Company Announcements

Schwab Reports Record Quarterly Earnings Per Share

Core Net New Assets Rise 28% Sequentially to $139.0 Billion, a Third Quarter Record

Total Client Assets Reach $7.61 Trillion, up 14% Year-to-Date

WESTLAKE, Texas--(BUSINESS WIRE)--Oct. 15, 2021-- The Charles Schwab Corporation announced today that its net income for the third quarter of 2021 was a record $1.5 billion compared with $1.3 billion for the second quarter of 2021, and $698 million for the third quarter of 2020. Net income for the nine months ended September 30, 2021 was $4.3 billion, compared with $2.2 billion for the year-earlier period. The company’s financial results include TD Ameritrade from October 6, 2020 forward, as well as certain acquisition and integration-related costs and the amortization of acquired intangibles. For the third quarter and first nine months of 2021, these transaction-related expenses totaled $257 million and $828 million, respectively, on a pre-tax basis. In addition, the company’s results for the first nine months of 2021 included a non-deductible charge of approximately $200 million regarding a previously disclosed regulatory matter.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211015005150/en/

 

Three Months Ended
September 30,

 

%

 

Nine Months Ended
September 30,

 

%

Financial Highlights (1)

2021

 

2020

 

Change

 

2021

 

2020

 

Change

 

 

 

 

 

 

 

Net revenues (in millions)

$

4,570

 

$

2,448

 

87

%

$

13,812

 

$

7,515

 

84

%

Net income (in millions)

 

 

 

 

 

 

GAAP

$

1,526

 

$

698

 

119

%

$

4,275

 

$

2,164

 

98

%

Adjusted (1)

$

1,722

 

$

749

 

130

%

$

4,895

 

$

2,318

 

111

%

Diluted earnings per common share

 

 

 

 

 

 

GAAP

$

.74

 

$

.48

 

54

%

$

2.06

 

$

1.54

 

34

%

Adjusted (1)

$

.84

 

$

.51

 

65

%

$

2.39

 

$

1.66

 

44

%

Pre-tax profit margin

 

 

 

 

 

 

GAAP

44.0

%

36.3

%

 

41.2

%

37.6

%

 

Adjusted (1)

49.6

%

39.1

%

 

47.2

%

40.3

%

 

Return on average common stockholders’ equity (annualized)

12

%

10

%

 

11

%

12

%

 

Return on tangible common equity (annualized) (1)

23

%

12

%

 

21

%

14

%

 

Note: All per-share results are rounded to the nearest cent, based on weighted-average diluted common shares outstanding.

(1)

Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-11 of this release.

CEO Walt Bettinger said, “Guided by our "Through Clients’ Eyes" strategy, Schwab continues to drive robust business momentum as we support investors through an uneven economic recovery. While bullish sentiment largely persisted throughout the third quarter, debates regarding the overall pace of economic growth, the potential path of inflation, and the ultimate impact of certain global market disruptions weighed on this optimism – contributing to the S&P 500® ending September essentially flat versus June 30. Through it all, investors consistently turned to Schwab as a trusted financial partner, opening over a million new brokerage accounts for the fourth consecutive quarter – bringing year-to-date new brokerage accounts to 6.0 million. We generated core net new assets of $139.0 billion in the quarter, pushing asset gathering for the first nine months of the year to $396.0 billion, representing an 8% annualized organic growth rate. Total client assets ended September at $7.61 trillion, up from $6.69 trillion at year-end 2020. In addition, while the third quarter is often viewed as a slower period for client activity, engagement levels showed persistent strength through the summer months – daily average trade volumes softened only modestly versus the prior quarter to 5.5 million.”

Mr. Bettinger continued, “We believe our ‘no trade-offs’ approach to combining value, service, transparency and trust has enabled us to continue meeting the needs of the expanding population of individual investors and independent investment advisors who look to Schwab for support. Clients remained highly engaged with our banking services during the third quarter, as demonstrated by a 21% increase in mortgage originations and 66% growth in Pledged Asset Line® balances on a year-over-year basis. Additionally, investor interest in low-cost investing solutions elevated our Schwab-managed ETFs to a record $251.6 billion in assets, up 49% year-over-year. Retail clients also sought out our help and guidance; over $437 billion of assets were enrolled in one of our advisory offerings at month-end September, representing an increase of 24% from a year ago. Finally, in support of our independent investment advisors we further enhanced the digital onboarding experience for new accounts to include integrated funding, end-client editing capabilities, and detailed status tracking, among other improvements. This streamlined and collaborative functionality minimizes the potential for errors and delays, saving advisors time to focus on creating and building relationships.”

“I am incredibly proud of all the great work our team of talented employees have poured into serving our clients and each other this year and throughout the pandemic,” Mr. Bettinger concluded. “Their unwavering focus has kept the TD Ameritrade integration on track, helped advance our other key strategic initiatives, and yielded outstanding operating and financial performance for our company. As such, we rewarded them by implementing a special 5% pay increase, effective at the end of September. Additionally, to better reflect the changing ways our employees live and work, we introduced a hybrid workplace program designed to provide greater flexibility while still maintaining our strong, interconnected culture. Investing in our talent, alongside other platform and service investments, allows us to continue building the future of modern wealth management.”

CFO Peter Crawford added, “Consistent execution of our strategy and sustained business momentum, in combination with our diversified revenue model, helped produce impressive financial performance in the third quarter. Net interest revenue grew 4% versus the second quarter of 2021, driven by further expansion of our interest-earning asset base, including strength in lending activity and rising investment portfolio balances. This expansion more than offset a decline in securities lending revenue as well as a lower average yield on outstanding margin loans. Asset management and administration fees increased 5% sequentially, driven by rising balances in both proprietary and third-party mutual fund and ETF offerings and advisory solutions. Trading revenue edged up 1% as a higher proportion of derivatives bolstered revenue per trade in the third quarter, offsetting the impact of an 8% slowdown in activity overall. Turning to expenses, our total GAAP spending declined 9% sequentially to $2.6 billion, which included $104 million in acquisition and integration-related costs and $153 million in amortization of acquired intangibles. Exclusive of these items (1), adjusted total expenses were down 8% quarter-over-quarter. The sequential declines in GAAP and adjusted expenses largely reflect lower Other expenses due to the non-recurring nature of the regulatory charge in the second quarter. The combination of our revenue growth and steady expense discipline enabled us to produce a 44.0% pre-tax profit margin – 49.6% on an adjusted basis (1) – our highest quarterly level since late 2019.”

Mr. Crawford concluded, “As we navigated the third quarter’s mixed macroeconomic environment, we worked to further enhance our liquidity position and streamline our capital structure. In August, we issued $850 million in long-term senior notes, marking our third debt issuance in 2021. We also completed a tender offer to exchange nearly $2 billion of TD Ameritrade Holding Corporation debt for an equal amount of equivalent Charles Schwab Corporation debt. Both organic client activity and the previously announced bank deposit account migrations helped our consolidated balance sheet reach $607.5 billion as of September 30, and the company’s preliminary Tier 1 Leverage Ratio was 6.3%. Our ongoing ability to maintain a healthy balance sheet and strong capital base enabled us to deliver a 12% return on equity and 23% ROTCE (1) for the quarter. Supported by the outstanding work of the entire Schwab team, we continue to operate from a position of strength, leveraging our sustained business momentum to keep building long-term stockholder value.”

(1)

Further details on non-GAAP financial measures and a reconciliation of such measures to GAAP reported results are included on pages 10-11 of this release.

 

Commentary from the CFO
Periodically, our Chief Financial Officer provides insight and commentary regarding Schwab’s financial picture at: https://www.aboutschwab.com/cfo-commentary. The most recent commentary, which provides perspective on recent account activity, was posted on May 14, 2021.

Forward-Looking Statements
This press release contains forward-looking statements relating to business momentum; growth in the client base, accounts and assets; integration of TD Ameritrade; strategic initiatives; investments to attract and retain talent, improve service and the client experience, expand products, services and offerings to meet client needs, diversify revenues, and drive scale and efficiency; balance sheet and capital base strength; and stockholder value. 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 include, but are not limited to, the company’s ability to attract and retain clients and independent investment advisors and grow those relationships and client assets; develop and launch new and enhanced products, services, and capabilities, as well as enhance its infrastructure and capacity, in a timely and successful manner; hire and retain talent; support client activity levels; successfully implement integration strategies and plans; monetize client assets; and manage expenses. Other important factors include general market conditions, including equity valuations, trading activity, the level of interest rates – which can impact money market fund fee waivers, and credit spreads; market volatility; client use of the company’s advisory solutions and other products and services; client sensitivity to rates; level of client assets, including cash balances; capital and liquidity needs and management; the migration of bank deposit account balances; balance sheet cash; the scope and duration of the COVID-19 pandemic and actions taken by governmental authorities to contain the spread of the virus and the economic impact; adverse developments in the resolution and settlement amount of the pending regulatory matter; and other factors set forth in the company’s most recent reports on Form 10-K and Form 10-Q.

About Charles Schwab
The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 32.7 million active brokerage accounts, 2.2 million corporate retirement plan participants, 1.6 million banking accounts, and approximately $7.61 trillion in client assets. Through its operating subsidiaries, the company provides a full range of wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiaries, Charles Schwab & Co., Inc., TD Ameritrade, Inc., and TD Ameritrade Clearing, Inc., (members SIPC, https://www.sipc.org), and their 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 primary banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at https://www.aboutschwab.com.

TD Ameritrade, Inc. and TD Ameritrade Clearing, Inc. are separate but affiliated companies and subsidiaries of TD Ameritrade Holding Corporation. TD Ameritrade Holding Corporation is a wholly owned subsidiary of The Charles Schwab Corporation. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank.

 

THE CHARLES SCHWAB CORPORATION

Consolidated Statements of Income

(In millions, except per share amounts)

(Unaudited)

 

 

 

 

Three Months Ended
September 30,

Nine Months Ended
September 30,

 

2021

2020

2021

2020

Net Revenues

 

 

 

 

Interest revenue

$

2,153

 

$

1,432

 

$

6,236

 

$

4,626

 

Interest expense

(123

)

(89

)

(348

)

(322

)

Net interest revenue

2,030

 

1,343

 

5,888

 

4,304

 

Asset management and administration fees (1)

1,101

 

860

 

3,164

 

2,488

 

Trading revenue

964

 

181

 

3,135

 

562

 

Bank deposit account fees

323

 

 

1,011

 

 

Other

152

 

64

 

614

 

161

 

Total net revenues

4,570

 

2,448

 

13,812

 

7,515

 

Expenses Excluding Interest

 

 

 

 

Compensation and benefits

1,303

 

840

 

4,051

 

2,556

 

Professional services

250

 

194

 

723

 

574

 

Occupancy and equipment

246

 

155

 

722

 

449

 

Advertising and market development

119

 

66

 

363

 

203

 

Communications

144

 

73

 

457

 

226

 

Depreciation and amortization

140

 

97

 

404

 

284

 

Amortization of acquired intangible assets

153

 

25

 

461

 

43

 

Regulatory fees and assessments

64

 

36

 

208

 

106

 

Other

140

 

73

 

733

 

250

 

Total expenses excluding interest

2,559

 

1,559

 

8,122

 

4,691

 

Income before taxes on income

2,011

 

889

 

5,690

 

2,824

 

Taxes on income

485

 

191

 

1,415

 

660

 

Net Income

1,526

 

698

 

4,275

 

2,164

 

Preferred stock dividends and other

120

 

83

 

364

 

171

 

Net Income Available to Common Stockholders

$

1,406

 

$

615

 

$

3,911

 

$

1,993

 

Weighted-Average Common Shares Outstanding:

 

 

 

 

Basic

1,888

 

1,289

 

1,885

 

1,288

 

Diluted

1,898

 

1,294

 

1,895

 

1,294

 

Earnings Per Common Shares Outstanding (2):

 

 

 

 

Basic

$

.74

 

$

.48

 

$

2.07

 

$

1.55

 

Diluted

$

.74

 

$

.48

 

$

2.06

 

$

1.54

 

(1)

Includes fee waivers of $83 million and $246 million for the three and nine months ended September 30, 2021, respectively, and $44 million and $59 million for the three and nine months ended September 30, 2020, respectively.

(2)

For the three and nine months ended September 30, 2021, the Company had 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.

 

THE CHARLES SCHWAB CORPORATION

Financial and Operating Highlights

(Unaudited)

 

 

 

Q3-21 % change

 

2021

 

2020

 

vs.

 

vs.

 

Third

 

Second

 

First

 

Fourth

 

Third

(In millions, except per share amounts and as noted)

Q3-20

 

Q2-21

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

Quarter

Net Revenues

 

 

 

 

 

 

 

Net interest revenue

51

%

4

%

$

2,030

 

$

1,947

 

$

1,911

 

$

1,809

 

$

1,343

 

Asset management and administration fees

28

%

5

%

1,101

 

1,047

 

1,016

 

987

 

860

 

Trading revenue

N/M

1

%

964

 

955

 

1,216

 

854

 

181

 

Bank deposit account fees

N/M

(4

)%

323

 

337

 

351

 

355

 

 

Other

138

%

(37

)%

152

 

241

 

221

 

171

 

64

 

Total net revenues

87

%

1

%

4,570

 

4,527

 

4,715

 

4,176

 

2,448

 

Expenses Excluding Interest

 

 

 

 

 

 

 

Compensation and benefits

55

%

(1

)%

1,303

 

1,318

 

1,430

 

1,398

 

840

 

Professional services

29

%

1

%

250

 

247

 

226

 

269

 

194

 

Occupancy and equipment

59

%

3

%

246

 

239

 

237

 

254

 

155

 

Advertising and market development

80

%

(7

)%

119

 

128

 

116

 

123

 

66

 

Communications

97

%

(13

)%

144

 

166

 

147

 

127

 

73

 

Depreciation and amortization

44

%

4

%

140

 

135

 

129

 

130

 

97

 

Amortization of acquired intangible assets

N/M

(1

)%

153

 

154

 

154

 

147

 

25

 

Regulatory fees and assessments

78

%

(3

)%

64

 

66

 

78

 

57

 

36

 

Other

92

%

(61

)%

140

 

355

 

238

 

195

 

73

 

Total expenses excluding interest

64

%

(9

)%

2,559

 

2,808

 

2,755

 

2,700

 

1,559

 

Income before taxes on income

126

%

17

%

2,011

 

1,719

 

1,960

 

1,476

 

889

 

Taxes on income

154

%

7

%

485

 

454

 

476

 

341

 

191

 

Net Income

119

%

21

%

$

1,526

 

$

1,265

 

$

1,484

 

$

1,135

 

$

698

 

Preferred stock dividends and other

45

%

(19

)%

120

 

148

 

96

 

85

 

83

 

Net Income Available to Common Stockholders

129

%

26

%

$

1,406

 

$

1,117

 

$

1,388

 

$

1,050

 

$

615

 

Earnings per common share (1):

 

 

 

 

 

 

 

Basic

54

%

25

%

$

.74

 

$

.59

 

$

.74

 

$

.57

 

$

.48

 

Diluted

54

%

25

%

$

.74

 

$

.59

 

$

.73

 

$

.57

 

$

.48

 

Dividends declared per common share

 

 

$

.18

 

$

.18

 

$

.18

 

$

.18

 

$

.18

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

Basic

46

%

 

1,888

 

1,886

 

1,882

 

1,848

 

1,289

 

Diluted

47

%

 

1,898

 

1,896

 

1,892

 

1,855

 

1,294

 

Performance Measures

 

 

 

 

 

 

 

Pre-tax profit margin

 

 

44.0

%

38.0

%

41.6

%

35.3

%

36.3

%

Return on average common stockholders’ equity (annualized) (2)

 

 

12

%

10

%

12

%

11

%

10

%

Financial Condition (at quarter end, in billions)

 

 

 

 

 

 

 

Cash and cash equivalents

25

%

13

%

$

34.3

 

$

30.3

 

$

48.6

 

$

40.3

 

$

27.5

 

Cash and investments segregated

43

%

6

%

42.3

 

39.9

 

40.4

 

50.4

 

29.6

 

Receivables from brokerage clients — net

N/M

5

%

86.6

 

82.2

 

74.7

 

64.4

 

25.4

 

Available for sale securities

24

%

5

%

377.0

 

359.6

 

341.6

 

337.4

 

303.8

 

Bank loans — net

42

%

9

%

31.6

 

28.9

 

25.4

 

23.8

 

22.3

 

Total assets

45

%

6

%

607.5

 

574.5

 

563.5

 

549.0

 

419.4

 

Bank deposits

23

%

7

%

395.3

 

368.6

 

369.9

 

358.0

 

320.7

 

Payables to brokerage clients

118

%

8

%

113.1

 

105.0

 

101.3

 

104.2

 

52.0

 

Short-term borrowings

N/M

(14

)%

3.0

 

3.5

 

2.5

 

 

 

Long-term debt

150

%

4

%

19.5

 

18.7

 

17.7

 

13.6

 

7.8

 

Stockholders’ equity

83

%

 

57.4

 

57.5

 

55.6

 

56.1

 

31.3

 

Other

 

 

 

 

 

 

 

Full-time equivalent employees (at quarter end, in thousands)

47

%

 

32.4

 

32.5

 

32.0

 

32.0

 

22.1

 

Capital expenditures — purchases of equipment, office facilities, and

property, net (in millions)

44

%

(22

)%

$

176

 

$

225

 

$

209

 

$

200

 

$

122

 

Expenses excluding interest as a percentage of average client assets

(annualized)

 

 

0.13

%

0.15

%

0.16

%

0.17

%

0.14

%

Clients’ Daily Average Trades (DATs) (in thousands)

N/M

(8

)%

5,549

 

6,042

 

8,414

 

5,796

 

1,460

 

Number of Trading Days

 

2

%

64.0

 

63.0

 

61.0

 

63.0

 

64.0

 

Revenue Per Trade (3)

40

%

8

%

$

2.71

 

$

2.51

 

$

2.37

 

$

2.34

 

$

1.94

 

 

 

 

 

 

 

 

 

Note: The above table reflects the recognition of TD Ameritrade’s assets acquired and liabilities assumed at fair value as of October 6, 2020. Results of operations and metrics are inclusive of TD Ameritrade beginning October 6, 2020.

(1)

Beginning in the fourth quarter of 2020, the Company had 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.

(2)

Return on average common stockholders’ equity is calculated using net income available to common stockholders divided by average common stockholders’ equity.

(3)

Revenue per trade is calculated as trading revenue divided by DATs multiplied by the number of trading days.

N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful.

THE CHARLES SCHWAB CORPORATION

Net Interest Revenue Information

(In millions, except ratios or as noted)

(Unaudited)

 

 

 

 

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2021

 

2020

 

2021

 

2020

 

 

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

$

38,732

$

11

0.12

%

$

32,628

$

8

 

0.10

%

 

$

39,848

$

27

 

0.09

%

$

40,410

$

112

 

0.37

%

Cash and investments segregated

42,617

5

0.04

%

33,214

14

 

0.16

%

 

43,914

19

 

0.06

%

30,162

128

 

0.56

%

Receivables from brokerage clients

80,873

628

3.04

%

21,242

125

 

2.31

%

 

74,831

1,800

 

3.17

%

19,442

404

 

2.73

%

Available for sale securities (1)

362,204

1,187

1.30

%

276,081

1,103

 

1.59

%

 

348,477

3,381

 

1.29

%

236,204

3,434

 

1.93

%

Bank loans

30,235

161

2.12

%

21,668

134

 

2.46

%

 

27,336

448

 

2.18

%

20,248

411

 

2.70

%

Total interest-earning assets

554,661

1,992

1.42

%

384,833

1,384

 

1.43

%

 

534,406

5,675

 

1.41

%

346,466

4,489

 

1.72

%

Securities lending revenue (2)

 

159

 

 

47

 

 

 

 

557

 

 

 

133

 

 

Other interest revenue (2)

 

2

 

 

1

 

 

 

 

4

 

 

 

4

 

 

Total interest-earning assets (3)

$

554,661

$

2,153

1.54

%

$

384,833

$

1,432

 

1.47

%

 

$

534,406

$

6,236

 

1.55

%

$

346,466

$

4,626

 

1.77

%

Funding sources

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank deposits

$

384,561

$

14

0.01

%

$

310,685

$

12

 

0.02

%

 

$

371,974

$

40

 

0.01

%

$

275,860

$

81

 

0.04

%

Payables to brokerage clients

92,498

3

0.01

%

40,169

1

 

0.01

%

 

89,087

7

 

0.01

%

36,001

10

 

0.04

%

Short-term borrowings (4)

3,485

3

0.34

%

5

 

0.12

%

 

2,617

6

 

0.32

%

16

 

0.29

%

Long-term debt

19,030

99

2.10

%

7,992

69

 

3.46

%

 

17,225

281

 

2.18

%

8,014

212

 

3.53

%

Total interest-bearing liabilities

499,574

119

0.09

%

358,851

82

 

0.09

%

 

480,903

334

 

0.09

%

319,891

303

 

0.13

%

Non-interest-bearing funding sources (3)

55,087

 

 

25,982

 

 

 

53,503

 

 

26,575

 

 

Securities lending expense (2)

 

4

 

 

10

 

 

 

 

16

 

 

 

26

 

 

Other interest expense (2)

 

 

 

(3

)

 

 

 

(2

)

 

 

(7

)

 

Total funding sources (3)

$

554,661

$

123

0.09

%

$

384,833

$

89

 

0.09

%

 

$

534,406

$

348

 

0.09

%

$

346,466

$

322

 

0.13

%

Net interest revenue

 

$

2,030

1.45

%

 

$

1,343

 

1.38

%

 

 

$

5,888

 

1.46

%

 

$

4,304

 

1.64

%

(1)

Amounts have been calculated based on amortized cost.

(2)

Beginning in the fourth quarter of 2020, securities lending revenue has been reclassified from broker-related receivables and other revenue. Securities lending expense has been reclassified from other expense. Prior period amounts have been reclassified to reflect this change.

(3)

Beginning in the fourth quarter of 2020, broker-related receivables were removed from total interest-earning assets and netted against non-interest-bearing funding sources, resulting in an immaterial reduction to total interest-earning assets and total funding sources. Prior period amounts have been reclassified to reflect this change.

(4)

Interest revenue or expense was less than $500 thousand in the period or periods presented.

 

THE CHARLES SCHWAB CORPORATION

Asset Management and Administration Fees Information

(In millions, except ratios or as noted)

(Unaudited)

 

 

 

 

 

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

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

$

149,508

$

112

 

0.30

%

$

199,822

$

153

 

0.30

%

$

158,749

$

348

 

0.29

%

$

205,544

$

469

 

0.30

%

Fee waivers

 

(83

)

 

 

(44

)

 

 

(246

)

 

 

(59

)

 

Schwab money market funds

149,508

29

 

0.08

%

199,822

109

 

0.22

%

158,749

102

 

0.09

%

205,544

410

 

0.27

%

Schwab equity and bond funds, ETFs, and collective trust funds (CTFs)

441,344

99

 

0.09

%

306,899

75

 

0.10

%

411,312

279

 

0.09

%

290,759

219

 

0.10

%

Mutual Fund OneSource® and other non-transaction fee funds

234,582

188

 

0.32

%

197,809

154

 

0.31

%

228,643

540

 

0.32

%

187,153

436

 

0.31

%

Other third-party mutual funds and ETFs (1)

918,363

187

 

0.08

%

469,822

85

 

0.07

%

888,003

533

 

0.08

%

446,007

235

 

0.07

%

Total mutual funds, ETFs, and CTFs (2)

$

1,743,797

503

 

0.11

%

$

1,174,352

423

 

0.14

%

$

1,686,707

1,454

 

0.12

%

$

1,129,463

1,300

 

0.15

%

Advice solutions (2)

 

 

 

 

 

 

 

 

 

 

 

 

Fee-based

$

463,827

511

 

0.44

%

$

307,983

373

 

0.48

%

$

445,521

1,469

 

0.44

%

$

277,297

999

 

0.48

%

Non-fee-based

90,649

 

 

73,850

 

 

87,758

 

 

71,438

 

 

Total advice solutions

$

554,476

511

 

0.37

%

$

381,833

373

 

0.39

%

$

533,279

1,469

 

0.37

%

$

348,735

999

 

0.38

%

Other balance-based fees (3)

632,806

68

 

0.04

%

443,929

51

 

0.05

%

604,995

195

 

0.04

%

428,191

150

 

0.05

%

Other (4)

 

19

 

 

 

13

 

 

 

46

 

 

 

39

 

 

Total asset management and administration fees

 

$

1,101

 

 

 

$

860

 

 

 

$

3,164

 

 

 

$

2,488

 

 

(1)

Beginning in the fourth quarter of 2020, includes third-party money funds related to the acquisition of TD Ameritrade.

(2)

Advice solutions include managed portfolios, specialized strategies, and customized investment advice such as Schwab Private Client™, Schwab Managed Portfolios™, 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®, TD Ameritrade 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.

(3)

Includes various asset-related fees, such as trust fees, 401(k) recordkeeping fees, and mutual fund clearing fees and other service fees.

(4)

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)

 

 

 

 

 

 

 

 

 

Q3-21 % Change

 

2021

 

2020

 

vs.

 

vs.

 

Third

 

Second

 

First

 

Fourth

 

Third

(In billions, at quarter end, except as noted)

Q3-20

 

Q2-21

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

Quarter

Assets in client accounts

 

 

 

 

 

 

 

Schwab One ®, certain cash equivalents and bank deposits

36

%

7

%

$

503.9

 

$

469.5

 

$

467.3

 

$

458.4

 

$

370.3

 

Bank deposit account balances

N/M

(5

)%

153.3

 

161.9

 

164.2

 

165.9

 

 

Proprietary mutual funds (Schwab Funds® and Laudus Funds®) and CTFs

 

 

 

 

 

 

 

Money market funds (1)

(22

)%

(3

)%

147.7

 

151.9

 

163.6

 

176.1

 

190.3

 

Equity and bond funds and CTFs (2)

33

%

1

%

167.4

 

165.9

 

152.9

 

142.9

 

125.5

 

Total proprietary mutual funds and CTFs

 

(1

)%

315.1

 

317.8

 

316.5

 

319.0

 

315.8

 

Mutual Fund Marketplace ® (3)

 

 

 

 

 

 

 

Mutual Fund OneSource® and other non-transaction fee funds

15

%

(2

)%

234.7

 

240.2

 

227.3

 

223.9

 

203.6

 

Mutual fund clearing services

19

%

 

271.9

 

271.3

 

248.7

 

252.9

 

228.4

 

Other third-party mutual funds (4)

71

%

1

%

1,450.1

 

1,441.5

 

1,375.8

 

1,304.6

 

848.1

 

Total Mutual Fund Marketplace

53

%

 

1,956.7

 

1,953.0

 

1,851.8

 

1,781.4

 

1,280.1

 

Total mutual fund assets

42

%

 

2,271.8

 

2,270.8

 

2,168.3

 

2,100.4

 

1,595.9

 

Exchange-traded funds (ETFs)

 

 

 

 

 

 

 

Proprietary ETFs (2)

49

%

3

%

251.6

 

245.2

 

220.9

 

198.8

 

168.9

 

Other third-party ETFs

131

%

2

%

1,183.7

 

1,158.8

 

1,035.1

 

947.3

 

512.6

 

Total ETF assets

111

%

2

%

1,435.3

 

1,404.0

 

1,256.0

 

1,146.1

 

681.5

 

Equity and other securities

105

%

 

2,976.7

 

2,988.8

 

2,721.0

 

2,504.7

 

1,453.2

 

Fixed income securities

12

%

(1

)%

356.8

 

359.6

 

364.5

 

377.1

 

318.0

 

Margin loans outstanding

N/M

5

%

(83.8

)

(79.8

)

(72.2

)

(60.9

)

(23.6

)

Total client assets

73

%

1

%

$

7,614.0

 

$

7,574.8

 

$

7,069.1

 

$

6,691.7

 

$

4,395.3

 

Client assets by business

 

 

 

 

 

 

 

Investor Services

74

%

 

$

4,137.7

 

$

4,146.2

 

$

3,865.9

 

$

3,667.9

 

$

2,377.7

 

Advisor Services

72

%

1

%

3,476.3

 

3,428.6

 

3,203.2

 

3,023.8

 

2,017.6

 

Total client assets

73

%

1

%

$

7,614.0

 

$

7,574.8

 

$

7,069.1

 

$

6,691.7

 

$

4,395.3

 

Net growth in assets in client accounts (for the quarter ended)

 

 

 

 

 

 

 

Net new assets by business

 

 

 

 

 

 

 

Investor Services (5)

N/M

30

%

$

57.9

 

$

44.5

 

$

65.1

 

$

939.2

 

$

18.9

 

Advisor Services (6)

151

%

26

%

81.1

 

64.3

 

68.7

 

751.5

 

32.3

 

Total net new assets

171

%

28

%

$

139.0

 

$

108.8

 

$

133.8

 

$

1,690.7

 

$

51.2

 

Net market (losses) gains

N/M

N/M

(99.8

)

396.9

 

243.6

 

605.7

 

234.0

 

Net growth (decline)

(86

)%

(92

)%

$

39.2

 

$

505.7

 

$

377.4

 

$

2,296.4

 

$

285.2

 

New brokerage accounts (in thousands, for the quarter ended) (7)

99

%

(29

)%

1,178

 

1,657

 

3,153

 

15,774

 

592

 

Client accounts (in thousands)

 

 

 

 

 

 

 

Active brokerage accounts

127

%

1

%

32,675

 

32,265

 

31,902

 

29,629

 

14,393

 

Banking accounts

6

%

 

1,580

 

1,574

 

1,608

 

1,499

 

1,486

 

Corporate retirement plan participants

28

%

3

%

2,207

 

2,149

 

2,105

 

2,054

 

1,722

 

 

 

 

 

 

 

 

 

(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 September 30, 2021, off-platform equity and bond funds, CTFs, and ETFs were $21.0 billion, $6.0 billion, and $87.5 billion, respectively.

(3)

Excludes all proprietary mutual funds and ETFs.

(4)

As of September 30, 2021, third-party money funds were $14.2 billion.

(5)

First quarter of 2021 includes an outflow of $14.4 billion from a mutual fund clearing services client. Fourth quarter of 2020 includes inflows of $890.7 billion related to the acquisition of TD Ameritrade.

(6)

Fourth quarter of 2020 includes inflows of $680.6 billion related to the acquisition of TD Ameritrade. Third quarter of 2020 includes an inflow of $8.5 billion related to the acquisition of Wasmer, Schroeder & Company, LLC.

(7)

Fourth quarter of 2020 includes 14.5 million new brokerage accounts related to the acquisition of TD Ameritrade.

N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful.

The Charles Schwab Corporation Monthly Activity Report For September 2021

 

 

2020

 

 

 

 

 

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change

 

Sep

 

Oct

 

Nov

 

Dec

 

Jan

 

Feb

 

Mar

 

Apr

 

May

 

Jun

 

Jul

 

Aug

 

Sep

 

Mo.

 

Yr.

Market Indices (at month end)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dow Jones Industrial Average

27,782

 

26,502

 

29,639

 

30,606

 

29,983

 

30,932

 

32,982

 

33,875

 

34,529

 

34,503

 

34,935

 

35,361

 

33,844

 

(4

)%

22

%

Nasdaq Composite

11,168

 

10,912

 

12,199

 

12,888

 

13,071

 

13,192

 

13,247

 

13,963

 

13,749

 

14,504

 

14,673

 

15,259

 

14,449

 

(5

)%

29

%

Standard & Poor’s® 500

3,363

 

3,270

 

3,622

 

3,756

 

3,714

 

3,811

 

3,973

 

4,181

 

4,204

 

4,298

 

4,395

 

4,523

 

4,308

 

(5

)%

28

%

Client Assets (in billions of dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning Client Assets

4,489.7

 

4,395.3

 

5,878.5

 

6,421.0

 

6,691.7

 

6,759.6

 

6,900.5

 

7,069.1

 

7,336.1

 

7,395.7

 

7,574.8

 

7,642.7

 

7,838.2

 

 

 

Net New Assets (1)

20.0

 

1,596.9

 

32.1

 

61.7

 

34.2

 

37.0

 

62.6

 

37.2

 

28.1

 

43.5

 

44.3

 

51.8

 

42.9

 

(17

)%

115

%

Net Market (Losses) Gains

(114.4

)

(113.7

)

510.4

 

209.0

 

33.7

 

103.9

 

106.0

 

229.8

 

31.5

 

135.6

 

23.6

 

143.7

 

(267.1

)

 

 

Total Client Assets (at month end)

4,395.3

 

5,878.5

 

6,421.0

 

6,691.7

 

6,759.6

 

6,900.5

 

7,069.1

 

7,336.1

 

7,395.7

 

7,574.8

 

7,642.7

 

7,838.2

 

7,614.0

 

(3

)%

73

%

Core Net New Assets (2)

20.0

 

25.6

 

32.1

 

61.7

 

34.2

 

51.4

 

62.6

 

37.2

 

28.1

 

43.5

 

44.3

 

51.8

 

42.9

 

(17

)%

115

%

Receiving Ongoing Advisory Services (at month end) (3)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investor Services

361.2

 

425.3

 

457.1

 

471.8

 

472.4

 

481.3

 

495.2

 

511.1

 

517.8

 

525.1

 

531.9

 

542.5

 

530.1

 

(2

)%

47

%

Advisor Services (4)

1,870.1

 

2,505.5

 

2,715.7

 

2,828.3

 

2,840.6

 

2,913.3

 

2,997.9

 

3,112.5

 

3,150.4

 

3,209.3

 

3,256.5

 

3,333.4

 

3,253.2

 

(2

)%

74

%

Client Accounts (at month end, in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active Brokerage Accounts

14,393

 

29,013

 

29,202

 

29,629

 

30,534

 

31,523

 

31,902

 

31,877

 

32,110

 

32,265

 

32,386

 

32,513

 

32,675

 

 

127

%

Banking Accounts

1,486

 

1,496

 

1,504

 

1,499

 

1,518

 

1,542

 

1,608

 

1,562

 

1,584

 

1,574

 

1,578

 

1,594

 

1,580

 

(1

)%

6

%

Corporate Retirement Plan Participants

1,722

 

2,072

 

2,045

 

2,054

 

2,069

 

2,093

 

2,105

 

2,116

 

2,130

 

2,149

 

2,159

 

2,188

 

2,207

 

1

%

28

%

Client Activity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Brokerage Accounts (in thousands) (5)

184

 

14,718

 

430

 

626

 

1,095

 

1,211

 

847

 

609

 

549

 

499

 

402

 

402

 

374

 

(7

)%

103

%

Client Cash as a Percentage of Client Assets (6)

12.8

%

13.4

%

12.4

%

12.3

%

12.2

%

11.8

%

11.5

%

10.9

%

10.8

%

10.5

%

10.4

%

10.3

%

10.8

%

50 bp

(200) bp

Derivative Trades as a Percentage of Total Trades

14.5

%

20.5

%

19.4

%

18.9

%

17.4

%

16.6

%

18.5

%

20.4

%

20.9

%

20.6

%

22.2

%

23.1

%

23.1

%

 

860 bp

Selected Average Balances (in millions of dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Interest-Earning Assets (7,8)

392,784

 

442,119

 

466,677

 

482,394

 

517,306

 

514,885

 

520,074

 

527,194

 

528,642

 

536,146

 

546,579

 

552,372

 

565,379

 

2

%

44

%

Average Margin Balances (8)

22,780

 

48,095

 

53,916

 

59,142

 

62,999

 

69,064

 

71,266

 

72,863

 

75,921

 

78,410

 

79,910

 

81,021

 

81,705

 

1

%

N/M

Average Bank Deposits Account Balances (8,9)

 

132,030

 

162,315

 

163,463

 

167,980

 

167,433

 

164,866

 

162,392

 

160,459

 

161,377

 

151,275

 

150,896

 

152,330

 

1

%

N/M

Mutual Fund and Exchange-Traded Fund

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Buys (Sells) (10,11) (in millions of dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equities

(1,372

)

(1,305

)

10,980

 

13,875

 

8,234

 

14,246

 

16,301

 

13,422

 

9,854

 

10,873

 

7,418

 

8,808

 

7,596

 

 

 

Hybrid

(12

)

(553

)

(402

)

359

 

407

 

832

 

1,133

 

877

 

1

 

390

 

666

 

569

 

335

 

 

 

Bonds

6,857

 

6,765

 

5,956

 

12,169

 

13,601

 

9,334

 

8,237

 

8,940

 

5,906

 

10,101

 

6,917

 

8,044

 

6,232

 

 

 

Net Buy (Sell) Activity (in millions of dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mutual Funds (10)

757

 

(2,260

)

2,832

 

6,336

 

5,713

 

6,273

 

6,190

 

5,754

 

2,022

 

5,872

 

2,644

 

3,876

 

(308

)

 

 

Exchange-Traded Funds (11)

4,716

 

7,167

 

13,702

 

20,067

 

16,529

 

18,139

 

19,481

 

17,485

 

13,739

 

15,492

 

12,357

 

13,545

 

14,471

 

 

 

Money Market Funds

(6,627

)

(4,021

)

(5,908

)

(7,332

)

(5,248

)

(4,405

)

(4,528

)

(5,153

)

(3,988

)

(3,806

)

(2,501

)

(1,372

)

(1,512

)

 

 

Note: Certain supplemental details related to the information above can be found at: https://www.aboutschwab.com/financial-reports.

(1)

February 2021 includes an outflow of $14.4 billion from a mutual fund clearing services client. October 2020 includes an inflow of $1.6 trillion related to the acquisition of TD Ameritrade.

(2)

Net new assets before significant one-time inflows or outflows, such as acquisitions/divestitures or extraordinary flows (generally greater than $10 billion) relating to a specific client. These flows may span multiple reporting periods.

(3)

Beginning in December 2020, AdvisorDirect® assets are presented as Investor Services. In December 2020, $46.5 billion and $50.4 billion for October and November, respectively, were reclassified from Advisor Services to Investor Services.

(4)

Excludes Retirement Business Services.

(5)

October 2020 includes 14.5 million new brokerage accounts related to the acquisition of TD Ameritrade.

(6)

Schwab One ®, certain cash equivalents, bank deposits, third-party bank deposit accounts, and money market fund balances as a percentage of total client assets.

(7)

Represents average total interest-earning assets on the company’s balance sheet.

(8)

October 2020 averages reflect a full month of Schwab balances and 26 days of TD Ameritrade balances following the acquisition closing on October 6, 2020. Calculating the consolidated daily average from the closing date onwards would result in Average Interest- Earning Assets, Average Margin Balances, and Average Bank Deposit Account Balances of $450,004 million, $52,744 million, and $157,414 million, respectively.

(9)

Represents average TD Ameritrade clients’ uninvested cash sweep account balances held in deposit accounts at third-party financial institutions.

(10)

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.

(11)

Represents the principal value of client ETF transactions handled by Schwab, including transactions in proprietary ETFs.

N/M Not meaningful. Percentage changes greater than 200% are presented as not meaningful.

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 U.S. (GAAP), Schwab’s third quarter earnings release contains references to the non-GAAP financial measures described below. We believe these non-GAAP financial measures provide useful supplemental information about the financial performance of the Company, and facilitate meaningful comparison of Schwab’s results in the current period to both historic and future results. These non-GAAP measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may not be comparable to non-GAAP financial measures presented by other companies.

Schwab’s use of non-GAAP measures is reflective of certain adjustments made to GAAP financial measures as described below.

Non-GAAP Adjustment
or Measure

Definition

Usefulness to Investors and Uses by
Management

Acquisition and integration-related costs and amortization of acquired intangible assets

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, and, where applicable, the income tax effect of these expenses.

 

Adjustments made to exclude amortization of acquired intangible assets are reflective of all acquired intangible assets, which were recorded as part of purchase accounting. These acquired intangible assets contribute to the Company’s revenue generation. Amortization of acquired intangible assets will continue in future periods over their remaining useful lives.

We exclude acquisition and integration-related costs and amortization of acquired intangible assets 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.

 

Acquisition and integration-related costs fluctuate based on the timing of acquisitions and integration activities, thereby limiting comparability of results among periods, and are not representative of the costs of running the Company’s ongoing business. Amortization of acquired intangible assets is excluded because management does not believe it is indicative of the Company’s underlying operating performance.

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.

Beginning in 2021, 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 September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

 

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),
Net income (GAAP)

$

2,559

 

$

1,526

 

$

1,559

 

$

698

 

$

8,122

 

$

4,275

 

$

4,691

 

$

2,164

 

Acquisition and integration-related costs (1)

(104

)

104

 

(42

)

42

 

(367

)

367

 

(160

)

160

 

Amortization of acquired intangible assets

(153

)

153

 

(25

)

25

 

(461

)

461

 

(43

)

43

 

Income tax effects (2)

N/A

 

(61

)

N/A

 

(16

)

N/A

 

(208

)

N/A

 

(49

)

Adjusted total expenses (non-GAAP),
Adjusted net income (non-GAAP)

$

2,302

 

$

1,722

 

$

1,492

 

$

749

 

$

7,294

 

$

4,895

 

$

4,488

 

$

2,318

 

(1)

Acquisition and integration-related costs for the three and nine months ended September 30, 2021 primarily consist of $58 million and $227 million of compensation and benefits, $35 million and $99 million of professional services, and $7 million and $30 million of occupancy and equipment. Acquisition and integration-related costs for the three and nine months ended September 30, 2020 primarily consist of professional services and compensation and benefits.

(2)

The income tax effects of the non-GAAP adjustments is determined using an effective tax rate reflecting the exclusion of non-deductible acquisition costs and is used to present the acquisition and integration-related costs and amortization of acquired intangible assets on an after-tax basis.

N/A Not applicable.

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

 

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),
Pre-tax profit margin (GAAP)

$

2,011

44.0

%

$

889

36.3

%

$

5,690

41.2

%

$

2,824

37.6

%

Acquisition and integration-related costs

104

2.3

%

42

1.7

%

367

2.7

%

160

2.1

%

Amortization of acquired intangible assets

153

3.3

%

25

1.1

%

461

3.3

%

43

0.6

%

Adjusted income before taxes on income (non-GAAP),
Adjusted pre-tax profit margin (non-GAAP)

$

2,268

49.6

%

$

956

39.1

%

$

6,518

47.2

%

$

3,027

40.3

%

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

 

Amount

 

Diluted
EPS

 

Amount

 

Diluted
EPS

 

Amount

 

Diluted
EPS

 

Amount

 

Diluted
EPS

Net income available to common stockholders (GAAP),
Earnings per common share — diluted (GAAP)

$

1,406

 

$

.74

 

$

615

 

$

.48

 

$

3,911

 

$

2.06

 

$

1,993

 

$

1.54

 

Acquisition and integration-related costs

104

 

.05

 

42

 

.03

 

367

 

.19

 

160

 

.12

 

Amortization of acquired intangible assets

153

 

.08

 

25

 

.02

 

461

 

.24

 

43

 

.03

 

Income tax effects

(61

)

(.03

)

(16

)

(.02

)

(208

)

(.10

)

(49

)

(.03

)

Adjusted net income available to common stockholders
(non-GAAP), Adjusted diluted EPS (non-GAAP)

$

1,602

 

$

.84

 

$

666

 

$

.51

 

$

4,531

 

$

2.39

 

$

2,147

 

$

1.66

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

2021

 

2020

 

2021

 

2020

Return on average common stockholders’ equity (GAAP)

12

%

10

%

11

%

12

%

Average common stockholders’ equity

$

47,492

 

$

25,810

 

$

47,908

 

$

22,511

 

Less: Average goodwill

(11,952

)

(1,735

)

(11,952

)

(1,482

)

Less: Average acquired intangible assets — net

(9,609

)

(1,268

)

(9,762

)

(693

)

Plus: Average deferred tax liabilities related to goodwill and acquired intangible assets — net

1,895

 

67

 

1,913

 

67

 

Average tangible common equity

$

27,826

 

$

22,874

 

$

28,107

 

$

20,403

 

Adjusted net income available to common stockholders (1)

$

1,602

 

$

666

 

$

4,531

 

$

2,147

 

Return on tangible common equity (non-GAAP)

23

%

12

%

21

%

14

%

(1)

See table above for the reconciliation of net income available to common stockholders to adjusted net income available to common stockholders (non-GAAP).

 

MEDIA:
Mayura Hooper
Charles Schwab
Phone: 415-667-1525

INVESTORS/ANALYSTS:
Jeff Edwards
Charles Schwab
Phone: 415-667-1524

Source: The Charles Schwab Corporation