Navient (NAVI) risk factors, 2026 10-K

Other

1. 01Economic conditions and the creditworthiness of third parties could have a material adverse effect on our business, results of operations, financial condition and stock price61% rewritten
2. 02Defaults on education loans held by us, particularly Private Education Loans, could adversely affect our earnings30% rewritten
3. 03The Company’s accounting for the Allowance for Loan Losses on our education loan portfolios requires significant judgment and estimates
4. 04Our Consumer Lending segment exposes us to credit underwriting risks based upon the credit model we use to forecast loss rates. If we are unable to effectively forecast loss rates, it could materially adversely affect our operating results71% rewritten
5. 05Our business is affected by changes in interest rates and the cost and availability of funding in the capital markets
6. 06Prepayments on our loans can materially impact our profitability, results of operations, financial condition, cash flows or future business prospects32% rewritten
7. 07Our ability to hedge Floor Income and our ability to enter into hedges relative to that Floor Income is dependent on the future interest rate environment and therefore is variable, which may adversely affect our earnings
8. 08Our credit ratings are important to our liquidity. A reduction in our credit ratings could adversely affect our liquidity, increase our borrowing costs or limit our access to the capital markets
9. 09Adverse market conditions or an inability to effectively manage our liquidity risk or access liquidity could negatively impact our ability to meet our liquidity and funding needs, which could materially and adversely impact our results of operations, cash flow or financial condition
10. 10The interest rate characteristics of our earning assets do not always match the interest rate characteristics of our funding arrangements, which may have a negative impact on our net interest income and net income
11. 11Our use of derivatives to manage interest rate and foreign currency sensitivity exposes us to credit and market risk that could have a material adverse effect on our earnings and liquidity
12. 12If we do not effectively and continually align our cost structure with our business operations, our results of operations and financial condition could be materially adversely affected31% rewritten
13. 13A failure of our operating systems or infrastructure could disrupt our business, cause significant losses, result in regulatory action or damage our reputation24% rewritten
14. 14We depend on secure information technology, and a breach of our information technology systems could result in significant losses, disclosure of confidential customer information and reputational damage, which would adversely affect our business
15. 15We depend on third parties for a wide array of services, systems and information technology applications, and a breach or violation of law by one of these third parties could disrupt our business or provide our competitors with an opportunity to enhance their position at our expense69% rewritten
16. 16Our business could be negatively impacted as a result of shareholder activism, including a proxy contest or an unsolicited takeover proposal
17. 17Uncertainties related to, or the results of, such actions could cause our stock price to experience periods of volatility. The occurrence of any of the foregoing events could materially adversely affect our business
18. 18REGULATORY, COMPLIANCE & LEGAL RISK80% rewritten
19. 19Expanded regulatory and governmental oversight of our businesses will increase our costs and risks
20. 20Certain provisions of Delaware law and our amended and restated certificate of incorporation and amended and restated by-laws may prevent or delay an acquisition of us, which could decrease the trading price of our common stock
21. 21the inability of our shareholders to cumulate their votes in the election of directors
22. 22Shareholders’ percentage ownership in Navient may be diluted in the future
23. 23Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our shareholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us
24. 24Reputational risk and social factors may impact our results and damage our brand
25. 25Net income on our existing FFELP Loan portfolio is declining over time. We may not be able to develop revenue streams to replace the declining revenue from FFELP Loans through increased private credit originations62% rewritten
26. 26Our growth strategy has included making opportunistic acquisitions of, or material investments in, loan portfolios and complementary businesses and products, as well as offering new products, such as the personal loan product launched by Earnest in 2025
27. 27Our framework for managing risks may not be effective in mitigating the risk of loss
28. 28We are subject to various legal proceedings and some of these legal proceedings or other contingencies may materially adversely affect our business, financial condition or results from operations
29. 29Incorrect estimates and assumptions by management in connection with the preparation of our consolidated financial statements could adversely affect our reported assets, liabilities, income, revenue or expenses25% rewritten
30. 30Our success is dependent, in large part, on our ability to attract and retain personnel with the knowledge and skills to lead our business. Experienced personnel in our industry are in high demand, and competition for talent is very highnew
31. 31Our businesses operate in competitive environments and could lose market share and revenues if competitors compete more aggressively or effectively