 2025
(Dollars in millions)	Balance			%			Balance			%			Balance			%
Loans in-school/grace/deferment(1)	$	216					$	395					$	402
Loans in forbearance(2)		244						236						239
Loans in repayment and percentage of each status:
Loans current		11,881			94.9	%		14,230			93.7	%		14,291			93.9	%
Loans delinquent 31-60 days(3)		233			1.9			326			2.1			315			2.1
Loans delinquent 61-90 days(3)		131			1.0			194			1.3			182			1.2
Loans delinquent greater than 90 days(3)		274			2.2			434			2.9			433			2.8
Total loans in repayment		12,519			100	%		15,184			100	%		15,221			100	%
Total loans(4)		12,979						15,815						15,862
Allowance for losses		(299	)					(364	)					(406	)
Loans, net	$	12,680					$	15,451					$	15,456
Percentage of loans in repayment					96.5	%					96.0	%					96.0	%
Delinquencies as a percentage of loans in repayment					5.1	%					6.3	%					6.1	%
Loans in forbearance as a percentage of loans in repayment and forbearance					1.9	%					1.5	%					1.5	%

(1)

Loans for customers who are attending school or are in other permitted educational activities and are not yet required to make payments on their loans, e.g., loans for customers who have requested and qualify for other permitted program deferments such as various military eligible deferments.

(2)

Loans for customers who have requested an extension of the grace period generally during employment transition or who have temporarily ceased making full payments due to hardship or other factors such as disaster relief 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)

September 30, 2026 excludes $2.4 billion of Private Education Loans that were classified as held for sale as of September 30, 2026 and $235 million of In-School Education Loans carried at fair value.

4. Allowance for Loan Losses – Education Loans (Continued)

FFELP Loans

FFELP Loans are substantially insured and guaranteed as to their principal and accrued interest in the event of default. The key credit quality indicators are loan status and loan type.


	FFELP Loan Delinquencies
	September 30, 2026						December 31, 2025						September 30, 2025
(Dollars in millions)	Balance			%			Balance			%			Balance			%
Loans in-school/grace/deferment(1)	$	1,097					$	1,210					$	1,276
Loans in forbearance(2)		3,094						3,532						3,726
Loans in repayment and percentage of each status:
Loans current		18,485			84.6	%		19,441			82.4	%		19,766			81.9	%
Loans delinquent 31-60 days(3)		1,015			4.6			1,075			4.6			1,062			4.4
Loans delinquent 61-90 days(3)		623			2.8			706			3.0			769			3.2
Loans delinquent greater than 90 days(3)		1,749			8.0			2,350			10.0			2,539			10.5
Total FFELP Loans in repayment		21,872			100	%		23,572			100	%		24,136			100	%
Total FFELP Loans		26,063						28,314						29,138
FFELP Loan allowance for losses		(165	)					(173	)					(186	)
FFELP Loans, net	$	25,898					$	28,141					$	28,952
Percentage of FFELP Loans in repayment					83.9	%					83.3	%					82.8	%
Delinquencies as a percentage of FFELP Loans in repayment					15.5	%					17.5	%					18.1	%
FFELP Loans in forbearance as a percentage of loans in repayment and forbearance					12.4	%					13.0	%					13.4	%

(1)

Loans for customers who may still be attending school or engaging 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, as well as loans for customers who have requested and qualify for other permitted program deferments such as military, unemployment, or economic hardships.

(2)

Loans for customers who have used their allowable deferment time or do not qualify for deferment, who need additional time to obtain employment or who have temporarily ceased making full payments due to hardship or other factors such as disaster relief 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.

Loan type:


(Dollars in millions)	September 30, 2026		September 30, 2025		Change
Stafford Loans	$	8,615	$	9,528	$	(913	)
Consolidation Loans		14,796		16,649		(1,853	)
Rehab Loans		2,652		2,961		(309	)
Total loans, gross	$	26,063	$	29,138	$	(3,075	)

Loan Modifications to Borrowers Experiencing Financial Difficulty

We adjust the terms of Private Education Loans for certain borrowers when we believe such changes will help our customers better manage their student loan obligations, achieve better outcomes and increase the collectability of the loans. These changes generally take the form of a temporary interest rate reduction, a temporary forbearance of payments, a temporary interest-only payment, and a temporary interest rate reduction with a permanent extension of the loan term. The effect of modifications of loans made to borrowers who are experiencing financial difficulty is already included in the allowance for credit losses because of the measurement methodologies used to estimate the allowance. The model design predicts borrowers that will have financial difficulty in the future and require loan modification and increased life of loan default risk.

Under our current forbearance practices, temporary hardship forbearance of payments generally cannot exceed 12 months over the life of the loan. However, exceptions can be made in cases where borrowers have shown the ability to make a substantial number of monthly principal and interest payments and in those cases borrowers can be granted up to 24 months of hardship forbearance over the life of the loan. We offer other administrative forbearances (e.g., death and disability, bankruptcy, military service, and disaster forbearance) that are either required by law (such as the Servicemembers Civil Relief Act) or are considered separate from our active loss mitigation programs and therefore are not considered to be loan modifications requiring disclosure under ASU No. 2022-02.

4. Allowance for Loan Losses – Education Loans (Continued)

FFELP Loans are at least 97 percent guaranteed as to their principal and accrued interest by the federal government in the event of default and, therefore, we do not deem FFELP Loans as nonperforming from a credit risk perspective at any point in their life cycle prior to claim payment and continue to accrue interest on those loans through the date of claim. Further, FFELP loan modification events are either legal entitlements subject to regulatory-driven eligibility criteria or addressed in the promissory note terms, so we do not consider these events as a component of our loan modification programs.

The disclosures below through the end of this footnote, for the three and nine months ended September 30, 2026, exclude the $2.4 billion of loans which were classified as held for sale as of September 30, 2026.

The following tables show the amortized cost basis as of September 30, 2026 and 2025 of the loans to borrowers experiencing financial difficulty that were modified during the respective period.


	Three Months Ended September 30, 2026
	Loan Modifications Made to Borrowers Experiencing Financial Difficulty
(Dollars in millions)	Interest Rate Reductions(1)					More Than an Insignificant Payment Delay (2)					Combination Rate Reduction and Term Extension
Loan Type	Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type
Private Education Loans	$	388		3.0	%	$	198		1.5	%	$	18		.1	%

	Three Months Ended September 30, 2025
	Loan Modifications Made to Borrowers Experiencing Financial Difficulty
(Dollars in millions)	Interest Rate Reductions(1)					More Than an Insignificant Payment Delay (2)					Combination Rate Reduction and Term Extension
Loan Type	Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type
Private Education Loans	$	599		3.8	%	$	298		1.9	%	$	33		.2	%

	Nine Months Ended September 30, 2026
(Dollars in millions)	Interest Rate Reductions(1)					More Than an Insignificant Payment Delay (2)					Combination Rate Reduction and Term Extension
Loan Type	Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type
Private Education Loans	$	1,082		8.3	%	$	489		3.8	%	$	62		.5	%

	Nine Months Ended September 30, 2025
(Dollars in millions)	Interest Rate Reductions(1)					More Than an Insignificant Payment Delay (2)					Combination Rate Reduction and Term Extension
Loan Type	Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type			Amortized Cost		% of Loan Type
Private Education Loans	$	1,554		9.8	%	$	734		4.6	%	$	87		.5	%

(1)

As of September 30, 2026 and 2025, there was $0.9 billion and $1.0 billion, respectively, of loans in the interest rate reduction program.

(2)

More Than an Insignificant Payment Delay includes loans granted more than 3 months of short-term interest only payments or hardship forbearance.

4. Allowance for Loan Losses – Education Loans (Continued)

For those loans modified in the three and nine months ended September 30, 2026 and 2025, the following tables show the impact of such modification.


Three Months Ended September 30, 2026
Loan Type	Interest Rate Reductions	More Than an Insignificant Payment Delay	Combination Rate Reduction and Term Extension
Private Education Loans	Reduced the weighted average contractual rate from 11.9% to 5.1%	Added an average 5 months to the remaining life of the loans	Added an average 6 years to the remaining life of the loans and reduced the weighted average contractual rate from 10.7% to 4.7%.

Three Months Ended September 30, 2025
Loan Type	Interest Rate Reductions	More Than an Insignificant Payment Delay	Combination Rate Reduction and Term Extension
Private Education Loans	Reduced the weighted average contractual rate from 12.3% to 5.4%	Added an average 5 months to the remaining life of the loans	Added an average 6 years to the remaining life of the loans and reduced the weighted average contractual rate from 12% to 5.2%.

Nine Months Ended September 30, 2026
Loan Type	Interest Rate Reductions	More Than an Insignificant Payment Delay	Combination Rate Reduction and Term Extension
Private Education Loans	Reduced the weighted average contractual rate from 11.9% to 5.2%	Added an average 6 months to the remaining life of the loans	Added an average 6 years to the remaining life of the loans and reduced the weighted average contractual rate from 11.2% to 4.7%.

Nine Months Ended September 30, 2025
Loan Type	Interest Rate Reductions	More Than an Insignificant Payment Delay	Combination Rate Reduction and Term Extension
Private Education Loans	Reduced the weighted average contractual rate from 12.3% to 5.4%	Added an average 7 months to the remaining life of the loans	Added an average 7 years to the remaining life of the loans and reduced the weighted average contractual rate from 12.1% to 5.4%.

The following table provides the amount of loan modifications for which a charge-off or payment default occurred in the respective period and within 12 months of the loan receiving a loan modification. We define payment default as 60 days or more past due for purposes of this disclosure. We closely monitor performance of the loans to borrowers experiencing financial difficulty that are modified to understand the effectiveness of the modification efforts.


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2026		2025		2026		2025
Modified loans (amortized cost) (1)	$	187	$	142	$	241	$	345
Payment default (par)	$	189	$	145	$	244	$	353
Charge-offs (par)	$	16	$	19	$	53	$	44

(1)

For the three months ended September 30, 2026 and 2025, the modified loans include $145 million and $95 million, respectively, of Interest Rate Reduction, $7 million and $7 million, respectively, of Combination Rate Reduction and Term Extension, and $35 million and $40 million, respectively, of More Than Insignificant Payment Delay. For the nine months ended September 30, 2026 and 2025, the modified loans include $177 million and $242 million, respectively, of Interest Rate Reduction, $10 million and $15 million, respectively, of Combination Rate Reduction and Term Extension, and $54 million and $88 million, respectively, of More Than Insignificant Payment Delay.

4. Allowance for Loan Losses – Education Loans (Continued)

The following table provides the performance and related loan status of Private Education Loans that have been modified within the 12 months prior to September 30, 2026 and the 12 months prior to December 31, 2025, respectively.


	Payment Status (Amortized Cost)
(Dollars in millions)	Twelve Months Ended
Loan Status	September 30, 2026		December 31, 2025
Loans in school/deferment	$	18	$	24
Loans in forbearance		81		73
Loans current		1,390		2,056
Loans delinquent 31 - 60 days		144		191
Loans delinquent 61 - 90 days		89		125
Loans delinquent greater than 90 days		143		211
Total modified loans	$	1,865	$	2,680

5. Goodwill

The following table summarizes our goodwill for our reporting units and reportable segments.



(Dollars in millions)	September 30, 2026		December 31, 2025
Consumer Lending reportable segment:
Legacy In-School Education Loans	$	106	$	106
Refinance Education Loans		77		77
Recent In-School Education Loans		13		13
Total		196		196
Federal Education Loans reportable segment:
FFELP Loans		227		227
Federal Education Loan Servicing		5		5
Total		232		232
Total goodwill	$	428	$	428

The Company performs its annual goodwill impairment test as of October 1. As of October 1, 2025, a quantitative test was performed, and the fair value of each reporting unit with goodwill exceeded its carrying value. In January 2026, Navient’s stock price experienced a decline and sustained volatility after Navient reduced its 2026 EPS guidance. The Company determined the decline in stock price constituted a triggering event requiring an interim goodwill impairment assessment.

Accordingly, management performed a qualitative impairment assessment as of March 31, 2026. The assessment included an analysis of the amount of cushion that existed (difference between the fair value and carrying value of the reporting unit) when the quantitative test was last completed in the fourth quarter of 2025, and a review of macroeconomic conditions, including stock price volatilities within our industry and the broader market, the regulatory and legislative environment and the performance of each reporting unit relative to the key assumptions used in the previous October 1, 2025, quantitative test. We also considered our market capitalization in relation to book equity. We concluded it was more likely than not on March 31, 2026, that the fair value of each reporting unit with goodwill continued to exceed their respective carrying values and therefore goodwill was not impaired. Therefore, a quantitative impairment test was not required.

We did not identify an additional triggering event for the second quarter ended June 30, 2026. Likewise, we did not identify a triggering event for the third quarter ended September 30, 2026 for the Private Education Refinance Loans, Private Education In-School Loans, Federal Education Loans and Federal Education Loan Servicing reporting units. We did, however, identify a triggering event related to the Private Education Legacy In-School Loans (Legacy Loans). As a result of recent and forecasted delinquencies and charge-offs persisting at elevated levels for a longer duration than previously anticipated, which resulted in the recognition of a Legacy loan provision for loan losses in the third quarter, we performed a quantitative impairment test. We used an income approach to estimate the fair value of the reporting unit measuring the value of future economic benefit determined based on the reporting unit’s discounted cash flows derived from our portfolio cash flow projections. Among other actors, the selected discount rate incorporated a company specific risk premium to capture specific risk related directly or indirectly to the reporting unit.

Goodwill attributed to the Legacy Loans reporting unit was not deemed impaired as a result of the quantitative impairment test as the concluded fair value of the reporting unit was greater than the reporting unit’s carrying value. We will continue to monitor actual cash flows in comparison to our estimated future cash flows for the Legacy Loans reporting unit.

We will continue to monitor the Company’s market capitalization and other qualitative factors to assess whether the underlying fair value of the Company’s reporting units has declined, which could result in future goodwill impairment. We will also monitor the decline in the stock price as a sustained decline could lead to goodwill impairment in the future.

6. Borrowings

The following table summarizes our borrowings.


	September 30, 2026									December 31, 2025
(Dollars in millions)	Short Term			Long Term			Total			Short Term			Long Term			Total
Unsecured borrowings:
Senior unsecured debt	$	721		$	4,581		$	5,302		$	525		$	4,782		$	5,307
Total unsecured borrowings		721			4,581			5,302			525			4,782			5,307
Secured borrowings:
Private Education Loan securitizations(1)		384			9,953			10,337			469			10,250			10,719
FFELP Loan securitizations(2)(3)		—			22,637			22,637			109			25,302			25,411
Private Education Loan ABCP facilities(4)		2,109			—			2,109			1,942			—			1,942
FFELP Loan ABCP facilities(4)		2,349			376			2,725			1,869			299			2,168
Other(5)		196			79			275			160			39			199
Total secured borrowings		5,038			33,045			38,083			4,549			35,890			40,439
Total before hedge accounting adjustments		5,759			37,626			43,385			5,074			40,672			45,746
Hedge accounting adjustments		(8	)		(197	)		(205	)		(1	)		(39	)		(40	)
Total	$	5,751		$	37,429		$	43,180		$	5,073		$	40,633		$	45,706

(1)

Includes $384 million and $469 million of short-term debt related to the Private Education Loan ABS repurchase facilities (Private Education Loan Repurchase Facilities) as of September 30, 2026 and December 31, 2025, respectively.

(2)

Includes $0 million and $109 million of short-term debt and $115 million and $0 million of long-term debt related to the FFELP Loan ABS repurchase facilities (FFELP Loan Repurchase Facilities) as of September 30, 2026 and December 31, 2025, respectively.

(3)

Includes defaulted FFELP secured debt tranches with a remaining principal amount of $948 million as of September 30, 2026 as a result of not maturing by their respective contractual maturity dates. Notices were delivered to the trustee, rating agencies and bondholders alerting them to these maturity date defaults. At this time, it is expected the bonds will be paid in full between 2027 and 2040. There is no impact to the principal amount owed or the coupon at which the bonds accrue, and there is no revised contractual maturity date.

(4)

ABCP facilities include $1.7 billion and $870 million of gross issuances in the three months ended September 30, 2026 and 2025, respectively, and $853 million and $675 million of gross paydowns in the three months ended September 30, 2026 and 2025, respectively. ABCP facilities include $3.3 billion and $1.8 billion of gross issuances in the nine months ended September 30, 2026 and 2025, respectively, and $2.5 billion and $1.8 billion of gross paydowns in the nine months ended September 30, 2026 and 2025, respectively.

(5)

“Other” primarily includes short-term repurchase obligation funding.

6. Borrowings (Continued)

Variable Interest Entities

We consolidated the following financing VIEs as of September 30, 2026 and December 31, 2025, as we are the primary beneficiary. As a result, these VIEs are accounted for as secured borrowings.


	September 30, 2026
	Debt Outstanding								Carrying Amount of Assets Securing Debt Outstanding
(Dollars in millions)	Short Term		Long Term			Total			Loans		Cash		Other Assets			Total
Secured Borrowings — VIEs:
Private Education Loan securitizations	$	384	$	9,953		$	10,337		$	11,735	$	352	$	152		$	12,239
FFELP Loan securitizations		—		22,637			22,637			23,198		762		1,092			25,052
Private Education Loan ABCP facilities		2,109		—			2,109			2,557		93		31			2,681
FFELP Loan ABCP facilities		2,349		376			2,725			2,657		77		142			2,876
Personal Loan ABCP facilities		—		40			40			47		—		—			47
Total before hedge accounting adjustments		4,842		33,006			37,848			40,194		1,284		1,417			42,895
Hedge accounting adjustments		—		(46	)		(46	)		—		—		(95	)		(95	)
Total	$	4,842	$	32,960		$	37,802		$	40,194	$	1,284	$	1,322		$	42,800


	December 31, 2025
	Debt Outstanding								Carrying Amount of Assets Securing Debt Outstanding
(Dollars in millions)	Short Term		Long Term			Total			Loans		Cash		Other Assets			Total
Secured Borrowings — VIEs:
Private Education Loan securitizations	$	469	$	10,250		$	10,719		$	11,960	$	364	$	127		$	12,451
FFELP Loan securitizations		109		25,302			25,411			25,942		950		1,096			27,988
Private Education Loan ABCP facilities		1,942		—			1,942			2,173		68		44			2,285
FFELP Loan ABCP facilities		1,869		299			2,168			2,115		84		108			2,307
Total before hedge accounting adjustments		4,389		35,851			40,240			42,190		1,466		1,375			45,031
Hedge accounting adjustments		—		(16	)		(16	)		—		—		(75	)		(75	)
Total	$	4,389	$	35,835		$	40,224		$	42,190	$	1,466	$	1,300		$	44,956

7. Derivative Financial Instruments

Summary of Derivative Financial Statement Impact

The following tables summarize the fair values and notional amounts of all derivative instruments and their impact on net income and other comprehensive income.

Impact of Derivatives on Balance Sheet


		Cash Flow				Fair Value(3)						Trading				Total
(Dollars in millions)	Hedged Risk Exposure	Sep 30, 2026		Dec 31, 2025		Sep 30, 2026			Dec 31, 2025			Sep 30, 2026		Dec 31, 2025		Sep 30, 2026			Dec 31, 2025
Fair Values(1)
Derivative Assets:
Interest rate swaps	Interest rate	$	—	$	—	$	—		$	39		$	—	$	—	$	—		$	39
Cross-currency interest rate swaps	Foreign currency and interest rate		—		—		—			3			—		—		—			3
Total derivative assets(2)			—		—		—			42			—		—		—			42
Derivative Liabilities:
Interest rate swaps	Interest rate		—		—		(6	)		—			—		—		(6	)		—
Cross-currency interest rate swaps	Foreign currency and interest rate		—		—		(95	)		(79	)		—		—		(95	)		(79	)
Total derivative liabilities(2)			—		—		(101	)		(79	)		—		—		(101	)		(79	)
Net total derivatives		$	—	$	—	$	(101	)	$	(37	)	$	—	$	—	$	(101	)	$	(37	)

(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 shows derivative positions net of collateral:


	Other Assets					Other Liabilities
(Dollars in millions)	September 30, 2026		December 31, 2025			September 30, 2026			December 31, 2025
Derivative values (as carried on balance sheet)	$	—	$	42		$	(101	)	$	(79	)
Cash collateral (held) pledged		—		(44	)		37			40
Net position	$	—	$	(2	)	$	(64	)	$	(39	)

(3)

The following table shows the carrying value of liabilities in fair value hedges and the related fair value hedging adjustments to these liabilities:


	As of September 30, 2026					As of December 31, 2025
(Dollars in millions)	Carrying Value		Hedge Basis Adjustments			Carrying Value		Hedge Basis Adjustments
Short-term borrowings	$	691	$	(8	)	$	499	$	(1	)
Long-term borrowings	$	4,175	$	(199	)	$	4,675	$	(42	)

7. Derivative Financial Instruments (Continued)

The above fair values include adjustments when necessary for counterparty credit risk.


	Cash Flow				Fair Value				Trading				Total
(Dollars in billions)	Sep 30, 2026		Dec 31, 2025		Sep 30, 2026		Dec 31, 2025		Sep 30, 2026		Dec 31, 2025		Sep 30, 2026		Dec 31, 2025
Notional Values:
Interest rate swaps	$	2.4	$	1.3	$	4.1	$	4.1	$	.1	$	.7	$	6.6	$	6.1
Cross-currency interest rate swaps		—		—		1.0		1.2		—		—		1.0		1.2
Total derivatives	$	2.4	$	1.3	$	5.1	$	5.3	$	.1	$	.7	$	7.6	$	7.3

Mark-to-Market Impact of Derivatives on Statements of Income


	Total Gains (Losses)
	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2026			2025			2026			2025
Fair Value Hedges:
Interest Rate Swaps
Gains (losses) recognized in net income on derivatives	$	(96	)	$	19		$	(124	)	$	128
Gains (losses) recognized in net income on hedged items		103			(21	)		134			(137	)
Net fair value hedge ineffectiveness gains (losses)		7			(2	)		10			(9	)
Cross-currency interest rate swaps
Gains (losses) recognized in net income on derivatives		(4	)		(1	)		(19	)		168
Gains (losses) recognized in net income on hedged items		6			5			30			(159	)
Net fair value hedge ineffectiveness gains (losses)		2			4			11			9
Total fair value hedges(1)(2)		9			2			21			—
Cash Flow Hedges:
Total cash flow hedges(2)		—			—			—			—
Trading:
Interest rate swaps		5			(4	)		11			(34	)
Total trading derivatives(3)		5			(4	)		11			(34	)
Mark-to-market gains (losses) recognized	$	14		$	(2	)	$	32		$	(34	)

(1)

Recorded in interest expense in the consolidated statements of income.

(2)

The accrued interest income (expense) on fair value hedges and cash flow hedges is recorded in interest expense and is excluded from this table.

(3)

Recorded in “gains (losses) on derivative and hedging activities, net” in the consolidated statements of income.

7. Derivative Financial Instruments (Continued)

Impact of Derivatives on Other Comprehensive Income (Equity)


	Three Months Ended September 30,					Nine Months Ended September 30,
(Dollars in millions)	2026		2025			2026		2025
Total gains (losses) on cash flow hedges	$	46	$	—		$	58	$	(3	)
Reclassification adjustments for derivative (gains) losses included in net income (interest expense)(1)		—		(1	)		—		(1	)
Net changes in cash flow hedges, net of tax	$	46	$	(1	)	$	58	$	(4	)

(1)

Includes net settlement income/expense.

Collateral

The following table details collateral held and pledged related to derivative exposure between us and our derivative counterparties:


(Dollars in millions)	September 30, 2026		December 31, 2025
Collateral held:
Cash (obligation to return cash collateral is recorded in short-term borrowings)	$	—	$	44
Securities at fair value — corporate derivatives (not recorded in financial statements)(1)		—		—
Securities at fair value — on-balance sheet securitization derivatives (not recorded in financial statements)(2)		—		—
Total collateral held	$	—	$	44
Derivative asset at fair value including accrued interest	$	—	$	51
Collateral pledged to others:
Cash (right to receive return of cash collateral is recorded in investments)	$	37	$	40
Total collateral pledged	$	37	$	40
Derivative liability at fair value including accrued interest and premium receivable	$	105	$	84

(1)

The Company has the ability to sell or re-pledge securities it holds as collateral.

(2)

The trusts do not have the ability to sell or re-pledge securities they hold as collateral.

Our corporate derivatives contain credit contingent features. At our current unsecured credit rating, we have fully collateralized our corporate liability position (including accrued interest and net of premiums receivable) of $6 million with our counterparties. Downgrades in our unsecured credit rating would not result in any additional collateral requirements. Trust related derivatives do not contain credit contingent features related to our or the trusts' credit ratings. At September 30, 2026 and December 31, 2025, we have a net positive exposure (derivative gain positions to us less collateral which has been posted by counterparties to us) related to Navient Holdings, Inc. derivatives of $0 and $4 million, respectively. The trusts are not required to post collateral to the counterparties. At September 30, 2026 and December 31, 2025, the net positive exposure on swaps in securitization trusts was $0 and $3 million, respectively.

8. Other Assets

The following table provides the detail of our other assets.


(Dollars in millions)	September 30, 2026		December 31, 2025
Accrued interest receivable	$	1,671	$	1,658
Benefit and insurance-related investments		456		458
Income tax asset, net		129		150
Derivatives at fair value		—		42
Fixed assets		25		23
Accounts receivable		23		12
Other		109		42
Total	$	2,413	$	2,385

9. Stockholders’ Equity

The following table summarizes our common share repurchases, issuances and dividends paid.


	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars and shares in millions, except per share amounts)	2026		2025		2026		2025
Common stock repurchased(1)		1.1		2.0		3.7		6.4
Common stock repurchased (in dollars)(1)	$	10	$	26	$	36	$	85
Average purchase price per share(1)	$	9.02	$	13.19	$	9.48	$	13.21
Remaining common stock repurchase authority(1)	$	64	$	26	$	64	$	26
Shares repurchased related to employee stock-based compensation plans(2)		—		—		.4		.4
Average purchase price per share(2)	$	—	$	—	$	9.65	$	13.80
Common shares issued(3)		—		.1		1.4		1.4
Dividends paid	$	15	$	16	$	45	$	48
Dividends per share	$	.16	$	.16	$	.48	$	.48

(1)

Common shares purchased under our share repurchase program. Our Board of Directors authorized a $100 million share repurchase program in October 2025.

(2)

Comprises shares withheld from the vesting of restricted stock for employees’ tax withholding obligations.

(3)

Common shares issued under our various compensation and benefit plans.

The closing price of our common stock on September 30, 2026 was $9.07.

10. Earnings (Loss) per Common Share

Basic earnings (loss) per common share (EPS) are calculated using the weighted average number of shares of common stock outstanding during each period. A reconciliation of the numerators and denominators of the basic and diluted EPS calculations on a GAAP basis follows.


	Three Months Ended September 30,					Nine Months Ended September 30,
(In millions, except per share data)	2026		2025			2026		2025
Numerator:
Net income	$	15	$	(86	)	$	56	$	(75	)
Denominator:
Weighted average shares used to compute basic EPS		93		98			94		100
Effect of dilutive securities:
Dilutive effect of restricted stock, restricted stock units, performance stock units, and Employee Stock Purchase Plan (ESPP)(1)		1		—			1		—
Dilutive potential common shares(2)		1		—			1		—
Weighted average shares used to compute diluted EPS		94		98			95		100
Basic earnings per common share	$	.16	$	(.87	)	$	.60	$	(.75	)
Diluted earnings per common share	$	.16	$	(.87	)	$	.59	$	(.75	)

(1)

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

(2)

For the three months ended September 30, 2026 and 2025, approximately 0 million and 2 million shares, respectively, were outstanding but not included in the computation of diluted earnings per share because they were anti-dilutive. For the nine months ended September 30, 2026 and 2025, securities covering approximately 0 million and 2 million shares, respectively, were outstanding but not included in the computation of diluted earnings per share because they were anti-dilutive.

11. Fair Value Measurements

As discussed in "Note 2 – Significant Accounting Policies,” effective July 1, 2026, the Company elected the fair value option available under ASC Topic 825, "Financial Instruments," to account for In School Private Education Loans originated on or after that date. Accordingly, these loans and commitments have been recorded at fair value and will continue to be re-measured each reporting period to the then current fair value of the loans. With the assistance of a third party valuation specialist fair value was determined by modeling loan cash flows using stated terms of the loans using mostly internally developed assumptions that are validated against market transactions when available. The primary assumptions used to determine fair value of this portfolio are prepayment speeds, loss rates, and the discount rate . A number of significant inputs into the models are internally derived and not observable in active markets. While the resulting fair value can be validated against market transactions where we are a participant, these markets are not considered active. As such, these are level 3 valuations.

We use estimates of fair value in applying various accounting standards in our financial statements. We categorize our fair value estimates based on a hierarchical framework associated with three levels of price transparency utilized in measuring financial instruments at fair value. The fair value of the items discussed below are separately disclosed in this footnote.

During the three and nine months ended September 30, 2026 and 2025, there were no significant transfers of financial instruments between levels, or changes in our methodology used to value our financial instruments.

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


	Fair Value Measurements on a Recurring Basis
	September 30, 2026											December 31, 2025
(Dollars in millions)	Level 1		Level 2			Level 3			Total			Level 1		Level 2		Level 3			Total
Assets
Private Education Loans at fair value	$	—	$	—		$	235		$	235		$	—	$	—	$	—		$	—
Private Education Loan commitments(1)		—		—			12			12			—		—		—			—
Interest rate swaps(2)(3)		—		—			—			—			—		39		—			39
Cross-currency interest rate swaps(2)(3)		—		—			—			—			—		—		3			3
Total assets	$	—	$	—		$	247		$	247		$	—	$	39	$	3		$	42
Liabilities(4)
Interest rate swaps(2)(3)	$	—	$	(6	)	$	—		$	(6	)	$	—	$	—	$	—		$	—
Cross-currency interest rate swaps(2)(3)		—		—			(95	)		(95	)		—		—		(79	)		(79	)
Total liabilities	$	—	$	(6	)	$	(95	)	$	(101	)	$	—	$	—	$	(79	)	$	(79	)

(1)

Private Education Loan commitments are loans that have been originated but have not yet disbursed. These are carried in Other Assets on the balance sheet.

(2)

Fair value of derivative instruments excludes accrued interest and the value of collateral.

(3)

See "Note 7 – Derivative Financial Instruments" for a reconciliation of gross positions without the impact of master netting agreements to the balance sheet classification.

(4)

Borrowings which are the hedged item in a fair value hedge relationship and which are adjusted for changes in value due to benchmark interest rates only are not carried at full fair value and not reflected in this table.

11. Fair Value Measurements (Continued)

The following tables summarize the change in balance sheet carrying value associated with level 3 financial instruments carried at fair value on a recurring basis.


	Three Months Ended September 30,
	2026										2025
(Dollars in millions)	Interest Rate Swaps		Cross Currency Interest Rate Swaps			Private Education Loans			Private Education Loan Commitments		Interest Rate Swaps		Cross Currency Interest Rate Swaps
Balance, beginning of period	$	—	$	(91	)	$	—		$	—	$	—	$	(75	)
Total gains/(losses):
Included in earnings(1)		—		(9	)		11			12		—		(10	)
Purchases(2)		—		—			226			—		—		—
Settlements(3)		—		5			(2	)		—		—		9
Other changes(4)		—		—			—			—		—		—
Transfers in and/or out of level 3		—		—			—			—		—		—
Balance, end of period	$	—	$	(95	)	$	235		$	12	$	—	$	(76	)
Change in mark-to- market gains/ (losses) relating to instruments still held at the reporting date(5)	$	—	$	(4	)	$	11		$	12	$	—	$	(1	)


	Nine Months Ended September 30,
	2026										2025
(Dollars in millions)	Interest Rate Swaps		Cross Currency Interest Rate Swaps			Private Education Loans			Private Education Loan Commitments		Interest Rate Swaps		Cross Currency Interest Rate Swaps
Balance, beginning of period	$	—	$	(76	)	$	—		$	—	$	—	$	(244	)
Total gains/(losses):
Included in earnings(1)		—		(38	)		11			12		—		142
Purchases(2)		—		—			226			—		—		—
Settlements(3)		—		19			(2	)		—		—		26
Other changes(4)		—		—			—			—		—		—
Transfers in and/or out of level 3		—		—			—			—		—		—
Balance, end of period	$	—	$	(95	)	$	235		$	12	$	—	$	(76	)
Change in mark-to- market gains/ (losses) relating to instruments still held at the reporting date(5)	$	—	$	(26	)	$	11		$	12	$	—	$	168

(1)

“Included in earnings” is comprised of the following amounts recorded in the specified line item in the consolidated statements of income:


	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2026			2025			2026			2025
Gains (losses) on derivative and hedging activities, net	$	—		$	—		$	—		$	—
Interest expense		(9	)		(10	)		(38	)		142
Net fair value changes of loans		23			—			23			—
Total	$	14		$	(10	)	$	(15	)	$	142

(2)

Purchases for education loans represents consideration paid for loans.

(3)

Settlements for education loans represents principal payments made on loans during the period.

(4)

Other changes for education loans represents amortization of purchase premiums.

(5)

Recorded in “gains (losses) on derivative and hedging activities, net” in the consolidated statements of income for interest rate swaps. Recorded in interest expense for cross-currency interest rate swaps in fair value hedges. Recorded in "net fair value changes of loans" for Private Education Loans and Private Education Loan commitments.

11. Fair Value Measurements (Continued)

The following table presents the significant inputs that are unobservable or from inactive markets used in the recurring valuations of the level 3 financial instruments detailed above.


(Dollars in millions)	Fair Value at September 30, 2026			Valuation Technique	Input	Weighted Average
Education Loans
Private Education Loans and commitments	$	247		Discounted cash flow	Discount rate	6.7%
					Constant prepayment rate	12.7%
					Constant default rate	0.9%
Derivatives
Cross-currency interest rate swaps		(95	)	Discounted cash flow	Constant Prepayment Rate	4%
Total	$	152

The key assumptions for Private Education loans and commitments are defined as follows:

•

Discount rate – The weighted average rate at which the projected cashflows are discounted to arrive at the net present value (fair value) of the loans. An increase in the discount rate, in isolation, would result in a decrease in fair value.

•

Constant prepayment rate – the annual percentage of beginning period principal that will be paid in addition to the scheduled payment amount. An increase in the constant prepayment rate, in isolation, would result in a decrease in fair value.

•

Constant default rate – the annual percentage of beginning of period principal that will default. An increase in the constant default rate, in isolation, would result in a decrease in fair value.

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 millions)	Fair Value			Carrying Value			Difference			Fair Value			Carrying Value			Difference
Earning assets
Private Education Loans at amortized cost	$	11,947		$	12,680		$	(733	)	$	15,051		$	15,451		$	(400	)
Private Education Loans at fair value		235			235			—			—			—			—
Private Education Loans held for sale		2,348			2,339			9			—			—			—
FFELP Loans		25,826			25,898			(72	)		28,096			28,141			(45	)
Cash and investments		2,133			2,133			—			2,270			2,270			—
Total earning assets		42,489			43,285			(796	)		45,417			45,862			(445	)
Interest-bearing liabilities
Short-term borrowings		5,758			5,751			(7	)		5,084			5,073			(11	)
Long-term borrowings		36,586			37,429			843			40,120			40,633			513
Total interest-bearing liabilities		42,344			43,180			836			45,204			45,706			502
Derivative financial instruments
Interest rate swaps		(6	)		(6	)		—			39			39			—
Cross-currency interest rate swaps		(95	)		(95	)		—			(76	)		(76	)		—
Excess of net asset fair value over carrying value							$	40								$	57

12. Commitments, Contingencies and Guarantees

Legal Proceedings

We and our subsidiaries and affiliates are subject to various claims, lawsuits and other actions that arise in the normal course of business. We believe that these claims, lawsuits and other actions will not, individually or in the aggregate, have a material adverse effect on our business, financial condition or results of operations, except as otherwise disclosed. Most of these matters are claims including individual and class action lawsuits relating to loan servicing and which allege violations of state or federal laws in connection with servicing or collection activities on education loans and other debts.

In the ordinary course of our business, the Company and our subsidiaries and affiliates receive information and document requests and investigative demands from various entities including State Attorneys General, U.S. Attorneys, legislative committees, individual members of Congress and administrative agencies. These requests may be informational, regulatory or enforcement in nature and may relate to our business practices, the industries in which we operate, or companies with whom we conduct business. Generally, our practice has been and continues to be to cooperate with these bodies and to be responsive to any such requests.

The number of these inquiries and the volume of related information demands have normalized at elevated levels and therefore the Company must continue to expend time and resources to timely respond to these requests which may, depending on their outcome, result in payments of restitution, fines and penalties.

Contingencies

In the ordinary course of business, we and our subsidiaries are defendants in or parties to pending and threatened legal actions and proceedings including actions brought on behalf of various classes of claimants. These actions and proceedings may be based on alleged violations of consumer protection, securities, employment and other laws. In certain of these actions and proceedings, claims for substantial monetary damages are asserted against us and our subsidiaries. We and our subsidiaries are also subject to potential unasserted claims by third parties.

In the ordinary course of business, we and our subsidiaries are subject to regulatory examinations, information gathering requests, inquiries and investigations. In connection with formal and informal inquiries in these cases, we and our subsidiaries receive requests, subpoenas and orders for documents, testimony and information in connection with various aspects of our regulated activities.

In view of the inherent difficulty of predicting the outcome of litigation and regulatory matters, we may not be able to predict what the eventual outcome of the pending matters will be, what the timing or the ultimate resolution of these matters will be, or what the eventual loss, fines or penalties, if any, related to each pending matter may be.

The Company accrues a liability for litigation, regulatory matters, and unasserted contract claims when those matters present loss contingencies that are both probable and reasonably estimable. When loss contingencies are not both probable and reasonably estimable, we do not accrue a liability. Based on current knowledge, management does not believe that loss contingencies, if any, arising from pending investigations, litigation or regulatory matters will have a material adverse effect on our consolidated financial position, liquidity, results of operations or cash flows, except as otherwise disclosed.

The Company evaluates its outstanding legal and regulatory matters each reporting period and makes adjustments to the accrued liabilities for such matters, upward or downward, as appropriate, based on the relevant facts and circumstances. The Company's accrued liabilities and estimated range of possible losses pertaining to certain matters can involve significant judgment given factors such as: the varying stages of the proceedings; the existence of numerous yet to be resolved issues; the breadth of the claims (often spanning multiple years and wide ranges of business activities); unspecified damages, civil money penalties or fines and/or the novelty of the legal issues presented; and the attendant uncertainty of the various potential outcomes of such proceedings, including where the Company has made assumptions concerning future rulings by the court or other adjudicator, or about the behavior or incentives of adverse parties or regulatory authorities. Various aspects of the legal proceedings underlying these estimates will change from time to time. Actual losses therefore may vary significantly from any estimates.

12. Commitments, Contingencies and Guarantees (Continued)

Regulatory Matters

The Company has been named as defendant in a number of putative class action and other cases alleging violations of various state and federal consumer protection laws including the Telephone Consumer Protection Act (TCPA), the Consumer Financial Protection Act of 2010 (CFPA), the Fair Credit Reporting Act (FCRA), the Fair Debt Collection Practices Act (FDCPA), in adversary proceedings under the U.S. Bankruptcy Code, and various state consumer protection laws. At this point in time, the Company is unable to anticipate the timing of a resolution or the impact that these legal proceedings may have on the Company’s consolidated financial position, liquidity, results of operations or cash flows. As a result, it is not possible at this time to estimate a range of potential exposure, if any, for amounts that

may be payable in connection with these matters and loss contingency accruals have not been established. It is possible that an adverse ruling or rulings may have a material adverse impact on the Company.

In addition, Navient and its subsidiaries are subject to examination or regulation by various federal regulatory, state licensing or other regulatory agencies as part of its ordinary course of business including the SEC, CFPB, FFIEC and ED. Items or matters similar to or different from those described above may arise during the course of those examinations. We also routinely receive inquiries or requests from various regulatory entities or bodies or government agencies concerning our business or our assets. Generally, the Company endeavors to cooperate with each such inquiry or request.

13. Segment Reporting

We monitor and assess our ongoing operations and results based on the following three reportable operating segments: Consumer Lending, Federal Education Loans, and Other.

These segments meet the quantitative thresholds for reportable operating segments. Accordingly, the results of operations of these reportable operating segments are presented separately. The underlying operating segments are used by the Company’s chief operating decision maker, our chief executive officer, to manage the business, review operating performance and allocate resources, and qualify to be aggregated as part of the primary reportable operating segments. As discussed further below, we measure the profitability of our operating segments based on Core Earnings net income. Accordingly, information regarding our reportable operating segments' net income is provided on a Core Earnings basis.

Consumer Lending Segment

Navient owns and manages Private Education Loans and is the master servicer for these portfolios. Through our Earnest brand, we originate In-School Education Loans, including undergraduate and graduate products, we refinance education loans for high-quality borrowers and we intend to expand into adjacent lending products over time. "Refinance" Education Loans are loans where a borrower has refinanced their education loans, and "In-School" Education Loans are loans originally made to borrowers while they are attending school. We generate revenue primarily through net interest income on our Private Education Loan portfolio.

The following table includes asset information for our Consumer Lending segment.


(Dollars in millions)	September 30, 2026		December 31, 2025
Private Education Loans, net	$	15,254	$	15,451
Cash and investments(1)		532		529
Other		593		565
Total assets	$	16,379	$	16,545

(1)

Includes restricted cash and investments.

Federal Education Loans Segment

Navient owns and manages FFELP Loans and is the master servicer on this portfolio. We generate revenue primarily through net interest income on our FFELP Loans.

The following table includes asset information for our Federal Education Loans segment.


(Dollars in millions)	September 30, 2026		December 31, 2025
FFELP Loans, net	$	25,898	$	28,141
Cash and investments(1)		848		1,034
Other		1,641		1,681
Total assets	$	28,387	$	30,856

(1)

Includes restricted cash and investments.

13. Segment Reporting (Continued)

Other Segment

This segment consists of our corporate liquidity portfolio, gains and losses incurred on the repurchase of debt, unallocated shared services which include certain corporate and IT costs as well as regulatory expenses, and restructuring/other reorganization expenses. Additionally, the segment contains the revenue and expenses in connection with the transition services we performed related to the outsourcing of loan servicing and divestiture of our Business Processing segment.

Unallocated shared services expenses are comprised of costs primarily related to information technology costs related to infrastructure and operations, stock-based compensation expense, accounting, finance, legal, compliance and risk management, regulatory-related expenses, human resources, certain executive management and the Board of Directors. Regulatory-related expenses include actual settlement amounts as well as third-party professional fees we incur in connection with such regulatory matters and are presented net of any insurance reimbursements for covered costs related to such matters.

At September 30, 2026 and December 31, 2025, the Other segment had total assets of $1.4 billion and $1.3 billion, respectively.

Business Processing Segment

In September 2024, Navient completed the sale of Xtend, which comprised the Company's healthcare services business in its Business Processing segment. In February 2025, Navient completed the sale of its government services businesses, which constituted the remainder of the Business Processing segment. Prior to the sale of its healthcare and government services businesses, Navient provided business processing solutions such as omnichannel contact center services, workflow processing, and revenue cycle optimization.

At September 30, 2026 and December 31, 2025, the Business Processing segment had total assets of $0 and $0, respectively.

13. Segment Reporting (Continued)

Measure of Profitability

We prepare financial statements and present financial results in accordance with GAAP. However, we also evaluate our business segments and present financial results on a basis that differs from GAAP. We refer to this different basis of presentation as Core Earnings. We provide this Core Earnings basis of presentation on a consolidated basis and for each business segment because this is what we review internally when making management decisions regarding our performance and how we allocate resources. We also refer to this information in our presentations with credit rating agencies, lenders and investors. Because our Core Earnings basis of presentation corresponds to our segment financial presentations, we are required by GAAP to provide Core Earnings disclosure in the notes to our consolidated financial statements for our business segments.

Core Earnings are not a substitute for reported results under GAAP. We use Core Earnings to manage our business segments because Core Earnings reflect adjustments to GAAP financial results for two items, discussed below, that can create significant volatility mostly due to timing factors generally beyond the control of management. Accordingly, we believe that Core Earnings provide management with a useful basis from which to better evaluate results from ongoing operations against the business plan or against results from prior periods. Consequently, we disclose this information because we believe it provides investors with additional information regarding the operational and performance indicators that are most closely assessed by management. When compared to GAAP results, the two items we remove to result in our Core Earnings presentations are:

Mark-to-market gains/losses resulting from our use of derivative instruments to hedge our economic risks that do not qualify for hedge accounting treatment or do qualify for hedge accounting treatment but result in ineffectiveness; and

The accounting for goodwill and acquired intangible assets.

While GAAP provides a uniform, comprehensive basis of accounting, for the reasons described above, our Core Earnings basis of presentation does not. Core Earnings are subject to certain general and specific limitations that investors should carefully consider. For example, there is no comprehensive, authoritative guidance for management reporting. Our Core Earnings are not defined terms within GAAP and may not be comparable to similarly titled measures reported by other companies. Accordingly, our Core Earnings presentation does not represent a comprehensive basis of accounting. Investors, therefore, may not be able to compare our performance with that of other financial services companies based upon Core Earnings. Core Earnings results are only meant to supplement GAAP results by providing additional information regarding the operational and performance indicators that are most closely used by management, our Board of Directors, credit rating agencies, lenders and investors to assess performance.

13. Segment Reporting (Continued)

Segment Results and Reconciliations to GAAP


	Three Months Ended September 30, 2026
				Adjustments										Reportable Segments
(Dollars in millions)	Total GAAP			Reclassi- fications		Additions/ (Subtractions)			Total Adjustments (1)			Total Core Earnings		Consumer Lending			Federal Education Loans		Business Processing		Other
Interest income:
Education loans	$	651												$	270		$	381	$	—	$	—
Personal Loans		1													1			—		—		—
Cash and investments		17													5			8		—		4
Total interest income		669													276			389		—		4
Total interest expense		554													189			342		—		27
Net interest income (loss)		115		$	—	$	(4	)	$	(4	)	$	111		87			47		—		(23	)
Less: provisions for loan losses		227											227		214			13		—		—
Net interest income (loss) after provisions for loan losses		(112	)												(127	)		34		—		(23	)
Other income (loss):
Servicing revenue		10													2			8		—		—
Asset recovery and business processing revenue		—													—			—		—		—
Other revenue		7													—			—		—		2
Gains on sales of loans		162													162			—		—		—
Net fair value changes of loans		23													23			—		—		—
Total other income		202			—		(5	)		(5	)		197		187			8		—		2
Expenses:
Direct operating expenses		70													57			13		—		—
Unallocated shared services expenses		5													—			—		—		5
Operating expenses(2)		75			—		—			—			75		57			13		—		5
Goodwill and acquired intangible asset impairment and amortization		—			—		—			—			—		—			—		—		—
Restructuring/other reorganization expenses		2			—		—			—			2		—			—		—		2
Total expenses		77			—		—			—			77		57			13		—		7
Income (loss) before income tax expense (benefit)		13			—		(9	)	$	(9	)	$	4		3			29		—		(28	)
Income tax expense (benefit)(3)		(2	)		—		3			3			1		1			7		—		(7	)
Net income (loss)	$	15		$	—	$	(12	)	$	(12	)	$	3	$	2		$	22	$	—	$	(21	)

(1)

Core Earnings adjustments to GAAP:


	Three Months Ended September 30, 2026
(Dollars in millions)	Net Impact of Derivative Accounting			Net Impact of Goodwill and Acquired Intangibles		Total
Net interest income (loss) after provisions for loan losses	$	(4	)	$	—	$	(4	)
Total other income		(5	)		—		(5	)
Goodwill and acquired intangible asset impairment and amortization		—			—		—
Total Core Earnings adjustments to GAAP	$	(9	)	$	—		(9	)
Income tax expense (benefit)							3
Net income (loss)						$	(12	)

(2)

Reportable segment significant operating expenses are comprised of:


	Three Months Ended September 30, 2026
(Dollars in millions)	Consumer Lending		Federal Education Loans		Business Processing		Other			Total
Servicing expenses	$	14	$	12	$	—	$	—		$	26
Information technology expenses		9		—		—		5			14
Corporate expenses		—		—		—		15			15
Other/remaining expenses		34		1		—		(15	)		20
Operating expenses	$	57	$	13	$	—	$	5		$	75

(3)

Income taxes are based on a percentage of net income before tax for the individual reportable segment.

13. Segment Reporting (Continued)


	Three Months Ended September 30, 2025
				Adjustments												Reportable Segments
(Dollars in millions)	Total GAAP			Reclassi- fications			Additions/ (Subtractions)			Total Adjustments (1)			Total Core Earnings			Consumer Lending			Federal Education Loans		Business Processing		Other
Interest income:
Education loans	$	760														$	276		$	484	$	—	$	—
Cash and investments		21															5			10		—		6
Total interest income		781															281			494		—		6
Total interest expense		639															183			429		—		23
Net interest income (loss)		142		$	4		$	—		$	4		$	146			98			65		—		(17	)
Less: provisions for loan losses		168												168			155			13		—		—
Net interest income (loss) after provisions for loan losses		(26	)														(57	)		52		—		(17	)
Other income (loss):
Servicing revenue		13															3			10		—		—
Asset recovery and business processing revenue		—															—			—		—		—
Other revenue (loss)		6															—			—		—		10
Total other income		19			(4	)		8			4			23			3			10		—		10
Expenses:
Direct operating expenses		61															45			16		—		—
Unallocated shared services expenses		44															—			—		—		44
Operating expenses(2)		105			—			—			—			105			45			16		—		44
Goodwill and acquired intangible asset impairment and amortization		1			—			(1	)		(1	)		—			—			—		—		—
Restructuring/other reorganization expenses		4			—			—			—			4			—			—		—		4
Total expenses		110			—			(1	)		(1	)		109			45			16		—		48
Income (loss) before income tax expense (benefit)		(117	)		—			9			9			(108	)		(99	)		46		—		(55	)
Income tax expense (benefit)(3)		(31	)		—			6			6			(25	)		(23	)		11		—		(13	)
Net income (loss)	$	(86	)	$	—		$	3		$	3		$	(83	)	$	(76	)	$	35	$	—	$	(42	)

(1)

Core Earnings adjustments to GAAP:


	Three Months Ended September 30, 2025
(Dollars in millions)	Net Impact of Derivative Accounting		Net Impact of Goodwill and Acquired Intangibles			Total
Net interest income (loss) after provisions for loan losses	$	4	$	—		$	4
Total other income		4		—			4
Goodwill and acquired intangible asset impairment and amortization		—		(1	)		(1	)
Total Core Earnings adjustments to GAAP	$	8	$	1			9
Income tax expense (benefit)							6
Net income (loss)						$	3

(2)

Reportable segment significant operating expenses are comprised of:


	Three Months Ended September 30, 2025
(Dollars in millions)	Consumer Lending		Federal Education Loans		Business Processing		Other		Total
Servicing expenses	$	12	$	16	$	—	$	—	$	28
Information technology expenses		8		—		—		19		27
Corporate expenses		—		—		—		21		21
Other/remaining expenses		25		—		—		4		29
Operating expenses	$	45	$	16	$	—	$	44	$	105

(3)

Income taxes are based on a percentage of net income before tax for the individual reportable segment.

13. Segment Reporting (Continued)


	Nine Months Ended September 30, 2026
			Adjustments											Reportable Segments
(Dollars in millions)	Total GAAP		Reclassi- fications			Additions/ (Subtractions)			Total Adjustments (1)			Total Core Earnings		Consumer Lending		Federal Education Loans		Business Processing		Other
Interest income:
Education loans	$	1,993												$	820	$	1,173	$	—	$	—
Personal Loans		1													1		—		—		—
Cash and investments		51													14		24		—		13
Total interest income		2,045													835		1,197		—		13
Total interest expense		1,677													553		1,056		—		79
Net interest income (loss)		368	$	3		$	(14	)	$	(11	)	$	357		282		141		—		(66	)
Less: provisions for loan losses		281											281		251		30		—		—
Net interest income (loss) after provisions for loan losses		87													31		111		—		(66	)
Other income (loss):
Servicing revenue		31													7		24		—		—
Asset recovery and business processing revenue		—													—		—		—		—
Other revenue		34													—		—		—		23
Gains on sales of loans		162													162		—		—		—
Net fair value changes of loans		23													23		—		—		—
Total other income		250		(3	)		(8	)		(11	)		239		192		24		—		23
Expenses:
Direct operating expenses		182													138		44		—		—
Unallocated shared services expenses		64													—		—		—		64
Operating expenses(2)		246		—			—			—			246		138		44		—		64
Goodwill and acquired intangible asset impairment and amortization		5		—			(5	)		(5	)		—		—		—		—		—
Restructuring/other reorganization expenses		4		—			—			—			4		—		—		—		4
Total expenses		255		—			(5	)		(5	)		250		138		44		—		68
Income (loss) before income tax expense (benefit)		82		—			(17	)		(17	)		65		85		91		—		(111	)
Income tax expense (benefit)(3)		26		—			(11	)		(11	)		15		20		21		—		(26	)
Net income (loss)	$	56	$	—		$	(6	)	$	(6	)	$	50	$	65	$	70	$	—	$	(85	)

(1)

Core Earnings adjustments to GAAP:


	Nine Months Ended September 30, 2026
(Dollars in millions)	Net Impact of Derivative Accounting			Net Impact of Goodwill and Acquired Intangibles			Total
Net interest income (loss) after provisions for loan losses	$	(11	)	$	—		$	(11	)
Total other income		(11	)		—			(11	)
Goodwill and acquired intangible asset impairment and amortization		—			(5	)		(5	)
Total Core Earnings adjustments to GAAP	$	(22	)	$	5			(17	)
Income tax expense (benefit)								(11	)
Net income (loss)							$	(6	)

(2)

Reportable segment significant operating expenses are comprised of:


	Nine Months Ended September 30, 2026
(Dollars in millions)	Consumer Lending		Federal Education Loans		Business Processing		Other			Total
Servicing expenses	$	41	$	42	$	—	$	—		$	83
Information technology expenses		29		—		—		21			50
Corporate expenses		1		1		—		54			56
Other/remaining expenses		67		1		—		(11	)		57
Operating expenses	$	138	$	44	$	—	$	64		$	246

(3)

Income taxes are based on a percentage of net income before tax for the individual reportable segment.

13. Segment Reporting (Continued)


	Nine Months Ended September 30, 2025
				Adjustments												Reportable Segments
(Dollars in millions)	Total GAAP			Reclassi- fications			Additions/ (Subtractions)			Total Adjustments (1)			Total Core Earnings			Consumer Lending			Federal Education Loans			Business Processing		Other
Interest income:
Education loans	$	2,297														$	838		$	1,459		$	—	$	—
Cash and investments		64															15			30			—		19
Total interest income		2,361															853			1,489			—		19
Total interest expense		1,961															547			1,321			—		72
Net interest income (loss)		400		$	15		$	6		$	21		$	421			306			168			—		(53	)
Less: provisions for loan losses		236												236			207			29			—		—
Net interest income (loss) after provisions for loan losses		164															99			139			—		(53	)
Other income (loss):
Servicing revenue		40															8			32			—		—
Asset recovery and business processing revenue		23															—			—			23		—
Other revenue (loss)		10															1			(1	)		—		44
Total other income		73			(15	)		49			34			107			9			31			23		44
Expenses:
Direct operating expenses		189															115			54			20		—
Unallocated shared services expenses		144															—			—			—		144
Operating expenses(2)		333			—			—			—			333			115			54			20		144
Goodwill and acquired intangible asset impairment and amortization		2			—			(2	)		(2	)		—			—			—			—		—
Restructuring/other reorganization expenses		6			—			—			—			6			—			—			—		6
Total expenses		341			—			(2	)		(2	)		339			115			54			20		150
Income (loss) before income tax expense (benefit)		(104	)		—			57			57			(47	)		(7	)		116			3		(159	)
Income tax expense (benefit)(3)		(29	)		—			18			18			(11	)		(3	)		27			1		(36	)
Net income (loss)	$	(75	)	$	—		$	39		$	39		$	(36	)	$	(4	)	$	89		$	2	$	(123	)

(1)

Core Earnings adjustments to GAAP:


	Nine Months Ended September 30, 2025
(Dollars in millions)	Net Impact of Derivative Accounting		Net Impact of Goodwill and Acquired Intangibles			Total
Net interest income (loss) after provisions for loan losses	$	21	$	—		$	21
Total other income		34		—			34
Goodwill and acquired intangible asset impairment and amortization		—		(2	)		(2	)
Total Core Earnings adjustments to GAAP	$	55	$	2			57
Income tax expense (benefit)							18
Net income (loss)						$	39

(2)

Reportable segment significant operating expenses are comprised of:


	Nine Months Ended September 30, 2025
(Dollars in millions)	Consumer Lending		Federal Education Loans		Business Processing		Other		Total
Servicing expenses	$	40	$	50	$	—	$	5	$	95
Information technology expenses		25		—		1		60		86
Corporate expenses		1		2		—		64		67
Other/remaining expenses		49		2		19		15		85
Operating expenses	$	115	$	54	$	20	$	144	$	333

(3)

Income taxes are based on a percentage of net income before tax for the individual reportable segment.

13. Segment Reporting (Continued)

Summary of Core Earnings Adjustments to GAAP


	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions)	2026			2025			2026			2025
GAAP net income	$	15		$	(86	)	$	56		$	(75	)
Core Earnings adjustments to GAAP:
Net impact of derivative accounting(1)		(9	)		8			(22	)		55
Net impact of goodwill and acquired intangible assets(2)		—			1			5			2
Net tax effect(3)		(3	)		(6	)		11			(18	)
Total Core Earnings adjustments to GAAP		(12	)		3			(6	)		39
Core Earnings net income	$	3		$	(83	)	$	50		$	(36	)

(1)

Derivative accounting: Core Earnings exclude periodic gains and losses that are caused by the mark-to-market valuations on derivatives that do not qualify for hedge accounting treatment under GAAP as well as the periodic mark-to-market gains and losses that are a result of ineffectiveness recognized related to effective hedges under GAAP. Under GAAP, for our derivatives that are held to maturity, the mark-to-market gain or loss over the life of the contract will equal $0. In our Core Earnings presentation, we recognize the economic effect of these hedges, which generally results in any net settlement cash paid or received being recognized ratably as an interest expense or revenue over the hedged item’s life.

(2)

Goodwill and acquired intangible assets: Our Core Earnings exclude goodwill and intangible asset impairment and amortization of acquired intangible assets.

(3)

Net tax effect: Such tax effect is based upon our Core Earnings effective tax rate for the year.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



	NAVIENT HOLDINGS, INC. (Registrant)
	By:	/s/ STEVE HAUBER
		Steve Hauber
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

Date: November 4, 2026

APPENDIX A

form 10-Q cross-reference index

         
        Page
Number


Part I. Financial Information


Item 1.	Financial Statements	46-85

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	7-38

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	40-43

Item 4.	Controls and Procedures	44

Part II. Other Information

Item 1.	Legal Proceedings	39, 76

Item 1A.	Risk Factors	39

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43

Item 3.	Defaults Upon Senior Securities	Not Applicable

Item 4.	Mine Safety Disclosures	Not Applicable

Item 5.	Other Information	44

Item 6.	Exhibits	45

Signatures		86