Exhibit 99.1

SallieMae            N E W S            R E L E A S E

FOR IMMEDIATE RELEASE	Media Contacts:	Investor Contacts:
	Tom Joyce	Steve McGarry
	703/984-5610	703/984-6746
	Martha Holler	Joe Fisher
	703/984-5178	703/984-5755

SALLIE MAE’S FEE-BASED BUSINESSES EXCEED $1 BILLION; MANAGED LOANS
GROW 16 PERCENT TO $142 BILLION

• Loan Purchases Top a Record $34 Billion

• Fee Income Increases 20 Percent

• Internal Lending Brands’ Growth Rate Exceeds 40 Percent

RESTON, Va., Jan. 18, 2007 — SLM Corporation (NYSE: SLM), commonly known as Sallie Mae, today reported fourth-quarter and full-year 2006 earnings and performance results that include a total managed student loan portfolio of $142 billion, a 16-percent increase from the year-ago quarter.

     “Core earnings” net income was $326 million, or $.74 per diluted share, for the 2006 fourth quarter, compared to $284 million, or $.63 per diluted share, in the year-ago quarter. For the full-year 2006, “core earnings” net income was $1.3 billion, or $2.83 per diluted share, up from $1.1 billion, or $2.51 per diluted share, for 2005. Recognizing stock-based compensation in both the current and year-ago periods and adjusting for one-time items, “core earnings” diluted earnings per share were $.74 in the fourth quarter 2006, a 16-percent increase from $.64 in the year-ago quarter, and $2.79 in 2006, a 17-percent increase from $2.39 in 2005.

     “We delivered a record amount of loans to help students access higher education,” said Tim Fitzpatrick, CEO. “The private sector, led by Sallie Mae, continues to provide product, pricing and service innovations that deliver results to 80 percent of colleges and universities in the U.S. and help nearly 6 million students access college every year.”

     Sallie Mae reports financial results on a GAAP basis and also presents certain “core earnings” performance measures on a basis that differs from GAAP. The company’s management, equity investors, credit rating agencies and debt capital providers use these “core earnings” measures to monitor the company’s business performance.

     During 2006, the company purchased $34.4 billion in education loans. The company originated $23.4 billion of student loans through its preferred channel last year — $13.1 billion, or 56 percent of that total, through its internal lending brands. In the fourth-quarter 2006, the company’s preferred-channel loan originations totaled $4.8 billion and included $1.6 billion of private education loans. Two thirds of the preferred-channel loans originated during the 2006 fourth quarter, or $3.1 billion, was originated through the company’s internal lending brands. Preferred-channel loans are originated through Sallie Mae’s internal or affiliated brands.

Sallie Mae • 12061 Bluemont Way • Reston, Va 20190 • www.SallieMae.com

     Also contributing to the company’s 2006 performance results was $1.1 billion in “core earnings” total other income. The company’s fee-based businesses generate non-interest income and primarily include fees earned on guarantor servicing, debt management operations and collection activities. “Core earnings” fee income and collection revenue were $183 million in the 2006 fourth quarter and $768 million for the full-year 2006, a 20-percent increase from $642 million during the full-year 2005.

     “Core earnings” net interest income was $651 million in the 2006 fourth quarter and $2.5 billion for the full-year 2006, 15-percent increases over the respective year-ago periods. “Core earnings” operating expenses were $328 million during the fourth-quarter 2006, compared to $279 million in the year-ago quarter.

     Fourth-quarter 2006 GAAP net income was $18 million, or $.02 per diluted share, compared to $431 million, or $.96 per diluted share, in the year-ago quarter. GAAP net income for 2006 totaled $1.2 billion, compared to $1.4 billion in 2005. Included in these GAAP results are pre-tax net losses on derivative and hedging activities of $(245) million in the fourth-quarter 2006 and $(339) million year-to-date 2006, compared to pre-tax net gains of $70 million and $247 million in the respective year-ago periods.

     Both a description of the “core earnings” treatment and a full reconciliation to the GAAP income statement can be found in the Fourth Quarter 2006 Supplemental Earnings Disclosure accompanying this press release, which is posted under the Investors page at http://www.salliemae.com/about/investors/stockholderinfo/earningsinfo.

     Total equity for the company at Dec. 31, 2006, was $4.4 billion, compared to $4.5 billion at Sept. 30, 2006. The company’s tangible capital at the end of the 2006 fourth quarter was 1.84 percent of managed assets, compared to 2.03 percent at prior quarter end.

     The company will host its quarterly earnings conference call today at noon. Sallie Mae executives will be on hand to discuss various highlights of the quarter and to answer questions related to the company’s performance. Individuals interested in participating should call the following number today, Jan. 18, 2007, starting at 11:45 a.m. EST: (877) 356-5689 (USA and Canada) or (706) 679-0623 (International). The conference call will be replayed continuously beginning Thursday, Jan. 18, at 3:00 p.m. EST and concluding at 11:59 p.m. EST on Thursday, Feb. 1. Please dial (800) 642-1687 (USA and Canada) or dial (706) 645-9291 (International) and use access code 5437459. In addition, there will be a live audio Web cast of the conference call, which may be accessed at www.SallieMae.com. A replay will be available beginning 30-45 minutes after the live broadcast.

***

Forward Looking Statements:

This press release contains “forward-looking statements” including expectations as to future market share, the success of preferred channel originations and future results. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Because such statements inherently involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks include, among others, changes in the terms of student loans and the educational credit marketplace arising from the implementation of applicable laws and regulations, and from changes in such laws and regulations, changes in the demand for educational financing or in financing preferences of educational institutions, students and their families, and changes in the general interest rate environment. For more information, see the company’s filings with the Securities and Exchange Commission.

Sallie Mae • 12061 Bluemont Way • Reston, Va 20190 • www.SallieMae.com

***

SLM Corporation (NYSE: SLM), commonly known as Sallie Mae, is the nation’s leading provider of saving- and paying-for-college programs. The company manages $142 billion in education loans and serves nearly 10 million student and parent customers. Through its Upromise affiliates, the company also manages $15 billion in 529 college-savings plans, and assists 7.5 million members with automatic savings through rebates on everyday purchases. Sallie Mae and its subsidiaries offer debt management services as well as business and technical products to a range of business clients, including higher education institutions, student loan guarantors and state and federal agencies. More information is available at www.salliemae.com. SLM Corporation and its subsidiaries are not sponsored by or agencies of the United States of America.

###

Sallie Mae • 12061 Bluemont Way • Reston, Va 20190 • www.SallieMae.com

SLM CORPORATION

Supplemental Earnings Disclosure

December 31, 2006

(Dollars in millions, except earnings per share)

	Quarters ended									Years ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2006			2006			2005			2006			2005
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
SELECTED FINANCIAL INFORMATION AND RATIOS
GAAP Basis
Net income	$	18		$	263		$	431		$	1,157		$	1,382
Diluted earnings per common share(1)(2)	$	.02		$	.60		$	.96		$	2.63		$	3.05
Return on assets		.07	%		1.10	%		1.88	%		1.22	%		1.68	%
“Core Earnings” Basis(3)
“Core Earnings” net income	$	326		$	321		$	284		$	1,253		$	1,131
“Core Earnings” diluted earnings per common share(1)(2)	$	.74		$	.73		$	.63		$	2.83		$	2.51
“Core Earnings” return on assets		.84	%		.86	%		.84	%		.86	%		.89	%
OTHER OPERATING STATISTICS
Average on-balance sheet student loans	$	91,522		$	84,241		$	82,914		$	84,856		$	74,724
Average off-balance sheet student loans		47,252			48,226			38,497			46,336			41,220
Average Managed student loans	$	138,774		$	132,467		$	121,411		$	131,192		$	115,944
Ending on-balance sheet student loans, net	$	95,920		$	88,038		$	82,604
Ending off-balance sheet student loans, net		46,172			48,897			39,925
Ending Managed student loans, net	$	142,092		$	136,935		$	122,529
Ending Managed FFELP Stafford and Other Student Loans, net	$	39,869		$	39,787		$	40,658
Ending Managed Consolidation Loans, net		79,635			75,947			65,434
Ending Managed Private Education Loans, net		22,588			21,201			16,437
Ending Managed student loans, net	$	142,092		$	136,935		$	122,529

⁽¹⁾   In December 2004, the Company adopted the Emerging Issues Task Force (“EITF”) Issue No. 04-8, “The Effect of Contingently Convertible Debt on Diluted Earnings per Share,” as it relates to the Company’s $2 billion in contingently convertible debt instruments (“Co-Cos”) issued in May 2003. EITF No. 04-8 requires the shares underlying Co-Cos to be included in diluted earnings per common share computations regardless of whether the market price trigger or the conversion price has been met, using the “if-converted” method. The impact of Co-Cos to diluted earnings per common share is as follows:

	Quarters ended									Years ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2006			2006			2005			2006			2005
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Impact of Co-Cos on GAAP diluted earnings per common share	$	—	(A)	$	—		$	(.03	)	$	(.03	)	$	(.11	)
Impact of Co-Cos on “Core Earnings” diluted earnings per common share	$	(.01	)	$	(.01	)	$	(.02	)	$	(.04	)	$	(.07	)

^(A)   There is no impact on diluted earnings per common share because the effect of the assumed conversion is antidilutive.

1

⁽²⁾   During the first quarter of 2006, the Company adopted the Financial Accounting Standards Board’s (“FASB’s”) Statement of Financial Accounting Standards (“SFAS”) No. 123(R), “Share-Based Payment,” which is a revision of SFAS No. 123, “Accounting for Stock-Based Compensation.” SFAS No. 123(R) requires all share based payments to employees to be recognized in the income statement based on their fair values. For the quarters ended December 31, 2006 and September 30, 2006, reported net income attributable to common stock included $9 million and $10 million, respectively, related to stock option compensation expense, net of related tax effects. The following table is a pro forma presentation of the Company’s results had SFAS No. 123(R) been in effect for all periods presented.

	Quarters ended						Years ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2006		2006		2005		2006		2005
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Pro forma GAAP diluted earnings per common share	$	.02	$	.60	$	.93	$	2.63	$	2.97
Pro forma “Core Earnings” diluted earnings per common share	$	.74	$	.73	$	.61	$	2.83	$	2.43

⁽³⁾   See explanation of “Core Earnings” performance measures under “Reconciliation of ‘Core Earnings’ Net Income to GAAP Net Income.”

2

SLM CORPORATION

Consolidated Balance Sheets

(In thousands, except per share amounts)

	December 31,		September 30,		December 31,
	2006		2006		2005
	(unaudited)		(unaudited)
Assets
FFELP Stafford and Other Student Loans (net of allowance for losses of $8,701; $7,649; and $6,311, respectively)	$	24,840,464	$	22,613,604	$	19,988,116
Consolidation Loans (net of allowance for losses of $11,614; $10,720; and $8,639, respectively)		61,324,008		57,201,754		54,858,676
Private Education Loans (net of allowance for losses of $308,346; $274,974; and $204,112, respectively)		9,755,289		8,222,400		7,756,770
Other loans (net of allowance for losses of $20,394; $18,327; and $16,180, respectively)		1,308,832		1,257,252		1,137,987
Cash and investments		5,184,673		4,399,196		4,867,654
Restricted cash and investments		3,423,326		3,806,978		3,300,102
Retained Interest in off-balance sheet securitized loans		3,341,591		3,613,376		2,406,222
Goodwill and acquired intangible assets, net		1,371,606		1,333,123		1,105,104
Other assets		5,585,943		4,605,014		3,918,053
Total assets	$	116,135,732	$	107,052,697	$	99,338,684
Liabilities
Short-term borrowings	$	3,528,263	$	3,669,842	$	3,809,655
Long-term borrowings		104,558,531		94,816,563		88,119,090
Other liabilities		3,679,781		4,053,931		3,609,332
Total liabilities		111,766,575		102,540,336		95,538,077
Commitments and contingencies
Minority interest in subsidiaries		9,115		9,338		9,182
Stockholders’ equity
Preferred stock, par value $.20 per share, 20,000 shares authorized; Series A: 3,300; 3,300; and 3,300 shares, respectively, issued at stated value of $50 per share; Series B: 4,000; 4,000; and 4,000 shares, respectively, issued at stated value of $100 per share		565,000		565,000		565,000
Common stock, par value $.20 per share, 1,125,000 shares authorized: 433,113; 431,590; and 426,484 shares, respectively, issued		86,623		86,318		85,297
Additional paid-in capital		2,565,211		2,490,851		2,233,647
Accumulated other comprehensive income, net of tax		349,111		460,527		367,910
Retained earnings		1,834,718		1,928,204		1,111,743
Stockholders’ equity before treasury stock		5,400,663		5,530,900		4,363,597
Common stock held in treasury at cost: 22,496; 22,229; and 13,347 shares, respectively		1,040,621		1,027,877		572,172
Total stockholders’ equity		4,360,042		4,503,023		3,791,425
Total liabilities and stockholders’ equity	$	116,135,732	$	107,052,697	$	99,338,684

3

SLM CORPORATION

Consolidated Statements of Income

(In thousands, except per share amounts)

	Quarters ended									Years ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2006			2006			2005			2006			2005
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	408,727		$	364,621		$	315,164		$	1,408,938		$	1,014,851
Consolidation Loans		966,840			916,091			760,338			3,545,857			2,500,008
Private Education Loans		291,425			254,747			203,992			1,021,221			633,884
Other loans		26,556			24,550			22,851			97,954			84,664
Cash and investments		141,155			141,083			89,921			503,002			276,756
Total interest income		1,834,703			1,701,092			1,392,266			6,576,972			4,510,163
Interest expense		1,462,733			1,363,271			1,002,133			5,122,855			3,058,718
Net interest income		371,970			337,821			390,133			1,454,117			1,451,445
Less: provisions for losses		92,005			67,242			65,318			286,962			203,006
Net interest income after provisions for losses		279,965			270,579			324,815			1,167,155			1,248,439
Other income:
Gains on student loan securitizations		—			201,132			240,651			902,417			552,546
Servicing and securitization revenue		184,686			187,082			80,032			553,541			356,730
Losses on securities, net		(24,458	)		(13,427	)		(6,979	)		(49,357	)		(63,955	)
Gains (losses) on derivative and hedging activities, net		(244,521	)		(130,855	)		70,270			(339,396	)		246,548
Guarantor servicing fees		33,089			38,848			21,555			132,100			115,477
Debt management fees		92,501			122,556			98,839			396,830			359,907
Collections revenue		57,878			57,913			48,304			239,829			166,840
Other		103,927			87,923			67,072			338,307			273,259
Total other income		203,102			551,172			619,744			2,174,271			2,007,352
Operating expenses		352,747			353,494			296,663			1,346,152			1,138,328
Income before income taxes and minority interest in net earnings of subsidiaries		130,320			468,257			647,896			1,995,274			2,117,463
Income taxes		111,752			203,686			215,907			834,311			728,767
Income before minority interest in net earnings of subsidiaries		18,568			264,571			431,989			1,160,963			1,388,696
Minority interest in net earnings of subsidiaries		463			1,099			954			4,007			6,412
Net income		18,105			263,472			431,035			1,156,956			1,382,284
Preferred stock dividends		9,258			9,221			7,832			35,567			21,903
Net income attributable to common stock	$	8,847		$	254,251		$	423,203		$	1,121,389		$	1,360,381
Basic earnings per common share	$	.02		$	.62		$	1.02		$	2.73		$	3.25
Average common shares outstanding		409,597			410,034			415,907			410,805			418,374
Diluted earnings per common share	$	.02		$	.60		$	.96		$	2.63		$	3.05
Average common and common equivalent shares outstanding		418,357			449,841			457,406			451,170			460,260
Dividends per common share	$	.25		$	.25		$	.22		$	.97		$	.85

4

SLM CORPORATION

Segment and “Core Earnings”

Consolidated Statements of Income

(In thousands)

	Quarter ended December 31, 2006
						Corporate			Total ‘‘Core					Total
	Lending		DMO			and Other			Earnings”		Adjustments			GAAP
	(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	700,961	$	—		$	—		$	700,961	$	(292,234	)	$	408,727
Consolidation Loans		1,305,744		—			—			1,305,744		(338,904	)		966,840
Private Education Loans		620,092		—			—			620,092		(328,667	)		291,425
Other loans		26,556		—			—			26,556		—			26,556
Cash and investments		197,161		—			2,225			199,386		(58,231	)		141,155
Total interest income		2,850,514		—			2,225			2,852,739		(1,018,036	)		1,834,703
Total interest expense		2,189,781		6,440			5,630			2,201,851		(739,118	)		1,462,733
Net interest income		660,733		(6,440	)		(3,405	)		650,888		(278,918	)		371,970
Less: provisions for losses		87,895		—			298			88,193		3,812			92,005
Net interest income after provisions for losses		572,838		(6,440	)		(3,703	)		562,695		(282,730	)		279,965
Fee income		—		92,501			33,089			125,590		—			125,590
Collections revenue		—		57,473			—			57,473		405			57,878
Other income		40,034		—			59,690			99,724		(80,090	)		19,634
Total other income		40,034		149,974			92,779			282,787		(79,685	)		203,102
Operating expenses(1)		164,289		91,833			71,567			327,689		25,058			352,747
Income before income taxes and minority interest in net earnings of subsidiaries		448,583		51,701			17,509			517,793		(387,473	)		130,320
Income tax expense(2)		165,976		19,178			6,429			191,583		(79,831	)		111,752
Minority interest in net earnings of subsidiaries		—		463			—			463		—			463
Net income	$	282,607	$	32,060		$	11,080		$	325,747	$	(307,642	)	$	18,105

(1)	Operating expenses for the Lending, DMO, and Corporate and Other business segments include $8 million, $3 million, and $3 million, respectively, of stock option compensation expense due to the implementation of SFAS No. 123(R) in the first quarter of 2006.
(2)	Income taxes are based on a percentage of net income before tax for the individual reportable segment.

5

	Quarter ended September 30, 2006
						Corporate			Total ‘‘Core					Total
	Lending		DMO			and Other			Earnings”		Adjustments			GAAP
	(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	701,615	$	—		$	—		$	701,615	$	(336,994	)	$	364,621
Consolidation Loans		1,241,999		—			—			1,241,999		(325,908	)		916,091
Private Education Loans		557,787		—			—			557,787		(303,040	)		254,747
Other loans		24,550		—			—			24,550		—			24,550
Cash and investments		206,837		—			2,782			209,619		(68,536	)		141,083
Total interest income		2,732,788		—			2,782			2,735,570		(1,034,478	)		1,701,092
Total interest expense		2,124,587		6,088			3,515			2,134,190		(770,919	)		1,363,271
Net interest income		608,201		(6,088	)		(733	)		601,380		(263,559	)		337,821
Less: provisions for losses		79,774		—			(3	)		79,771		(12,529	)		67,242
Net interest income after provisions for losses		528,427		(6,088	)		(730	)		521,609		(251,030	)		270,579
Fee income		—		122,556			38,848			161,404		—			161,404
Collections revenue		—		57,744			—			57,744		169			57,913
Other income		46,074		—			40,988			87,062		244,793			331,855
Total other income		46,074		180,300			79,836			306,210		244,962			551,172
Operating expenses(1)		156,168		91,341			69,644			317,153		36,341			353,494
Income before income taxes and minority interest in net earnings of subsidiaries		418,333		82,871			9,462			510,666		(42,409	)		468,257
Income tax expense(2)		154,783		30,662			3,502			188,947		14,739			203,686
Minority interest in net earnings of subsidiaries		—		1,099			—			1,099		—			1,099
Net income	$	263,550	$	51,110		$	5,960		$	320,620	$	(57,148	)	$	263,472

(1)	Operating expenses for the Lending, DMO, and Corporate and Other business segments include $8 million, $4 million, and $4 million, respectively, of stock option compensation expense due to the implementation of SFAS No. 123(R) in the first quarter of 2006.
(2)	Income taxes are based on a percentage of net income before tax for the individual reportable segment.

6

	Quarter ended December 31, 2005
						Corporate			Total “Core					Total
	Lending(2)		DMO(2)			and Other(2)			Earnings”		Adjustments			GAAP
	(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	619,987	$	—		$	—		$	619,987	$	(304,823	)	$	315,164
Consolidation Loans		934,096		—			—			934,096		(173,758	)		760,338
Private Education Loans		373,801		—			—			373,801		(169,809	)		203,992
Other loans		22,851		—			—			22,851		—			22,851
Cash and investments		127,418		—			1,564			128,982		(39,061	)		89,921
Total interest income		2,078,153		—			1,564			2,079,717		(687,451	)		1,392,266
Total interest expense		1,506,852		5,531			1,455			1,513,838		(511,705	)		1,002,133
Net interest income		571,301		(5,531	)		109			565,879		(175,746	)		390,133
Less: provisions for losses		69,243		—			(7	)		69,236		(3,918	)		65,318
Net interest income after provisions for losses		502,058		(5,531	)		116			496,643		(171,828	)		324,815
Fee income		—		98,839			21,555			120,394		—			120,394
Collections revenue		—		48,112			—			48,112		192			48,304
Other income		37,696		—			28,355			66,051		384,995			451,046
Total other income		37,696		146,951			49,910			234,557		385,187			619,744
Operating expenses		138,778		83,920			55,895			278,593		18,070			296,663
Income before income taxes and minority interest in net earnings of subsidiaries		400,976		57,500			(5,869	)		452,607		195,289			647,896
Income tax expense(1)		148,362		21,275			(2,172	)		167,465		48,442			215,907
Minority interest in net earnings of subsidiaries		—		954			—			954		—			954
Net income	$	252,614	$	35,271		$	(3,697	)	$	284,188	$	146,847		$	431,035

(1)	Income taxes are based on a percentage of net income before tax for the individual reportable segment.
(2)	In the first quarter of 2006, the Company changed its method for allocating certain Corporate and Other expenses to the other business segments. All periods presented have been updated to reflect the new allocation methodology.

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	Year ended December 31, 2006
						Corporate			Total ‘‘Core					Total
	Lending		DMO			and Other			Earnings”		Adjustments			GAAP
	(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	2,771,236	$	—		$	—		$	2,771,236	$	(1,362,298	)	$	1,408,938
Consolidation Loans		4,690,060		—			—			4,690,060		(1,144,203	)		3,545,857
Private Education Loans		2,092,068		—			—			2,092,068		(1,070,847	)		1,021,221
Other loans		97,954		—			—			97,954		—			97,954
Cash and investments		704,336		—			6,989			711,325		(208,323	)		503,002
Total interest income		10,355,654		—			6,989			10,362,643		(3,785,671	)		6,576,972
Total interest expense		7,877,263		23,150			11,768			7,912,181		(2,789,326	)		5,122,855
Net interest income		2,478,391		(23,150	)		(4,779	)		2,450,462		(996,345	)		1,454,117
Less: provisions for losses		302,498		—			282			302,780		(15,818	)		286,962
Net interest income after provisions for losses		2,175,893		(23,150	)		(5,061	)		2,147,682		(980,527	)		1,167,155
Fee income		—		396,830			132,100			528,930		—			528,930
Collections revenue		—		238,970			—			238,970		859			239,829
Other income		177,451		—			155,025			332,476		1,073,036			1,405,512
Total other income		177,451		635,800			287,125			1,100,376		1,073,895			2,174,271
Operating expenses(1)		645,057		357,797			249,958			1,252,812		93,340			1,346,152
Income before income taxes and minority interest in net earnings of subsidiaries		1,708,287		254,853			32,106			1,995,246		28			1,995,274
Income tax expense(2)		632,067		94,344			11,830			738,241		96,070			834,311
Minority interest in net earnings of subsidiaries		—		4,007			—			4,007		—			4,007
Net income	$	1,076,220	$	156,502		$	20,276		$	1,252,998	$	(96,042	)	$	1,156,956

(1)	Operating expenses for the Lending, DMO, and Corporate and Other business segments include $34 million, $12 million, and $17 million, respectively, of stock option compensation expense due to the implementation of SFAS No. 123(R) in the first quarter of 2006.
(2)	Income taxes are based on a percentage of net income before tax for the individual reportable segment.

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	Year ended December 31, 2005
						Corporate			Total ‘‘Core					Total
	Lending(2)		DMO(2)			and Other(2)			Earnings”		Adjustments			GAAP
	(unaudited)
Interest income:
FFELP Stafford and Other Student Loans	$	2,298,256	$	—		$	—		$	2,298,256	$	(1,283,405	)	$	1,014,851
Consolidation Loans		3,014,383		—			—			3,014,383		(514,375	)		2,500,008
Private Education Loans		1,160,239		—			—			1,160,239		(526,355	)		633,884
Other loans		84,664		—			—			84,664		—			84,664
Cash and investments		395,613		—			4,734			400,347		(123,591	)		276,756
Total interest income		6,953,155		—			4,734			6,957,889		(2,447,726	)		4,510,163
Total interest expense		4,797,271		19,176			5,998			4,822,445		(1,763,727	)		3,058,718
Net interest income		2,155,884		(19,176	)		(1,264	)		2,135,444		(683,999	)		1,451,445
Less: provisions for losses		138,026		—			177			138,203		64,803			203,006
Net interest income after provisions for losses		2,017,858		(19,176	)		(1,441	)		1,997,241		(748,802	)		1,248,439
Fee income		—		359,907			115,477			475,384		—			475,384
Collections revenue		—		166,648			—			166,648		192			166,840
Other income		109,700		1			126,086			235,787		1,129,341			1,365,128
Total other income		109,700		526,556			241,563			877,819		1,129,533			2,007,352
Operating expenses		547,405		287,050			235,430			1,069,885		68,443			1,138,328
Income before income taxes and minority interest in net earnings of subsidiaries		1,580,153		220,330			4,692			1,805,175		312,288			2,117,463
Income tax expense(1)		584,657		81,522			1,736			667,915		60,852			728,767
Minority interest in net earnings of subsidiaries		1,749		4,403			—			6,152		260			6,412
Net income	$	993,747	$	134,405		$	2,956		$	1,131,108	$	251,176		$	1,382,284

(1)	Income taxes are based on a percentage of net income before tax for the individual reportable segment.
(2)	In the first quarter of 2006, the Company changed its method for allocating certain Corporate and Other expenses to the other business segments. All periods presented have been updated to reflect the new allocation methodology.

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SLM CORPORATION

Reconciliation of “Core Earnings” Net Income to GAAP Net Income

(In thousands, except per share amounts)

	Quarters ended									Years ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2006			2006			2005			2006			2005
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
“Core Earnings” net income(A)	$	325,747		$	320,620		$	284,188		$	1,252,998		$	1,131,108
“Core Earnings” adjustments:
Net impact of securitization accounting		(67,984	)		159,468			117,520			532,506			(60,069	)
Net impact of derivative accounting		(242,614	)		(112,699	)		149,755			(229,452	)		637,460
Net impact of Floor Income		(51,762	)		(52,781	)		(56,108	)		(209,445	)		(203,943	)
Net impact of acquired intangibles(B)		(25,113	)		(36,397	)		(15,878	)		(93,581	)		(61,160	)
Total “Core Earnings” adjustments before income taxes and minority interest in net earnings of subsidiaries		(387,473	)		(42,409	)		195,289			28			312,288
Net tax effect(C)		79,831			(14,739	)		(48,442	)		(96,070	)		(60,852	)
Total “Core Earnings” adjustments before minority interest in net earnings of subsidiaries		(307,642	)		(57,148	)		146,847			(96,042	)		251,436
Minority interest in net earnings of subsidiaries		—			—			—			—			(260	)
Total “Core Earnings” adjustments		(307,642	)		(57,148	)		146,847			(96,042	)		251,176
GAAP net income	$	18,105		$	263,472		$	431,035		$	1,156,956		$	1,382,284
GAAP diluted earnings per common share	$	.02		$	.60		$	.96		$	2.63		$	3.05
(A) “Core Earnings” diluted earnings per common share	$	.74		$	.73		$	.63		$	2.83		$	2.51

(B)	Represents goodwill and intangible impairment and the amortization of acquired intangibles.
(C)	Such tax effect is based upon the Company’s “Core Earnings” effective tax rate for the year. The net tax effect results primarily from the exclusion of the permanent income tax impact of the equity forward contracts.

“Core Earnings”

In accordance with the Rules and Regulations of the Securities and Exchange Commission (“SEC”), we prepare financial statements in accordance with generally accepted accounting principles in the United States of America (“GAAP”). In addition to evaluating the Company’s GAAP-based financial information, management evaluates the Company’s business segments on a basis that, as allowed under SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” differs from GAAP. We refer to management’s basis of evaluating our segment results as “Core Earnings” presentations for each business segment and we refer to this information in our presentations with credit rating agencies and lenders. While “Core Earnings” are not a substitute for reported results under GAAP, we rely on “Core Earnings” to manage each operating segment because we believe these measures provide additional information regarding the operational and performance indicators that are most closely assessed by management.

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Our “Core Earnings” are the primary financial performance measures used by management to evaluate performance and to allocate resources. Accordingly, financial information is reported to management on a “Core Earnings” basis by reportable segment, as these are the measures used regularly by our chief operating decision maker. Our “Core Earnings” are used in developing our financial plans and tracking results, and also in establishing corporate performance targets and determining incentive compensation. Management believes this information provides additional insight into the financial performance of the Company’s core business activities. Our “Core Earnings” are not defined terms within GAAP and may not be comparable to similarly titled measures reported by other companies. “Core Earnings” reflect only current period adjustments to GAAP as described below. Accordingly, the Company’s “Core Earnings” presentation does not represent another comprehensive basis of accounting. A more detailed discussion of the differences between GAAP and “Core Earnings” follows.

Limitations of “Core Earnings”

While GAAP provides a uniform, comprehensive basis of accounting, for the reasons described above, management believes that “Core Earnings” are an important additional tool for providing a more complete understanding of the Company’s results of operations. Nevertheless, “Core Earnings” are subject to certain general and specific limitations that investors should carefully consider. For example, as stated above, unlike financial accounting, there is no comprehensive, authoritative guidance for management reporting. Our “Core Earnings” are not defined terms within GAAP and may not be comparable to similarly titled measures reported by other companies. Unlike GAAP, “Core Earnings” reflect only current period adjustments to GAAP. Accordingly, the Company’s “Core Earnings” presentation does not represent a comprehensive basis of accounting. Investors, therefore, may not compare our Company’s performance with that of other financial services companies based upon “Core Earnings.” “Core Earnings” results are only meant to supplement GAAP results by providing additional information regarding the operational and performance indicators that are most closely used by management, the Company’s board of directors, rating agencies and lenders to assess performance.

Other limitations arise from the specific adjustments that management makes to GAAP results to derive “Core Earnings” results. For example, in reversing the unrealized gains and losses that result from SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities,” on derivatives that do not qualify for “hedge treatment,” as well as on derivatives that do qualify but are in part ineffective because they are not perfect hedges, we focus on the long-term economic effectiveness of those instruments relative to the underlying hedged item and isolate the effects of interest rate volatility, changing credit spreads and changes in our stock price on the fair value of such instruments during the period. Under GAAP, the effects of these factors on the fair value of the derivative instruments (but not on the underlying hedged item) tend to show more volatility in the short term. While our presentation of our results on a Managed Basis provides important information regarding the performance of our Managed portfolio, a limitation of this presentation is that we are presenting the ongoing spread income on loans that have been sold to a trust managed by us. While we believe that our Managed Basis presentation presents the economic substance of our Managed loan portfolio, it understates earnings volatility from securitization gains. Our “Core Earnings” results exclude certain Floor Income, which is real cash income, from our reported results and therefore may understate earnings in certain periods. Management’s financial planning and valuation of operating results, however, does not take into account Floor Income because of its inherent uncertainty, except when it is economically hedged through Floor Income Contracts.

Pre-Tax Differences between “Core Earnings” and GAAP

Our “Core Earnings” are the primary financial performance measures used by management to evaluate performance and to allocate resources. Accordingly, financial information is reported to management on a “Core Earnings” basis by reportable segment, as these are the measures used regularly by our chief operating decision maker. Our “Core Earnings” are used in developing our financial plans and tracking results, and also in establishing corporate performance targets and determining incentive compensation. Management believes this information provides additional insight into the financial performance of the Company’s core business

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activities. “Core Earnings” reflect only current period adjustments to GAAP, as described in the more detailed discussion of the differences between GAAP and “Core Earnings” that follows, which includes further detail on each specific adjustment required to reconcile our “Core Earnings” segment presentation to our GAAP earnings.

1)	Securitization Accounting: Under GAAP, certain securitization transactions in our Lending operating segment are accounted for as sales of assets. Under “Core Earnings” for the Lending operating segment, we present all securitization transactions on a Managed Basis as long-term non-recourse financings. The upfront “gains” on sale from securitization transactions as well as ongoing “servicing and securitization revenue” presented in accordance with GAAP are excluded from “Core Earnings” and are replaced by the interest income, provisions for loan losses, and interest expense as they are earned or incurred on the securitization loans. We also exclude transactions with our off-balance sheet trusts from “Core Earnings” as they are considered intercompany transactions on a Managed Basis.
2)	Derivative Accounting: “Core Earnings” exclude periodic unrealized gains and losses arising primarily in our Lending business segment, and to a lesser degree in our Corporate and Other business segment, that are caused primarily by the one-sided mark-to-market derivative valuations prescribed by SFAS No. 133 on derivatives that do not qualify for “hedge treatment” under GAAP. Under “Core Earnings,” we recognize the economic effect of these hedges, which generally results in any cash paid or received being recognized ratably as an expense or revenue over the hedged item’s life. “Core Earnings” also exclude the gain or loss on equity forward contracts that under SFAS No. 133 are required to be accounted for as derivatives and marked-to-market through earnings.
3)	Floor Income: The timing and amount (if any) of Floor Income earned in our Lending operating segment is uncertain and in excess of expected spreads. Therefore, we exclude such income from “Core Earnings” when it is not economically hedged. We employ derivatives, primarily Floor Income Contracts and futures, to economically hedge Floor Income. As discussed above in “Derivative Accounting,” these derivatives do not qualify as effective accounting hedges, and therefore, under GAAP, they are marked-to-market through the “gains (losses) on derivative and hedging activities, net” line on the income statement with no offsetting gain or loss recorded for the economically hedged items. For “Core Earnings,” we reverse the fair value adjustments on the Floor Income Contracts and futures economically hedging Floor Income and include the amortization of net premiums received in income.
4)	Acquired Intangibles: We exclude goodwill and intangible impairment and the amortization of acquired intangibles.

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