Jeff Adelson: Okay, great. And just on the $650 million repurchase authorization, I know you talked about doing half this year, half next year. Does that also contemplate the plan you laid out at the Investor Forum in kind of the base case for loan sales? Or is that more of a conservative outlook on your part? Because it does look like half and half is a little bit below what you did this past year.
Pete Graham: Yeah. I mean, it’s roughly in-line. We didn’t say exactly half. We said approximately half. And as I said in my remarks on a prior question, the pace and amount of that will be governed by the loan sales that we do this year. We’re off to a good start with the $2 billion that we’ll close this quarter, and the timing and amounts will be dictated by when we do additional loan sales as we [move through the year] (ph).
Jeff Adelson: Okay. And just one last one for me. On federal loan student loan payments, anything you can update us on what you’re seeing from your borrowers that are making those payments? I think there are still some puts and takes to come here with the new — the full benefit of the new income-driven plan kicking-in in July, but then you have this on ramp expiring later in the year. Just maybe give us a quick update on what you’re seeing, what you’re expecting there?
Jon Witter: Yeah, Jeff, happy to. We track as best we can sort of the performance of our customers who have federal student loans and those who don’t. We don’t know as perfectly who has enrolled in which income-driven repayment program or sort of other programs. But we have a pretty good sense of it. As of the last month, I saw data for, which was pretty recently, we have not yet seen any material divergence in performance between those with or without federal loans. And so, we continue to watch it closely. We recognize that the on-ramp is a powerful tool for customers. We understand that income-driven repayment plans are a powerful tool for federal customers. But as of yet, we’ve not seen anything that would strike us as a material divergence.
Jeff Adelson: Okay. Perfect. Thank you.
Operator: Thank you. Please standby for our next question. Our next question comes from the line of Vincent Caintic with Stephens. Your line is open.
Vincent Caintic: Hi. Good afternoon. Thanks for taking my questions. First one, I wanted to get your industry thoughts on the student loan refinancing market on the expectation of five rate cuts, what that would do? And then, for Sallie Mae, specifically, how you’re thinking about maybe any consolidation pressure or your thoughts on the balance sheet growth? Thank you.
Pete Graham: Yeah, I’ll take first crack, and Jon, you could add on if I miss any of the high points. Obviously, the consolidation market is really a rate-driven exercise. And so, as rates are going down, we do expect a return in some respect of the consolidation players. But I think the wild card in it for us is, what impact the new programs in the federal space have on sort of deterring folks from consolidating their loans. Because generally, that’s going to be a big factor in terms of whether someone wants to give up the potential benefits that they might be able to get in the federal programs in order to get an overall lower rate. So, it’s something we’ve got our eye on and certainly we have expectations in our outlook for what consolidations will be, and that’s considered within our guidance. But, yeah, I think that’s one that’s going to have to play out a little bit.
Jon Witter: Yeah. And Vincent, I think the only thing that I would add, and let me preface this the way I always do when I get questions on consolidations, this is obviously not our core business. I’m sure there’s people out there who have deeper insight into sort of the economics of the refi game than we do. But I think if you look at even the sort of rate cuts that are being assumed, that doesn’t take us anywhere back to the kind of uber-low rate environment that I think we’ve been living in for the last 20 years. And you asked me for my opinion, I will give you my opinion. I don’t think we’re going to see that kind of uber-low rate environment ever again. And so, I think you have to realize, there’s an awful lot of recent college grads and there’s an awful lot of, quite frankly, even current college seniors, juniors, and sophomores, who made loans under a much lower interest rate environment than what we’ve seen over the course of the last 18 months.
So, I think when you think about the sort of refi economics, I think you have to look at it through the lens of when did different borrowers make loans, what is the prevailing interest rate when they made those loans, and what are the rates today? We have done and will continue to do manners of those analyses. I agree with what Pete said, there will be some time in the future where consolidations come back and are larger than they are today. But I think we saw a golden age of loan consolidations given the super low rate environment. I think we’ll all have to see if we ever see that kind of golden age again.
Vincent Caintic: Okay. That’s helpful. Thank you. And second question, just on the forbearance programs and actually how we should think about the numbers. So, I guess as these modification programs roll out, should we be expecting that? I guess the forbearance number will increase from this level, and I’m just wondering how that plays out, because usually if we see forbearance, we might be concerned. But if it’s from these new programs that are driving some more success, I just want to anticipate that in advance? Thank you.
Jon Witter: Yeah. Vincent, it’s a wonderful simple answer. A question deserving a simple answer. I’m going to make it slightly more complicated. The answer is, for most customers using what we call hardship forbearance today, which is still allowable under sort of OCC guidance and our program is absolutely geared to that, it is short in duration and highly limited in use. It’s really no longer a substitute, as we’ve used it today or have used it for the last few years for the kind of more tailored and systematic programs that both Pete and I described earlier. There are some of our programs for which forbearance is a part of the recipe, but I think our plan is to sort of break those out separately in our reporting so that you can see those.
But I would not necessarily expect that there would be huge changes in forbearance, because I think we’ve largely operated under the new system for the last two years. And I think at the end of the day, it’s serving a fundamentally different purpose than these other programs at this point in time.
