UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

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SLM Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement if other than the Registrant)

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LETTER FROM THE

CHIEF EXECUTIVE OFFICER

April 22, 2021

Dear Fellow Stockholders:

When I joined Sallie Mae as Chief Executive Officer last year, nobody could have predicted the challenges that we would face in 2020. A global pandemic, social injustice and unrest, and a Presidential election that revealed a divided nation. These challenges had a direct impact on Sallie Mae: we implemented new ways of working, our customers and university partners imagined new ways of delivering education, and our team members managed the stresses and strains impacting their families and our communities. Through it all, however, our team members demonstrated true grit and determination.

As the leader in higher education financing, we strive to be more than just a lender. Access to higher education has a multi-generational impact on the economic success of families. Higher education is also a critical factor in promoting economic mobility and social justice. Because these stakes are so high, we recognize that the journey to and through college is stressful and uncertain for students and their families. As a result, our mission is to power confidence as students begin their unique life journeys.

We are proud that last year we served more than 420,000 students and families with their direct financing needs. We are also proud to have provided tools, information, and services to millions of additional customers to help them simplify the college planning process, improve access, and support the completion of higher education. In addition, in 2020, we pioneered new initiatives to advance equality and social justice, including a $4.5 million commitment over the next three years to provide scholarships and grants to support minority and underserved communities.

This commitment to powering confidence, increasing access and opportunity, and advancing social justice and college completion are highlighted in our latest Corporate Social Responsibility report that was published in April 2021, available on our website at www.salliemae.com.

We appreciate that we cannot “win” for our customers if we do not also “win” for our stockholders. Our investment thesis is simple: we seek to provide attractive growth through a focus on market share and operating leverage, expertly allocate and return capital to stockholders, and manage risk. Further, we seek to align the interest of our team members with this long-term valuation orientation.

Our strategy is designed to deliver for both our customers and stockholders and is comprised of five strategic imperatives. These imperatives include maximizing the profitability and growth of our core business; optimizing the value of our brand and our attractive client base; better informing the external narrative about student lending; maintaining a rigorous and predictable capital allocation and return program to create shareholder value; and driving a mission-led culture. Progress on each imperative is underway through a new organizational structure—introduced in 2020—to better aligns with these focused strategic initiatives.

I look forward to you joining me at the 2021 Annual Meeting of Stockholders (the “Annual Meeting”) on Tuesday, June 8, 2021, at 1 p.m. EDT to be held virtually via the Internet at www.virtualshareholdermeeting.com/SLM2021.

Details of the business to be conducted at the Annual Meeting and how to participate at the meeting are provided in the attached Notice of Annual Meeting and proxy statement. You are being asked to vote on a number of important matters. Your vote is important, regardless of the number of shares you own, and all holders of our Common Stock are cordially invited to attend the Annual Meeting. Whether or not you plan to attend the Annual Meeting, please vote at your earliest convenience by following the instructions in the Notice of Availability of Proxy Materials or the proxy card you received in the mail.

Thank you for your continued support and confidence in Sallie Mae.

All best,

Jonathan W. Witter

Chief Executive Officer

NOTICE OF 2021 ANNUAL MEETING

OF STOCKHOLDERS

You may vote one of the following ways:

 

		By Telephone 1-800-690-6903
		By Internet before the meeting www.proxyvote.com
		By Mail completing and signing the proxy card enclosed and returning it in the envelope provided
		By Internet during the meeting www.virtualshareholdermeeting.com/SLM2021

2021 Virtual Annual Stockholder Meeting

 

After careful consideration, the Board of Directors has determined to hold a virtual annual meeting in order to facilitate stockholder attendance and participation by enabling stockholders to participate from any location and at no cost. We believe this is the right choice for SLM at this time, as it enables engagement with our stockholders, regardless of size, resources, or physical location while safeguarding the health of our stockholders, Board of Directors and management. We are committed to ensuring that stockholders will be afforded the same rights and opportunities to participate as they would at an in-person meeting, including submitting questions. You will be able to attend the meeting online, vote your shares electronically and submit questions during the meeting by visiting www.virtualshareholdermeeting.com/SLM2021. To participate in the virtual meeting, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form. The meeting webcast will begin promptly at 1:00 p.m., Eastern Daylight Time. We encourage you to log in and access the meeting at least 15 minutes prior to the start time.

By order of the Board of Directors

Richard M. Nelson

Corporate Secretary

April 22, 2021

TABLE OF CONTENTS

TABLE OF CONTENTS

2021 Proxy Statement — SLM CORPORATION

TABLE OF CONTENTS

SLM CORPORATION — 2021 Proxy Statement

300 Continental Drive

Newark, Delaware 19713

The Board of Directors of SLM Corporation (“Sallie Mae,” the “Company,” “we,” “our” or “us”) is furnishing this proxy statement to solicit proxies for use at Sallie Mae’s 2021 Annual Meeting of Stockholders (the “Annual Meeting”). A copy of the Notice of the Annual Meeting accompanies this proxy statement. This proxy statement is being sent or made available, as applicable, to our stockholders beginning on or about April 28, 2021. In light of the persisting coronavirus (“COVID-19”), for the safety and well-being of our stockholders, and taking into account the protocols of local, state and federal governments, we have determined that the Annual Meeting will be held in a virtual meeting format only (with no in-person meeting), via the Internet, at www.virtualshareholdermeeting.com/SLM2021. For more information regarding the Annual Meeting process, please review the section entitled “Questions and Answers About the Annual Meeting and Voting” contained at the end of this proxy statement.

The proxy statement and Sallie Mae’s Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”) are available at: https://www.salliemae.com/investors/shareholder-information and https://materials.proxyvote.com. You may also obtain these materials at the Securities and Exchange Commission (“SEC”) website at www.sec.gov or by contacting the Office of the Corporate Secretary at the Company’s principal executive offices, located at 300 Continental Drive, Newark, Delaware 19713. Sallie Mae will provide a copy of the 2020 Form 10-K without charge to any stockholder upon written request.

PROXY STATEMENT SUMMARY

This summary highlights certain information contained in this proxy statement. You should read the entire proxy statement and 2020 Annual Report carefully before you vote.

SLM’s Strategy

With the arrival of a new CEO in 2020, and based on changing market dynamics, we undertook a comprehensive strategic review. The strategic review validated much of our previous strategy, but also highlighted several areas for greater focus. As a result, we introduced the following five strategic imperatives in the third quarter of 2020, that we believe will increase stockholder value:    

2021 Proxy Statement — SLM CORPORATION    1

Our Response to COVID-19

The impact of COVID-19 is felt by our colleagues, our customers, and our communities. In response to COVID-19, we implemented efforts to safeguard our team members and enabled a remote work environment. In addition, we have taken steps to help our customers in this time of crisis. Further, The Sallie Mae Fund, our charitable arm, has made contributions to assist in our hometown communities.

To make it as easy as possible to access the assistance they need, we have communicated to our customers multiple times and in multiple ways. At the start of the pandemic, we sent all our customers an email explaining their self-serve options and how to contact us if they need assistance. We continue to send emails to those customers who have enrolled for COVID-19 disaster forbearance and we regularly update our website at www.SallieMae.com/coronavirus with the latest information on how our customers can access their account and get assistance or payment relief, if needed.

Our goal has been to support our team members during the present uncertainty while meeting the needs of our customers and providing business continuity. Early in the crisis, we provided our people with information about best practices to prevent the spread of COVID-19 and other viruses or illnesses and have enabled substantially all of our workforce to work remotely. To further protect the health and welfare of our people and respond to their individual circumstances, we have provided additional wellness assistance. We have also encouraged team members who potentially have been exposed to COVID-19 to self-quarantine for 14 days while we continue to pay them. To ease access to medical assistance, we are waiving co-payments for COVID-19 testing and telemedicine for those team members enrolled in our health insurance plans.

While the Company closely monitored the impact of the COVID-19 crisis on the economy and our business, it was ultimately determined that no changes or adjustments needed to be made to our executive compensation programs in response to COVID-19.

2021 Annual Meeting of Stockholders

OVERVIEW OF PROPOSALS

This proxy statement contains four proposals requiring stockholder action, each of which is discussed in more detail below. Proposal 1 seeks the election of 12 directors nominated by the Board of Directors. Proposal 2 seeks approval of the 2021 Omnibus Incentive Plan, including the number of shares of Common Stock authorized for issuance under the 2021 Omnibus Incentive Plan. Proposal 3 seeks approval, on an advisory basis, of Sallie Mae’s executive compensation. Proposal 4 seeks ratification of the appointment of KPMG LLP as Sallie Mae’s independent registered public accounting firm for the fiscal year ending December 31, 2021. Each share of Common Stock is entitled to one vote on each proposal or, in the case of the election of directors, on each nominee.

The Board of Directors recommends that you vote FOR each of Proposals 1 - 4 as discussed in more detail below.

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PROPOSAL 1—ELECTION OF DIRECTORS

PROPOSAL 1—ELECTION OF DIRECTORS

Our Board of Directors has nominated and recommends 12 individuals for election to our Board of Directors at the Annual Meeting. These individuals are as follows:

Under our Certificate of Incorporation, the size of our Board of Directors may not be fewer than 11 nor more than 16 members. Under our By-Laws, the Board of Directors has the authority to determine the size of the Board of Directors within that range and to fill any vacancies that may arise prior to the next annual meeting of stockholders. The Board of Directors has set the number of members at 12, effective as of the Annual Meeting.

Biographical information, qualifications, and experience with respect to each director nominee appear below. In addition to fulfilling the general criteria for director nominees described in the section titled “Nominations Process,” each nominee possesses experience, skills, attributes, and other qualifications the Board of Directors has determined support its oversight and management of Sallie Mae’s business, operations, and structure. These qualifications are discussed below, along with biographical information regarding each director nominee, including each individual’s age, principal occupation, and business experience during the past five years. Information concerning each director nominee is based in part on information received from the respective director nominee and in part from Sallie Mae’s records.

All nominees appearing below have consented to being named in this proxy statement and to serve if elected. Should any nominee subsequently decline or be unable to accept such nomination to serve as a director, the Board of Directors may designate a substitute nominee or the persons voting the shares represented by proxies solicited hereby may vote such shares for a reduced number of nominees. If the Board of Directors designates a substitute nominee, persons named as proxies will vote “FOR” that substitute nominee.

Our By-Laws provide the election of a director in an uncontested election will be by a majority of the votes cast with respect to a nominee at a meeting for the election of directors at which a quorum is present. Each share of Common Stock is entitled to one vote for each nominee. A director nominee will be elected to the Board of Directors if the number of shares voted “FOR” the nominee exceeds the number of votes cast “AGAINST” the nominee’s election. Abstentions and shares not voted on the proposal, including broker non-votes, are of no effect.

If any director nominee fails to receive a majority of the votes cast “FOR” his or her election, such nominee will automatically tender his or her resignation upon certification of the election results. The Nominations, Governance and Compensation Committee (the “NGC Committee”) of the Board of Directors will make a recommendation to the Board of Directors on whether to accept or reject such nominee’s resignation. The Board of Directors will act on the NGC Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date of certification of the election results.

2021 Proxy Statement — SLM CORPORATION    3

PROPOSAL 1—ELECTION OF DIRECTORS

NOMINEES FOR ELECTION TO THE BOARD OF DIRECTORS

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PROPOSAL 1—ELECTION OF DIRECTORS

2021 Proxy Statement — SLM CORPORATION    5

PROPOSAL 1—ELECTION OF DIRECTORS

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PROPOSAL 1—ELECTION OF DIRECTORS

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PROPOSAL 1—ELECTION OF DIRECTORS

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PROPOSAL 1—ELECTION OF DIRECTORS

Board of Directors Recommendation

2021 Proxy Statement — SLM CORPORATION    9

PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

PROPOSAL 2—APPROVAL OF THE 2021

OMNIBUS INCENTIVE PLAN

At the Annual Meeting, upon the recommendation of the NGC Committee to the Board, and the Board’s subsequent approval and recommendation to the stockholders, the stockholders are being asked to approve the SLM Corporation 2021 Omnibus Incentive Plan (the “Omnibus Plan”), including the number of shares of Common Stock authorized for issuance under the Omnibus Plan, to replace the Company’s existing equity incentive plan – the SLM Corporation 2012 Omnibus Incentive Plan (the “Predecessor Plan”). A copy of the Omnibus Plan is attached hereto as Appendix A, and the following summary of the material terms of the Omnibus Plan does not purport to be complete and is qualified in its entirety by the terms of the Omnibus Plan. Following the date of the approval of the Omnibus Plan by the stockholders, no further awards will be issued under the Predecessor Plan; provided that the Company may grant awards under the Predecessor Plan through June 8, 2021. However, in the event that the Omnibus Plan is not approved by stockholders, awards will continue to be made under the Predecessor Plan. Stockholders originally approved the Predecessor Plan at our 2012 annual meeting of stockholders, and approved amendments to the Predecessor Plan at our 2017 annual meeting of stockholders. The Board of Directors is requesting this vote in order to obtain stockholder approval of the Omnibus Plan.

Considerations for the Approval of the Omnibus Plan

In designing the Omnibus Plan, the NGC Committee and the Board of Directors carefully considered our anticipated future equity needs, our historical equity incentive compensation practices, and the advice of the NGC Committee’s independent compensation consultant. The Board of Directors believes that the grant of Common Stock and other equity-based incentives for members of the Board of Directors, senior management, other members of management, and employees of the Company is an essential component of the mix of compensation awarded to these individuals. Equity-based incentives encourage proprietorship and commitment to the Company’s business goals and objectives, thereby aligning these individuals’ interests with those of the Company’s stockholders, and enable the Company to continue to attract and retain highly qualified employees and directors. Stockholders are encouraged to read more about the Company’s philosophy regarding the importance of equity-based incentives for senior management in the “Compensation Discussion and Analysis” section of this proxy statement.

The aggregate number of shares of SLM Corporation’s Common Stock, $0.20 per share (collectively, the “Shares” and each a “Share”) being requested for authorization under the Omnibus Plan pursuant to awards granted after the Omnibus Plan’s approval is 20,700,000 Shares. If the Omnibus Plan is approved by our stockholders, the Omnibus Plan will replace the Predecessor Plan (which is the only equity plan of the Company in place as of the date of this proxy statement), and, following the date of such approval, no additional grants will be made under the Predecessor Plan; provided that the Company may grant awards under the Predecessor Plan through June 8, 2021. However, in the event that the Omnibus Plan is not approved by stockholders, awards will continue to be made under the Predecessor Plan.

Key Aspects of the Omnibus Plan

The Omnibus Plan incorporates the best governance practices to further align our equity compensation program with the interests of our stockholders. The following is a list of some of the key factors to be considered by stockholders in connection with approving the Omnibus Plan:

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Key Data

The following table includes information regarding outstanding equity awards and Shares available for future awards under the Predecessor Plan as of December 31, 2020:

Over the last three fiscal years, the Company has granted awards covering a total of 10,110,103 Shares. The following table sets forth information regarding awards granted and the annualized grant rate for each of the three fiscal years:

In combination with other activity under the Predecessor Plan that occurred since December 31, 2020, the Company has approximately 10,400,000 shares available for future issuance under the Predecessor Plan as of the record date. Since December 31, 2020, the Company has issued 2,550,496 shares as of the record date and will limit additional grants in the aggregate under the Predecessor Plan between the record date of April 12, 2021 and through the 2021 Annual Meeting of Stockholders to be held on June 8, 2021 to be no more than 400,000 shares in total. Following the date of the approval of the Omnibus Plan by the stockholders, no further awards will be issued under the Predecessor Plan; provided that the Company may grant awards under the Predecessor Plan through June 8, 2021.

Description of Incentive Plan

The following discussion summarizes the material terms of the Omnibus Plan.

General. The Omnibus Plan provides for the grants of stock options (both nonqualified and incentive stock options), SARs, restricted stock, RSUs, performance awards and other cash- and stock-based awards to the Company’s employees and non-employee directors. Any award may be granted alone or in tandem with other awards, and may be granted in addition to, or in substitution for, other types of awards. Compensation payable to Board members in the form of Shares will also be paid from the Omnibus Plan.

Purpose. The purpose of the Omnibus Plan is to attract and retain employees and other individuals and motivate them to perform at the highest level and contribute significantly to the success of the Company, thereby furthering the best interests of the Company and its stockholders.

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Eligibility. Employees of the Company and non-employee directors of the Company are eligible to receive awards under the Omnibus Plan. There are approximately 730 employees and 12 non-employee directors currently eligible to receive awards under the Omnibus Plan. Awards under the Omnibus Plan may include grants of options, SARs, restricted stock, RSUs, performance units, and other cash- and stock-based awards. Eligibility for any particular award is determined by the NGC Committee (or the Board of Directors, in the case of awards to non-employee directors) and, in the case of certain awards such as incentive stock options, may be limited by the Code. The basis for participation in the Omnibus Plan is the decision by the NGC Committee (or the Board of Directors, as applicable), in its sole discretion, that an award to an eligible participant will further the Omnibus Plan’s purposes of motivating and rewarding participants to perform at the highest level and contribute to the Company’s success. In exercising its discretion, the NGC Committee and the Board of Directors will consider the recommendations of management and the purposes of the Omnibus Plan.

Administration. Except as otherwise provided in the Omnibus Plan with respect to actions or determinations by the Board of Directors, the Omnibus Plan is administered by our NGC Committee. However, (x) any and all members of the NGC Committee must satisfy any independence requirements prescribed by NASDAQ or any other stock exchange on which the Company lists the Shares, and (y) to the extent that any awards are granted to individuals who are subject to Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) the NGC Committee must consist of two or more “Non-Employee Directors” as defined in SEC Rule 16b-3.

The NGC Committee has authority to administer the Omnibus Plan and to take all actions that are specifically contemplated under the Omnibus Plan except with respect to awards granted to non-employee directors, which will be administered by the Board of Directors. Under the Omnibus Plan, the NGC Committee or the Board of Directors, as the case may be, has the following authority:

The NGC Committee may delegate the authority to grant awards under the Omnibus Plan, to the extent permitted by applicable law, to (i) one or more officers of the Company (except that such delegation will not be applicable to any award for a person then covered by Section 16 of the Exchange Act) and (ii) one or more committees of the Board (which may consist solely of one director).

Number of Shares. The Omnibus Plan provides for awards with respect to a maximum of 20,700,000 Shares to employees of the Company and directors of the Company (which constitutes 6.41% percent of the Company’s outstanding 322,869,208 Shares as of April 12, 2021), excluding any awards granted in assumption of, or in substitution for, any outstanding award previously granted by a company or other business acquired by the Company or with which the Company combines (“Substitute Awards”). The number and class of shares available under the Omnibus Plan and/or subject to outstanding awards may be adjusted by the NGC Committee to prevent dilution or enlargement of rights in the event of various changes in the capitalization of the Company.

Award Limits. All Shares available under the Omnibus Plan are available for grants of incentive stock options.

Individual Limits. During any calendar year, no employee may be granted:

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Limitations on Director Awards. The Omnibus Plan also provides a limit on the cash- and stock-based awards that may be granted to our non-employee directors. Under the Omnibus Plan, no non-employee director may be granted, during any calendar year, cash- or equity-based compensation that would result in aggregate total cash- and/or equity-based compensation determined on the grant date to be in excess of $750,000.

Adjustments. Each of the above limits is subject to adjustment for certain changes in the Company’s capitalization such as declaration of dividends, stock splits, combinations, corporate mergers, consolidations, amalgamations, acquisitions of property or stock, separations, reorganizations or liquidations, or similar events. If an award expires, terminates, is forfeited or is settled in cash rather than in Shares, the Shares not issued under that award will again become available for grant under the Omnibus Plan. If Shares are surrendered to the Company or withheld to pay any exercise price or satisfy tax-withholding requirements, such Shares withheld or surrendered will be counted against the number of Shares available under the Omnibus Plan.

Types of Awards.

Stock Options. The Omnibus Plan authorizes the grant of incentive stock options and nonqualified stock options. Incentive stock options are stock options that are intended to comply with the requirements of Section 422 of the Code. Nonqualified stock options are stock options that do not comply with the requirements of Section 422 of the Code. Options granted under the Omnibus Plan entitle the grantee, upon exercise, to purchase a specified number of Shares from the Company at a specified exercise price per Share. The NGC Committee determines the period of time during which an option may be exercised, the vesting schedule, the method and form by which each option is to be exercised, and the expiration date of each option, provided that no option will be exercisable more than 10 years after the grant date. The exercise price per Share covered by an option will be determined by the NGC Committee and may not be less than 100 percent of the fair market value of a Share on the date of grant, except in the case of Substitute Awards.

SARs. The NGC Committee may grant SARs under the Omnibus Plan. Subject to the terms of the award, SARs entitle the participant to receive a distribution in an amount equal to the number of Shares subject to the portion of the SAR exercised multiplied by the excess, if any, of the fair market value of a Share on the date of exercise of the SAR over the exercise or hurdle price of the SAR. Such distributions are payable in cash or Shares, or a combination thereof, as determined by the NGC Committee. The terms and conditions applicable to stock options also apply to SARs. The exercise price per Share covered by a SAR will be determined by the NGC Committee and may not be less than 100 percent of the fair market value of a Share on the date of grant, except in the case of Substitute Awards. The exercise period for a SAR shall extend no more than 10 years after the grant date.

Restricted Stock. The Omnibus Plan also authorizes the grant of restricted stock on terms and conditions established by the NGC Committee, which will include the designation of a restriction period during which the Shares are not transferable and are subject to forfeiture.

Restricted Stock Units. RSUs may be granted subject to terms and conditions as determined by the NGC Committee. In the case of RSUs, no Shares are issued at the time of grant. Rather, upon the lapse of any applicable vesting schedule and other restriction, an RSU entitles a participant to receive Shares or cash, or a combination thereof, as determined by the NGC Committee.

Performance Awards. The NGC Committee may grant performance awards to participants, subject to terms and conditions as determined by the NGC Committee. Performance awards may be denominated in cash, Shares or units, or a combination thereof, and may be earned based on the achievement of one or more performance conditions specified by the NGC Committee. The NGC Committee will make all determinations regarding the achievement of performance goals. Settlement of performance awards will be in cash, Shares, other awards or property, net settlement, or any combination thereof. The NGC Committee may, in its discretion, increase or reduce the amount of a settlement to be made in connection with a performance award.

Dividend Equivalents. The Omnibus Plan authorizes grants of dividend equivalents to any participant either in combination with, or separately from, the awards. A dividend equivalent permits the participant to receive payments equivalent to the dividends paid to holders of Shares. Dividend equivalents are payable in cash or Shares, or a combination thereof, as determined by the NGC Committee, provided that the dividend equivalent will be subject to the same restrictions (including applicable vesting conditions) as the underlying award.

Other Cash and Stock-Based Awards. The Omnibus Plan authorizes the making of other cash- or stock-based awards. The NGC Committee will establish the terms and conditions applicable to each award.

Exercise Price. The exercise price for an option or SAR may not be less than the fair market value of the Shares on the grant date.

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Expiration Date. The NGC Committee will determine the expiration date of each option and SAR, but no option or SAR will be exercisable more than 10 years after the grant date.

Change in Control. The Omnibus Plan provides that, upon a Change in Control (as defined in the Omnibus Plan), the NGC Committee retains discretion to accelerate the vesting or exercisability of an award, eliminate or make less restrictive any restrictions contained in an award, waive any restriction or other provision of the Omnibus Plan or an award, or otherwise amend or modify an award in any manner.

Duration, Amendments and Termination. The Omnibus Plan will be effective immediately upon approval by the stockholders of the Company and will automatically terminate on June 8, 2031, if not earlier terminated under the terms of the Omnibus Plan. The Board of Directors may amend, modify, suspend, or terminate the Omnibus Plan for the purpose of meeting or addressing any changes in legal requirements or for any other purpose permitted by law, except that (a) no amendment or alteration that would materially adversely affect the rights of any participant under any previously granted award will be made without the consent of such participant and (b) no material amendments or alternations will be effective prior to approval by the stockholders to the extent such approval is required, including any amendment that would: (i) materially increase the number of Shares issued under the Omnibus Plan; (ii) materially increase the benefits to participants, including any material change to (x) permit a repricing (or decrease in exercise price) of outstanding options, (y) reduce the price at which awards or options may be offered, or (z) extend the duration of the Omnibus Plan; (iii) materially expand the class of participants eligible to participate in the Omnibus Plan; or (iv) expand the types of awards provided under the Omnibus Plan.

Prohibition on Repricing. Subject to the adjustment provision described above, the NGC Committee may not directly or indirectly, through cancellation or regrant or any other method, reduce, or have the effect of reducing, the exercise or hurdle price of any award established at the time of grant without approval of the Company’s stockholders.

Restrictions on Transfer. Except as otherwise permitted by the NGC Committee and provided in the award, awards may not be transferred or exercised by another person except by will or by the laws of descent and distribution or pursuant to a domestic relations order issued by a court of competent jurisdiction.

Cancellation or “Clawback” of Awards. The NGC Committee may, to the extent permitted by applicable law and stock exchange rules or by any applicable Company policy, cancel or require reimbursement of any awards granted, Shares issued or cash received upon the vesting, exercise, or settlement of any awards granted under the Omnibus Plan or the sale of Shares underlying such awards.

Registration With the SEC. If our stockholders approve the Omnibus Plan, we plan to file a registration statement on a Form S-8 (and/or an amendment to our existing registration statement that has been filed with respect to the Predecessor Plan) with the SEC, as soon as reasonably practicable after such approval, to register the Shares available for issuance under the Omnibus Plan.

New Plan Benefits. Any awards granted under the Omnibus Plan will be at the discretion of the NGC Committee. Therefore, it is not possible at present to determine the amount or form of any award that will be available for grant to any individual during the term of the Omnibus Plan or that would have been granted during the last fiscal year had the Omnibus Plan been in effect.

U.S. Federal Income Tax Consequences. The following is a general summary of the current federal income tax treatment of awards, which are authorized to be granted under the Omnibus Plan, based upon the current provisions of the Code and regulations promulgated thereunder. The rules governing the tax treatment of such awards are technical, so the following discussion of tax consequences is necessarily general in nature and does not purport to be complete. In addition, statutory provisions are subject to change, as are their interpretations, and their application may vary in individual circumstances. Finally, this discussion does not address the tax consequences under applicable state and local law.

Incentive Stock Options. A participant will not recognize income on the grant or exercise of an incentive stock option. However, the difference between the exercise price and the fair market value of the stock on the date of exercise is an adjustment item for purposes of the alternative minimum tax. If a participant does not exercise an incentive stock option within certain specified periods after termination of employment, the participant will recognize ordinary income on the exercise of an incentive stock option in the same manner as on the exercise of a nonqualified stock option, as described below.

The general rule is that gain or loss from the sale or exchange of shares acquired on the exercise of an incentive stock option will be treated as capital gain or loss. If certain holding period requirements are not satisfied, however, the participant generally will recognize ordinary income at the time of the disposition. Gain recognized on the disposition in excess of the ordinary income resulting therefrom will be capital gain, and any loss recognized will be a capital loss.

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Restricted Stock. Unless a participant who receives an award of restricted stock makes an election under Section 83(b) of the Code (“Section 83(b) Election”) as described below, the participant generally is not required to recognize ordinary income on the award of restricted stock. Instead, on the date the shares vest (i.e., become transferable or no longer subject to forfeiture), the participant will be required to recognize ordinary income in an amount equal to the excess, if any, of the fair market value of the shares on such date over the amount, if any, paid for such shares. If a participant makes a Section 83(b) Election to recognize ordinary income on the date the shares are awarded, the amount of ordinary income required to be recognized is an amount equal to the excess, if any, of the fair market value of the shares on the date of award over the amount, if any, paid for such shares. In such case, the participant will not be required to recognize additional ordinary income when the shares vest.

Nonqualified Stock Options, SARs, RSUs, Performance Awards, and Other Stock-based Awards. A participant generally is not required to recognize income on the grant of a nonqualified stock option, SAR, RSU, a performance award, or a stock award. Instead, ordinary income generally is required to be recognized on the date the nonqualified stock option or SAR is exercised, or in the case of RSUs, performance awards, and stock awards, upon the issuance of shares and/or the payment of cash pursuant to the terms of the award. In general, the amount of ordinary income required to be recognized: (i) in the case of a nonqualified stock option, is an amount equal to the excess, if any, of the fair market value of the shares on the exercise date over the exercise price; (ii) in the case of SARs, the amount of cash and/or the fair market value of any shares received upon exercise plus the amount of taxes withheld from such amounts; and (iii) in the case of RSUs, performance awards, and stock awards, the amount of cash and/or the fair market value of any shares received in respect thereof, plus the amount of taxes withheld from such amounts.

Gain or Loss on Sale or Exchange of Shares. In general, gain or loss from the sale or exchange of shares granted or awarded under the Omnibus Plan will be treated as capital gain or loss, provided that the shares are held as capital assets at the time of the sale or exchange. However, if certain holding period requirements are not satisfied at the time of a sale or exchange of shares acquired upon exercise of an incentive stock option (a “disqualifying disposition”), a participant generally will be required to recognize ordinary income upon such disposition.

Tax Deductibility by Company. The Company generally is not allowed a deduction in connection with the grant or exercise of an incentive stock option. However, if a participant is required to recognize income as a result of a disqualifying disposition, the Company will be entitled to a deduction equal to the amount of ordinary income so recognized. In general, in the case of nonqualified stock options (including incentive stock options that are treated as nonqualified stock options, as described above), SARs, restricted stock, RSUs, performance awards, and stock awards, the Company will be allowed a deduction in an amount equal to the amount of ordinary income recognized by a participant, provided that certain income tax reporting requirements are satisfied. However, the Company may be subject to limits on tax deductibility relating to compensation under certain statutory provisions, including Section 162(m) of the Code.

Equity Compensation Plan Information. The following table summarizes information as of December 31, 2020, relating to equity compensation plans or arrangements pursuant to which options, restricted stock, RSUs, PSUs, stock units, or other rights to acquire shares may be granted from time to time.

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PROPOSAL 2—APPROVAL OF THE 2021 OMNIBUS INCENTIVE PLAN

Required Vote. This proposal to approve the Omnibus Plan requires the affirmative vote of the holders of a majority of the Common Stock present, represented, and entitled to vote at the Annual Meeting. Abstentions have the same effect as votes “AGAINST” the matter. Shares not voted on the matter, including broker non-votes, have no direct effect on the matter.

Board of Directors Recommendation

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PROPOSAL 3—ADVISORY VOTE ON EXECUTIVE COMPENSATION

PROPOSAL 3—ADVISORY VOTE ON

EXECUTIVE COMPENSATION

Sallie Mae is asking stockholders to approve an advisory resolution (commonly referred to as a “say-on-pay” resolution) on its executive compensation as reported in this proxy statement. Sallie Mae urges stockholders to read the “Compensation Discussion and Analysis” section (“CD&A”) of this proxy statement, which describes how our executive compensation policies and procedures operate and are designed to achieve our compensation objectives, as well as the Summary Compensation Table and other related compensation tables and narrative, which provide detailed information on the compensation of Sallie Mae’s named executive officers (“NEOs”).

At our annual meeting of stockholders held in June 2020, we submitted a non-binding vote to our stockholders to approve our executive compensation. Approximately 94.4 percent of the stockholders voted in favor of the say-on-pay proposal. We attribute that broad support in part to our continued efforts to understand and address the feedback we received from our stockholders. Specifically, in 2020 we continued to focus on performance-based compensation for our NEOs as we (i) tied a significant portion of total NEO compensation to the achievement of performance goals that we believe drive the fundamentals of our business and (ii) awarded a significant percentage, set at 50 percent, of the NEO’s long-term incentive plan equity award (“LTIP”) in the form of performance stock units (“PSUs”). In 2021, we further increased the performance based LTIP compensation of our NEOs from 50 percent to 75 percent by changing the mix of equity awards such that NEOs received 25 percent of the LTIP award as PSUs and 50 percent as premium options.

The compensation awarded to our current Chief Executive Officer (“CEO”), Jonathan W. Witter, our former CEO, Raymond J. Quinlan, and other NEOs for 2020 reflects the positive performance of the Company, notwithstanding a global pandemic. The NGC Committee is mindful of its responsibility to align executive compensation with the overall performance of the Company, while taking into consideration the need to provide market competitive compensation in order to recruit and retain highly skilled and experienced executives. The CD&A provides a comprehensive discussion and rationale for the 2020 pay decisions made by the NGC Committee and the correlation to Company performance.

As described in the CD&A, our executive compensation programs are designed to attract, retain, and motivate our NEOs, who are important to our long-term success. Under these programs, we provide our NEOs with appropriate objectives and incentives to achieve our business goals. We believe that our compensation features demonstrate our responsiveness to our stockholders, our commitment to our pay-for-performance philosophy, and our goal of aligning management’s interests with those of our stockholders to support the creation of long-term value.

The Board of Directors has adopted a policy providing for annual “say-on-pay” advisory votes. In accordance with this policy and Section 14A of the Exchange Act, and as a matter of good corporate governance, Sallie Mae is asking stockholders to approve the following advisory resolution at the Annual Meeting:

“Resolved, that Sallie Mae’s stockholders approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed in the Compensation Discussion and Analysis and the related compensation tables and narrative disclosure in this proxy statement.”

This proposal to approve the resolution regarding the compensation of Sallie Mae’s NEOs requires the affirmative vote of the holders of a majority of the Common Stock present, represented, and entitled to vote at the Annual Meeting. Abstentions have the same effect as votes “AGAINST” the matter. Shares not voted on the matter, including broker non-votes, have no direct effect on the matter. This proposal is advisory in nature and, therefore, is not binding upon the NGC Committee or the Board of Directors. However, the NGC Committee will, as it has done in the past, carefully evaluate the outcome of the vote when considering future executive compensation decisions.

Board of Directors Recommendation

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PROPOSAL 4—RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PROPOSAL 4—RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Sallie Mae’s independent registered public accounting firm, KPMG LLP (“KPMG”), is selected by the Audit Committee of Sallie Mae’s Board of Directors (the “Audit Committee”). The Audit Committee has engaged KPMG as Sallie Mae’s independent registered public accounting firm for the fiscal year ending December 31, 2021. Representatives of KPMG are expected to be present at the Annual Meeting, and they will have the opportunity to respond to appropriate questions from stockholders and to make a statement if they desire to do so.

This proposal is put before the stockholders because the Board of Directors believes it is a good corporate governance practice to provide stockholders a vote on ratification of the selection of the independent registered public accounting firm.

For ratification, this proposal will require the affirmative vote of the holders of a majority of the shares of Common Stock present, represented, and entitled to vote at the Annual Meeting. Abstentions have the same effect as votes “AGAINST” the matter. Shares not voted on the matter, including broker non-votes, have no direct effect on the matter. If the appointment of KPMG is not ratified, the Audit Committee will evaluate the basis for the stockholders’ vote when determining whether to continue the firm’s engagement. Even if the selection of Sallie Mae’s independent registered public accounting firm is ratified, the Audit Committee may direct the appointment of a different independent registered public accounting firm at any time during 2021 if, in its discretion, it determines such a change would be in the Company’s best interests.

Board of Directors Recommendation

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CORPORATE GOVERNANCE

CORPORATE GOVERNANCE

Roles and Responsibilities of the Board of Directors

The Board of Directors believes strong corporate governance is critical to achieving Sallie Mae’s performance goals and to maintaining the trust and confidence of investors, employees, regulatory agencies, and other stakeholders.

The primary responsibilities of the Board of Directors are to:

Board Governance Guidelines

The Board of Directors’ Governance Guidelines (the “Guidelines”) are reviewed each year by the NGC Committee, which from time to time will recommend changes to the Board of Directors. The Guidelines are published at www.salliemae.com under “For Investors,” and a written copy may be obtained by contacting the Corporate Secretary at corporatesecretary@salliemae.com or SLM Corporation, 300 Continental Drive, Newark, DE 19713. The Guidelines, along with Sallie Mae’s By-Laws, embody the following governance practices, among others:

Board Leadership Structure

On April 19, 2020, in connection with the appointment of Mr. Witter as the Company’s new CEO, the Board of Directors adopted a structure separating the Board Chair from the CEO. Mr. Quinlan, the Company’s former CEO, served as Board Chair of the Company (as well as Board Chair of Sallie Mae Bank, our wholly-owned subsidiary (the “Bank”)) until June 18, 2020. At that time, Mr. Quinlan no longer served on the

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Board of Directors, and on June 18, 2020, the Board of Directors appointed Ms. Franke, an independent director of the Company and Bank since 2014, to serve as the first woman to chair the Board of Directors of the Company as well as the Board of Directors of the Bank.

The Board of Directors believes that, going forward, an independent director is best situated to serve as Board Chair as an effective counterbalance to management and our CEO, who also serves on the Board of Directors. By separating the CEO role from the Board Chair role, the Company is currently put in the best position to oversee all executives of the Company and set a pro-stockholder agenda without presenting potential conflicts that having the two positions combined might pose. The Board of Directors believes the Company is currently best served by separating the roles of Board Chair and CEO. However, subject to Sallie Mae’s By-Laws, the Board of Directors reserves the right to revisit this structure and combine the two roles, depending on the future needs and strategy of the Company at a given point in time. Our independent Board Chair serves as the principal representative of the Board of Directors, presiding over meetings of the Board of Directors and stockholders.

Director Independence

For a director to be considered independent, the Board of Directors must determine the director does not have any direct or indirect material relationship with Sallie Mae. The Board of Directors has adopted the Guidelines, which embody the corporate governance principles and practices of the Company. The Guidelines include the standards for determining director independence, which conform to the independence requirements of the NASDAQ Global Select Market (“NASDAQ”) listing standards.

The Board of Directors has determined that each of the individuals who served as a director during 2020, other than Mr. Quinlan, our former CEO, and Mr. Witter, our current CEO, and all nominees standing for election at the Annual Meeting, other than Mr. Witter, are independent of Sallie Mae.

Each member of the Board of Directors’ Audit and NGC Committees is independent within the meaning of the NASDAQ listing standards, Exchange Act Rule 10A-3, and Sallie Mae’s own director independence standards set forth in the Guidelines. The Guidelines are published at www.salliemae.com under “For Investors”.

Board Diversity

Our Board believes diversity is important and seeks representation across a range of attributes, including gender, race, ethnicity, and professional experience, and regularly assesses our Board’s diversity when identifying and evaluating director candidates. As of December 31, 2020, our Board of Directors consisted of the following:

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CORPORATE GOVERNANCE

Board Skills and Experience

Board, Committee, and Annual Meeting Attendance

Our Board of Directors met 15 times in 2020. Each of the then-serving directors attended at least 75 percent of the total number of meetings of the Board of Directors and committees on which he or she served. Directors are expected to attend the Annual Meeting, and 13 out of 13 of the then-serving members of the Board of Directors attended the Annual Meeting in June 2020.

Roles of the Board and Its Committees

The Board of Directors has established the following standing committees to assist in its oversight responsibilities: Audit; NGC; Risk; and Preferred Stock. On September 17, 2020, the Board of Directors eliminated the Strategic Planning Committee with the expectation that strategic planning and oversight will be undertaken by all members of the Board of Directors. Separately, the Bank Board of Directors has also established a Compliance Committee. Each committee is governed by a Board-approved written charter, which is evaluated annually and which sets forth the respective committee’s functions, responsibilities, and delegated authority. Membership of each of the committees is established on an annual basis.    

Committee charters are available at www.salliemae.com under “For Investors, Corporate Governance.” Stockholders may obtain a written copy of any and all committee charters by contacting the Corporate Secretary at corporatesecretary@salliemae.com or SLM Corporation, 300 Continental Drive, Newark, Delaware 19713.

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CORPORATE GOVERNANCE

The following table sets forth the membership and number of meetings held for each committee of the Board of Directors as of December 31, 2020.

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CORPORATE GOVERNANCE

Risk Oversight

The Board of Directors and its committees oversee Sallie Mae’s overall strategic direction, including setting risk management philosophy, tolerance and parameters, and establishing procedures for assessing the risks of each business line as well as the risk management practices the management team develops and utilizes. Management escalates to the Board of Directors and/or its committees any significant departures from established tolerances and parameters and reviews new and emerging risks. Throughout the year, the Board of Directors and/or its committees dedicate a portion of their meetings to reviewing and discussing specific risk topics in greater detail with senior management, including risks related to cybersecurity. We believe that this risk oversight structure complements our current board leadership structure of separate Chair and CEO. The primary risk oversight responsibilities of each of the standing committees of the Board of Directors are as follows:

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CORPORATE GOVERNANCE

Nominations Process

The NGC Committee considers for nomination to the Board of Directors candidates recommended by stockholders and members of the Board of Directors. The candidates are evaluated based on the needs of the Board of Directors and Sallie Mae at that time. The Board of Directors seeks representation across a range of professional experiences, and that reflects gender, race, ethnic, and geographic diversity. The minimum qualifications and attributes the NGC Committee believes a director nominee must possess include:

To recommend a candidate, stockholders should send, in writing, the candidate’s name, credentials, contact information, and his or her consent to be considered as a candidate to the Chair of the NGC Committee at corporatesecretary@salliemae.com or c/o Corporate Secretary, SLM Corporation, 300 Continental Drive, Newark, Delaware 19713. The stockholder should also include his or her contact information and a statement of his or her share ownership. The nomination deadline for the 2021 Annual Meeting has now closed. A stockholder wishing to nominate a candidate must comply with the notice and other requirements described under “Stockholder Proposals for the 2022 Annual Meeting” in this proxy statement.

Related Party Transactions

Sallie Mae has a written policy regarding review and approval of related party transactions. Transactions covered by the policy are transactions involving Sallie Mae in excess of $120,000 in any year in which any director, nominee, executive officer, or greater-than-five percent beneficial owner of the Company, or any of their respective immediate family members, has or had a direct or indirect material interest, other than solely as a director and/or less-than-ten percent owner of an entity involved in the transaction (“Related Party Transactions”). Loans made in the ordinary course of Sallie Mae’s business to executive officers, directors, and their family members are considered Related Party Transactions and are pre-approved. Moreover, the Bank has also adopted written policies to implement the requirements of Regulation O of the Board of Governors of the Federal Reserve System, which restricts the extension of credit to directors and executive officers and their family members and other related interests. Under these policies, extensions of credit that exceed regulatory thresholds must be, and are, approved by the Board of Directors of the Bank. The Company issued credit cards to Daniel P. Kennedy, Executive Vice President and Chief Operational Officer and President of Sallie Mae Bank, and Paul F. Thome, Former Executive Vice President, President of Sallie Mae Bank, and Chief Administrative Officer. Each credit card was issued in the ordinary course of business; is on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to the Company; and does not involve more than the normal risk of collectability or present other features unfavorable to the Company. Since January 1, 2020, we have not had any other transactions with related persons required to be disclosed under Item 404(a) of Regulation S-K, and no such transactions are currently proposed.

Under the Related Party Transactions policy, the Chief Legal, Government Affairs and Communications Officer will notify the Chair of the NGC Committee of any proposed Related Party Transaction, and the Chair of the NGC Committee will determine if approval under the policy is required. If required, the NGC Committee will then review the proposed Related Party Transaction and make a recommendation to the Board of Directors regarding whether to approve the transaction. In considering a transaction, the NGC Committee takes into account whether a transaction would be on terms no less favorable than to an unaffiliated third party under the same or similar circumstances, among other factors.

Environmental, Social and Governance Practices

In conducting our business, we continually pursue practices that we believe will drive sustainable, long-term growth and profitability. Such “environmental, social, and governance” or “ESG” practices mean different things to different investors and stakeholders and to the organizations that evaluate and rate ESG practices. Our ESG practices are shaped by our mission—to power confidence as students begin

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CORPORATE GOVERNANCE

their unique journeys. In April 2021, we released our second Corporate Social Responsibility report, discussing our commitment to ESG practices. For a full discussion, please read our Corporate Social Responsibility report at http://www.salliemae.com. Neither the report nor our website are incorporated by reference in this proxy statement.

Human Capital Management and Talent Development

With respect to our workforce, and in furtherance of our strategic imperative to leverage our culture to engage employees and recognize and reward contributions to business results and develop talent to support our business strategy and growth, we strive to adopt policies, programs, and compensation structures that lead to a safe, productive, diverse, and engaged workforce.

Our “MAPS” program (Manage, Apply, Practice, and Succeed) is designed to identify, and cultivate, our future leaders from existing employees of Sallie Mae. Now in its third year and seventh cohort, the MAPS program brings together mid and senior-level managers to enhance their leadership skills and build their project management capabilities through group projects and collaborative exercises. Our leadership development program is designed to build on our leadership competencies, and is offered to mid to senior-level leaders who have the potential to assume broader roles in the future.

We believe that a diverse and inclusive workforce can lead to a more effective company. As of December 31, 2020, 54.1 percent of our team members were female and 40.6 percent of our team members self-identified as part of a minority group. Our talent acquisition program has led to a steady increase since 2015 in female and minority representation in leadership positions across the Company.

We believe an engaged workforce leads to a more innovative, productive, and profitable company. For this reason, we periodically measure employee engagement. The results from engagement surveys are used to implement programs and processes designed to keep our team members connected and growing at Sallie Mae.

Corporate Governance

Sallie Mae’s Board of Directors, executive leaders, team members, and business partners are committed to operating under sound principles of corporate governance. We believe that maintaining high standards of accountability and transparency are fundamental for our long-term success of our business. Our corporate governance structure ensures robust Board and management responsibility, responsiveness to our stockholders, and responsible decision-making. Our overarching code of conduct, corporate governance policies, Board committee charters, certificate of incorporation, and By-Laws form the framework of governance at Sallie Mae. Since the formation of the Company, we have attracted and built a strong, qualified, and diverse Board of Directors whose members have expertise relevant to our business and are deeply committed to operating ethically and with integrity. Twelve members of the Board are independent directors, including Ms. Franke, the first female Board Chair in the Company’s history.

Our response to COVID-19

Throughout the COVID-19 pandemic, we have taken steps to ensure the well-being of our customers, employees, and communities. In particular, we have published educational materials to help customers and our community from COVID-19 scams and offered COVID-19 forbearance programs for our customers, where appropriate. We also implemented changes to support our employees’ ability to work remotely, and advanced social distancing and enhanced cleaning measures at all facilities. In addition, The Sallie Mae Fund donated $1 million in aggregate to local food banks in Delaware, Indiana, Massachusetts, Utah, and Virginia — the communities in which we work and live. Each of these organizations received $200,000 from The Sallie Mae Fund to help deploy vital hunger-relief resources to our neighbors in need.

Political Expenditures

Our current policy on political activities is publicly available on our website at www.salliemae.com under “For Investors” and sets forth the principles regarding our stance on political activities. We comply with federal, state, and local lobbying registration and disclosure requirements. We work closely with the NGC Committee to review and reconsider our existing policies, procedures, and decision-making approaches to government relations and political activities.

At this time, we have one long-term, experienced employee engaged in lobbying activities exclusively related to matters that directly or indirectly affect the Private Education Loan industry and our mission. The compensation of the employee, and other executives, for time attributed to lobbying activity is reported as lobbying expenditure. That employee manages external, bipartisan lobbying/consulting firms that

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CORPORATE GOVERNANCE

assist with the same objectives, and we report the lobbying-related expenditures made to external firms in our lobbying disclosures. Our involvement with industry associations is limited to those associations comprised of financial institutions with similar interests.

Quarterly disclosures detailing our lobbying activities and expenditures, as required by the Lobbying Disclosure Act of 1995, are posted online by the Clerk of the U.S. House of Representatives and the Secretary of the U.S. Senate. Disclosures relating to contributions by our Political Action Committee are posted online by the Federal Election Commission (“FEC”). We will continue to comply with all applicable laws and regulations on disclosure of those activities.

The Sallie Mae Political Action Committee (“PAC”)

In June 2015, we formed the Sallie Mae PAC. All of the assets and activities of its predecessor prior to the spin-off of Navient Corporation (“Navient”) in April 2014 (the “Spin-Off”) were assumed and taken over by Navient in connection with the Spin-Off.

Our PAC is governed by an Advisory Board comprised of six employees, who represent different divisions within the Sallie Mae organization. The PAC’s Advisory Board reviews and approves all PAC and corporate political contributions. The PAC’s Advisory Board evaluates candidates on the basis of their views on issues that impact us or our employees. It also takes note of whether our facilities or employees reside in a candidate’s district or state.

Our PAC contributions are published on the FEC website.

Stockholder Communications with the Board

Stockholders and other interested parties may submit communications to the Board of Directors, the non-management directors as a group, the Board Chair, or any other individual member of the Board of Directors by contacting the Corporate Secretary in writing at corporatesecretary@salliemae.com or c/o Corporate Secretary, SLM Corporation, 300 Continental Drive, Newark, Delaware 19713.

Code of Business Conduct

We have a Code of Business Conduct that applies to Board of Directors members and all employees. The Code of Business Conduct is available on our website (www.salliemae.com under “For Investors”) and a written copy is available from the Corporate Secretary. We intend to post amendments to or waivers of the Code of Business Conduct, if any (to the extent applicable to the Company’s chief executive officer, principal financial officer, principal accounting officer, or any director), at this location on our website.

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REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

The Audit Committee hereby reports as follows:

Audit Committee

Paul G. Child, Chair

Mary Carter Warren Franke

Marianne M. Keler

Mark L. Lavelle

Jim Matheson

Vivian C. Schneck-Last

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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

INDEPENDENT REGISTERED PUBLIC

ACCOUNTING FIRM

Independent Registered Public Accounting Firm Fees for 2020 and 2019

Aggregate fees billed for services performed for Sallie Mae by its independent accountant, KPMG, for fiscal years ended December 31, 2020 and 2019, are set forth below.

Audit Fees. Audit fees include fees for professional services rendered for the audits of the consolidated financial statements of Sallie Mae and statutory and subsidiary audits, issuance of comfort letters, consents, income tax provision procedures, and assistance with review of documents filed with the SEC.

Audit-Related Fees. Audit-related fees include fees for assurance and other services related to service provider compliance reports, trust servicing and administration reports, internal control reviews, and attest services that are not required by statute or regulation.

Tax Fees. Tax fees include fees for federal and state tax compliance, and tax consultation services.

All Other Fees. All other fees for the fiscal year ended December 31, 2020 were $0. All other fees for the fiscal year ended December  31, 2019 were $0.

Pre-Approval Requirements

The Audit Committee’s charter addresses the approval of audit and non-audit services to be provided by the independent registered public accounting firm to the Company. The Audit Committee’s charter requires all services to be provided by our independent registered public accounting firm be pre-approved by the Audit Committee or its Chair. Each approval of the Audit Committee or the Chair of the Audit Committee must describe the services provided and set a dollar limit for the services. The Audit Committee, or its Chair, pre-approved all audit and non-audit services provided by KPMG during 2020. Reporting is provided to the Audit Committee regarding services the Chair of the Audit Committee pre-approved between committee meetings. The Audit Committee receives regular reports from management regarding the actual provision of all services by KPMG. No services provided by our independent registered public accounting firm were approved by the Audit Committee pursuant to the “de minimis” exception to the pre-approval requirement set forth in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

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OWNERSHIP OF COMMON STOCK BY 5 PERCENT OR MORE HOLDERS

OWNERSHIP OF COMMON STOCK BY 5 PERCENT OR MORE HOLDERS

The following table provides information about each stockholder known to Sallie Mae to beneficially own five percent or more of the outstanding shares of our Common Stock, based solely on the information filed by each such stockholder in 2021 for the year ended December 31, 2020 on Schedule 13G/A or on Schedule 13F-HR, as applicable, under the Exchange Act.

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OWNERSHIP OF COMMON STOCK BY DIRECTORS AND EXECUTIVE OFFICERS

OWNERSHIP OF COMMON STOCK BY DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the beneficial ownership of Sallie Mae’s Common Stock by: (i) our current directors and nominees; (ii) the Named Executive Officers listed in the Summary Compensation Table; and (iii) all of the Company’s current directors and executive officers as a group. Under SEC rules, beneficial ownership for purposes of this table takes into account shares as to which the individual has or shares voting and/or investment power as well as shares that may be acquired within 60 days (such as by exercising vested stock options). Information is provided as of February 26, 2021, unless noted otherwise. As of February 26, 2021, the Company had 363,669,712 outstanding shares of Common Stock. The beneficial owners listed have sole voting and investment power with respect to shares beneficially owned, except as to the interests of spouses or as otherwise indicated.

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EXECUTIVE OFFICERS

EXECUTIVE OFFICERS

Our executive officers are appointed annually by the Board of Directors. The following sets forth biographical information concerning Sallie Mae’s executive officers who are not directors. Biographical information for Mr. Witter is included in Proposal 1—Election of Directors.

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COMPENSATION DISCUSSION AND ANALYSIS

COMPENSATION DISCUSSION AND ANALYSIS

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COMPENSATION DISCUSSION AND ANALYSIS

(through metrics such as Private Education Loan originations, customer ease, and pre-tax, pre-provision income), while both our 2020 MIP and PSU grants ensure that such growth comes from high credit quality loans (through metrics such as weighted average origination FICO score for Private Education Loans, gross Private Education Loan defaults as a percentage of average loan balances in repayment, and cumulative charge-offs). In addition to the more traditional financial metrics (adjusted core earnings and operating expenses), these goals focused our senior executives’ attention on increasing the number of Private Education Loans we originated in 2020.

We further aligned our performance-based compensation programs for 2021 by modifying our equity-based compensation program to place a greater emphasis on performance, as 75 percent of our 2021 equity awards are based on the performance of our Common Stock. These equity awards include:

We believe this increased emphasis on performance-based compensation, as well as the greater focus on share value as a key metric for equity-based compensation, should further align our executives’ compensation with the interests of our stockholders.

The compensation set forth in this CD&A, and the amounts provided by our NGC Committee and the Board of Directors in connection with the 2020 MIP and PSU grants, were determined after taking into account the costs associated with the hiring of Mr. Witter, the Company’s new CEO, in April 2020, and the subsequent restructuring of the Company’s business. While the Company closely monitored the impact of the COVID-19 crisis on the economy and our business, it was ultimately determined that no changes needed to be made to our executive compensation programs, including the 2020 MIP, in response to COVID-19.

Compensation Philosophy

The pay-for-performance philosophy underlying our executive compensation program provides a competitive total compensation program tied to both Company and individual performance and aligned with the interests of our stockholders. For 2020, we used the following principles to implement our compensation philosophy and achieve our executive compensation program objectives:

Named Executive Officers

For the fiscal year ended December 31, 2020, our Named Executive Officers were:

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COMPENSATION DISCUSSION AND ANALYSIS

Compensation Practices Summary

Stockholder Engagement & Say-on-Pay Results

		STOCKHOLDER ENGAGEMENT
Spring		Summer		Fall		Winter
•  Active outreach with institutional holders to discuss important governance items to be considered at Annual Meeting   •  Publish annual communications to stockholders including the proxy statement and Form 10-K   •  Publish annual Corporate Social Responsibility Report		•  Conduct Annual Meeting   •  Review results and feedback from Annual Meeting with institutional holders   •  Share investor feedback with the Board of Directors   •  Active outreach with institutional holders to discuss vote and follow up issues   •  Conduct annual Board of Directors assessment of governance		•  Active outreach with institutional holders to identify focus and priorities for the coming year		•  Perform peer group compensation analysis to ensure compensation is appropriate based on financial performance comparisons   •  Review governance practices and trends, regulatory developments, and our governance framework

34    SLM CORPORATION — 2021 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

We engage with our stockholders and proxy advisory firms throughout the year and provide stockholders with an annual opportunity to cast an advisory say-on-pay vote. At our 2020 annual meeting of stockholders, approximately 94 percent of the votes present voted in favor of our say-on-pay proposal. Additionally, in 2020 management reached out to investors owning a majority of the outstanding shares and discussed our executive compensation program and other compensation-related matters with a number of them. Through our stockholder engagement and strong say-on-pay vote, we gathered important information on how our compensation policies could continue to improve and continued practices that encourage sustainable long-term growth. We continue to focus on performance-based compensation for our NEOs as we (i) tie a significant portion of total NEO compensation to the achievement of performance metrics and goals pursuant to the management incentive programs and (ii) award a significant percentage, set at 75 percent, of each NEO’s LTIP in the form of PSUs and premium priced stock options (for 2021, the percentage of each NEO’s LTIP that is in the form of PSUs will decrease to 25 percent while 50 percent of each NEO’s LTIP will be in the form of premium priced stock options). Stockholder engagement and the outcome of the say-on-pay vote results will continue to inform future compensation decisions.

Historical Say-on-Pay Vote

Stock Performance

Our stock generated a three-year total return for stockholders of 12.5 percent from 2017 through 2020, compared to 0.4 percent for our peer group of companies, 14.1 percent for the S&P Supercomposite Consumer Finance Sub Industry Index, and negative 10.5 percent for the S&P 400 Regional Bank Sub-Industry Index. As of December 31, 2020, we ranked in the 80^th percentile of total returns for the three-year period of our peer group.

Total Shareholder Return

12/31/17-12/31/20

Over the last three years, we have increased Total Assets by 41 percent and GAAP Diluted Earnings Per Common Share by 263 percent. During this three-year period, the Total Shareholder Return for the Company was 12.5 percent.

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COMPENSATION DISCUSSION AND ANALYSIS

Highlights of Company Performance

Allocation of Compensation

The charts below illustrate, for our CEO and separately for the other NEOs in aggregate, the percentage of 2020 compensation that consisted of base salaries, annual bonuses (determined and paid in cash in early 2021), and LTIP awards of restricted stock units (“RSUs”) and PSUs granted in early 2020.

36    SLM CORPORATION — 2021 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

Elements of Compensation

The compensation program in 2020 for our NEOs consisted of seven elements. These elements, as well as the reasons why each was chosen and the ways in which each achieves our compensation objectives, are described below:

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COMPENSATION DISCUSSION AND ANALYSIS

How Our Compensation Decisions Are Made

In establishing compensation levels and structures, policies, and performance for 2020, the NGC Committee also considered the results of the annual “say-on-pay” advisory vote of stockholders, which received the approval of approximately 94.4 percent of the shares present in person or represented by proxy and entitled to vote on the matter at our 2020 annual meeting of stockholders, and recommendations from stockholders as part of our stockholder outreach.

38    SLM CORPORATION — 2021 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

2020 Management Incentive Plan for Named Executive Officers

The following are highlights of the 2020 MIP:

Management Incentive Plan Goal Setting

Each year, management develops a rigorous business plan that reflects the Company’s strategy for achieving operating and financial results to enhance franchise value while prudently growing our business. The Company’s business plan was the source of the performance goals approved by the NGC Committee for purposes of setting our 2020 MIP targets. These performance goals were carefully analyzed and subject to considerable review by the NGC Committee, with the advice of its independent compensation consultant. After taking into account the costs associated with our CEO transition, in April 2020, and the subsequent restructuring of the Company’s business, approximately $34 million was excluded from the calculation of the operating expenses metric under the 2020 MIP, because these expenses reflected large, one-time expenses that were not part of the Company’s business plan and were not within the control of the 2020 MIP participants.

Since establishing Sallie Mae as a stand-alone consumer bank in April 2014, we generally have been able to consistently enhance franchise value by growing assets and earnings, maintaining conservative credit standards, and providing excellent customer service. As a financial institution, our targets for the 2020 MIP were designed to balance asset growth, credit quality, operating expenses, risk management, and customer satisfaction, by utilizing a mix of financial metrics (adjusted core earnings and operating expenses), customer growth metrics (private credit loan originations and customer ease), and credit quality metrics (weighted average origination FICO and gross Private Education Loan defaults as a percentage of average loan balances in repayment).

In selecting objective performance metrics and establishing challenging target, threshold, and maximum levels, the NGC Committee considered the upcoming year’s business objectives and outlook in light of the unique dynamics of the consumer-banking sector at that point in time. Rather than only examining and relying upon the prior year’s targets and actual results—which may not reflect the current year’s changes to our strategic business plan—and challenges affecting our industry, the NGC Committee’s goal setting considers particular and timely market trends that are likely to impact our business based on current activity, as well as our Company’s projected growth and other factors specific to our business.

Core Net Operating Income served as the performance metric for establishing the initial funding pool at 200 percent of target for the 2020 MIP. The NGC Committee used that financial metric for the initial bonus pool funding because it reflects the Company’s performance for the year at the broadest level. The Company calculated Core Net Operating Income for 2020 as the sum of (i) Core Earnings attributable to the Company’s Common Stock and (ii) preferred stock dividends paid by the Company in 2020. For a description of how we calculate “Core Earnings” and for a reconciliation of “Core Earnings” to the nearest comparable GAAP measure, see Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Key Financial Measures-Core Earnings” in our 2020 Form 10-K.

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