SLM ($SLM) Misleading Delinquency Disclosures and Credit Quality Concerns

D. New Jersey

Court

2:25-cv-18834

Case number

07/25/2025

Class period Start

08/14/2025

Class period End

02/17/2026

Lead Plaintiff motion deadline

$SLM investors filed a claim against SLM Corporation, also known as Sallie Mae, for allegedly downplaying rising delinquency rates and overstating the effectiveness of its loan mitigation programs.
After analysts flagged worsening credit metrics that contradicted SLM’s reassurances, $SLM fell 8.1% on August 15, 2025, and later dropped another 14.9% on December 9, 2025, following underwhelming guidance.
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Case Details:

Between July 25, 2025, and August 14, 2025, SLM Corporation assured investors that rising delinquencies in its private education loan (PEL) portfolio were due to normal seasonal trends and minor program refinements. Executives pointed to “enhanced” loss mitigation efforts and claimed stability in credit performance, even amid modest year-over-year increases in delinquency.

However, on August 14, 2025, investment bank TD Cowen released a report showing that early-stage delinquencies had increased 49 basis points month-over-month in July, far worse than the typical seasonal uptick of 10 basis points. The report directly contradicted earlier public comments by SLM’s CFO, who had insisted trends were normal. In response, SLM’s stock fell 8.1% to close at $30.32 on August 15, 2025.

Later, on December 8, 2025, SLM hosted an investor forum where it issued below-consensus earnings guidance through 2028, despite having previously guided to higher earnings. Management forecasted earnings of $2.63 for FY2026, well below the $3.41 expected by analysts. On this news, shares fell another 14.9%, closing at $26.24 the next day, triggering downgrades from multiple analysts.

Based on these events, $SLM investors filed a claim against SLM Corporation, alleging the company:
It misrepresented the true nature and extent of rising delinquencies in its loan portfolio.
It overstated the effectiveness of its loss mitigation and loan modification programs.
It failed to provide timely and accurate guidance on credit quality and earnings expectations.
Investors argue SLM misled the market about the stability of its loan book and credit performance, leading to sharp losses when the truth emerged.

Case Type

US Securities Class Action

Case Status

Lead Plaintiff Appointment

Alleged Offence

Misleading Statements,

Financial Misrepresentation,

Failure to Disclose

Suspected Party

Directors,

Management

Security Type

Stocks

Trade Direction

Long

Shock Event Date

08/14/2025

Filing date

12/19/2025

Lead Plaintiff Deadline

02/17/2026

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