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As of | As of | |||||
June 30, 2017 | December 31, 2016 | |||||
Federally insured loans: | ||||||
Stafford and other | $ | 4,704,409 | 5,186,047 | |||
Consolidation | 18,442,998 | 19,643,937 | ||||
Total | 23,147,407 | 24,829,984 | ||||
Private education loans | 242,893 | 273,659 | ||||
23,390,300 | 25,103,643 | |||||
Loan discount, net of unamortized loan premiums and deferred origination costs | (123,326 | ) | (129,507 | ) | ||
Non-accretable discount (a) | (14,972 | ) | (18,570 | ) | ||
Allowance for loan losses – federally insured loans | (35,862 | ) | (37,268 | ) | ||
Allowance for loan losses – private education loans | (13,846 | ) | (14,574 | ) | ||
$ | 23,202,294 | 24,903,724 |
(a) | For loans purchased where there is evidence of credit deterioration since the origination of the loan, the Company records a credit discount, separate from the allowance for loan losses, which is non-accretable to interest income. |
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
Balance at beginning of period | $ | 50,526 | 50,084 | 51,842 | 50,498 | ||||||||
Provision for loan losses: | |||||||||||||
Federally insured loans | 2,000 | 2,000 | 4,000 | 4,000 | |||||||||
Private education loans | — | — | (1,000 | ) | 500 | ||||||||
Total provision for loan losses | 2,000 | 2,000 | 3,000 | 4,500 | |||||||||
Charge-offs: | |||||||||||||
Federally insured loans | (2,825 | ) | (3,217 | ) | (5,406 | ) | (6,266 | ) | |||||
Private education loans | (288 | ) | (514 | ) | (370 | ) | (915 | ) | |||||
Total charge-offs | (3,113 | ) | (3,731 | ) | (5,776 | ) | (7,181 | ) | |||||
Recoveries - private education loans | 245 | 250 | 442 | 526 | |||||||||
Purchase of private education loans | — | 100 | — | 260 | |||||||||
Transfer from repurchase obligation related to private education loans repurchased | 50 | 50 | 200 | 150 | |||||||||
Balance at end of period | $ | 49,708 | 48,753 | 49,708 | $ | 48,753 | |||||||
Allocation of the allowance for loan losses: | |||||||||||||
Federally insured loans | $ | 35,862 | 33,224 | 35,862 | 33,224 | ||||||||
Private education loans | 13,846 | 15,529 | 13,846 | 15,529 | |||||||||
Total allowance for loan losses | $ | 49,708 | 48,753 | 49,708 | 48,753 |
As of June 30, 2017 | As of December 31, 2016 | As of June 30, 2016 | ||||||||||||||||||
Federally insured loans: | ||||||||||||||||||||
Loans in-school/grace/deferment | $ | 1,454,802 | $ | 1,606,468 | $ | 1,936,064 | ||||||||||||||
Loans in forbearance | 2,065,167 | 2,295,367 | 2,672,241 | |||||||||||||||||
Loans in repayment status: | ||||||||||||||||||||
Loans current | 17,106,921 | 87.2 | % | 18,125,768 | 86.6 | % | 18,957,457 | 86.7 | % | |||||||||||
Loans delinquent 31-60 days | 743,738 | 3.8 | 818,976 | 3.9 | 828,885 | 3.8 | ||||||||||||||
Loans delinquent 61-90 days | 479,552 | 2.4 | 487,647 | 2.3 | 482,379 | 2.2 | ||||||||||||||
Loans delinquent 91-120 days | 267,139 | 1.4 | 335,291 | 1.6 | 320,213 | 1.5 | ||||||||||||||
Loans delinquent 121-270 days | 772,875 | 3.9 | 854,432 | 4.1 | 918,788 | 4.2 | ||||||||||||||
Loans delinquent 271 days or greater | 257,213 | 1.3 | 306,035 | 1.5 | 350,363 | 1.6 | ||||||||||||||
Total loans in repayment | 19,627,438 | 100.0 | % | 20,928,149 | 100.0 | % | 21,858,085 | 100.0 | % | |||||||||||
Total federally insured loans | $ | 23,147,407 | $ | 24,829,984 | $ | 26,466,390 | ||||||||||||||
Private education loans: | ||||||||||||||||||||
Loans in-school/grace/deferment | $ | 32,016 | $ | 35,146 | $ | 54,597 | ||||||||||||||
Loans in forbearance | 1,814 | 3,448 | 1,610 | |||||||||||||||||
Loans in repayment status: | ||||||||||||||||||||
Loans current | 202,155 | 96.7 | % | 228,612 | 97.2 | % | 225,585 | 97.2 | % | |||||||||||
Loans delinquent 31-60 days | 2,066 | 1.0 | 1,677 | 0.7 | 1,361 | 0.6 | ||||||||||||||
Loans delinquent 61-90 days | 1,323 | 0.6 | 1,110 | 0.5 | 929 | 0.4 | ||||||||||||||
Loans delinquent 91 days or greater | 3,519 | 1.7 | 3,666 | 1.6 | 4,088 | 1.8 | ||||||||||||||
Total loans in repayment | 209,063 | 100.0 | % | 235,065 | 100.0 | % | 231,963 | 100.0 | % | |||||||||||
Total private education loans | $ | 242,893 | $ | 273,659 | $ | 288,170 |
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As of June 30, 2017 | |||||||
Carrying amount | Interest rate range | Final maturity | |||||
Variable-rate bonds and notes issued in FFELP loan asset-backed securitizations: | |||||||
Bonds and notes based on indices | $ | 21,063,700 | 0.22% - 6.90% | 8/25/21 - 9/25/65 | |||
Bonds and notes based on auction | 796,140 | 1.82% - 2.36% | 3/22/32 - 11/26/46 | ||||
Total FFELP variable-rate bonds and notes | 21,859,840 | ||||||
FFELP warehouse facilities | 1,058,413 | 1.08% - 1.29% | 9/7/18 - 4/27/20 | ||||
Variable-rate bonds and notes issued in private education loan asset-backed securitization | 93,727 | 2.97% | 12/26/40 | ||||
Fixed-rate bonds and notes issued in private education loan asset-backed securitization | 98,076 | 3.60% / 5.35% | 12/26/40 / 12/28/43 | ||||
Unsecured line of credit | — | — | 12/12/21 | ||||
Unsecured debt - Junior Subordinated Hybrid Securities | 20,526 | 4.67% | 9/15/61 | ||||
Other borrowings | 60,169 | 1.96% - 3.38% | 7/17/17 - 12/15/45 | ||||
23,190,751 | |||||||
Discount on bonds and notes payable and debt issuance costs | (399,971 | ) | |||||
Total | $ | 22,790,780 |
As of December 31, 2016 | |||||||
Carrying amount | Interest rate range | Final maturity | |||||
Variable-rate bonds and notes issued in FFELP loan asset-backed securitizations: | |||||||
Bonds and notes based on indices | $ | 22,130,063 | 0.24% - 6.90% | 6/25/21 - 9/25/65 | |||
Bonds and notes based on auction | 998,415 | 1.61% - 2.28% | 3/22/32 - 11/26/46 | ||||
Total FFELP variable-rate bonds and notes | 23,128,478 | ||||||
FFELP warehouse facilities | 1,677,443 | 0.63% - 1.09% | 9/7/18 - 12/13/19 | ||||
Variable-rate bonds and notes issued in private education loan asset-backed securitization | 112,582 | 2.60% | 12/26/40 | ||||
Fixed-rate bonds and notes issued in private education loan asset-backed securitization | 113,378 | 3.60% / 5.35% | 12/26/40 / 12/28/43 | ||||
Unsecured line of credit | — | — | 12/12/21 | ||||
Unsecured debt - Junior Subordinated Hybrid Securities | 50,184 | 4.37% | 9/15/61 | ||||
Other borrowings | 18,355 | 3.38% | 3/31/23 / 12/15/45 | ||||
25,100,420 | |||||||
Discount on bonds and notes payable and debt issuance costs | (431,930 | ) | |||||
Total | $ | 24,668,490 |
NFSLW-I (a) | NHELP-II | NHELP-III (b) | Total | ||||||||||
Maximum financing amount | $ | 700,000 | 500,000 | 200,000 | 1,400,000 | ||||||||
Amount outstanding | 511,846 | 357,461 | 189,106 | 1,058,413 | |||||||||
Amount available | $ | 188,154 | 142,539 | 10,894 | 341,587 | ||||||||
Expiration of liquidity provisions | July 10, 2018 | December 15, 2017 | April 27, 2018 | ||||||||||
Final maturity date | September 7, 2018 | December 13, 2019 | April 27, 2020 | ||||||||||
Maximum advance rates | 92.0 - 98.0% | 85.0 - 95.0% | 92.2 - 95.0% | ||||||||||
Minimum advance rates | 84.0 - 90.0% | 85.0 - 95.0% | 92.2 - 95.0% | ||||||||||
Advanced as equity support | $ | 13,260 | 26,440 | 5,668 | 45,368 |
(a) | On May 25, 2017, the Company decreased the maximum financing amount for this warehouse facility from $875.0 million to $700.0 million. |
(b) | On April 3, 2017, the Company entered into a letter agreement for this warehouse facility to decrease the maximum financing amount from $750.0 million to $600.0 million. On April 28, 2017, the Company amended the agreement for this warehouse facility, which changed the expiration date for the liquidity provisions to April 27, 2018 and changed the final maturity date to April 27, 2020. On May 5, 2017, May 25, 2017, and June 2, 2017, the Company decreased the maximum financing amount for this warehouse facility by $200.0 million, $100.0 million, and $100.0 million, respectively. As of June 30, 2017, the maximum financing amount for this warehouse facility was $200.0 million, as reflected in this table. |
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As of June 30, | As of December 31, | |||||||
2017 | 2016 | |||||||
Maturity | Notional amount | Notional amount | ||||||
2018 | $ | 4,000,000 | $ | — | ||||
2019 | 2,000,000 | — | ||||||
2024 | 250,000 | — | ||||||
2026 | 1,150,000 | 1,150,000 | ||||||
2027 | 375,000 | — | ||||||
2028 | 325,000 | 325,000 | ||||||
2029 | 100,000 | — | ||||||
2031 | 300,000 | 300,000 | ||||||
$ | 8,500,000 | $ | 1,775,000 |
As of June 30, 2017 | As of December 31, 2016 | |||||||||||||
Maturity | Notional amount | Weighted average fixed rate paid by the Company (a) | Notional amount | Weighted average fixed rate paid by the Company (a) | ||||||||||
2017 | $ | 250,000 | 1.04 | % | $ | 750,000 | 0.99 | % | ||||||
2018 | 1,350,000 | 1.07 | 1,350,000 | 1.07 | ||||||||||
2019 | 3,250,000 | 0.97 | 3,250,000 | 0.97 | ||||||||||
2020 | 1,500,000 | 1.01 | 1,500,000 | 1.01 | ||||||||||
2025 | 100,000 | 2.32 | 100,000 | 2.32 | ||||||||||
$ | 6,450,000 | 1.02 | % | $ | 6,950,000 | 1.02 | % |
(a) | For all interest rate derivatives, the Company receives discrete three-month LIBOR. |
Maturity | Notional amount | Weighted average fixed rate paid by the Company (a) | |||||
2036 | $ | 25,000 | 4.28 | % |
(a) | For all interest rate derivatives, the Company receives discrete three-month LIBOR. |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Re-measurement of Euro Notes | $ | (27,261 | ) | 9,768 | (31,951 | ) | (8,712 | ) | ||||
Change in fair value of cross-currency interest rate swap | 27,639 | (12,008 | ) | 28,574 | 20,693 | |||||||
Total impact to consolidated statements of income - income (expense) (a) | $ | 378 | (2,240 | ) | (3,377 | ) | 11,981 |
(a) | The financial statement impact of the above items is included in "Derivative market value and foreign currency transaction adjustments and derivative settlements, net" in the Company's consolidated statements of income. |
Fair value of asset derivatives | Fair value of liability derivatives | |||||||||||
As of | As of | As of | As of | |||||||||
June 30, 2017 | December 31, 2016 | June 30, 2017 | December 31, 2016 | |||||||||
1:3 basis swaps | $ | — | — | — | 2,624 | |||||||
Interest rate swaps - floor income hedges | 20 | 81,159 | — | 256 | ||||||||
Interest rate swap option - floor income hedge | 1,265 | 2,977 | — | — | ||||||||
Interest rate caps | 334 | 1,152 | — | — | ||||||||
Interest rate swaps - hybrid debt hedges | — | — | 7,375 | 7,341 | ||||||||
Cross-currency interest rate swap | — | — | 39,031 | 67,605 | ||||||||
Other | — | 2,243 | — | — | ||||||||
Total | $ | 1,619 | 87,531 | 46,406 | 77,826 |
Gross amounts not offset in the consolidated balance sheets | |||||||||||||
Derivative assets | Gross amounts of recognized assets presented in the consolidated balance sheets | Derivatives subject to enforceable master netting arrangement | Cash collateral pledged | Net asset (liability) | |||||||||
Balance as of June 30, 2017 | $ | 1,619 | — | — | 1,619 | ||||||||
Balance as of December 31, 2016 | 87,531 | (2,880 | ) | 475 | 85,126 |
Gross amounts not offset in the consolidated balance sheets | |||||||||||||
Derivative liabilities | Gross amounts of recognized liabilities presented in the consolidated balance sheets | Derivatives subject to enforceable master netting arrangement | Cash collateral (received) pledged, net (a) | Net asset (liability) | |||||||||
Balance as of June 30, 2017 | $ | (46,406 | ) | — | (13,252 | ) | (59,658 | ) | |||||
Balance as of December 31, 2016 | (77,826 | ) | 2,880 | 7,292 | (67,654 | ) |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Settlements: | ||||||||||||
1:3 basis swaps | $ | (362 | ) | 743 | 336 | 414 | ||||||
Interest rate swaps - floor income hedges | 2,114 | (4,841 | ) | 1,994 | (10,084 | ) | ||||||
Interest rate swaps - hybrid debt hedges | (198 | ) | (231 | ) | (402 | ) | (463 | ) | ||||
Cross-currency interest rate swap | (1,917 | ) | (1,166 | ) | (3,669 | ) | (1,898 | ) | ||||
Total settlements - (expense) income | (363 | ) | (5,495 | ) | (1,741 | ) | (12,031 | ) | ||||
Change in fair value: | ||||||||||||
1:3 basis swaps | (8,841 | ) | (586 | ) | (11,416 | ) | 183 | |||||
Interest rate swaps - floor income hedges | (17,810 | ) | (27,276 | ) | (13,485 | ) | (59,985 | ) | ||||
Interest rate swap option - floor income hedge | (828 | ) | (856 | ) | (1,712 | ) | (2,272 | ) | ||||
Interest rate caps | (311 | ) | (453 | ) | (833 | ) | (1,215 | ) | ||||
Interest rate swaps - hybrid debt hedges | (453 | ) | (1,464 | ) | (34 | ) | (4,014 | ) | ||||
Cross-currency interest rate swap | 27,639 | (12,008 | ) | 28,574 | 20,693 | |||||||
Other | 318 | (2,332 | ) | (143 | ) | (2,039 | ) | |||||
Total change in fair value - (expense) income | (286 | ) | (44,975 | ) | 951 | (48,649 | ) | |||||
Re-measurement of Euro Notes (foreign currency transaction adjustment) - (expense) income | (27,261 | ) | 9,768 | (31,951 | ) | (8,712 | ) | |||||
Derivative market value and foreign currency transaction adjustments and derivative settlements, net - (expense) income | $ | (27,910 | ) | (40,702 | ) | (32,741 | ) | (69,392 | ) |
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As of June 30, 2017 | As of December 31, 2016 | ||||||||||||||||||||||||
Amortized cost | Gross unrealized gains | Gross unrealized losses (a) | Fair value | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||||||||||
Investments (at fair value): | |||||||||||||||||||||||||
Available-for-sale investments: | |||||||||||||||||||||||||
Student loan asset-backed and other debt securities (b) | $ | 109,624 | 5,436 | (678 | ) | 114,382 | 98,260 | 6,280 | (641 | ) | 103,899 | ||||||||||||||
Equity securities | 804 | 2,050 | (62 | ) | 2,792 | 720 | 1,930 | (61 | ) | 2,589 | |||||||||||||||
Total available-for-sale investments | $ | 110,428 | 7,486 | (740 | ) | 117,174 | 98,980 | 8,210 | (702 | ) | 106,488 | ||||||||||||||
Trading investments - equity securities | — | 105 | |||||||||||||||||||||||
Total available-for-sale and trading investments | 117,174 | 106,593 | |||||||||||||||||||||||
Other Investments and Other Receivables (not measured at fair value): | |||||||||||||||||||||||||
Venture capital and funds | 74,413 | 69,789 | |||||||||||||||||||||||
Real estate | 46,862 | 48,379 | |||||||||||||||||||||||
Notes and loans receivable | 41,065 | 17,031 | |||||||||||||||||||||||
Tax liens and affordable housing | 10,790 | 12,352 | |||||||||||||||||||||||
Total investments and other receivables | $ | 290,304 | 254,144 |
(a) | As of June 30, 2017, the aggregate fair value of available-for-sale investments with unrealized losses was $30.4 million, of which $11.0 million had been in a continuous unrealized loss position for greater than 12 months. Because the Company currently has the intent and ability to retain these investments for an anticipated recovery in fair value, as of June 30, 2017, the Company considered the decline in market value of its available-for-sale investments to be temporary in nature and did not consider any of its investments other-than-temporarily impaired. |
(b) | As of June 30, 2017, the stated maturities of substantially all of the Company's student loan asset-backed and other debt securities classified as available-for-sale were greater than 10 years. |
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Weighted average remaining useful life as of June 30, 2017 (months) | As of June 30, 2017 | As of December 31, 2016 | |||||||
Amortizable intangible assets: | |||||||||
Customer relationships (net of accumulated amortization of $10,676 and $8,548, respectively) | 164 | $ | 26,208 | 28,335 | |||||
Trade names (net of accumulated amortization of $2,075 and $1,653, respectively) | 183 | 9,497 | 9,919 | ||||||
Computer software (net of accumulated amortization of $7,844 and $5,675, respectively) | 20 | 7,127 | 9,296 | ||||||
Covenants not to compete (net of accumulated amortization of $109 and $91, respectively) | 83 | 245 | 263 | ||||||
Total - amortizable intangible assets | 144 | $ | 43,077 | 47,813 |
2017 (July 1 - December 31) | $ | 4,650 | |
2018 | 8,605 | ||
2019 | 5,147 | ||
2020 | 4,231 | ||
2021 | 3,480 | ||
2022 and thereafter | 16,964 | ||
$ | 43,077 |
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Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Total | |||||||||||||
Goodwill balance | $ | 8,596 | 67,168 | 21,112 | 41,883 | 8,553 | 147,312 |
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As of June 30, 2017 | As of December 31, 2016 | |||||||
Useful life | ||||||||
Non-communications: | ||||||||
Computer equipment and software | 1-5 years | $ | 104,946 | 97,317 | ||||
Office furniture and equipment | 3-7 years | 12,514 | 12,344 | |||||
Building and building improvements | 5-39 years | 13,383 | 13,363 | |||||
Transportation equipment | 4-10 years | 3,813 | 3,809 | |||||
Leasehold improvements | 5-20 years | 3,627 | 3,579 | |||||
Land | — | 1,682 | 1,682 | |||||
Construction in progress | — | 29,491 | 16,346 | |||||
169,456 | 148,440 | |||||||
Accumulated depreciation - non-communications | 99,718 | 91,285 | ||||||
Non-communications, net property and equipment | 69,738 | 57,155 | ||||||
Communications: | ||||||||
Network plant and fiber | 5-15 years | 64,337 | 40,844 | |||||
Central office | 5-15 years | 8,115 | 6,448 | |||||
Customer located property | 5-10 years | 8,811 | 5,138 | |||||
Transportation equipment | 4-10 years | 4,620 | 2,966 | |||||
Computer equipment and software | 1-5 years | 3,048 | 2,026 | |||||
Other | 1-39 years | 1,581 | 1,268 | |||||
Land | — | 70 | 70 | |||||
Construction in progress | — | 29,726 | 12,537 | |||||
120,308 | 71,297 | |||||||
Accumulated depreciation - communications | 8,948 | 4,666 | ||||||
Communications, net property and equipment | 111,360 | 66,631 | ||||||
Total property and equipment, net | $ | 181,098 | 123,786 |
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Three months ended June 30, 2017 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 120 | 3 | 1 | 191,367 | 3,362 | (1,776 | ) | 193,077 | ||||||||||||
Interest expense | — | — | 1,104 | 113,073 | 835 | (1,776 | ) | 113,236 | |||||||||||||
Net interest income | 120 | 3 | (1,103 | ) | 78,294 | 2,527 | — | 79,841 | |||||||||||||
Less provision for loan losses | — | — | — | 2,000 | — | — | 2,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 120 | 3 | (1,103 | ) | 76,294 | 2,527 | — | 77,841 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 56,899 | — | — | — | — | — | 56,899 | ||||||||||||||
Intersegment servicing revenue | 9,952 | — | — | — | — | (9,952 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 34,224 | — | — | — | — | 34,224 | ||||||||||||||
Communications revenue | — | — | 5,719 | — | — | — | 5,719 | ||||||||||||||
Other income | — | — | — | 3,057 | 9,429 | — | 12,485 | ||||||||||||||
Gain from debt repurchases | — | — | — | 442 | — | — | 442 | ||||||||||||||
Derivative settlements, net | — | — | — | (165 | ) | (198 | ) | — | (363 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (27,412 | ) | (135 | ) | — | (27,547 | ) | |||||||||||
Total other income | 66,851 | 34,224 | 5,719 | (24,078 | ) | 9,096 | (9,952 | ) | 81,859 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 40,506 | 16,901 | 3,411 | 363 | 13,447 | — | 74,628 | ||||||||||||||
Depreciation and amortization | 546 | 2,346 | 2,600 | — | 3,547 | — | 9,038 | ||||||||||||||
Loan servicing fees | — | — | — | 5,620 | — | — | 5,620 | ||||||||||||||
Cost to provide communications services | — | — | 2,203 | — | — | — | 2,203 | ||||||||||||||
Other expenses | 8,879 | 4,853 | 1,772 | 1,827 | 10,195 | — | 27,528 | ||||||||||||||
Intersegment expenses, net | 8,324 | 2,136 | 496 | 10,043 | (11,046 | ) | (9,952 | ) | — | ||||||||||||
Total operating expenses | 58,255 | 26,236 | 10,482 | 17,853 | 16,143 | (9,952 | ) | 119,017 | |||||||||||||
Income (loss) before income taxes | 8,716 | 7,991 | (5,866 | ) | 34,363 | (4,520 | ) | — | 40,683 | ||||||||||||
Income tax (expense) benefit | (4,918 | ) | (3,037 | ) | 2,229 | (13,057 | ) | 2,751 | — | (16,032 | ) | ||||||||||
Net income (loss) | 3,798 | 4,954 | (3,637 | ) | 21,306 | (1,769 | ) | — | 24,651 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | 4,226 | — | — | — | (141 | ) | — | 4,086 | |||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 8,024 | 4,954 | (3,637 | ) | 21,306 | (1,910 | ) | — | 28,737 | |||||||||||
Total assets as of June 30, 2017 | $ | 99,841 | 230,145 | 150,809 | 24,433,881 | 684,840 | (276,429 | ) | 25,323,087 |
Three months ended June 30, 2016 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 22 | 3 | — | 184,966 | 2,064 | (802 | ) | 186,252 | ||||||||||||
Interest expense | — | — | 205 | 92,769 | 1,881 | (802 | ) | 94,052 | |||||||||||||
Net interest income | 22 | 3 | (205 | ) | 92,197 | 183 | — | 92,200 | |||||||||||||
Less provision for loan losses | — | — | — | 2,000 | — | — | 2,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 22 | 3 | (205 | ) | 90,197 | 183 | — | 90,200 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 54,402 | — | — | — | — | — | 54,402 | ||||||||||||||
Intersegment servicing revenue | 11,408 | — | — | — | — | (11,408 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 30,483 | — | — | — | — | 30,483 | ||||||||||||||
Communications revenue | — | — | 4,478 | — | — | — | 4,478 | ||||||||||||||
Enrollment services revenue | — | — | — | — | — | — | — | ||||||||||||||
Other income | — | — | — | 3,834 | 5,931 | — | 9,765 | ||||||||||||||
Gain from debt repurchases | — | — | — | — | — | — | — | ||||||||||||||
Derivative settlements, net | — | — | — | (5,264 | ) | (231 | ) | — | (5,495 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (31,411 | ) | (3,797 | ) | — | (35,207 | ) | |||||||||||
Total other income | 65,810 | 30,483 | 4,478 | (32,841 | ) | 1,903 | (11,408 | ) | 58,426 | ||||||||||||
Operating expenses: | . | ||||||||||||||||||||
Salaries and benefits | 31,380 | 15,444 | 1,377 | 499 | 12,222 | — | 60,923 | ||||||||||||||
Depreciation and amortization | 445 | 2,511 | 1,378 | — | 3,848 | — | 8,183 | ||||||||||||||
Loan servicing fees | — | — | — | 7,216 | — | — | 7,216 | ||||||||||||||
Cost to provide communications services | — | — | 1,681 | — | — | — | 1,681 | ||||||||||||||
Cost to provide enrollment services | — | — | — | — | — | — | — | ||||||||||||||
Other expenses | 11,380 | 4,815 | 813 | 1,481 | 10,920 | — | 29,409 | ||||||||||||||
Intersegment expenses, net | 6,102 | 1,562 | 187 | 11,539 | (7,981 | ) | (11,408 | ) | — | ||||||||||||
Total operating expenses | 49,307 | 24,332 | 5,436 | 20,735 | 19,009 | (11,408 | ) | 107,412 | |||||||||||||
Income (loss) before income taxes | 16,525 | 6,154 | (1,163 | ) | 36,621 | (16,923 | ) | — | 41,214 | ||||||||||||
Income tax (expense) benefit | (6,280 | ) | (2,338 | ) | 442 | (13,916 | ) | 7,057 | — | (15,036 | ) | ||||||||||
Net income (loss) | 10,245 | 3,816 | (721 | ) | 22,705 | (9,866 | ) | — | 26,178 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | — | — | — | — | (28 | ) | — | (28 | ) | ||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 10,245 | 3,816 | (721 | ) | 22,705 | (9,894 | ) | — | 26,150 | |||||||||||
Total assets as of June 30, 2016 | $ | 71,403 | 230,308 | 78,578 | 27,856,952 | 730,122 | (251,565 | ) | 28,715,798 |
Six months ended June 30, 2017 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 214 | 5 | 1 | 373,692 | 6,123 | (3,135 | ) | 376,901 | ||||||||||||
Interest expense | — | — | 1,816 | 219,824 | 1,630 | (3,135 | ) | 220,135 | |||||||||||||
Net interest income | 214 | 5 | (1,815 | ) | 153,868 | 4,493 | — | 156,766 | |||||||||||||
Less provision for loan losses | — | — | — | 3,000 | — | — | 3,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 214 | 5 | (1,815 | ) | 150,868 | 4,493 | — | 153,766 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 111,128 | — | — | — | — | — | 111,128 | ||||||||||||||
Intersegment servicing revenue | 20,275 | — | — | — | — | (20,275 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 77,844 | — | — | — | — | 77,844 | ||||||||||||||
Communications revenue | — | — | 10,826 | — | — | — | 10,826 | ||||||||||||||
Other income | — | — | — | 6,399 | 18,719 | — | 25,118 | ||||||||||||||
Gain from debt repurchases | — | — | — | 981 | 4,440 | — | 5,421 | ||||||||||||||
Derivative settlements, net | — | — | — | (1,339 | ) | (402 | ) | — | (1,741 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (30,823 | ) | (177 | ) | — | (31,000 | ) | |||||||||||
Total other income | 131,403 | 77,844 | 10,826 | (24,782 | ) | 22,580 | (20,275 | ) | 197,596 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 78,497 | 33,553 | 6,390 | 763 | 27,287 | — | 146,491 | ||||||||||||||
Depreciation and amortization | 1,095 | 4,737 | 4,735 | — | 7,069 | — | 17,636 | ||||||||||||||
Loan servicing fees | — | — | — | 11,645 | — | — | 11,645 | ||||||||||||||
Cost to provide communications services | — | — | 4,157 | — | — | — | 4,157 | ||||||||||||||
Other expenses | 18,015 | 9,847 | 3,144 | 2,819 | 20,249 | — | 54,075 | ||||||||||||||
Intersegment expenses, net | 15,722 | 4,210 | 1,002 | 20,455 | (21,114 | ) | (20,275 | ) | — | ||||||||||||
Total operating expenses | 113,329 | 52,347 | 19,428 | 35,682 | 33,491 | (20,275 | ) | 234,004 | |||||||||||||
Income (loss) before income taxes | 18,288 | 25,502 | (10,417 | ) | 90,404 | (6,418 | ) | — | 117,358 | ||||||||||||
Income tax (expense) benefit | (9,473 | ) | (9,690 | ) | 3,959 | (34,354 | ) | 4,772 | — | (44,787 | ) | ||||||||||
Net income (loss) | 8,815 | 15,812 | (6,458 | ) | 56,050 | (1,646 | ) | — | 72,571 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | 6,641 | — | — | — | (450 | ) | — | 6,192 | |||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 15,456 | 15,812 | (6,458 | ) | 56,050 | (2,096 | ) | — | 78,763 | |||||||||||
Total assets as of June 30, 2017 | $ | 99,841 | 230,145 | 150,809 | 24,433,881 | 684,840 | (276,429 | ) | 25,323,087 |
Six months ended June 30, 2016 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 43 | 5 | — | 375,689 | 4,157 | (1,625 | ) | 378,269 | ||||||||||||
Interest expense | — | — | 352 | 182,647 | 3,087 | (1,625 | ) | 184,460 | |||||||||||||
Net interest income | 43 | 5 | (352 | ) | 193,042 | 1,070 | — | 193,809 | |||||||||||||
Less provision for loan losses | — | — | — | 4,500 | — | — | 4,500 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 43 | 5 | (352 | ) | 188,542 | 1,070 | — | 189,309 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 106,732 | — | — | — | — | — | 106,732 | ||||||||||||||
Intersegment servicing revenue | 23,415 | — | — | — | — | (23,415 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 69,140 | — | — | — | — | 69,140 | ||||||||||||||
Communications revenue | — | — | 8,824 | — | — | — | 8,824 | ||||||||||||||
Enrollment services revenue | — | — | — | — | 4,326 | — | 4,326 | ||||||||||||||
Other income | — | — | — | 8,097 | 15,462 | — | 23,559 | ||||||||||||||
Gain from debt repurchases | — | — | — | 101 | — | — | 101 | ||||||||||||||
Derivative settlements, net | — | — | — | (11,568 | ) | (463 | ) | — | (12,031 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (51,308 | ) | (6,053 | ) | — | (57,361 | ) | |||||||||||
Total other income | 130,147 | 69,140 | 8,824 | (54,678 | ) | 13,272 | (23,415 | ) | 143,290 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 64,346 | 29,880 | 2,467 | 1,018 | 26,454 | — | 124,165 | ||||||||||||||
Depreciation and amortization | 883 | 4,782 | 2,507 | — | 7,650 | — | 15,823 | ||||||||||||||
Loan servicing fees | — | — | — | 14,144 | — | — | 14,144 | ||||||||||||||
Cost to provide communications services | — | — | 3,384 | — | — | — | 3,384 | ||||||||||||||
Cost to provide enrollment services | — | — | — | — | 3,623 | — | 3,623 | ||||||||||||||
Other expenses | 22,850 | 8,973 | 1,566 | 2,997 | 21,397 | — | 57,783 | ||||||||||||||
Intersegment expenses, net | 12,343 | 3,074 | 331 | 23,646 | (15,978 | ) | (23,415 | ) | — | ||||||||||||
Total operating expenses | 100,422 | 46,709 | 10,255 | 41,805 | 43,146 | (23,415 | ) | 218,922 | |||||||||||||
Income (loss) before income taxes | 29,768 | 22,436 | (1,783 | ) | 92,059 | (28,804 | ) | — | 113,677 | ||||||||||||
Income tax (expense) benefit | (11,312 | ) | (8,526 | ) | 678 | (34,983 | ) | 14,674 | — | (39,469 | ) | ||||||||||
Net income (loss) | 18,456 | 13,910 | (1,105 | ) | 57,076 | (14,130 | ) | — | 74,208 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | — | — | — | — | (97 | ) | — | (97 | ) | ||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 18,456 | 13,910 | (1,105 | ) | 57,076 | (14,227 | ) | — | 74,111 | |||||||||||
Total assets as of June 30, 2016 | $ | 71,403 | 230,308 | 78,578 | 27,856,952 | 730,122 | (251,565 | ) | 28,715,798 |
|
|
|
As of June 30, 2017 | As of December 31, 2016 | |||||||||||||||||
Level 1 | Level 2 | Total | Level 1 | Level 2 | Total | |||||||||||||
Assets: | ||||||||||||||||||
Investments (available-for-sale and trading): | ||||||||||||||||||
Student loan and other asset-backed securities | $ | — | 114,267 | 114,267 | — | 103,780 | 103,780 | |||||||||||
Equity securities | 2,793 | — | 2,793 | 2,694 | — | 2,694 | ||||||||||||
Debt securities | 114 | — | 114 | 119 | — | 119 | ||||||||||||
Total investments (available-for-sale and trading) | 2,907 | 114,267 | 117,174 | 2,813 | 103,780 | 106,593 | ||||||||||||
Derivative instruments | — | 1,619 | 1,619 | — | 87,531 | 87,531 | ||||||||||||
Total assets | $ | 2,907 | 115,886 | 118,793 | 2,813 | 191,311 | 194,124 | |||||||||||
Liabilities: | ||||||||||||||||||
Derivative instruments | $ | — | 46,406 | 46,406 | — | 77,826 | 77,826 | |||||||||||
Total liabilities | $ | — | 46,406 | 46,406 | — | 77,826 | 77,826 |
As of June 30, 2017 | |||||||||||||||
Fair value | Carrying value | Level 1 | Level 2 | Level 3 | |||||||||||
Financial assets: | |||||||||||||||
Student loans receivable | $ | 24,278,179 | 23,202,294 | — | — | 24,278,179 | |||||||||
Cash and cash equivalents | 69,239 | 69,239 | 69,239 | — | — | ||||||||||
Investments (available-for-sale) | 117,174 | 117,174 | 2,907 | 114,267 | — | ||||||||||
Notes receivable | 16,563 | 16,563 | — | 16,563 | — | ||||||||||
Loans receivable | 25,502 | 24,502 | — | — | 25,502 | ||||||||||
Restricted cash | 780,141 | 780,141 | 780,141 | — | — | ||||||||||
Restricted cash – due to customers | 136,900 | 136,900 | 136,900 | — | — | ||||||||||
Accrued interest receivable | 395,734 | 395,734 | — | 395,734 | — | ||||||||||
Derivative instruments | 1,619 | 1,619 | — | 1,619 | — | ||||||||||
Financial liabilities: | |||||||||||||||
Bonds and notes payable | 22,744,128 | 22,790,780 | — | 22,744,128 | — | ||||||||||
Accrued interest payable | 47,064 | 47,064 | — | 47,064 | — | ||||||||||
Due to customers | 136,900 | 136,900 | 136,900 | — | — | ||||||||||
Derivative instruments | 46,406 | 46,406 | — | 46,406 | — |
As of December 31, 2016 | |||||||||||||||
Fair value | Carrying value | Level 1 | Level 2 | Level 3 | |||||||||||
Financial assets: | |||||||||||||||
Student loans receivable | $ | 25,653,581 | 24,903,724 | — | — | 25,653,581 | |||||||||
Cash and cash equivalents | 69,654 | 69,654 | 69,654 | — | — | ||||||||||
Investments (available-for-sale and trading) | 106,593 | 106,593 | 2,813 | 103,780 | — | ||||||||||
Notes receivable | 17,031 | 17,031 | — | 17,031 | — | ||||||||||
Restricted cash | 980,961 | 980,961 | 980,961 | — | — | ||||||||||
Restricted cash – due to customers | 119,702 | 119,702 | 119,702 | — | — | ||||||||||
Accrued interest receivable | 391,264 | 391,264 | — | 391,264 | — | ||||||||||
Derivative instruments | 87,531 | 87,531 | — | 87,531 | — | ||||||||||
Financial liabilities: | |||||||||||||||
Bonds and notes payable | 24,220,996 | 24,668,490 | — | 24,220,996 | — | ||||||||||
Accrued interest payable | 45,677 | 45,677 | — | 45,677 | — | ||||||||||
Due to customers | 119,702 | 119,702 | 119,702 | — | — | ||||||||||
Derivative instruments | 77,826 | 77,826 | — | 77,826 | — |
|
|
|
As of | As of | |||||
June 30, 2017 | December 31, 2016 | |||||
Federally insured loans: | ||||||
Stafford and other | $ | 4,704,409 | 5,186,047 | |||
Consolidation | 18,442,998 | 19,643,937 | ||||
Total | 23,147,407 | 24,829,984 | ||||
Private education loans | 242,893 | 273,659 | ||||
23,390,300 | 25,103,643 | |||||
Loan discount, net of unamortized loan premiums and deferred origination costs | (123,326 | ) | (129,507 | ) | ||
Non-accretable discount (a) | (14,972 | ) | (18,570 | ) | ||
Allowance for loan losses – federally insured loans | (35,862 | ) | (37,268 | ) | ||
Allowance for loan losses – private education loans | (13,846 | ) | (14,574 | ) | ||
$ | 23,202,294 | 24,903,724 |
(a) |
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
Balance at beginning of period | $ | 50,526 | 50,084 | 51,842 | 50,498 | ||||||||
Provision for loan losses: | |||||||||||||
Federally insured loans | 2,000 | 2,000 | 4,000 | 4,000 | |||||||||
Private education loans | — | — | (1,000 | ) | 500 | ||||||||
Total provision for loan losses | 2,000 | 2,000 | 3,000 | 4,500 | |||||||||
Charge-offs: | |||||||||||||
Federally insured loans | (2,825 | ) | (3,217 | ) | (5,406 | ) | (6,266 | ) | |||||
Private education loans | (288 | ) | (514 | ) | (370 | ) | (915 | ) | |||||
Total charge-offs | (3,113 | ) | (3,731 | ) | (5,776 | ) | (7,181 | ) | |||||
Recoveries - private education loans | 245 | 250 | 442 | 526 | |||||||||
Purchase of private education loans | — | 100 | — | 260 | |||||||||
Transfer from repurchase obligation related to private education loans repurchased | 50 | 50 | 200 | 150 | |||||||||
Balance at end of period | $ | 49,708 | 48,753 | 49,708 | $ | 48,753 | |||||||
Allocation of the allowance for loan losses: | |||||||||||||
Federally insured loans | $ | 35,862 | 33,224 | 35,862 | 33,224 | ||||||||
Private education loans | 13,846 | 15,529 | 13,846 | 15,529 | |||||||||
Total allowance for loan losses | $ | 49,708 | 48,753 | 49,708 | 48,753 |
As of June 30, 2017 | As of December 31, 2016 | As of June 30, 2016 | ||||||||||||||||||
Federally insured loans: | ||||||||||||||||||||
Loans in-school/grace/deferment | $ | 1,454,802 | $ | 1,606,468 | $ | 1,936,064 | ||||||||||||||
Loans in forbearance | 2,065,167 | 2,295,367 | 2,672,241 | |||||||||||||||||
Loans in repayment status: | ||||||||||||||||||||
Loans current | 17,106,921 | 87.2 | % | 18,125,768 | 86.6 | % | 18,957,457 | 86.7 | % | |||||||||||
Loans delinquent 31-60 days | 743,738 | 3.8 | 818,976 | 3.9 | 828,885 | 3.8 | ||||||||||||||
Loans delinquent 61-90 days | 479,552 | 2.4 | 487,647 | 2.3 | 482,379 | 2.2 | ||||||||||||||
Loans delinquent 91-120 days | 267,139 | 1.4 | 335,291 | 1.6 | 320,213 | 1.5 | ||||||||||||||
Loans delinquent 121-270 days | 772,875 | 3.9 | 854,432 | 4.1 | 918,788 | 4.2 | ||||||||||||||
Loans delinquent 271 days or greater | 257,213 | 1.3 | 306,035 | 1.5 | 350,363 | 1.6 | ||||||||||||||
Total loans in repayment | 19,627,438 | 100.0 | % | 20,928,149 | 100.0 | % | 21,858,085 | 100.0 | % | |||||||||||
Total federally insured loans | $ | 23,147,407 | $ | 24,829,984 | $ | 26,466,390 | ||||||||||||||
Private education loans: | ||||||||||||||||||||
Loans in-school/grace/deferment | $ | 32,016 | $ | 35,146 | $ | 54,597 | ||||||||||||||
Loans in forbearance | 1,814 | 3,448 | 1,610 | |||||||||||||||||
Loans in repayment status: | ||||||||||||||||||||
Loans current | 202,155 | 96.7 | % | 228,612 | 97.2 | % | 225,585 | 97.2 | % | |||||||||||
Loans delinquent 31-60 days | 2,066 | 1.0 | 1,677 | 0.7 | 1,361 | 0.6 | ||||||||||||||
Loans delinquent 61-90 days | 1,323 | 0.6 | 1,110 | 0.5 | 929 | 0.4 | ||||||||||||||
Loans delinquent 91 days or greater | 3,519 | 1.7 | 3,666 | 1.6 | 4,088 | 1.8 | ||||||||||||||
Total loans in repayment | 209,063 | 100.0 | % | 235,065 | 100.0 | % | 231,963 | 100.0 | % | |||||||||||
Total private education loans | $ | 242,893 | $ | 273,659 | $ | 288,170 |
|
As of June 30, 2017 | |||||||
Carrying amount | Interest rate range | Final maturity | |||||
Variable-rate bonds and notes issued in FFELP loan asset-backed securitizations: | |||||||
Bonds and notes based on indices | $ | 21,063,700 | 0.22% - 6.90% | 8/25/21 - 9/25/65 | |||
Bonds and notes based on auction | 796,140 | 1.82% - 2.36% | 3/22/32 - 11/26/46 | ||||
Total FFELP variable-rate bonds and notes | 21,859,840 | ||||||
FFELP warehouse facilities | 1,058,413 | 1.08% - 1.29% | 9/7/18 - 4/27/20 | ||||
Variable-rate bonds and notes issued in private education loan asset-backed securitization | 93,727 | 2.97% | 12/26/40 | ||||
Fixed-rate bonds and notes issued in private education loan asset-backed securitization | 98,076 | 3.60% / 5.35% | 12/26/40 / 12/28/43 | ||||
Unsecured line of credit | — | — | 12/12/21 | ||||
Unsecured debt - Junior Subordinated Hybrid Securities | 20,526 | 4.67% | 9/15/61 | ||||
Other borrowings | 60,169 | 1.96% - 3.38% | 7/17/17 - 12/15/45 | ||||
23,190,751 | |||||||
Discount on bonds and notes payable and debt issuance costs | (399,971 | ) | |||||
Total | $ | 22,790,780 |
As of December 31, 2016 | |||||||
Carrying amount | Interest rate range | Final maturity | |||||
Variable-rate bonds and notes issued in FFELP loan asset-backed securitizations: | |||||||
Bonds and notes based on indices | $ | 22,130,063 | 0.24% - 6.90% | 6/25/21 - 9/25/65 | |||
Bonds and notes based on auction | 998,415 | 1.61% - 2.28% | 3/22/32 - 11/26/46 | ||||
Total FFELP variable-rate bonds and notes | 23,128,478 | ||||||
FFELP warehouse facilities | 1,677,443 | 0.63% - 1.09% | 9/7/18 - 12/13/19 | ||||
Variable-rate bonds and notes issued in private education loan asset-backed securitization | 112,582 | 2.60% | 12/26/40 | ||||
Fixed-rate bonds and notes issued in private education loan asset-backed securitization | 113,378 | 3.60% / 5.35% | 12/26/40 / 12/28/43 | ||||
Unsecured line of credit | — | — | 12/12/21 | ||||
Unsecured debt - Junior Subordinated Hybrid Securities | 50,184 | 4.37% | 9/15/61 | ||||
Other borrowings | 18,355 | 3.38% | 3/31/23 / 12/15/45 | ||||
25,100,420 | |||||||
Discount on bonds and notes payable and debt issuance costs | (431,930 | ) | |||||
Total | $ | 24,668,490 |
NFSLW-I (a) | NHELP-II | NHELP-III (b) | Total | ||||||||||
Maximum financing amount | $ | 700,000 | 500,000 | 200,000 | 1,400,000 | ||||||||
Amount outstanding | 511,846 | 357,461 | 189,106 | 1,058,413 | |||||||||
Amount available | $ | 188,154 | 142,539 | 10,894 | 341,587 | ||||||||
Expiration of liquidity provisions | July 10, 2018 | December 15, 2017 | April 27, 2018 | ||||||||||
Final maturity date | September 7, 2018 | December 13, 2019 | April 27, 2020 | ||||||||||
Maximum advance rates | 92.0 - 98.0% | 85.0 - 95.0% | 92.2 - 95.0% | ||||||||||
Minimum advance rates | 84.0 - 90.0% | 85.0 - 95.0% | 92.2 - 95.0% | ||||||||||
Advanced as equity support | $ | 13,260 | 26,440 | 5,668 | 45,368 |
(a) | On May 25, 2017, the Company decreased the maximum financing amount for this warehouse facility from $875.0 million to $700.0 million. |
(b) | On April 3, 2017, the Company entered into a letter agreement for this warehouse facility to decrease the maximum financing amount from $750.0 million to $600.0 million. On April 28, 2017, the Company amended the agreement for this warehouse facility, which changed the expiration date for the liquidity provisions to April 27, 2018 and changed the final maturity date to April 27, 2020. On May 5, 2017, May 25, 2017, and June 2, 2017, the Company decreased the maximum financing amount for this warehouse facility by $200.0 million, $100.0 million, and $100.0 million, respectively. As of June 30, 2017, the maximum financing amount for this warehouse facility was $200.0 million, as reflected in this table. |
|
As of June 30, | As of December 31, | |||||||
2017 | 2016 | |||||||
Maturity | Notional amount | Notional amount | ||||||
2018 | $ | 4,000,000 | $ | — | ||||
2019 | 2,000,000 | — | ||||||
2024 | 250,000 | — | ||||||
2026 | 1,150,000 | 1,150,000 | ||||||
2027 | 375,000 | — | ||||||
2028 | 325,000 | 325,000 | ||||||
2029 | 100,000 | — | ||||||
2031 | 300,000 | 300,000 | ||||||
$ | 8,500,000 | $ | 1,775,000 |
As of June 30, 2017 | As of December 31, 2016 | |||||||||||||
Maturity | Notional amount | Weighted average fixed rate paid by the Company (a) | Notional amount | Weighted average fixed rate paid by the Company (a) | ||||||||||
2017 | $ | 250,000 | 1.04 | % | $ | 750,000 | 0.99 | % | ||||||
2018 | 1,350,000 | 1.07 | 1,350,000 | 1.07 | ||||||||||
2019 | 3,250,000 | 0.97 | 3,250,000 | 0.97 | ||||||||||
2020 | 1,500,000 | 1.01 | 1,500,000 | 1.01 | ||||||||||
2025 | 100,000 | 2.32 | 100,000 | 2.32 | ||||||||||
$ | 6,450,000 | 1.02 | % | $ | 6,950,000 | 1.02 | % |
(a) | For all interest rate derivatives, the Company receives discrete three-month LIBOR. |
Maturity | Notional amount | Weighted average fixed rate paid by the Company (a) | |||||
2036 | $ | 25,000 | 4.28 | % |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Re-measurement of Euro Notes | $ | (27,261 | ) | 9,768 | (31,951 | ) | (8,712 | ) | ||||
Change in fair value of cross-currency interest rate swap | 27,639 | (12,008 | ) | 28,574 | 20,693 | |||||||
Total impact to consolidated statements of income - income (expense) (a) | $ | 378 | (2,240 | ) | (3,377 | ) | 11,981 |
(a) | The financial statement impact of the above items is included in "Derivative market value and foreign currency transaction adjustments and derivative settlements, net" in the Company's consolidated statements of income. |
Fair value of asset derivatives | Fair value of liability derivatives | |||||||||||
As of | As of | As of | As of | |||||||||
June 30, 2017 | December 31, 2016 | June 30, 2017 | December 31, 2016 | |||||||||
1:3 basis swaps | $ | — | — | — | 2,624 | |||||||
Interest rate swaps - floor income hedges | 20 | 81,159 | — | 256 | ||||||||
Interest rate swap option - floor income hedge | 1,265 | 2,977 | — | — | ||||||||
Interest rate caps | 334 | 1,152 | — | — | ||||||||
Interest rate swaps - hybrid debt hedges | — | — | 7,375 | 7,341 | ||||||||
Cross-currency interest rate swap | — | — | 39,031 | 67,605 | ||||||||
Other | — | 2,243 | — | — | ||||||||
Total | $ | 1,619 | 87,531 | 46,406 | 77,826 |
Gross amounts not offset in the consolidated balance sheets | |||||||||||||
Derivative assets | Gross amounts of recognized assets presented in the consolidated balance sheets | Derivatives subject to enforceable master netting arrangement | Cash collateral pledged | Net asset (liability) | |||||||||
Balance as of June 30, 2017 | $ | 1,619 | — | — | 1,619 | ||||||||
Balance as of December 31, 2016 | 87,531 | (2,880 | ) | 475 | 85,126 |
Gross amounts not offset in the consolidated balance sheets | |||||||||||||
Derivative liabilities | Gross amounts of recognized liabilities presented in the consolidated balance sheets | Derivatives subject to enforceable master netting arrangement | Cash collateral (received) pledged, net (a) | Net asset (liability) | |||||||||
Balance as of June 30, 2017 | $ | (46,406 | ) | — | (13,252 | ) | (59,658 | ) | |||||
Balance as of December 31, 2016 | (77,826 | ) | 2,880 | 7,292 | (67,654 | ) |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Settlements: | ||||||||||||
1:3 basis swaps | $ | (362 | ) | 743 | 336 | 414 | ||||||
Interest rate swaps - floor income hedges | 2,114 | (4,841 | ) | 1,994 | (10,084 | ) | ||||||
Interest rate swaps - hybrid debt hedges | (198 | ) | (231 | ) | (402 | ) | (463 | ) | ||||
Cross-currency interest rate swap | (1,917 | ) | (1,166 | ) | (3,669 | ) | (1,898 | ) | ||||
Total settlements - (expense) income | (363 | ) | (5,495 | ) | (1,741 | ) | (12,031 | ) | ||||
Change in fair value: | ||||||||||||
1:3 basis swaps | (8,841 | ) | (586 | ) | (11,416 | ) | 183 | |||||
Interest rate swaps - floor income hedges | (17,810 | ) | (27,276 | ) | (13,485 | ) | (59,985 | ) | ||||
Interest rate swap option - floor income hedge | (828 | ) | (856 | ) | (1,712 | ) | (2,272 | ) | ||||
Interest rate caps | (311 | ) | (453 | ) | (833 | ) | (1,215 | ) | ||||
Interest rate swaps - hybrid debt hedges | (453 | ) | (1,464 | ) | (34 | ) | (4,014 | ) | ||||
Cross-currency interest rate swap | 27,639 | (12,008 | ) | 28,574 | 20,693 | |||||||
Other | 318 | (2,332 | ) | (143 | ) | (2,039 | ) | |||||
Total change in fair value - (expense) income | (286 | ) | (44,975 | ) | 951 | (48,649 | ) | |||||
Re-measurement of Euro Notes (foreign currency transaction adjustment) - (expense) income | (27,261 | ) | 9,768 | (31,951 | ) | (8,712 | ) | |||||
Derivative market value and foreign currency transaction adjustments and derivative settlements, net - (expense) income | $ | (27,910 | ) | (40,702 | ) | (32,741 | ) | (69,392 | ) |
|
As of June 30, 2017 | As of December 31, 2016 | ||||||||||||||||||||||||
Amortized cost | Gross unrealized gains | Gross unrealized losses (a) | Fair value | Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | ||||||||||||||||||
Investments (at fair value): | |||||||||||||||||||||||||
Available-for-sale investments: | |||||||||||||||||||||||||
Student loan asset-backed and other debt securities (b) | $ | 109,624 | 5,436 | (678 | ) | 114,382 | 98,260 | 6,280 | (641 | ) | 103,899 | ||||||||||||||
Equity securities | 804 | 2,050 | (62 | ) | 2,792 | 720 | 1,930 | (61 | ) | 2,589 | |||||||||||||||
Total available-for-sale investments | $ | 110,428 | 7,486 | (740 | ) | 117,174 | 98,980 | 8,210 | (702 | ) | 106,488 | ||||||||||||||
Trading investments - equity securities | — | 105 | |||||||||||||||||||||||
Total available-for-sale and trading investments | 117,174 | 106,593 | |||||||||||||||||||||||
Other Investments and Other Receivables (not measured at fair value): | |||||||||||||||||||||||||
Venture capital and funds | 74,413 | 69,789 | |||||||||||||||||||||||
Real estate | 46,862 | 48,379 | |||||||||||||||||||||||
Notes and loans receivable | 41,065 | 17,031 | |||||||||||||||||||||||
Tax liens and affordable housing | 10,790 | 12,352 | |||||||||||||||||||||||
Total investments and other receivables | $ | 290,304 | 254,144 |
(a) | As of June 30, 2017, the aggregate fair value of available-for-sale investments with unrealized losses was $30.4 million, of which $11.0 million had been in a continuous unrealized loss position for greater than 12 months. Because the Company currently has the intent and ability to retain these investments for an anticipated recovery in fair value, as of June 30, 2017, the Company considered the decline in market value of its available-for-sale investments to be temporary in nature and did not consider any of its investments other-than-temporarily impaired. |
(b) | As of June 30, 2017, the stated maturities of substantially all of the Company's student loan asset-backed and other debt securities classified as available-for-sale were greater than 10 years. |
|
Weighted average remaining useful life as of June 30, 2017 (months) | As of June 30, 2017 | As of December 31, 2016 | |||||||
Amortizable intangible assets: | |||||||||
Customer relationships (net of accumulated amortization of $10,676 and $8,548, respectively) | 164 | $ | 26,208 | 28,335 | |||||
Trade names (net of accumulated amortization of $2,075 and $1,653, respectively) | 183 | 9,497 | 9,919 | ||||||
Computer software (net of accumulated amortization of $7,844 and $5,675, respectively) | 20 | 7,127 | 9,296 | ||||||
Covenants not to compete (net of accumulated amortization of $109 and $91, respectively) | 83 | 245 | 263 | ||||||
Total - amortizable intangible assets | 144 | $ | 43,077 | 47,813 |
2017 (July 1 - December 31) | $ | 4,650 | |
2018 | 8,605 | ||
2019 | 5,147 | ||
2020 | 4,231 | ||
2021 | 3,480 | ||
2022 and thereafter | 16,964 | ||
$ | 43,077 |
|
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Total | |||||||||||||
Goodwill balance | $ | 8,596 | 67,168 | 21,112 | 41,883 | 8,553 | 147,312 |
|
As of June 30, 2017 | As of December 31, 2016 | |||||||
Useful life | ||||||||
Non-communications: | ||||||||
Computer equipment and software | 1-5 years | $ | 104,946 | 97,317 | ||||
Office furniture and equipment | 3-7 years | 12,514 | 12,344 | |||||
Building and building improvements | 5-39 years | 13,383 | 13,363 | |||||
Transportation equipment | 4-10 years | 3,813 | 3,809 | |||||
Leasehold improvements | 5-20 years | 3,627 | 3,579 | |||||
Land | — | 1,682 | 1,682 | |||||
Construction in progress | — | 29,491 | 16,346 | |||||
169,456 | 148,440 | |||||||
Accumulated depreciation - non-communications | 99,718 | 91,285 | ||||||
Non-communications, net property and equipment | 69,738 | 57,155 | ||||||
Communications: | ||||||||
Network plant and fiber | 5-15 years | 64,337 | 40,844 | |||||
Central office | 5-15 years | 8,115 | 6,448 | |||||
Customer located property | 5-10 years | 8,811 | 5,138 | |||||
Transportation equipment | 4-10 years | 4,620 | 2,966 | |||||
Computer equipment and software | 1-5 years | 3,048 | 2,026 | |||||
Other | 1-39 years | 1,581 | 1,268 | |||||
Land | — | 70 | 70 | |||||
Construction in progress | — | 29,726 | 12,537 | |||||
120,308 | 71,297 | |||||||
Accumulated depreciation - communications | 8,948 | 4,666 | ||||||
Communications, net property and equipment | 111,360 | 66,631 | ||||||
Total property and equipment, net | $ | 181,098 | 123,786 |
|
Three months ended June 30, 2017 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 120 | 3 | 1 | 191,367 | 3,362 | (1,776 | ) | 193,077 | ||||||||||||
Interest expense | — | — | 1,104 | 113,073 | 835 | (1,776 | ) | 113,236 | |||||||||||||
Net interest income | 120 | 3 | (1,103 | ) | 78,294 | 2,527 | — | 79,841 | |||||||||||||
Less provision for loan losses | — | — | — | 2,000 | — | — | 2,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 120 | 3 | (1,103 | ) | 76,294 | 2,527 | — | 77,841 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 56,899 | — | — | — | — | — | 56,899 | ||||||||||||||
Intersegment servicing revenue | 9,952 | — | — | — | — | (9,952 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 34,224 | — | — | — | — | 34,224 | ||||||||||||||
Communications revenue | — | — | 5,719 | — | — | — | 5,719 | ||||||||||||||
Other income | — | — | — | 3,057 | 9,429 | — | 12,485 | ||||||||||||||
Gain from debt repurchases | — | — | — | 442 | — | — | 442 | ||||||||||||||
Derivative settlements, net | — | — | — | (165 | ) | (198 | ) | — | (363 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (27,412 | ) | (135 | ) | — | (27,547 | ) | |||||||||||
Total other income | 66,851 | 34,224 | 5,719 | (24,078 | ) | 9,096 | (9,952 | ) | 81,859 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 40,506 | 16,901 | 3,411 | 363 | 13,447 | — | 74,628 | ||||||||||||||
Depreciation and amortization | 546 | 2,346 | 2,600 | — | 3,547 | — | 9,038 | ||||||||||||||
Loan servicing fees | — | — | — | 5,620 | — | — | 5,620 | ||||||||||||||
Cost to provide communications services | — | — | 2,203 | — | — | — | 2,203 | ||||||||||||||
Other expenses | 8,879 | 4,853 | 1,772 | 1,827 | 10,195 | — | 27,528 | ||||||||||||||
Intersegment expenses, net | 8,324 | 2,136 | 496 | 10,043 | (11,046 | ) | (9,952 | ) | — | ||||||||||||
Total operating expenses | 58,255 | 26,236 | 10,482 | 17,853 | 16,143 | (9,952 | ) | 119,017 | |||||||||||||
Income (loss) before income taxes | 8,716 | 7,991 | (5,866 | ) | 34,363 | (4,520 | ) | — | 40,683 | ||||||||||||
Income tax (expense) benefit | (4,918 | ) | (3,037 | ) | 2,229 | (13,057 | ) | 2,751 | — | (16,032 | ) | ||||||||||
Net income (loss) | 3,798 | 4,954 | (3,637 | ) | 21,306 | (1,769 | ) | — | 24,651 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | 4,226 | — | — | — | (141 | ) | — | 4,086 | |||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 8,024 | 4,954 | (3,637 | ) | 21,306 | (1,910 | ) | — | 28,737 | |||||||||||
Total assets as of June 30, 2017 | $ | 99,841 | 230,145 | 150,809 | 24,433,881 | 684,840 | (276,429 | ) | 25,323,087 |
Three months ended June 30, 2016 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 22 | 3 | — | 184,966 | 2,064 | (802 | ) | 186,252 | ||||||||||||
Interest expense | — | — | 205 | 92,769 | 1,881 | (802 | ) | 94,052 | |||||||||||||
Net interest income | 22 | 3 | (205 | ) | 92,197 | 183 | — | 92,200 | |||||||||||||
Less provision for loan losses | — | — | — | 2,000 | — | — | 2,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 22 | 3 | (205 | ) | 90,197 | 183 | — | 90,200 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 54,402 | — | — | — | — | — | 54,402 | ||||||||||||||
Intersegment servicing revenue | 11,408 | — | — | — | — | (11,408 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 30,483 | — | — | — | — | 30,483 | ||||||||||||||
Communications revenue | — | — | 4,478 | — | — | — | 4,478 | ||||||||||||||
Enrollment services revenue | — | — | — | — | — | — | — | ||||||||||||||
Other income | — | — | — | 3,834 | 5,931 | — | 9,765 | ||||||||||||||
Gain from debt repurchases | — | — | — | — | — | — | — | ||||||||||||||
Derivative settlements, net | — | — | — | (5,264 | ) | (231 | ) | — | (5,495 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (31,411 | ) | (3,797 | ) | — | (35,207 | ) | |||||||||||
Total other income | 65,810 | 30,483 | 4,478 | (32,841 | ) | 1,903 | (11,408 | ) | 58,426 | ||||||||||||
Operating expenses: | . | ||||||||||||||||||||
Salaries and benefits | 31,380 | 15,444 | 1,377 | 499 | 12,222 | — | 60,923 | ||||||||||||||
Depreciation and amortization | 445 | 2,511 | 1,378 | — | 3,848 | — | 8,183 | ||||||||||||||
Loan servicing fees | — | — | — | 7,216 | — | — | 7,216 | ||||||||||||||
Cost to provide communications services | — | — | 1,681 | — | — | — | 1,681 | ||||||||||||||
Cost to provide enrollment services | — | — | — | — | — | — | — | ||||||||||||||
Other expenses | 11,380 | 4,815 | 813 | 1,481 | 10,920 | — | 29,409 | ||||||||||||||
Intersegment expenses, net | 6,102 | 1,562 | 187 | 11,539 | (7,981 | ) | (11,408 | ) | — | ||||||||||||
Total operating expenses | 49,307 | 24,332 | 5,436 | 20,735 | 19,009 | (11,408 | ) | 107,412 | |||||||||||||
Income (loss) before income taxes | 16,525 | 6,154 | (1,163 | ) | 36,621 | (16,923 | ) | — | 41,214 | ||||||||||||
Income tax (expense) benefit | (6,280 | ) | (2,338 | ) | 442 | (13,916 | ) | 7,057 | — | (15,036 | ) | ||||||||||
Net income (loss) | 10,245 | 3,816 | (721 | ) | 22,705 | (9,866 | ) | — | 26,178 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | — | — | — | — | (28 | ) | — | (28 | ) | ||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 10,245 | 3,816 | (721 | ) | 22,705 | (9,894 | ) | — | 26,150 | |||||||||||
Total assets as of June 30, 2016 | $ | 71,403 | 230,308 | 78,578 | 27,856,952 | 730,122 | (251,565 | ) | 28,715,798 |
Six months ended June 30, 2017 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 214 | 5 | 1 | 373,692 | 6,123 | (3,135 | ) | 376,901 | ||||||||||||
Interest expense | — | — | 1,816 | 219,824 | 1,630 | (3,135 | ) | 220,135 | |||||||||||||
Net interest income | 214 | 5 | (1,815 | ) | 153,868 | 4,493 | — | 156,766 | |||||||||||||
Less provision for loan losses | — | — | — | 3,000 | — | — | 3,000 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 214 | 5 | (1,815 | ) | 150,868 | 4,493 | — | 153,766 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 111,128 | — | — | — | — | — | 111,128 | ||||||||||||||
Intersegment servicing revenue | 20,275 | — | — | — | — | (20,275 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 77,844 | — | — | — | — | 77,844 | ||||||||||||||
Communications revenue | — | — | 10,826 | — | — | — | 10,826 | ||||||||||||||
Other income | — | — | — | 6,399 | 18,719 | — | 25,118 | ||||||||||||||
Gain from debt repurchases | — | — | — | 981 | 4,440 | — | 5,421 | ||||||||||||||
Derivative settlements, net | — | — | — | (1,339 | ) | (402 | ) | — | (1,741 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (30,823 | ) | (177 | ) | — | (31,000 | ) | |||||||||||
Total other income | 131,403 | 77,844 | 10,826 | (24,782 | ) | 22,580 | (20,275 | ) | 197,596 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 78,497 | 33,553 | 6,390 | 763 | 27,287 | — | 146,491 | ||||||||||||||
Depreciation and amortization | 1,095 | 4,737 | 4,735 | — | 7,069 | — | 17,636 | ||||||||||||||
Loan servicing fees | — | — | — | 11,645 | — | — | 11,645 | ||||||||||||||
Cost to provide communications services | — | — | 4,157 | — | — | — | 4,157 | ||||||||||||||
Other expenses | 18,015 | 9,847 | 3,144 | 2,819 | 20,249 | — | 54,075 | ||||||||||||||
Intersegment expenses, net | 15,722 | 4,210 | 1,002 | 20,455 | (21,114 | ) | (20,275 | ) | — | ||||||||||||
Total operating expenses | 113,329 | 52,347 | 19,428 | 35,682 | 33,491 | (20,275 | ) | 234,004 | |||||||||||||
Income (loss) before income taxes | 18,288 | 25,502 | (10,417 | ) | 90,404 | (6,418 | ) | — | 117,358 | ||||||||||||
Income tax (expense) benefit | (9,473 | ) | (9,690 | ) | 3,959 | (34,354 | ) | 4,772 | — | (44,787 | ) | ||||||||||
Net income (loss) | 8,815 | 15,812 | (6,458 | ) | 56,050 | (1,646 | ) | — | 72,571 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | 6,641 | — | — | — | (450 | ) | — | 6,192 | |||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 15,456 | 15,812 | (6,458 | ) | 56,050 | (2,096 | ) | — | 78,763 | |||||||||||
Total assets as of June 30, 2017 | $ | 99,841 | 230,145 | 150,809 | 24,433,881 | 684,840 | (276,429 | ) | 25,323,087 |
Six months ended June 30, 2016 | |||||||||||||||||||||
Loan Systems and Servicing | Tuition Payment Processing and Campus Commerce | Communications | Asset Generation and Management | Corporate and Other Activities | Eliminations | Total | |||||||||||||||
Total interest income | $ | 43 | 5 | — | 375,689 | 4,157 | (1,625 | ) | 378,269 | ||||||||||||
Interest expense | — | — | 352 | 182,647 | 3,087 | (1,625 | ) | 184,460 | |||||||||||||
Net interest income | 43 | 5 | (352 | ) | 193,042 | 1,070 | — | 193,809 | |||||||||||||
Less provision for loan losses | — | — | — | 4,500 | — | — | 4,500 | ||||||||||||||
Net interest income (loss) after provision for loan losses | 43 | 5 | (352 | ) | 188,542 | 1,070 | — | 189,309 | |||||||||||||
Other income: | |||||||||||||||||||||
Loan systems and servicing revenue | 106,732 | — | — | — | — | — | 106,732 | ||||||||||||||
Intersegment servicing revenue | 23,415 | — | — | — | — | (23,415 | ) | — | |||||||||||||
Tuition payment processing, school information, and campus commerce revenue | — | 69,140 | — | — | — | — | 69,140 | ||||||||||||||
Communications revenue | — | — | 8,824 | — | — | — | 8,824 | ||||||||||||||
Enrollment services revenue | — | — | — | — | 4,326 | — | 4,326 | ||||||||||||||
Other income | — | — | — | 8,097 | 15,462 | — | 23,559 | ||||||||||||||
Gain from debt repurchases | — | — | — | 101 | — | — | 101 | ||||||||||||||
Derivative settlements, net | — | — | — | (11,568 | ) | (463 | ) | — | (12,031 | ) | |||||||||||
Derivative market value and foreign currency transaction adjustments, net | — | — | — | (51,308 | ) | (6,053 | ) | — | (57,361 | ) | |||||||||||
Total other income | 130,147 | 69,140 | 8,824 | (54,678 | ) | 13,272 | (23,415 | ) | 143,290 | ||||||||||||
Operating expenses: | |||||||||||||||||||||
Salaries and benefits | 64,346 | 29,880 | 2,467 | 1,018 | 26,454 | — | 124,165 | ||||||||||||||
Depreciation and amortization | 883 | 4,782 | 2,507 | — | 7,650 | — | 15,823 | ||||||||||||||
Loan servicing fees | — | — | — | 14,144 | — | — | 14,144 | ||||||||||||||
Cost to provide communications services | — | — | 3,384 | — | — | — | 3,384 | ||||||||||||||
Cost to provide enrollment services | — | — | — | — | 3,623 | — | 3,623 | ||||||||||||||
Other expenses | 22,850 | 8,973 | 1,566 | 2,997 | 21,397 | — | 57,783 | ||||||||||||||
Intersegment expenses, net | 12,343 | 3,074 | 331 | 23,646 | (15,978 | ) | (23,415 | ) | — | ||||||||||||
Total operating expenses | 100,422 | 46,709 | 10,255 | 41,805 | 43,146 | (23,415 | ) | 218,922 | |||||||||||||
Income (loss) before income taxes | 29,768 | 22,436 | (1,783 | ) | 92,059 | (28,804 | ) | — | 113,677 | ||||||||||||
Income tax (expense) benefit | (11,312 | ) | (8,526 | ) | 678 | (34,983 | ) | 14,674 | — | (39,469 | ) | ||||||||||
Net income (loss) | 18,456 | 13,910 | (1,105 | ) | 57,076 | (14,130 | ) | — | 74,208 | ||||||||||||
Net loss (income) attributable to noncontrolling interests | — | — | — | — | (97 | ) | — | (97 | ) | ||||||||||||
Net income (loss) attributable to Nelnet, Inc. | $ | 18,456 | 13,910 | (1,105 | ) | 57,076 | (14,227 | ) | — | 74,111 | |||||||||||
Total assets as of June 30, 2016 | $ | 71,403 | 230,308 | 78,578 | 27,856,952 | 730,122 | (251,565 | ) | 28,715,798 |
|
As of June 30, 2017 | As of December 31, 2016 | |||||||||||||||||
Level 1 | Level 2 | Total | Level 1 | Level 2 | Total | |||||||||||||
Assets: | ||||||||||||||||||
Investments (available-for-sale and trading): | ||||||||||||||||||
Student loan and other asset-backed securities | $ | — | 114,267 | 114,267 | — | 103,780 | 103,780 | |||||||||||
Equity securities | 2,793 | — | 2,793 | 2,694 | — | 2,694 | ||||||||||||
Debt securities | 114 | — | 114 | 119 | — | 119 | ||||||||||||
Total investments (available-for-sale and trading) | 2,907 | 114,267 | 117,174 | 2,813 | 103,780 | 106,593 | ||||||||||||
Derivative instruments | — | 1,619 | 1,619 | — | 87,531 | 87,531 | ||||||||||||
Total assets | $ | 2,907 | 115,886 | 118,793 | 2,813 | 191,311 | 194,124 | |||||||||||
Liabilities: | ||||||||||||||||||
Derivative instruments | $ | — | 46,406 | 46,406 | — | 77,826 | 77,826 | |||||||||||
Total liabilities | $ | — | 46,406 | 46,406 | — | 77,826 | 77,826 |
As of June 30, 2017 | |||||||||||||||
Fair value | Carrying value | Level 1 | Level 2 | Level 3 | |||||||||||
Financial assets: | |||||||||||||||
Student loans receivable | $ | 24,278,179 | 23,202,294 | — | — | 24,278,179 | |||||||||
Cash and cash equivalents | 69,239 | 69,239 | 69,239 | — | — | ||||||||||
Investments (available-for-sale) | 117,174 | 117,174 | 2,907 | 114,267 | — | ||||||||||
Notes receivable | 16,563 | 16,563 | — | 16,563 | — | ||||||||||
Loans receivable | 25,502 | 24,502 | — | — | 25,502 | ||||||||||
Restricted cash | 780,141 | 780,141 | 780,141 | — | — | ||||||||||
Restricted cash – due to customers | 136,900 | 136,900 | 136,900 | — | — | ||||||||||
Accrued interest receivable | 395,734 | 395,734 | — | 395,734 | — | ||||||||||
Derivative instruments | 1,619 | 1,619 | — | 1,619 | — | ||||||||||
Financial liabilities: | |||||||||||||||
Bonds and notes payable | 22,744,128 | 22,790,780 | — | 22,744,128 | — | ||||||||||
Accrued interest payable | 47,064 | 47,064 | — | 47,064 | — | ||||||||||
Due to customers | 136,900 | 136,900 | 136,900 | — | — | ||||||||||
Derivative instruments | 46,406 | 46,406 | — | 46,406 | — |
As of December 31, 2016 | |||||||||||||||
Fair value | Carrying value | Level 1 | Level 2 | Level 3 | |||||||||||
Financial assets: | |||||||||||||||
Student loans receivable | $ | 25,653,581 | 24,903,724 | — | — | 25,653,581 | |||||||||
Cash and cash equivalents | 69,654 | 69,654 | 69,654 | — | — | ||||||||||
Investments (available-for-sale and trading) | 106,593 | 106,593 | 2,813 | 103,780 | — | ||||||||||
Notes receivable | 17,031 | 17,031 | — | 17,031 | — | ||||||||||
Restricted cash | 980,961 | 980,961 | 980,961 | — | — | ||||||||||
Restricted cash – due to customers | 119,702 | 119,702 | 119,702 | — | — | ||||||||||
Accrued interest receivable | 391,264 | 391,264 | — | 391,264 | — | ||||||||||
Derivative instruments | 87,531 | 87,531 | — | 87,531 | — | ||||||||||
Financial liabilities: | |||||||||||||||
Bonds and notes payable | 24,220,996 | 24,668,490 | — | 24,220,996 | — | ||||||||||
Accrued interest payable | 45,677 | 45,677 | — | 45,677 | — | ||||||||||
Due to customers | 119,702 | 119,702 | 119,702 | — | — | ||||||||||
Derivative instruments | 77,826 | 77,826 | — | 77,826 | — |
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