Schwab Reports Second Quarter Results

Client Focus Yields Increased Net New Assets

Growth, Diversified Revenues and Operating Discipline All Contribute to Financial Performance

SAN FRANCISCO--()--The Charles Schwab Corporation announced today that its net income for the second quarter of 2012 was $275 million, up 41% from $195 million for the first quarter of 2012, and up 16% from $238 million for the second quarter of 2011. Net income for the six months ended June 30, 2012 was $470 million, down 2% from the year-earlier period. The company’s financial results for both the second quarter and first half of 2012 include a pre-tax gain of $70 million, or approximately $44 million after-tax, relating to the previously disclosed resolution of a vendor dispute.

  Three Months Ended
--June 30,--
  %   Six Months Ended
--June 30,--
  %
Financial Highlights     2012       2011     Change     2012       2011     Change
   
Net revenues (in millions) $ 1,283 $ 1,190 8 % $ 2,472 $ 2,397 3 %
Net income (in millions) $ 275 $ 238 16 % $ 470 $ 481 (2 )%
Diluted earnings per common share $ .20 $ .20 - $ .36 $ .40 (10 )%
Pre-tax profit margin 33.7 % 32.4 % 30.1 % 32.5 %

Return on average common stockholders’ equity (annualized)

13 % 14 % 11 % 15 %
                         

CEO and President Walt Bettinger commented, “Our ‘through clients’ eyes’ strategy continues to prove itself and deliver growth as it resonates with investors in all economic environments. While the economy and financial markets faced heightened challenges during the second quarter, demand for our full-service capabilities remained strong – we ended the quarter with 2.5 million accounts at Schwab that were either enrolled in one of our advisory offerings or under the guidance of an independent advisor, up 9% year-over-year. Even as trading activity weakened during the period, we saw other signs of sustained client engagement, including $16.0 billion in net new assets, up 4% from a year ago; an ongoing pattern of net purchases of securities throughout the quarter; and cash holdings at Schwab that remained at pre-financial crisis levels. In addition, clients opened 221,000 new brokerage accounts during the second quarter, up 8% year-over-year. We ended the quarter with 8.7 million active brokerage accounts, 822,000 banking accounts, and $1.80 trillion in total client assets, up 7, 10, and 9%, respectively, over June 2011.”

Mr. Bettinger added, “We’re proud that a growing number of clients trust us to help them reach their financial goals, and we believe our commitment to sustained investment in our client base is essential to reinforcing that trust and supporting our long-term expansion. That investment is always balanced with our emphasis on strong near-term profitability. Our ongoing expense discipline helped the company to move forward with our key 2012 client initiatives during the second quarter and still deliver a pre-tax profit margin of nearly 30% excluding the one-time vendor payment.”

CFO Joe Martinetto said, “Our second quarter financial performance benefited from the company’s diversified revenue streams as well as our growing client base and expense discipline. Environmental headwinds picked up yet again during the quarter, including further declines in long-term interest rates. While trading revenue slowed under these conditions, asset management and administration fees and net interest revenue both increased sequentially, by 2% and 6%, respectively. As a result, our second quarter results included 1% sequential growth for those three major revenue lines combined. With our expenses staying within planned levels, we were able to achieve an 18% increase in net income from the first quarter even before factoring in the vendor payment.”

Mr. Martinetto concluded, “During the second quarter we took advantage of market conditions to further strengthen our operating flexibility via a second preferred stock offering, which followed our first-ever preferred offering during January 2012. Completing these offerings leaves us with nearly $900 million of this cost-effective, non-dilutive capital as part of our funding mix. With our healthy financial performance, balance sheet and capital base, Schwab is ready to continue its profitable growth in the months ahead.”

Business highlights for the second quarter (data as of quarter-end unless otherwise noted):

Investor Services

  • Net new accounts for the quarter totaled approximately 40,000, down 2% year-over-year. Total accounts reached 6.1 million as of June 30, 2012, up 2% year-over-year.
  • Expanded the company’s integrated mobile banking capabilities to include Schwab Bank Bill Pay™ for iPad® and mobile devices. The new Bill Pay feature allows Schwab Bank clients to make, edit, monitor and cancel payments as well as add and edit new payees and billers.

Institutional Services

Advisor Services

  • Bolstered the Schwab OpenView Workflow Library to include a full range of 28 universal workflows, covering critical aspects of managing a successful investment advisory practice, including lead generation, client onboarding, service requests and business operations.
  • Launched the Schwab Advisor Center® application for the iPhone®, enabling advisors to view their clients’ account balances, positions and transactions while away from the office.

Products and Infrastructure

  • For Charles Schwab Bank:
    • Balance sheet assets = $72.2 billion, up 27% year-over-year.
    • Outstanding mortgage and home equity loans = $9.1 billion, up 3% year-over-year.
    • First mortgage originations by Quicken Loans and Schwab during the quarter = $1.0 billion.
    • Delinquency, nonaccrual, and loss reserve ratios for Schwab Bank’s loan portfolio = 0.80%, 0.48% and 0.52%, respectively, at month-end June.
  • Schwab Bank High Yield Investor Checking® accounts = 631,000, with $10.7 billion in balances.
  • Client assets managed by Windhaven® totaled $11.1 billion; up 8% from the first quarter of 2012.
  • Total assets under management in Schwab ETFs = $6.7 billion. Total assets in Schwab Managed Portfolios-ETFs = $2.4 billion.

Apple, the Apple logo, iPad, and iPhone are trademarks of Apple Inc. registered in the U.S. and other countries.

Android is a trademark of Google Inc.

Supporting schedules are either attached or located at:

www.aboutschwab.com/investor_relations/financial_reports.

Forward Looking Statements

This press release contains forward looking statements relating to the company’s growth and profitability. Achievement of these expectations is subject to risks and uncertainties that could cause actual results to differ materially from the expressed expectations. Important factors that may cause such differences include, but are not limited to, the company’s ability to attract and retain clients and grow client assets/relationships; competitive pressures on rates and fees; general market conditions, including the level of interest rates, equity valuations and trading activity; the level of client assets, including cash balances; the company’s ability to monetize client assets; the company’s ability to develop and launch new products, services and capabilities in a timely and successful manner; capital needs and management; level of expenses; the impact of changes in market conditions on money market fund fee waivers, revenues, expenses and pre-tax margins; the effect of adverse developments in litigation or regulatory matters and the extent of any charges associated with legal matters; any adverse impact of financial reform legislation and related regulations; and other factors set forth in the company’s Form 10-Q for the period ending March 31, 2012.

About Charles Schwab

The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with more than 300 offices and 8.7 million client brokerage accounts, 1.52 million corporate retirement plan participants, 822,000 banking accounts, and $1.80 trillion in client assets. The company was ranked “Highest in Investor Satisfaction with Self-Directed Services” in the 2012 U.S. Self-Directed Investor Satisfaction StudySM from J.D. Power and Associates. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. More information is available at www.schwab.com and www.aboutschwab.com.

THE CHARLES SCHWAB CORPORATION
Consolidated Statements of Income
(In millions, except per share amounts)
(Unaudited)
 
  Three Months Ended
June 30,
  Six Months Ended
June 30,
    2012   2011   2012   2011
   
Net Revenues
Asset management and administration fees $ 496 $ 502 $ 980 $ 1,004
 
Interest revenue 497 496 969 977
Interest expense   (39 )   (45 )   (77 )   (90 )
Net interest revenue 458 451 892 887
 
Trading revenue 219 205 462 446
Other 121 35 167 74
Provision for loan losses (4 ) (1 ) (4 ) (5 )
Net impairment losses on securities (1) (7 ) (2 ) (25 ) (9 )
                 
Total net revenues     1,283       1,190       2,472       2,397  
 
Expenses Excluding Interest
Compensation and benefits 446 430 911 867
Professional services 93 92 189 184
Occupancy and equipment 80 73 156 144
Advertising and market development 57 51 124 111
Communications 55 54 113 110
Depreciation and amortization 48 33 96 68
Class action litigation and regulatory reserve - 7 - 7
Other     72       64       138       126  
Total expenses excluding interest     851       804       1,727       1,617  
 
Income before taxes on income 432 386 745 780
Taxes on income     157       148       275       299  
 
Net Income     275       238       470       481  
 
Preferred stock dividends     14       -       14       -  
 
Net Income Available to Common Stockholders   $ 261     $ 238     $ 456     $ 481  
 
Weighted-Average Common Shares Outstanding — Diluted     1,274       1,210       1,273       1,208  
 
Earnings Per Common Share — Basic $ .20 $ .20 $ .36 $ .40
 
Earnings Per Common Share — Diluted   $ .20     $ .20     $ .36     $ .40  
(1) Net impairment losses on securities include total other-than-temporary impairment losses of $12 million and $11 million, net of $5 million and $9 million recognized in other comprehensive income, for the three months ended June 30, 2012 and 2011, respectively. Net impairment losses on securities include total other-than-temporary impairment losses of $14 million and $11 million, net of $(11) million and $2 million recognized in other comprehensive income, for the six months ended June 30, 2012 and 2011, respectively.
 
See Note to Consolidated Statements of Income, Financial and Operating Highlights, and Net Interest Revenue Information.
 
THE CHARLES SCHWAB CORPORATION
Financial and Operating Highlights
(Unaudited)
             
 

Q2-12 % change

2012 2011
(In millions, except per share amounts and as noted) vs.
Q2-11
  vs.
Q1-12
Second
Quarter
  First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
Net Revenues
Asset management and administration fees (1 %) 2 % $ 496 $ 484 $ 458 $ 466 $ 502
Net interest revenue 2 % 6 % 458 434 395 443 451
Trading revenue 7 % (10 %) 219 243 233 248 205
Other (1) N/M 163 % 121 46 41 45 35
Provision for loan losses N/M N/M (4 ) - (5 ) (8 ) (1 )
Net impairment losses on securities N/M (61 %)   (7 )     (18 )     (9 )     (13 )     (2 )
Total net revenues 8 % 8 %   1,283       1,189       1,113       1,181       1,190  
Expenses Excluding Interest
Compensation and benefits 4 % (4 %) 446 465 442 423 430
Professional services 1 % (3 %) 93 96 99 104 92
Occupancy and equipment 10 % 5 % 80 76 79 78 73
Advertising and market development 12 % (15 %) 57 67 69 48 51
Communications 2 % (5 %) 55 58 54 56 54
Depreciation and amortization 45 % - 48 48 48 39 33
Class action litigation and regulatory reserve N/M - - - - - 7
Other 13 % 9 %   72       66       70       73       64  
Total expenses excluding interest 6 % (3 %)   851       876       861       821       804  
Income before taxes on income 12 % 38 % 432 313 252 360 386
Taxes on income 6 % 33 %   157       118       89       140       148  
Net Income 16 % 41 % $ 275     $ 195     $ 163     $ 220     $ 238  
Preferred stock dividends N/M N/M   14       -       -       -       -  
Net Income Available to Common Stockholders 10 % 34 % $ 261     $ 195     $ 163     $ 220     $ 238  
Basic earnings per common share - 33 % $ .20 $ .15 $ .13 $ .18 $ .20
Diluted earnings per common share - 33 % $ .20 $ .15 $ .13 $ .18 $ .20
Dividends declared per common share - - $ .06 $ .06 $ .06 $ .06 $ .06
Weighted-average common shares outstanding - diluted 5 % -   1,274       1,273       1,271       1,229       1,210  
Performance Measures
Pre-tax profit margin 33.7 % 26.3 % 22.6 % 30.5 % 32.4 %
Return on average common stockholders’ equity (annualized) (2)   13 %     10 %     8 %     12 %     14 %
Financial Condition (at quarter end, in billions)
Cash and investments segregated (5 %) (16 %) $ 22.7 $ 26.9 $ 26.0 $ 27.0 $ 23.8
Receivables from brokerage clients 3 % 7 % $ 12.0 $ 11.2 $ 11.1 $ 11.1 $ 11.6
Loans to banking clients 3 % - $ 9.8 $ 9.8 $ 9.8 $ 9.7 $ 9.5
Total assets (3) 15 % - $ 111.8 $ 111.5 $ 108.6 $ 102.9 $ 97.6
Deposits from banking clients 27 % 6 % $ 66.3 $ 62.3 $ 60.9 $ 54.1 $ 52.3
Payables to brokerage clients (6 %) (13 %) $ 31.8 $ 36.4 $ 35.5 $ 36.6 $ 33.9
Long-term debt - - $ 2.0 $ 2.0 $ 2.0 $ 2.0 $ 2.0
Stockholders' equity (4) 36 % 10 % $ 9.1     $ 8.3     $ 7.7     $ 7.7     $ 6.7  
Other
Full-time equivalent employees (at quarter end, in thousands) 4 % (2 %) 13.7 14.0 14.1 13.9 13.2

Annualized net revenues per average full-time equivalent employee (in thousands)

3 % 9 % $ 372 $ 340 $ 316 $ 350 $ 361

Capital expenditures - cash purchases of equipment, office facilities, and property, net (in millions)

(30 %) (9 %) $ 31     $ 34     $ 55     $ 54     $ 44  
Clients’ Daily Average Trades (in thousands)
Revenue trades (5) 8 % (10 %) 285.2 318.4 307.4 323.1 264.9
Asset-based trades (6) 16 % (6 %) 50.6 53.7 45.9 50.6 43.6
Other trades (7) 13 % (4 %)   99.8       104.1       106.3       101.7       88.6  
Total 10 % (9 %)   435.6       476.2       459.6       475.4       397.1  
Average Revenue Per Revenue Trade (5) (1 %) (2 %) $ 12.15     $ 12.35     $ 12.21     $ 12.04     $ 12.23  
 
(1) Includes $70 million relating to a confidential resolution of a vendor dispute, which was received in the second quarter of 2012.
(2) Return on average common stockholders' equity is calculated using net income available to common stockholders divided by average common stockholders' equity.
(3) Total assets as of June 30, 2012, March 31, 2012, December 31, 2011, and September 30, 2011, reflect preliminary purchase accounting for the assignment of fair values
to optionsXpress Holdings, Inc.'s assets and liabilities acquired. Amounts are subject to refinement as information relative to the closing date fair values becomes available.
(4) In the second quarter and first quarter of 2012, the Company issued non-cumulative perpetual preferred stock, Series B, for a total liquidation preference of $485 million
and non-cumulative perpetual preferred stock, Series A, with a total liquidation preference of $400 million, respectively.
(5) Includes all client trades that generate either commission revenue or revenue from principal markups (i.e., fixed income); also known as DART.
(6) Includes eligible trades executed by clients who participate in one or more of the Company's asset-based pricing relationships.
(7) Includes all commission free trades, including Schwab Mutual Fund OneSource® funds and ETFs, and other proprietary products.
N/M Not meaningful.
 
See Note to Consolidated Statements of Income, Financial and Operating Highlights, and Net Interest Revenue Information.
 
THE CHARLES SCHWAB CORPORATION
Net Interest Revenue Information
(In millions)
(Unaudited)
       
  Three Months Ended

June 30,

Six Months Ended

June 30,

2012     2011 2012     2011
    Average

Balance

  Interest

Revenue/

Expense

  Average

Yield/

Rate

Average

Balance

  Interest

Revenue/

Expense

  Average

Yield/

Rate

Average

Balance

  Interest

Revenue/

Expense

  Average

Yield/

Rate

Average

Balance

  Interest

Revenue/

Expense

  Average

Yield/

Rate

               
Interest-earning assets:
Cash and cash equivalents $ 5,721 $ 4 0.28 % $ 5,318 $ 3 0.23 % $ 6,134 $ 8 0.26 % $ 5,137 $ 6 0.24 %
Cash and investments segregated 25,429 11 0.17 % 23,478 9 0.15 % 26,140 21 0.16 % 23,335 23 0.20 %
Broker-related receivables (1) 306 - 0.06 % 367 - - 311 - 0.07 % 370 - 0.06 %
Receivables from brokerage clients 11,091 115 4.17 % 10,880 122 4.50 % 10,646 221 4.17 % 10,609 239 4.54 %
Securities available for sale (2) 38,407 152 1.59 % 26,105 110 1.69 % 37,302 297 1.60 % 25,563 216 1.70 %
Securities held to maturity 15,240 108 2.85 % 16,350 145 3.56 % 15,106 207 2.76 % 16,742 285 3.43 %
Loans to banking clients 9,884 77 3.13 % 9,366 77 3.30 % 9,874 156 3.18 % 9,188 152 3.34 %
Loans held for sale (1)     18     -   4.04 %   27     -   4.71 %   36     1   4.12 %   70     1   4.50 %
Total interest-earning assets     106,096     467   1.77 %   91,891     466   2.03 %   105,549     911   1.74 %   91,014     922   2.04 %
Other interest revenue         30           30           58           55    
Total interest-earning assets   $ 106,096   $ 497   1.88 % $ 91,891   $ 496   2.17 % $ 105,549   $ 969   1.85 % $ 91,014   $ 977   2.16 %
Funding sources:
Deposits from banking clients $ 62,560 $ 10 0.06 % $ 51,338 $ 16 0.13 % $ 61,833 $ 20 0.07 % $ 50,836 $ 33 0.13 %
Payables to brokerage clients (1) 29,977 - 0.01 % 28,086 - 0.01 % 30,266 1 0.01 % 27,573 1 0.01 %
Long-term debt     1,999     27   5.43 %   2,004     27   5.40 %   2,000     54   5.43 %   2,005     54   5.43 %
Total interest-bearing liabilities     94,536     37   0.16 %   81,428     43   0.21 %   94,099     75   0.16 %   80,414     88   0.22 %
Non-interest-bearing funding sources 11,560 10,463 11,450 10,600
Other interest expense         2           2           2           2    
Total funding sources   $ 106,096   $ 39   0.14 % $ 91,891   $ 45   0.20 % $ 105,549 $ 77 0.15 % $ 91,014 $ 90 0.20 %
Net interest revenue       $ 458   1.74 %     $ 451   1.97 %   $ 892 1.70 %   $ 887 1.96 %
(1) Interest revenue or expense was less than $500,000 in the period or periods presented.
(2) Amounts have been calculated based on amortized cost.
 
See Note to Consolidated Statements of Income, Financial and Operating Highlights, and Net Interest Revenue Information.
 

Note to Consolidated Statements of Income, Financial and Operating Highlights,

and Net Interest Revenue Information
(Unaudited)

 
The Company
The consolidated statements of income, financial and operating highlights, and net interest revenue information include The Charles Schwab Corporation (CSC) and its majority-owned subsidiaries (collectively referred to as the Company), including Charles Schwab & Co., Inc. and Charles Schwab Bank. Certain prior period amounts have been reclassified to conform to the 2012 presentation. The consolidated statements of income, financial and operating highlights, and net interest revenue information should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.
 
THE CHARLES SCHWAB CORPORATION
Asset Management and Administration Fees Information
(In millions)
(Unaudited)
       
  Three Months Ended

June 30,

Six Months Ended

June 30,

2012     2011 2012     2011
    Average

Client

Assets

 

Revenue

  Average

Fee

Average

Client

Assets

 

Revenue

  Average

Fee

Average

Client

Assets

 

Revenue

  Average

Fee

Average

Client

Assets

 

Revenue

  Average

Fee

               
Schwab money market funds
before fee waivers $ 153,103 $ 220 0.58 % $ 149,652 $ 208 0.56 % $ 154,858 $ 442 0.57 % $ 151,027 $ 419 0.56 %
Fee waivers         (146 )           (128 )           (309 )           (240 )    
Schwab money market funds 153,103 74 0.19 % 149,652 80 0.21 % 154,858 133 0.17 % 151,027 179 0.24 %
Equity and bond funds (1) 46,375 31 0.27 % 42,577 31 0.29 % 46,003 63 0.28 % 41,892 60 0.29 %
Mutual Fund OneSource ®     212,028     164     0.31 %   224,022     182     0.33 %   213,689     330     0.31 %   219,994     356     0.33 %
Total mutual funds (2)   $ 411,506     269     0.26 % $ 416,251     293     0.28 % $ 414,550     526     0.26 % $ 412,913     595     0.29 %
Advice solutions (2) $ 117,001 140 0.48 % $ 111,911 134 0.48 % $ 116,248 279 0.48 % $ 110,002 263 0.48 %
Other (3)         87             75             175             146      
Total asset management and
administration fees       $ 496           $ 502           $ 980           $ 1,004      
(1) Includes Schwab ETFs.
(2)

Advice solutions include separately managed accounts, customized personal advice for tailored portfolios, and specialized planning and full-time portfolio management offered through the Company's Schwab Private Client, Schwab Managed Portfolio and Managed Account Select programs. Advice solutions also includes Schwab Advisor Network, Schwab Advisor Source, and Windhaven. Average client assets for advice solutions may also include the asset balances contained in the three categories of mutual funds listed above.

(3) Includes various asset based fees, such as trust fees, 401k record keeping fees, and mutual fund clearing and other service fees.
 
THE CHARLES SCHWAB CORPORATION
Reconciliation of Net Revenues, Income Before Taxes on Income,
and Net Income Excluding Certain Items to Reported Amounts
(In millions)
(Unaudited)
 
    Three Months Ended
June 30, 2012
  Three Months Ended
March 31, 2012
  % Change
     
Net Revenues Excluding Certain Items $ 1,213 $ 1,189 2%
Other revenues (1)     70       -     N/M
 
Reported Net Revenues   $ 1,283     $ 1,189     8%
 
Reported Expenses Excluding Interest   $ 851     $ 876     (3%)
 
Income Before Taxes On Income Excluding Certain Items $ 362 $ 313 16%
Add: Other revenues excluded above     70       -     N/M
 
Reported Income Before Taxes on Income   $ 432     $ 313     38%
 
Net Income Excluding Certain Items (2) $ 231 $ 195 18%
Add: Other revenues excluded above 70 - N/M
Tax expense     (26 )     -     N/M
 
Reported Net Income   $ 275     $ 195     41%
 
Pre-tax Profit Margin Excluding Certain Items (2) 29.8 % 26.3 %
 
Reported Pre-tax Profit Margin     33.7 %     26.3 %    
(1) Relates to a confidential resolution of a vendor dispute, which was received in the second quarter of 2012.
(2)

Management believes these non-GAAP financial measures are useful indicators of the Company's ongoing financial performance, and tools that can provide meaningful insight into financial performance without the effects of certain material items that are not expected to be an ongoing part of operations.

N/M Not meaningful.
 
THE CHARLES SCHWAB CORPORATION
Growth in Client Assets and Accounts
(Unaudited)
             
 

Q2-12 % Change

2012 2011
(In billions, at quarter end, except as noted) vs.
Q2-11
  vs.
Q1-12
Second
Quarter
  First
Quarter
  Fourth
Quarter
  Third
Quarter
  Second
Quarter
Assets in client accounts  

Schwab One®, other cash equivalents and deposits from banking clients

14% (1%) $ 98.2 $ 98.8 $ 96.4 $ 90.9 $ 86.5
Proprietary funds (Schwab Funds® and Laudus Funds®):
Money market funds 1% (1%) 152.9 154.4 159.8 155.5 152.0
Equity and bond funds (9%) (1%) 45.3   45.8   38.2   34.3   49.6
Total proprietary funds (2%) (1%) 198.2   200.2   198.0   189.8   201.6
Mutual Fund Marketplace® (1)
Mutual Fund OneSource® (4%) (4%) 211.2 219.5 198.6 187.9 220.8
Mutual fund clearing services 189% - 126.4 127.0 104.2 98.6 43.7
Other third-party mutual funds 5% (2%) 328.7   334.1   305.9   290.4   314.2
Total Mutual Fund Marketplace 15% (2%) 666.3   680.6   608.7   576.9   578.7
Total mutual fund assets 11% (2%) 864.5   880.8   806.7   766.7   780.3
Equity and other securities (1) 7% (2%) 670.4 685.0 607.9 552.9 624.5
Fixed income securities 3% 1% 180.5 179.4 176.9 176.4 175.1
Margin loans outstanding 3% 7% (11.2)   (10.5)   (10.2)   (10.5)   (10.9)
Total client assets 9% (2%) $ 1,802.4   $ 1,833.5   $ 1,677.7   $ 1,576.4   $ 1,655.5
 
Client assets by business
Investor Services 4% (2%) $ 737.0 $ 753.3 $ 697.9 $ 655.4 $ 711.6
Advisor Services 4% (1%) 727.6 735.9 679.0 640.1 697.8
Other Institutional Services 37% (2%) 337.8   344.3   300.8   280.9   246.1
Total client assets by business 9% (2%) $ 1,802.4   $ 1,833.5   $ 1,677.7   $ 1,576.4   $ 1,655.5
 
Net growth in assets in client accounts (for the quarter ended)
Net new assets
Investor Services (2) 45% (51%) $ 2.9 $ 5.9 $ 5.3 $ 11.6 $ 2.0
Advisor Services (7%) (21%) 9.9 12.6 9.2 10.6 10.6
Other Institutional Services (3) 14% (84%) 3.2   20.4   7.0   63.8   2.8
Total net new assets 4% (59%) 16.0   38.9   21.5   86.0   15.4
Net market (losses) gains N/M (140%) (47.1)   116.9   79.8   (165.1)   (6.8)
Net (decline) growth N/M (120%) $ (31.1)   $ 155.8   $ 101.3   $ (79.1)   $ 8.6
 
New brokerage accounts (in thousands, for the quarter ended) (4) 8% (8%) 221 240 203 506 205
Clients (in thousands)
Active Brokerage Accounts 7% 1% 8,720 8,639 8,552 8,510 8,140
Banking Accounts 10% 3% 822 801 780 769 745
Corporate Retirement Plan Participants 6% 1% 1,524   1,516   1,492   1,462   1,439
 
(1) Excludes all proprietary money market, equity, and bond funds.
(2) Includes inflows of $7.5 billion from the acquisition of optionsXpress Holdings, Inc. in the third quarter of 2011.
(3) Includes inflows of $12.0 billion and $60.9 billion from mutual fund clearing services clients in the first quarter of 2012 and third quarter of 2011, respectively.
(4) Includes 315,000 new brokerage accounts from the acquisition of optionsXpress Holdings, Inc. in the third quarter of 2011.
N/M Not meaningful.

Contacts

Charles Schwab
Greg Gable, 415-667-0473 (Media)
Rich Fowler, 415-667-1841 (Investors/Analysts)

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Contacts

Charles Schwab
Greg Gable, 415-667-0473 (Media)
Rich Fowler, 415-667-1841 (Investors/Analysts)