Schwab Reports Second Quarter Results
Charles Schwab (SCHW) reported strong Q2 2024 results, with net income of $1.3 billion and diluted EPS of $0.66. Adjusted figures were $1.5 billion and $0.73, respectively. Total client assets reached a record $9.4 trillion, up 17% year-over-year. Core net new assets rose 17% to $61.2 billion. The company's pre-tax profit margin was 37.2% (41.0% adjusted). Schwab's Tier 1 Leverage Ratio stood at 9.4%, with an adjusted ratio of 5.9%. The company saw robust client engagement, with active brokerage accounts up 4% to 35.6 million and margin balances increasing 15% since the end of 2023 to $71.7 billion.
- Record total client assets of $9.4 trillion, up 17% year-over-year
- Core net new assets increased 17% to $61.2 billion
- Net interest margin expanded to 2.03%, up 1 basis point sequentially
- Asset management and administration fees reached a new quarterly record of $1.4 billion
- Strong capital levels with Tier 1 Leverage Ratio at 9.4%
- Adjusted net income decreased 2% year-over-year to $1.5 billion
- Adjusted diluted EPS declined 3% to $0.73
- Adjusted pre-tax profit margin decreased to 41.0% from 42.0% in Q2 2023
- Return on average common stockholders' equity dropped to 14% from 17% in Q2 2023
The second quarter results for Charles Schwab highlight a record-high total client assets of
One noteworthy element is the adjusted net income of
In the broader financial landscape, Schwab's performance is noteworthy for its balance sheet management, with a Tier 1 Leverage Ratio of
Retail investors should consider these robust financial metrics, as they indicate Schwab's stability and growth potential in both the short-term and long-term. However, it's worth noting the minor decline in revenue and income growth compared to the previous year, which could suggest a need for cautious optimism moving forward.
The growth in Schwab's managed investing solutions by
Additionally, Schwab's position as the top-ranked mobile app for customer experience for the second consecutive year indicates a strong digital strategy, which is essential in today's increasingly tech-driven financial industry. This accolade, backed by independent research, can enhance client engagement and retention, boosting long-term client loyalty.
For retail investors, Schwab’s emphasis on technology and managed investing solutions signals a forward-thinking approach that aligns with market trends. The robust growth in these areas suggests potential for sustained client acquisition and asset growth, making it an attractive proposition for those considering long-term investments.
Total Client Assets Reached A Record
Core Net New Assets Rose
Client Driven
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+ |
“Schwab’s ‘no trade-offs’ value proposition continued to resonate with investors, as new brokerage accounts opened this year grew to over 2 million and second quarter core asset gathering equaled |
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Modern Wealth
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+ to Managed Investing Solutions Versus 2023 |
“Client interest in our broad array of wealth solutions remained strong through June. Year-to-date enrollments are up ~ Co-Chairman and CEO Walt Bettinger |
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Diversified
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Pre-Tax Profit Margin (1) |
“Record asset management and administration fees, along with our balanced approach to expense management, helped Schwab produce a second quarter pre-tax margin of |
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Balance Sheet
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Leverage Ratio (1) |
“Similar to prior years, our strong capital levels and all-weather model enabled us to successfully complete the 2024 Federal Reserve stress test, with Schwab notching the highest post-stress ratios among all major banks.” CFO Peter Crawford |
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2Q24 Client and Business Highlights
-
Sustained equity market strength and organic asset gathering pushed total client assets to a record
$9.41 trillion -
Active brokerage accounts increased
4% year-over-year to 35.6 million -
Despite expected integration-related attrition, core net new assets grew
17% versus the prior year to$61.2 billion -
Client assets receiving ongoing advisory services are up
16% year-over-year, including year-to-date net flow increases into Schwab Wealth Advisory™ and Wasmer Schroeder™ Strategies of40% and53% , respectively -
Margin balances totaled
at quarter-end, up$71.7 billion 15% since the end of 2023 - Second quarter trading activity remained robust versus 2023 levels as client engagement in the markets persisted
-
Strong year-to-date client net buying of mutual and exchange-traded funds totaled
– the 2nd highest first half ever$77 billion - Schwab ranked #1 for mobile app customer experience by Corporate Insight for the second year in a row (2)
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Three Months Ended
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% |
|
Six Months Ended
|
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% |
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Financial Highlights (1) |
2024 |
|
2023 |
|
Change |
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2024 |
|
2023 |
|
Change |
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Net revenues (in millions) |
$ |
4,690 |
|
$ |
4,656 |
|
1 |
% |
$ |
9,430 |
|
$ |
9,772 |
|
(3 |
)% |
||||||
Net income (in millions) |
|
|
|
|
|
|
||||||||||||||||
GAAP |
$ |
1,332 |
|
$ |
1,294 |
|
3 |
% |
$ |
2,694 |
|
$ |
2,897 |
|
(7 |
)% |
||||||
Adjusted (1) |
$ |
1,465 |
|
$ |
1,494 |
|
(2 |
)% |
$ |
2,934 |
|
$ |
3,274 |
|
(10 |
)% |
||||||
Diluted earnings per common share |
|
|
|
|
|
|
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GAAP |
$ |
.66 |
|
$ |
.64 |
|
3 |
% |
$ |
1.34 |
|
$ |
1.48 |
|
(9 |
)% |
||||||
Adjusted (1) |
$ |
.73 |
|
$ |
.75 |
|
(3 |
)% |
$ |
1.47 |
|
$ |
1.68 |
|
(13 |
)% |
||||||
Pre-tax profit margin |
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|
|
|
|
|
||||||||||||||||
GAAP |
|
37.2 |
% |
|
36.3 |
% |
|
|
37.6 |
% |
|
38.9 |
% |
|
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Adjusted (1) |
|
41.0 |
% |
|
42.0 |
% |
|
|
40.9 |
% |
|
44.0 |
% |
|
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Return on average common stockholders’ equity (annualized) |
|
14 |
% |
|
17 |
% |
|
|
15 |
% |
|
20 |
% |
|
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Return on tangible common equity (annualized) (1) |
|
34 |
% |
|
62 |
% |
|
|
36 |
% |
|
71 |
% |
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Note: All per-share results are rounded to the nearest cent, based on weighted-average diluted common shares outstanding. |
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2Q24 Financial Commentary
-
Total net revenue increased by
1% year-over-year led by sustained market strength -
Net interest margin expanded to
2.03% , up 1 basis point sequentially -
Client transactional sweep cash balances ended June at
, reflecting clients’ April tax disbursements, slowing client cash realignment activity, and continued net securities purchases by clients$374.8 billion -
Supplemental funding (3) finished the second quarter at
, up from the first quarter as we redirected some client cash from the bank to the broker-dealer to support increased margin lending$73.7 billion -
Asset management and administration fees totaled
, a new quarterly record$1.4 billion -
GAAP expenses declined by
1% versus the prior year period and included in accruals in connection with an industry-wide regulatory review of off-channel communications$43 million -
Second quarter acquisition and integration-related costs, amortization of acquired intangibles, and restructuring costs totaled
, down$175 million from 2Q23. Exclusive of these items, adjusted total expenses (1) grew by$89 million 2% -
Charles Schwab Bank, SSB (CSB) capital ratios continued to build, with preliminary Tier 1 Leverage and adjusted Tier 1 Leverage (1) reaching
10.9% and6.2% , respectively
(1) |
Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10–12 of this release. |
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(2) |
Charles Schwab leads in mobile in Corporate Insight’s 2024 Brokerage Experience Benchmarks (https://corporateinsight.com/the-2024-brokerage-experience-benchmarks-find-hybrids-still-offer-best-experiences/), which evaluate the individual investor experience offered by 20 leading brokerage websites and mobile apps. This research was independently conducted by Corporate Benchmarks’ analytical frameworks that are built on over 25 years of research and provide a clear view of how the nation’s top brokerage websites and mobile apps stack up against one another in terms of functionality, design, navigation, and usability. Schwab paid a licensing fee to Corporate Insight for use of the award and logos. |
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(3) |
Supplemental funding includes repurchase agreements, Schwab Bank Certificates of Deposit (CDs), and Federal Home Loan Bank balances. |
Summer Business Update
The company will host its Summer Business Update for institutional investors this morning from 7:30 a.m. - 8:30 a.m. CT, 8:30 a.m. - 9:30 a.m. ET.
Registration for this Update webcast is accessible at https://www.aboutschwab.com/schwabevents.
Forward-Looking Statements
This press release contains forward-looking statements relating to the company’s value proposition and success with investors, Ameritrade integration-related attrition, expense management and capital levels. These forward-looking statements reflect management’s expectations as of the date hereof. Achievement of these expectations and objectives 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 are described in the company’s most recent reports on Form 10-K and Form 10-Q, which have been filed with the Securities and Exchange Commission and are available on the company’s website (https://www.aboutschwab.com/financial-reports) and on the Securities and Exchange Commission’s website (https://www.sec.gov). The company makes no commitment to update any forward-looking statements.
About Charles Schwab
The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 35.6 million active brokerage accounts, 5.4 million workplace plan participant accounts, 1.9 million banking accounts, and
THE CHARLES SCHWAB CORPORATION |
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Consolidated Statements of Income |
||||||||||||||||
(In millions, except per share amounts) |
||||||||||||||||
(Unaudited) |
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Three Months Ended
|
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Six Months Ended
|
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|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net Revenues |
|
|
|
|
||||||||||||
Interest revenue |
$ |
3,817 |
|
$ |
4,104 |
|
$ |
7,758 |
|
$ |
8,120 |
|
||||
Interest expense |
|
(1,659 |
) |
|
(1,814 |
) |
|
(3,367 |
) |
|
(3,060 |
) |
||||
Net interest revenue |
|
2,158 |
|
|
2,290 |
|
|
4,391 |
|
|
5,060 |
|
||||
Asset management and administration fees |
|
1,383 |
|
|
1,173 |
|
|
2,731 |
|
|
2,291 |
|
||||
Trading revenue |
|
777 |
|
|
803 |
|
|
1,594 |
|
|
1,695 |
|
||||
Bank deposit account fees |
|
153 |
|
|
175 |
|
|
336 |
|
|
326 |
|
||||
Other |
|
219 |
|
|
215 |
|
|
378 |
|
|
400 |
|
||||
Total net revenues |
|
4,690 |
|
|
4,656 |
|
|
9,430 |
|
|
9,772 |
|
||||
Expenses Excluding Interest |
|
|
|
|
||||||||||||
Compensation and benefits |
|
1,450 |
|
|
1,498 |
|
|
2,988 |
|
|
3,136 |
|
||||
Professional services |
|
259 |
|
|
272 |
|
|
500 |
|
|
530 |
|
||||
Occupancy and equipment |
|
248 |
|
|
319 |
|
|
513 |
|
|
618 |
|
||||
Advertising and market development |
|
107 |
|
|
103 |
|
|
195 |
|
|
191 |
|
||||
Communications |
|
172 |
|
|
188 |
|
|
313 |
|
|
334 |
|
||||
Depreciation and amortization |
|
233 |
|
|
191 |
|
|
461 |
|
|
368 |
|
||||
Amortization of acquired intangible assets |
|
129 |
|
|
134 |
|
|
259 |
|
|
269 |
|
||||
Regulatory fees and assessments |
|
96 |
|
|
80 |
|
|
221 |
|
|
163 |
|
||||
Other |
|
249 |
|
|
180 |
|
|
435 |
|
|
362 |
|
||||
Total expenses excluding interest |
|
2,943 |
|
|
2,965 |
|
|
5,885 |
|
|
5,971 |
|
||||
Income before taxes on income |
|
1,747 |
|
|
1,691 |
|
|
3,545 |
|
|
3,801 |
|
||||
Taxes on income |
|
415 |
|
|
397 |
|
|
851 |
|
|
904 |
|
||||
Net Income |
|
1,332 |
|
|
1,294 |
|
|
2,694 |
|
|
2,897 |
|
||||
Preferred stock dividends and other |
|
121 |
|
|
121 |
|
|
232 |
|
|
191 |
|
||||
Net Income Available to Common Stockholders |
$ |
1,211 |
|
$ |
1,173 |
|
$ |
2,462 |
|
$ |
2,706 |
|
||||
Weighted-Average Common Shares Outstanding: |
|
|
|
|
||||||||||||
Basic |
|
1,828 |
|
|
1,820 |
|
|
1,827 |
|
|
1,827 |
|
||||
Diluted |
|
1,834 |
|
|
1,825 |
|
|
1,832 |
|
|
1,834 |
|
||||
Earnings Per Common Shares Outstanding (1): |
|
|
|
|
||||||||||||
Basic |
$ |
.66 |
|
$ |
.64 |
|
$ |
1.35 |
|
$ |
1.48 |
|
||||
Diluted |
$ |
.66 |
|
$ |
.64 |
|
$ |
1.34 |
|
$ |
1.48 |
|
(1) |
The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class. |
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THE CHARLES SCHWAB CORPORATION |
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Financial and Operating Highlights |
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(Unaudited) |
|||||||||||||||||||||||||||
|
Q2-24 % change |
2024 |
|
2023 |
|||||||||||||||||||||||
(In millions, except per share amounts and as noted) |
vs.
|
|
vs.
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
||||||||||||||
Net Revenues |
|
|
|
|
|
|
|
||||||||||||||||||||
Net interest revenue |
(6 |
)% |
(3 |
)% |
$ |
2,158 |
|
$ |
2,233 |
|
$ |
2,130 |
|
$ |
2,237 |
|
$ |
2,290 |
|
||||||||
Asset management and administration fees |
18 |
% |
3 |
% |
|
1,383 |
|
|
1,348 |
|
|
1,241 |
|
|
1,224 |
|
|
1,173 |
|
||||||||
Trading revenue |
(3 |
)% |
(5 |
)% |
|
777 |
|
|
817 |
|
|
767 |
|
|
768 |
|
|
803 |
|
||||||||
Bank deposit account fees |
(13 |
)% |
(16 |
)% |
|
153 |
|
|
183 |
|
|
174 |
|
|
205 |
|
|
175 |
|
||||||||
Other |
2 |
% |
38 |
% |
|
219 |
|
|
159 |
|
|
147 |
|
|
172 |
|
|
215 |
|
||||||||
Total net revenues |
1 |
% |
(1 |
)% |
|
4,690 |
|
|
4,740 |
|
|
4,459 |
|
|
4,606 |
|
|
4,656 |
|
||||||||
Expenses Excluding Interest |
|
|
|
|
|
|
|
||||||||||||||||||||
Compensation and benefits (1) |
(3 |
)% |
(6 |
)% |
|
1,450 |
|
|
1,538 |
|
|
1,409 |
|
|
1,770 |
|
|
1,498 |
|
||||||||
Professional services |
(5 |
)% |
7 |
% |
|
259 |
|
|
241 |
|
|
253 |
|
|
275 |
|
|
272 |
|
||||||||
Occupancy and equipment |
(22 |
)% |
(6 |
)% |
|
248 |
|
|
265 |
|
|
331 |
|
|
305 |
|
|
319 |
|
||||||||
Advertising and market development |
4 |
% |
22 |
% |
|
107 |
|
|
88 |
|
|
104 |
|
|
102 |
|
|
103 |
|
||||||||
Communications |
(9 |
)% |
22 |
% |
|
172 |
|
|
141 |
|
|
144 |
|
|
151 |
|
|
188 |
|
||||||||
Depreciation and amortization |
22 |
% |
2 |
% |
|
233 |
|
|
228 |
|
|
238 |
|
|
198 |
|
|
191 |
|
||||||||
Amortization of acquired intangible assets |
(4 |
)% |
(1 |
)% |
|
129 |
|
|
130 |
|
|
130 |
|
|
135 |
|
|
134 |
|
||||||||
Regulatory fees and assessments |
20 |
% |
(23 |
)% |
|
96 |
|
|
125 |
|
|
270 |
|
|
114 |
|
|
80 |
|
||||||||
Other (2) |
38 |
% |
34 |
% |
|
249 |
|
|
186 |
|
|
386 |
|
|
173 |
|
|
180 |
|
||||||||
Total expenses excluding interest |
(1 |
)% |
— |
|
|
2,943 |
|
|
2,942 |
|
|
3,265 |
|
|
3,223 |
|
|
2,965 |
|
||||||||
Income before taxes on income |
3 |
% |
(3 |
)% |
|
1,747 |
|
|
1,798 |
|
|
1,194 |
|
|
1,383 |
|
|
1,691 |
|
||||||||
Taxes on income |
5 |
% |
(5 |
)% |
|
415 |
|
|
436 |
|
|
149 |
|
|
258 |
|
|
397 |
|
||||||||
Net Income |
3 |
% |
(2 |
)% |
|
1,332 |
|
|
1,362 |
|
|
1,045 |
|
|
1,125 |
|
|
1,294 |
|
||||||||
Preferred stock dividends and other |
— |
|
9 |
% |
|
121 |
|
|
111 |
|
|
119 |
|
|
108 |
|
|
121 |
|
||||||||
Net Income Available to Common Stockholders |
3 |
% |
(3 |
)% |
$ |
1,211 |
|
$ |
1,251 |
|
$ |
926 |
|
$ |
1,017 |
|
$ |
1,173 |
|
||||||||
Earnings per common share (3): |
|
|
|
|
|
|
|
||||||||||||||||||||
Basic |
3 |
% |
(4 |
)% |
$ |
.66 |
|
$ |
.69 |
|
$ |
.51 |
|
$ |
.56 |
|
$ |
.64 |
|
||||||||
Diluted |
3 |
% |
(3 |
)% |
$ |
.66 |
|
$ |
.68 |
|
$ |
.51 |
|
$ |
.56 |
|
$ |
.64 |
|
||||||||
Dividends declared per common share |
— |
|
— |
|
$ |
.25 |
|
$ |
.25 |
|
$ |
.25 |
|
$ |
.25 |
|
$ |
.25 |
|
||||||||
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
||||||||||||||||||||
Basic |
— |
|
— |
|
|
1,828 |
|
|
1,825 |
|
|
1,823 |
|
|
1,821 |
|
|
1,820 |
|
||||||||
Diluted |
— |
|
— |
|
|
1,834 |
|
|
1,831 |
|
|
1,828 |
|
|
1,827 |
|
|
1,825 |
|
||||||||
Performance Measures |
|
|
|
|
|
|
|
||||||||||||||||||||
Pre-tax profit margin |
|
|
|
37.2 |
% |
|
37.9 |
% |
|
26.8 |
% |
|
30.0 |
% |
|
36.3 |
% |
||||||||||
Return on average common stockholders’ equity (annualized) (4) |
|
|
|
14 |
% |
|
15 |
% |
|
12 |
% |
|
14 |
% |
|
17 |
% |
||||||||||
Financial Condition (at quarter end, in billions) |
|
|
|
|
|
|
|
||||||||||||||||||||
Cash and cash equivalents |
(47 |
)% |
(20 |
)% |
$ |
25.4 |
|
$ |
31.8 |
|
$ |
43.3 |
|
$ |
33.3 |
|
$ |
47.7 |
|
||||||||
Cash and investments segregated |
(14 |
)% |
(16 |
)% |
|
21.7 |
|
|
25.9 |
|
|
31.8 |
|
|
18.6 |
|
|
25.1 |
|
||||||||
Receivables from brokerage clients — net |
12 |
% |
2 |
% |
|
72.8 |
|
|
71.2 |
|
|
68.7 |
|
|
69.1 |
|
|
65.2 |
|
||||||||
Available for sale securities |
(26 |
)% |
(7 |
)% |
|
93.6 |
|
|
101.1 |
|
|
107.6 |
|
|
110.3 |
|
|
125.8 |
|
||||||||
Held to maturity securities |
(8 |
)% |
(2 |
)% |
|
153.2 |
|
|
156.4 |
|
|
159.5 |
|
|
162.5 |
|
|
166.3 |
|
||||||||
Bank loans — net |
5 |
% |
3 |
% |
|
42.2 |
|
|
40.8 |
|
|
40.4 |
|
|
40.3 |
|
|
40.1 |
|
||||||||
Total assets |
(12 |
)% |
(4 |
)% |
|
449.7 |
|
|
468.8 |
|
|
493.2 |
|
|
475.2 |
|
|
511.5 |
|
||||||||
Bank deposits |
(17 |
)% |
(6 |
)% |
|
252.4 |
|
|
269.5 |
|
|
290.0 |
|
|
284.4 |
|
|
304.4 |
|
||||||||
Payables to brokerage clients |
(6 |
)% |
(5 |
)% |
|
80.0 |
|
|
84.0 |
|
|
84.8 |
|
|
72.8 |
|
|
84.8 |
|
||||||||
Other short-term borrowings |
28 |
% |
19 |
% |
|
10.0 |
|
|
8.4 |
|
|
6.6 |
|
|
7.6 |
|
|
7.8 |
|
||||||||
Federal Home Loan Bank borrowings |
(40 |
)% |
2 |
% |
|
24.4 |
|
|
24.0 |
|
|
26.4 |
|
|
31.8 |
|
|
41.0 |
|
||||||||
Long-term debt |
— |
|
(2 |
)% |
|
22.4 |
|
|
22.9 |
|
|
26.1 |
|
|
24.8 |
|
|
22.5 |
|
||||||||
Stockholders’ equity |
19 |
% |
4 |
% |
|
44.0 |
|
|
42.4 |
|
|
41.0 |
|
|
37.8 |
|
|
37.1 |
|
||||||||
Other |
|
|
|
|
|
|
|
||||||||||||||||||||
Full-time equivalent employees (at quarter end, in thousands) |
(12 |
)% |
(1 |
)% |
|
32.3 |
|
|
32.6 |
|
|
33.0 |
|
|
35.9 |
|
|
36.6 |
|
||||||||
Capital expenditures — purchases of equipment, office facilities, and property, net (in millions) |
(45 |
)% |
(25 |
)% |
$ |
92 |
|
$ |
122 |
|
$ |
199 |
|
$ |
250 |
|
$ |
168 |
|
||||||||
Expenses excluding interest as a percentage of average client assets (annualized) |
|
|
|
0.13 |
% |
|
0.14 |
% |
|
0.16 |
% |
|
0.16 |
% |
|
0.15 |
% |
||||||||||
Clients’ Daily Average Trades (DATs) (in thousands) |
4 |
% |
(8 |
)% |
|
5,486 |
|
|
5,958 |
|
|
5,192 |
|
|
5,218 |
|
|
5,272 |
|
||||||||
Number of Trading Days |
2 |
% |
3 |
% |
|
63.0 |
|
|
61.0 |
|
|
62.5 |
|
|
62.5 |
|
|
62.0 |
|
||||||||
Revenue Per Trade (5) |
(9 |
)% |
— |
|
$ |
2.25 |
|
$ |
2.25 |
|
$ |
2.36 |
|
$ |
2.35 |
|
$ |
2.46 |
|
||||||||
|
|
|
|
|
|
|
|
(1) |
Fourth quarter of 2023 includes |
|
(2) |
Fourth quarter of 2023 includes |
|
(3) |
The Company has voting and nonvoting common stock outstanding. As the participation rights, including dividend and liquidation rights, are identical between the voting and nonvoting stock classes, basic and diluted earnings per share are the same for each class. |
|
(4) |
Return on average common stockholders’ equity is calculated using net income available to common stockholders divided by average common stockholders’ equity. |
|
(5) |
Revenue per trade is calculated as trading revenue divided by DATs multiplied by the number of trading days. |
|
THE CHARLES SCHWAB CORPORATION |
||||||||||||||||||||||||||||||||||||||||
Net Interest Revenue Information |
||||||||||||||||||||||||||||||||||||||||
(In millions, except ratios or as noted) |
||||||||||||||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|||||||||||||||||||||||||||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|||||||||||||||||||||||||||||
|
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 |
$ |
28,839 |
$ |
382 |
5.24 |
% |
$ |
44,683 |
$ |
547 |
|
4.84 |
% |
$ |
31,394 |
$ |
836 |
5.26 |
% |
$ |
40,891 |
$ |
960 |
4.67 |
% |
|||||||||||||||
Cash and investments segregated |
|
21,493 |
|
281 |
5.17 |
% |
|
27,399 |
|
324 |
|
4.68 |
% |
|
25,503 |
|
669 |
5.19 |
% |
|
33,699 |
|
756 |
4.46 |
% |
|||||||||||||||
Receivables from brokerage clients |
|
68,715 |
|
1,351 |
7.78 |
% |
|
60,709 |
|
1,167 |
|
7.60 |
% |
|
66,259 |
|
2,611 |
7.80 |
% |
|
60,626 |
|
2,251 |
7.39 |
% |
|||||||||||||||
Available for sale securities (1) |
|
104,045 |
|
555 |
2.13 |
% |
|
145,032 |
|
791 |
|
2.18 |
% |
|
107,956 |
|
1,149 |
2.12 |
% |
|
150,382 |
|
1,616 |
2.15 |
% |
|||||||||||||||
Held to maturity securities |
|
154,314 |
|
658 |
1.70 |
% |
|
167,499 |
|
720 |
|
1.72 |
% |
|
155,862 |
|
1,348 |
1.73 |
% |
|
169,184 |
|
1,466 |
1.73 |
% |
|||||||||||||||
Bank loans |
|
41,562 |
|
460 |
4.44 |
% |
|
40,124 |
|
410 |
|
4.09 |
% |
|
41,046 |
|
900 |
4.40 |
% |
|
40,185 |
|
801 |
4.00 |
% |
|||||||||||||||
Total interest-earning assets |
|
418,968 |
|
3,687 |
3.50 |
% |
|
485,446 |
|
3,959 |
|
3.24 |
% |
|
428,020 |
|
7,513 |
3.49 |
% |
|
494,967 |
|
7,850 |
3.16 |
% |
|||||||||||||||
Securities lending revenue |
|
|
95 |
|
|
|
124 |
|
|
|
|
171 |
|
|
|
236 |
|
|||||||||||||||||||||||
Other interest revenue |
|
|
35 |
|
|
|
21 |
|
|
|
|
74 |
|
|
|
34 |
|
|||||||||||||||||||||||
Total interest-earning assets |
$ |
418,968 |
$ |
3,817 |
3.62 |
% |
$ |
485,446 |
$ |
4,104 |
|
3.36 |
% |
$ |
428,020 |
$ |
7,758 |
3.60 |
% |
$ |
494,967 |
$ |
8,120 |
3.27 |
% |
|||||||||||||||
Funding sources |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||
Bank deposits |
$ |
258,119 |
$ |
840 |
1.31 |
% |
$ |
312,543 |
$ |
863 |
|
1.11 |
% |
$ |
266,243 |
$ |
1,761 |
1.33 |
% |
$ |
327,739 |
$ |
1,481 |
0.91 |
% |
|||||||||||||||
Payables to brokerage clients |
|
67,680 |
|
77 |
0.45 |
% |
|
64,892 |
|
64 |
|
0.40 |
% |
|
68,011 |
|
150 |
0.44 |
% |
|
70,997 |
|
139 |
0.40 |
% |
|||||||||||||||
Other short-term borrowings |
|
9,268 |
|
129 |
5.59 |
% |
|
7,622 |
|
97 |
|
5.08 |
% |
|
8,327 |
|
232 |
5.60 |
% |
|
7,272 |
|
183 |
5.06 |
% |
|||||||||||||||
Federal Home Loan Bank borrowings |
|
25,582 |
|
348 |
5.42 |
% |
|
46,813 |
|
606 |
|
5.13 |
% |
|
25,220 |
|
678 |
5.35 |
% |
|
35,697 |
|
910 |
5.07 |
% |
|||||||||||||||
Long-term debt |
|
22,460 |
|
208 |
3.70 |
% |
|
21,237 |
|
157 |
|
2.95 |
% |
|
23,730 |
|
432 |
3.64 |
% |
|
20,766 |
|
296 |
2.85 |
% |
|||||||||||||||
Total interest-bearing liabilities |
|
383,109 |
|
1,602 |
1.68 |
% |
|
453,107 |
|
1,787 |
|
1.57 |
% |
|
391,531 |
|
3,253 |
1.66 |
% |
|
462,471 |
|
3,009 |
1.31 |
% |
|||||||||||||||
Non-interest-bearing funding sources |
|
35,859 |
|
|
|
32,339 |
|
|
|
36,489 |
|
|
|
32,496 |
|
|
||||||||||||||||||||||||
Securities lending expense |
|
|
57 |
|
|
|
28 |
|
|
|
|
112 |
|
|
|
50 |
|
|||||||||||||||||||||||
Other interest expense |
|
|
— |
|
|
|
(1 |
) |
|
|
|
2 |
|
|
|
1 |
|
|||||||||||||||||||||||
Total funding sources |
$ |
418,968 |
$ |
1,659 |
1.59 |
% |
$ |
485,446 |
$ |
1,814 |
|
1.49 |
% |
$ |
428,020 |
$ |
3,367 |
1.57 |
% |
$ |
494,967 |
$ |
3,060 |
1.24 |
% |
|||||||||||||||
Net interest revenue |
|
$ |
2,158 |
2.03 |
% |
|
$ |
2,290 |
|
1.87 |
% |
|
$ |
4,391 |
2.03 |
% |
|
$ |
5,060 |
2.03 |
% |
(1) |
Amounts have been calculated based on amortized cost. |
|
THE CHARLES SCHWAB CORPORATION |
|||||||||||||||||||||||||||||||||||||||
Asset Management and Administration Fees Information |
|||||||||||||||||||||||||||||||||||||||
(In millions, except ratios or as noted) |
|||||||||||||||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||||||||||||||
|
Three Months Ended
|
|
|
Six Months Ended
|
|||||||||||||||||||||||||||||||||||
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|||||||||||||||||||||||||||||
|
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 |
$ |
523,665 |
|
$ |
357 |
|
0.27 |
% |
|
|
$ |
375,898 |
|
$ |
252 |
|
0.27 |
% |
|
|
$ |
511,776 |
|
$ |
693 |
|
0.27 |
% |
|
|
$ |
346,145 |
|
$ |
465 |
|
0.27 |
% |
|
Schwab equity and bond funds, exchange-traded funds (ETFs), and collective trust funds (CTFs) |
|
565,848 |
|
|
112 |
|
0.08 |
% |
|
|
|
465,079 |
|
|
94 |
|
0.08 |
% |
|
|
|
552,755 |
|
|
219 |
|
0.08 |
% |
|
|
|
457,830 |
|
|
185 |
|
0.08 |
% |
|
Mutual Fund OneSource® and other no-transaction- fee funds |
|
338,198 |
|
|
214 |
|
0.25 |
% |
|
|
|
229,207 |
|
|
151 |
|
0.26 |
% |
|
|
|
326,387 |
|
|
423 |
|
0.26 |
% |
|
|
|
225,822 |
|
|
299 |
|
0.27 |
% |
|
Other third-party mutual funds and ETFs |
|
600,902 |
|
|
102 |
|
0.07 |
% |
|
|
|
681,486 |
|
|
133 |
|
0.08 |
% |
|
|
|
603,263 |
|
|
208 |
|
0.07 |
% |
|
|
|
678,915 |
|
|
266 |
|
0.08 |
% |
|
Total mutual funds, ETFs, and CTFs (1) |
$ |
2,028,613 |
|
|
785 |
|
0.16 |
% |
|
|
$ |
1,751,670 |
|
|
630 |
|
0.14 |
% |
|
|
$ |
1,994,181 |
|
|
1,543 |
|
0.16 |
% |
|
|
$ |
1,708,712 |
|
|
1,215 |
|
0.14 |
% |
|
Advice solutions (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Fee-based |
$ |
525,689 |
|
|
510 |
|
0.39 |
% |
|
|
$ |
455,859 |
|
|
464 |
|
0.41 |
% |
|
|
$ |
515,911 |
|
|
1,013 |
|
0.39 |
% |
|
|
$ |
449,443 |
|
|
917 |
|
0.41 |
% |
|
Non-fee-based |
|
110,234 |
|
|
— |
|
— |
|
|
|
|
95,427 |
|
|
— |
|
— |
|
|
|
|
108,133 |
|
|
— |
|
— |
|
|
|
|
94,948 |
|
|
— |
|
— |
|
|
Total advice solutions |
$ |
635,923 |
|
|
510 |
|
0.32 |
% |
|
|
$ |
551,286 |
|
|
464 |
|
0.34 |
% |
|
|
$ |
624,044 |
|
|
1,013 |
|
0.33 |
% |
|
|
$ |
544,391 |
|
|
917 |
|
0.34 |
% |
|
Other balance-based fees (2) |
|
763,750 |
|
|
69 |
|
0.04 |
% |
|
|
|
594,528 |
|
|
63 |
|
0.04 |
% |
|
|
|
741,599 |
|
|
138 |
|
0.04 |
% |
|
|
|
578,158 |
|
|
125 |
|
0.04 |
% |
|
Other (3) |
|
|
|
19 |
|
|
|
|
|
|
|
16 |
|
|
|
|
|
|
|
37 |
|
|
|
|
|
|
|
34 |
|
|
|||||||||
Total asset management and administration fees |
|
|
$ |
1,383 |
|
|
|
|
|
|
$ |
1,173 |
|
|
|
|
|
|
$ |
2,731 |
|
|
|
|
|
|
$ |
2,291 |
|
|
(1) |
Advice solutions include managed portfolios, specialized strategies, and customized investment advice such as Schwab Wealth AdvisoryTM, Schwab Managed PortfoliosTM, Managed Account Select®, Schwab Advisor Network®, Windhaven Strategies®, ThomasPartners® Strategies, Schwab Index Advantage advised retirement plan balances, Schwab Intelligent Portfolios®, Institutional Intelligent Portfolios®, Schwab Intelligent Portfolios Premium®, AdvisorDirect®, Essential Portfolios, Selective Portfolios, and Personalized Portfolios; as well as legacy non-fee advice solutions including Schwab Advisor Source and certain retirement plan balances. Average client assets for advice solutions may also include the asset balances contained in the mutual fund and/or ETF categories listed above. For the total end of period view, please see the Monthly Activity Report. |
|
(2) |
Includes various asset-related fees, such as trust fees, 401(k) recordkeeping fees, and mutual fund clearing fees and other service fees. |
|
(3) |
Includes miscellaneous service and transaction fees relating to mutual funds and ETFs that are not balance-based. |
|
THE CHARLES SCHWAB CORPORATION |
|||||||||||||||||||||||||||
Growth in Client Assets and Accounts |
|||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||
|
Q2-24 % Change |
|
|
2024 |
|
2023 |
|||||||||||||||||||||
(In billions, at quarter end, except as noted) |
vs.
|
|
vs.
|
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|||||||||||||
Assets in client accounts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Schwab One®, certain cash equivalents, and bank deposits |
(14 |
)% |
|
(5 |
)% |
|
|
$ |
330.7 |
|
|
$ |
348.2 |
|
|
$ |
368.3 |
|
|
$ |
353.1 |
|
|
$ |
384.4 |
|
|
Bank deposit account balances |
(18 |
)% |
|
(6 |
)% |
|
|
|
84.5 |
|
|
|
90.2 |
|
|
|
97.4 |
|
|
|
99.5 |
|
|
|
102.7 |
|
|
Proprietary mutual funds (Schwab Funds® and Laudus Funds®) and CTFs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Money market funds (1) |
36 |
% |
|
3 |
% |
|
|
|
533.6 |
|
|
|
515.7 |
|
|
|
476.4 |
|
|
|
436.3 |
|
|
|
392.9 |
|
|
Equity and bond funds and CTFs (2) |
24 |
% |
|
4 |
% |
|
|
|
214.4 |
|
|
|
206.0 |
|
|
|
186.7 |
|
|
|
167.9 |
|
|
|
172.6 |
|
|
Total proprietary mutual funds and CTFs |
32 |
% |
|
4 |
% |
|
|
|
748.0 |
|
|
|
721.7 |
|
|
|
663.1 |
|
|
|
604.2 |
|
|
|
565.5 |
|
|
Mutual Fund Marketplace® (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Mutual Fund OneSource® and other no-transaction-fee funds |
35 |
% |
|
5 |
% |
|
|
|
344.8 |
|
|
|
329.2 |
|
|
|
306.2 |
|
|
|
288.0 |
|
|
|
254.6 |
|
|
Mutual fund clearing services |
20 |
% |
|
7 |
% |
|
|
|
264.7 |
|
|
|
248.1 |
|
|
|
233.4 |
|
|
|
216.9 |
|
|
|
220.7 |
|
|
Other third-party mutual funds |
2 |
% |
|
— |
|
|
|
|
1,177.5 |
|
|
|
1,182.9 |
|
|
|
1,126.5 |
|
|
|
1,055.3 |
|
|
|
1,150.8 |
|
|
Total Mutual Fund Marketplace |
10 |
% |
|
2 |
% |
|
|
|
1,787.0 |
|
|
|
1,760.2 |
|
|
|
1,666.1 |
|
|
|
1,560.2 |
|
|
|
1,626.1 |
|
|
Total mutual fund assets |
16 |
% |
|
2 |
% |
|
|
|
2,535.0 |
|
|
|
2,481.9 |
|
|
|
2,329.2 |
|
|
|
2,164.4 |
|
|
|
2,191.6 |
|
|
Exchange-traded funds |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Proprietary ETFs (2) |
19 |
% |
|
2 |
% |
|
|
|
349.6 |
|
|
|
342.9 |
|
|
|
319.4 |
|
|
|
286.2 |
|
|
|
293.2 |
|
|
Other third-party ETFs |
26 |
% |
|
4 |
% |
|
|
|
1,738.6 |
|
|
|
1,676.6 |
|
|
|
1,521.7 |
|
|
|
1,352.6 |
|
|
|
1,381.4 |
|
|
Total ETF assets |
25 |
% |
|
3 |
% |
|
|
|
2,088.2 |
|
|
|
2,019.5 |
|
|
|
1,841.1 |
|
|
|
1,638.8 |
|
|
|
1,674.6 |
|
|
Equity and other securities |
22 |
% |
|
5 |
% |
|
|
|
3,648.8 |
|
|
|
3,467.7 |
|
|
|
3,163.5 |
|
|
|
2,886.4 |
|
|
|
3,002.7 |
|
|
Fixed income securities |
10 |
% |
|
2 |
% |
|
|
|
792.0 |
|
|
|
779.0 |
|
|
|
779.7 |
|
|
|
747.4 |
|
|
|
722.6 |
|
|
Margin loans outstanding |
14 |
% |
|
5 |
% |
|
|
|
(71.7 |
) |
|
|
(68.1 |
) |
|
|
(62.6 |
) |
|
|
(65.1 |
) |
|
|
(62.8 |
) |
|
Total client assets |
17 |
% |
|
3 |
% |
|
|
$ |
9,407.5 |
|
|
$ |
9,118.4 |
|
|
$ |
8,516.6 |
|
|
$ |
7,824.5 |
|
|
$ |
8,015.8 |
|
|
Client assets by business |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Investor Services |
18 |
% |
|
4 |
% |
|
|
$ |
5,055.7 |
|
|
$ |
4,852.2 |
|
|
$ |
4,519.1 |
|
|
$ |
4,157.7 |
|
|
$ |
4,267.9 |
|
|
Advisor Services |
16 |
% |
|
2 |
% |
|
|
|
4,351.8 |
|
|
|
4,266.2 |
|
|
|
3,997.5 |
|
|
|
3,666.8 |
|
|
|
3,747.9 |
|
|
Total client assets |
17 |
% |
|
3 |
% |
|
|
$ |
9,407.5 |
|
|
$ |
9,118.4 |
|
|
$ |
8,516.6 |
|
|
$ |
7,824.5 |
|
|
$ |
8,015.8 |
|
|
Net growth in assets in client accounts (for the quarter ended) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net new assets by business |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Investor Services (4) |
11 |
% |
|
14 |
% |
|
|
$ |
39.9 |
|
|
$ |
34.9 |
|
|
$ |
25.0 |
|
|
$ |
28.6 |
|
|
$ |
36.0 |
|
|
Advisor Services (5) |
(5 |
)% |
|
(36 |
)% |
|
|
|
34.3 |
|
|
|
53.3 |
|
|
|
41.3 |
|
|
|
19.6 |
|
|
|
36.0 |
|
|
Total net new assets |
3 |
% |
|
(16 |
)% |
|
|
$ |
74.2 |
|
|
$ |
88.2 |
|
|
$ |
66.3 |
|
|
$ |
48.2 |
|
|
$ |
72.0 |
|
|
Net market gains (losses) |
|
|
|
|
|
|
214.9 |
|
|
|
513.6 |
|
|
|
625.8 |
|
|
|
(239.5 |
) |
|
|
363.8 |
|
|||
Net growth (decline) |
|
|
|
|
|
$ |
289.1 |
|
|
$ |
601.8 |
|
|
$ |
692.1 |
|
|
$ |
(191.3 |
) |
|
$ |
435.8 |
|
|||
New brokerage accounts (in thousands, for the quarter ended) |
3 |
% |
|
(10 |
)% |
|
|
|
985 |
|
|
|
1,094 |
|
|
|
910 |
|
|
|
894 |
|
|
|
960 |
|
|
Client accounts (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Active brokerage accounts |
4 |
% |
|
1 |
% |
|
|
|
35,612 |
|
|
|
35,301 |
|
|
|
34,838 |
|
|
|
34,540 |
|
|
|
34,382 |
|
|
Banking accounts |
8 |
% |
|
2 |
% |
|
|
|
1,931 |
|
|
|
1,885 |
|
|
|
1,838 |
|
|
|
1,799 |
|
|
|
1,781 |
|
|
Workplace Plan Participant Accounts (6) |
7 |
% |
|
2 |
% |
|
|
|
5,363 |
|
|
|
5,277 |
|
|
|
5,221 |
|
|
|
5,141 |
|
|
|
5,003 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Total client assets in purchased money market funds are located at: https://www.aboutschwab.com/investor-relations. |
|
(2) |
Includes balances held on and off the Schwab platform. As of June 30, 2024, off-platform equity and bond funds, CTFs, and ETFs were |
|
(3) |
Excludes all proprietary mutual funds and ETFs. |
|
(4) |
Second quarter of 2024 includes net inflows of |
|
(5) |
Fourth quarter of 2023 includes outflows of |
|
(6) |
Beginning in the fourth quarter 2023, Retirement Plan Participants was expanded to include accounts in Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business. Prior periods have been recast to reflect this change. |
|
The Charles Schwab Corporation Monthly Activity Report For June 2024 |
||||||||||||||||||||||||||||||||||||||||||||||
|
2023 |
|
|
|
|
|
|
2024 |
|
|
|
|
|
Change |
||||||||||||||||||||||||||||||||
|
Jun |
Jul |
Aug |
Sep |
Oct |
Nov |
Dec |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Mo. |
Yr. |
|||||||||||||||||||||||||||||||
Market Indices (at month end) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Dow Jones Industrial Average® |
34,408 |
|
35,560 |
|
34,722 |
|
33,508 |
|
33,053 |
|
35,951 |
|
37,690 |
|
38,150 |
|
38,996 |
|
39,807 |
|
37,816 |
|
38,686 |
|
39,119 |
|
1 |
% |
14 |
% |
||||||||||||||||
Nasdaq Composite® |
13,788 |
|
14,346 |
|
14,035 |
|
13,219 |
|
12,851 |
|
14,226 |
|
15,011 |
|
15,164 |
|
16,092 |
|
16,379 |
|
15,658 |
|
16,735 |
|
17,733 |
|
6 |
% |
29 |
% |
||||||||||||||||
Standard & Poor’s® 500 |
4,450 |
|
4,589 |
|
4,508 |
|
4,288 |
|
4,194 |
|
4,568 |
|
4,770 |
|
4,846 |
|
5,096 |
|
5,254 |
|
5,036 |
|
5,278 |
|
5,460 |
|
3 |
% |
23 |
% |
||||||||||||||||
Client Assets (in billions of dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Beginning Client Assets |
7,650.2 |
|
8,015.8 |
|
8,241.0 |
|
8,094.7 |
|
7,824.5 |
|
7,653.4 |
|
8,180.6 |
|
8,516.6 |
|
8,558.1 |
|
8,879.5 |
|
9,118.4 |
|
8,847.5 |
|
9,206.3 |
|
|
|
||||||||||||||||||
Net New Assets (1) |
33.8 |
|
12.9 |
|
8.1 |
|
27.2 |
|
5.0 |
|
19.2 |
|
42.1 |
|
14.8 |
|
31.7 |
|
41.7 |
|
10.0 |
|
31.0 |
|
33.2 |
|
7 |
% |
(2 |
)% |
||||||||||||||||
Net Market Gains (Losses) |
331.8 |
|
212.3 |
|
(154.4 |
) |
(297.4 |
) |
(176.1 |
) |
508.0 |
|
293.9 |
|
26.7 |
|
289.7 |
|
197.2 |
|
(280.9 |
) |
327.8 |
|
168.0 |
|
|
|
||||||||||||||||||
Total Client Assets (at month end) |
8,015.8 |
|
8,241.0 |
|
8,094.7 |
|
7,824.5 |
|
7,653.4 |
|
8,180.6 |
|
8,516.6 |
|
8,558.1 |
|
8,879.5 |
|
9,118.4 |
|
8,847.5 |
|
9,206.3 |
|
9,407.5 |
|
2 |
% |
17 |
% |
||||||||||||||||
Core Net New Assets (1,2) |
33.8 |
|
13.7 |
|
4.9 |
|
27.1 |
|
11.3 |
|
21.7 |
|
43.1 |
|
17.2 |
|
33.4 |
|
45.0 |
|
1.0 |
|
31.1 |
|
29.1 |
|
(6 |
)% |
(14 |
)% |
||||||||||||||||
Receiving Ongoing Advisory Services (at month end) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Investor Services |
547.5 |
|
560.6 |
|
552.2 |
|
533.0 |
|
522.2 |
|
557.0 |
|
581.4 |
|
584.1 |
|
601.8 |
|
618.5 |
|
602.2 |
|
624.0 |
|
632.9 |
|
1 |
% |
16 |
% |
||||||||||||||||
Advisor Services (3) |
3,527.8 |
|
3,619.8 |
|
3,554.2 |
|
3,448.0 |
|
3,380.3 |
|
3,604.4 |
|
3,757.4 |
|
3,780.4 |
|
3,902.5 |
|
4,009.5 |
|
3,893.9 |
|
4,027.3 |
|
4,090.0 |
|
2 |
% |
16 |
% |
||||||||||||||||
Client Accounts (at month end, in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Active Brokerage Accounts |
34,382 |
|
34,434 |
|
34,440 |
|
34,540 |
|
34,571 |
|
34,672 |
|
34,838 |
|
35,017 |
|
35,127 |
|
35,301 |
|
35,426 |
|
35,524 |
|
35,612 |
|
— |
|
4 |
% |
||||||||||||||||
Banking Accounts |
1,781 |
|
1,792 |
|
1,798 |
|
1,799 |
|
1,812 |
|
1,825 |
|
1,838 |
|
1,856 |
|
1,871 |
|
1,885 |
|
1,901 |
|
1,916 |
|
1,931 |
|
1 |
% |
8 |
% |
||||||||||||||||
Workplace Plan Participant Accounts (4) |
5,003 |
|
5,030 |
|
5,037 |
|
5,141 |
|
5,212 |
|
5,212 |
|
5,221 |
|
5,226 |
|
5,268 |
|
5,277 |
|
5,282 |
|
5,345 |
|
5,363 |
|
— |
|
7 |
% |
||||||||||||||||
Client Activity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
New Brokerage Accounts (in thousands) |
315 |
|
303 |
|
311 |
|
280 |
|
284 |
|
286 |
|
340 |
|
366 |
|
345 |
|
383 |
|
361 |
|
314 |
|
310 |
|
(1 |
)% |
(2 |
)% |
||||||||||||||||
Client Cash as a Percentage of Client Assets (5,6) |
10.5 |
% |
10.2 |
% |
10.4 |
% |
10.8 |
% |
11.2 |
% |
10.7 |
% |
10.5 |
% |
10.5 |
% |
10.2 |
% |
10.0 |
% |
10.2 |
% |
9.9 |
% |
9.7 |
% |
(20) bp |
(80) bp |
||||||||||||||||||
Derivative Trades as a Percentage of Total Trades |
23.9 |
% |
23.0 |
% |
24.4 |
% |
24.2 |
% |
23.2 |
% |
23.1 |
% |
21.8 |
% |
21.8 |
% |
22.2 |
% |
21.9 |
% |
22.1 |
% |
21.9 |
% |
21.3 |
% |
(60) bp |
(260) bp |
||||||||||||||||||
Selected Average Balances (in millions of dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Average Interest-Earning Assets (7) |
479,752 |
|
466,659 |
|
449,483 |
|
444,864 |
|
438,522 |
|
439,118 |
|
446,305 |
|
443,694 |
|
434,822 |
|
431,456 |
|
423,532 |
|
415,950 |
|
417,150 |
|
— |
|
(13 |
)% |
||||||||||||||||
Average Margin Balances |
61,543 |
|
63,040 |
|
64,226 |
|
64,014 |
|
63,946 |
|
61,502 |
|
62,309 |
|
61,368 |
|
63,600 |
|
66,425 |
|
68,827 |
|
67,614 |
|
69,730 |
|
3 |
% |
13 |
% |
||||||||||||||||
Average Bank Deposit Account Balances (8) |
102,917 |
|
102,566 |
|
101,928 |
|
100,404 |
|
97,893 |
|
94,991 |
|
95,518 |
|
95,553 |
|
92,075 |
|
90,774 |
|
88,819 |
|
86,844 |
|
85,195 |
|
(2 |
)% |
(17 |
)% |
||||||||||||||||
Mutual Fund and Exchange-Traded Fund |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Net Buys (Sells) (9,10) (in millions of dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Equities |
9,190 |
|
7,423 |
|
(278 |
) |
675 |
|
(3,039 |
) |
6,099 |
|
7,903 |
|
8,182 |
|
7,624 |
|
10,379 |
|
3,472 |
|
5,734 |
|
3,379 |
|
|
|
||||||||||||||||||
Hybrid |
(903 |
) |
(407 |
) |
(1,037 |
) |
(828 |
) |
(1,457 |
) |
(1,466 |
) |
(1,596 |
) |
(501 |
) |
(1,330 |
) |
(439 |
) |
(703 |
) |
(558 |
) |
(843 |
) |
|
|
||||||||||||||||||
Bonds |
3,302 |
|
2,515 |
|
4,696 |
|
2,723 |
|
1,094 |
|
255 |
|
6,104 |
|
7,510 |
|
9,883 |
|
7,561 |
|
5,949 |
|
5,854 |
|
6,346 |
|
|
|
||||||||||||||||||
Net Buy (Sell) Activity (in millions of dollars) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Mutual Funds (9) |
(4,485 |
) |
(3,333 |
) |
(6,476 |
) |
(5,853 |
) |
(12,245 |
) |
(9,267 |
) |
(7,406 |
) |
(966 |
) |
(1,348 |
) |
(1,607 |
) |
(4,818 |
) |
(5,544 |
) |
(4,254 |
) |
|
|
||||||||||||||||||
Exchange-Traded Funds (10) |
16,074 |
|
12,864 |
|
9,857 |
|
8,423 |
|
8,843 |
|
14,155 |
|
19,817 |
|
16,157 |
|
17,525 |
|
19,108 |
|
13,536 |
|
16,574 |
|
13,136 |
|
|
|
||||||||||||||||||
Money Market Funds |
9,112 |
|
7,911 |
|
16,869 |
|
13,388 |
|
16,976 |
|
11,670 |
|
7,745 |
|
11,717 |
|
10,129 |
|
9,085 |
|
(2,357 |
) |
9,790 |
|
3,858 |
|
|
|
||||||||||||||||||
Note: Certain supplemental details related to the information above can be found at: https://www.aboutschwab.com/financial-reports. | ||
(1) |
Unless otherwise noted, differences between net new assets and core net new assets are net flows from off-platform Schwab Bank Retail CDs. Additionally, 2024 includes an inflow of |
|
(2) |
Net new assets before significant one-time inflows or outflows, such as acquisitions/divestitures or extraordinary flows (generally greater than |
|
(3) |
Excludes Retirement Business Services. |
|
(4) |
Beginning October 2023, Retirement Plan Participants was expanded to include accounts in Stock Plan Services, Designated Brokerage Services, and Retirement Business Services. Participants may be enrolled in services in more than one Workplace business. Prior periods have been recast to reflect this change. |
|
(5) |
Schwab One®, certain cash equivalents, bank deposits, third-party bank deposit accounts, and money market fund balances as a percentage of total client assets. |
|
(6) |
Beginning July 2023, client cash as a percentage of client assets excludes brokered CDs issued by Charles Schwab Bank. Prior periods have been recast to reflect this change. |
|
(7) |
Represents average total interest-earning assets on the Company’s balance sheet. |
|
(8) |
Represents average clients’ uninvested cash sweep account balances held in deposit accounts at third-party financial institutions. |
|
(9) |
Represents the principal value of client mutual fund transactions handled by Schwab, including transactions in proprietary funds. Includes institutional funds available only to Investment Managers. Excludes money market fund transactions. |
|
(10) |
Represents the principal value of client ETF transactions handled by Schwab, including transactions in proprietary ETFs. |
|
THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)
In addition to disclosing financial results in accordance with generally accepted accounting principles in the
Schwab’s use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below. Beginning in the third quarter of 2023, these adjustments also include restructuring costs, which the Company began incurring in connection with its previously announced plans to streamline its operations to prepare for post-integration of Ameritrade. See Part I – Item 1 – Note 10 of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 for additional information.
Non-GAAP Adjustment or Measure |
Definition |
Usefulness to Investors and Uses by Management |
||
Acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs |
Schwab adjusts certain GAAP financial measures to exclude the impact of acquisition and integration-related costs incurred as a result of the Company’s acquisitions, amortization of acquired intangible assets, restructuring costs, and, where applicable, the income tax effect of these expenses.
|
We exclude acquisition and integration-related costs, amortization of acquired intangible assets, and restructuring costs for the purpose of calculating certain non-GAAP measures because we believe doing so provides additional transparency of Schwab’s ongoing operations, and is useful in both evaluating the operating performance of the business and facilitating comparison of results with prior and future periods.
|
||
Return on tangible common equity |
Return on tangible common equity represents annualized adjusted net income available to common stockholders as a percentage of average tangible common equity. Tangible common equity represents common equity less goodwill, acquired intangible assets — net, and related deferred tax liabilities. |
Acquisitions typically result in the recognition of significant amounts of goodwill and acquired intangible assets. We believe return on tangible common equity may be useful to investors as a supplemental measure to facilitate assessing capital efficiency and returns relative to the composition of Schwab’s balance sheet. |
||
Adjusted Tier 1 Leverage Ratio |
Adjusted Tier 1 Leverage Ratio represents the Tier 1 Leverage Ratio as prescribed by bank regulatory guidance for the consolidated company and for CSB, adjusted to reflect the inclusion of accumulated other comprehensive income (AOCI) in the ratio. |
Inclusion of the impacts of AOCI in the Company’s Tier 1 Leverage Ratio provides additional information regarding the Company’s current capital position. We believe Adjusted Tier 1 Leverage Ratio may be useful to investors as a supplemental measure of the Company’s capital levels. |
The Company also uses adjusted diluted EPS and return on tangible common equity as components of performance criteria for employee bonus and certain executive management incentive compensation arrangements. The Compensation Committee of CSC’s Board of Directors maintains discretion in evaluating performance against these criteria.
THE CHARLES SCHWAB CORPORATION
Non-GAAP Financial Measures
(In millions, except ratios and per share amounts)
(Unaudited)
The tables below present reconciliations of GAAP measures to non-GAAP measures:
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||||||||||||||||||
|
2024 |
2023 |
|
2024 |
2023 |
|||||||||||||||||||||||||||
|
Total Expenses Excluding Interest |
Net Income |
Total Expenses Excluding Interest |
Net Income |
|
Total Expenses Excluding Interest |
Net Income |
Total Expenses Excluding Interest |
Net Income |
|||||||||||||||||||||||
Total expenses excluding interest (GAAP),
|
$ |
2,943 |
|
$ |
1,332 |
|
$ |
2,965 |
|
$ |
1,294 |
|
|
$ |
5,885 |
|
$ |
2,694 |
|
$ |
5,971 |
|
$ |
2,897 |
|
|||||||
Acquisition and integration-related costs (1) |
|
(36 |
) |
|
36 |
|
|
(130 |
) |
|
130 |
|
|
|
(74 |
) |
|
74 |
|
|
(228 |
) |
|
228 |
|
|||||||
Amortization of acquired intangible assets |
|
(129 |
) |
|
129 |
|
|
(134 |
) |
|
134 |
|
|
|
(259 |
) |
|
259 |
|
|
(269 |
) |
|
269 |
|
|||||||
Restructuring costs (2) |
|
(10 |
) |
|
10 |
|
|
— |
|
|
— |
|
|
|
18 |
|
|
(18 |
) |
|
— |
|
|
— |
|
|||||||
Income tax effects (3) |
|
N/A |
|
|
(42 |
) |
|
N/A |
|
|
(64 |
) |
|
|
N/A |
|
|
(75 |
) |
|
N/A |
|
|
(120 |
) |
|||||||
Adjusted total expenses (non-GAAP),
|
$ |
2,768 |
|
$ |
1,465 |
|
$ |
2,701 |
|
$ |
1,494 |
|
|
$ |
5,570 |
|
$ |
2,934 |
|
$ |
5,474 |
|
$ |
3,274 |
|
|||||||
(1) |
Acquisition and integration-related costs for the three and six months ended June 30, 2024 primarily consist of |
|
(2) |
Restructuring costs for the three and six months ended June 30, 2024 reflect a change in estimate of |
|
(3) |
The income tax effects of the non-GAAP adjustments are determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and are used to present the acquisition and integration-related costs, amortization of acquired intangible assets and restructuring costs on an after-tax basis. |
|
N/A Not applicable. |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||||||||||||
|
2024 |
2023 |
|
2024 |
2023 |
||||||||||||||||||||
|
Amount |
% of Total Net Revenues |
Amount |
% of Total Net Revenues |
|
Amount |
% of Total Net Revenues |
Amount |
% of Total Net Revenues |
||||||||||||||||
Income before taxes on income (GAAP),
|
$ |
1,747 |
37.2 |
% |
$ |
1,691 |
36.3 |
% |
|
$ |
3,545 |
|
37.6 |
% |
$ |
3,801 |
38.9 |
% |
|||||||
Acquisition and integration-related costs |
|
36 |
0.8 |
% |
|
130 |
2.8 |
% |
|
|
74 |
|
0.8 |
% |
|
228 |
2.3 |
% |
|||||||
Amortization of acquired intangible assets |
|
129 |
2.8 |
% |
|
134 |
2.9 |
% |
|
|
259 |
|
2.7 |
% |
|
269 |
2.8 |
% |
|||||||
Restructuring costs |
|
10 |
0.2 |
% |
|
— |
— |
|
|
|
(18 |
) |
(0.2 |
%) |
|
— |
— |
|
|||||||
Adjusted income before taxes on income (non-GAAP),
|
$ |
1,922 |
41.0 |
% |
$ |
1,955 |
42.0 |
% |
|
$ |
3,860 |
|
40.9 |
% |
$ |
4,298 |
44.0 |
% |
|||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||||||||||||||||||
|
2024 |
2023 |
|
2024 |
2023 |
|||||||||||||||||||||||||||
|
Amount |
Diluted EPS |
Amount |
Diluted EPS |
|
Amount |
Diluted EPS |
Amount |
Diluted EPS |
|||||||||||||||||||||||
Net income available to common stockholders (GAAP),
|
$ |
1,211 |
|
$ |
.66 |
|
$ |
1,173 |
|
$ |
.64 |
|
|
$ |
2,462 |
|
$ |
1.34 |
|
$ |
2,706 |
|
$ |
1.48 |
|
|||||||
Acquisition and integration-related costs |
|
36 |
|
|
.02 |
|
|
130 |
|
|
.07 |
|
|
|
74 |
|
|
.04 |
|
|
228 |
|
|
.12 |
|
|||||||
Amortization of acquired intangible assets |
|
129 |
|
|
.07 |
|
|
134 |
|
|
.07 |
|
|
|
259 |
|
|
.14 |
|
|
269 |
|
|
.15 |
|
|||||||
Restructuring costs |
|
10 |
|
|
.01 |
|
|
— |
|
|
— |
|
|
|
(18 |
) |
|
(.01 |
) |
|
— |
|
|
— |
|
|||||||
Income tax effects |
|
(42 |
) |
|
(.03 |
) |
|
(64 |
) |
|
(.03 |
) |
|
|
(75 |
) |
|
(.04 |
) |
|
(120 |
) |
|
(.07 |
) |
|||||||
Adjusted net income available to common stockholders
|
$ |
1,344 |
|
$ |
.73 |
|
$ |
1,373 |
|
$ |
.75 |
|
|
$ |
2,702 |
|
$ |
1.47 |
|
$ |
3,083 |
|
$ |
1.68 |
|
|||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|||||||||||||
|
2024 |
2023 |
|
2024 |
2023 |
|||||||||||
Return on average common stockholders’ equity (GAAP) |
|
14 |
% |
|
17 |
% |
|
|
15 |
% |
|
20 |
% |
|||
Average common stockholders’ equity |
$ |
33,991 |
|
$ |
27,556 |
|
|
$ |
33,264 |
|
$ |
27,429 |
|
|||
Less: Average goodwill |
|
(11,951 |
) |
|
(11,951 |
) |
|
|
(11,951 |
) |
|
(11,951 |
) |
|||
Less: Average acquired intangible assets — net |
|
(8,067 |
) |
|
(8,591 |
) |
|
|
(8,132 |
) |
|
(8,657 |
) |
|||
Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net |
|
1,747 |
|
|
1,834 |
|
|
|
1,753 |
|
|
1,837 |
|
|||
Average tangible common equity |
$ |
15,720 |
|
$ |
8,848 |
|
|
$ |
14,934 |
|
$ |
8,658 |
|
|||
Adjusted net income available to common stockholders (1) |
$ |
1,344 |
|
$ |
1,373 |
|
|
$ |
2,702 |
|
$ |
3,083 |
|
|||
Return on tangible common equity (non-GAAP) |
|
34 |
% |
|
62 |
% |
|
|
36 |
% |
|
71 |
% |
(1) |
See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP). |
|
|
(Preliminary) |
|||||||
|
June 30, 2024 |
|||||||
|
CSC |
CSB |
||||||
Tier 1 Leverage Ratio (GAAP) |
|
9.4 |
% |
|
10.9 |
% |
||
Tier 1 Capital |
$ |
42,624 |
|
$ |
32,091 |
|
||
Plus: AOCI adjustment |
|
(16,926 |
) |
|
(14,755 |
) |
||
Adjusted Tier 1 Capital |
|
25,698 |
|
|
17,336 |
|
||
Average assets with regulatory adjustments |
|
451,304 |
|
|
294,465 |
|
||
Plus: AOCI adjustment |
|
(17,301 |
) |
|
(15,251 |
) |
||
Adjusted average assets with regulatory adjustments |
$ |
434,003 |
|
$ |
279,214 |
|
||
Adjusted Tier 1 Leverage Ratio (non-GAAP) |
|
5.9 |
% |
|
6.2 |
% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240716776368/en/
MEDIA
Mayura Hooper, 415-667-1525
public.relations@schwab.com
INVESTORS/ANALYSTS
Jeff Edwards, 415-667-1524
investor.relations@schwab.com
Source: The Charles Schwab Corporation
FAQ
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