SLM Corp (NASDAQ:SLMBP) Q4 2014 Earnings Conference Call - Final Transcript
Jan 22, 2015 • 08:00 am ET
But, we are exactly where we want to be on that, and of course we might have to manage our operating expenses, which we will also expand on. In regard to the regulatory environment, we had a very good year, the cease-and-desist order that was on the bank for six years was lifted in June of this year. We are in compliance with all of these mandates associated with the consent order.
We have shared our three-year plan with our regulator. Our primary regulator, the FDIC along with the UDFI folks in Utah, and we are in very good working partnerships with all of our regulators. In regard to the future, the future is bright for us. We can now turn from a year of distraction and we have been focused entirely on building our consumer franchise and that will be something you will hear about from us on a consistent basis as we go forward.
In regard to those results, we did hit $4.1 billion of originations that carried with it the consequence that we were able to -- despite all of our distractions able to increase our market share by an estimated one-to-two percentage points, which was a terrific performance on the part of our sales and marketing organization. As you know we have provided guidance that $4.1 billion of originations this year will increase to $4.3 next year, and so we are right on the trend that we had always discussed with all regulators as well as investors reflecting approximately a 5% growth in that particular variable.
We are gratified that the quality of our new customers is impacted measured by independent indicators such as the FICO score, higher quality than what we had experienced here before with an average FICO of 748, and we maintain a consistent 90% cosign. Our yield in the quarter and the year for it 8.07 and our NIM of 5.01%, both steady and as we think about those going into future, we do believe that they will continue to be steady at those levels.
Our credit losses were right on-track to where we wanted to be in 2014, as the portfolio grows rapidly and we will talk about the dynamic associated with that; that number will be loan loss reserves will increase proportionately in 2015, but this is a consequence of the rapid growth in maturation of the portfolio along with the attendant dynamics that in all consumer portfolios credit loss is associated with a particular advantage are concentrated in the early years specifically years one and two.
Our operating expenses, as we look forward it is the case that if we take the fourth quarter operating expenses, which reflects our true operating base, and we were to use that as a run rate. And to glance into 2015 based upon what we are thinking about the product revenues that our marginal efficiency ratio is 22%, an astounding number and
reflecting the leverage that we had discussed with many audiences and