Charles Schwab Reports Asset Management Growth

Charles Schwab Reports Asset Management Growth

Time Stamp: October 17, 2023 6:23 PM
Source Node: 2333491

Charles Schwab, the US brokerage firm, exceeded Wall
Street’s expectations in its third-quarter earnings report, highlighting robust
growth in asset management business. The company’s remarkable performance was
driven by a surge in fees, leading to an increase of 5.4% in its stock price,
according to a report by Reuters.

Charles Schwab’s impressive performance in the third
quarter occurred at a time when the financial industry has been grappling with
challenges. Schwab reported an increase of 17% in asset management and administration fees, totalling $1.22
billion, during the period.

Charles Schwab‘s Chief Financial Officer, Peter
Crawford, said: “During the quarter, our balance sheet management
continued to prioritize flexibility in support of our growing client base. In
late August, we issued approximately $2.4 billion of senior notes across two
tranches due in 2026 and 2034, further bolstering our diversified liquidity
profile.”

For the third quarter, Charles Schwab reported net revenue of $4.6 billion, reflecting a decrease of 16% compared to the same period last year. This figure slightly missed analysts’
average estimate of $4.63 billion, according to LSEG data, Reuters reported. Net
interest revenue deflated 24% year-over-year to $2.2 billion, impacted by
client allocation decisions within a higher-interest-rate environment.

Rebounding with Impressive Quarterly
Earnings

Charles Schwab posted a profit of 77 cents per share
for the third quarter, excluding one-time costs. This exceeded analysts’
expectations, who had predicted 74 cents per share, according to LSEG data.

Comparatively, Schwab reported a substantial decline of 27%
in net income, amounting to $1.2 billion, in the second quarter,
compared to the $1.8 billion reported in the same quarter of the previous year, Finance Magnates reported.

Revenue for the first half of the year also took a
hit, declining by 9% to $2.9 billion. Despite these challenges, Charles Schwab
welcomed 1 million new brokerage accounts during the period, attributed in part
to the growth in the asset management business.

Charles Schwab, the US brokerage firm, exceeded Wall
Street’s expectations in its third-quarter earnings report, highlighting robust
growth in asset management business. The company’s remarkable performance was
driven by a surge in fees, leading to an increase of 5.4% in its stock price,
according to a report by Reuters.

Charles Schwab’s impressive performance in the third
quarter occurred at a time when the financial industry has been grappling with
challenges. Schwab reported an increase of 17% in asset management and administration fees, totalling $1.22
billion, during the period.

Charles Schwab‘s Chief Financial Officer, Peter
Crawford, said: “During the quarter, our balance sheet management
continued to prioritize flexibility in support of our growing client base. In
late August, we issued approximately $2.4 billion of senior notes across two
tranches due in 2026 and 2034, further bolstering our diversified liquidity
profile.”

For the third quarter, Charles Schwab reported net revenue of $4.6 billion, reflecting a decrease of 16% compared to the same period last year. This figure slightly missed analysts’
average estimate of $4.63 billion, according to LSEG data, Reuters reported. Net
interest revenue deflated 24% year-over-year to $2.2 billion, impacted by
client allocation decisions within a higher-interest-rate environment.

Rebounding with Impressive Quarterly
Earnings

Charles Schwab posted a profit of 77 cents per share
for the third quarter, excluding one-time costs. This exceeded analysts’
expectations, who had predicted 74 cents per share, according to LSEG data.

Comparatively, Schwab reported a substantial decline of 27%
in net income, amounting to $1.2 billion, in the second quarter,
compared to the $1.8 billion reported in the same quarter of the previous year, Finance Magnates reported.

Revenue for the first half of the year also took a
hit, declining by 9% to $2.9 billion. Despite these challenges, Charles Schwab
welcomed 1 million new brokerage accounts during the period, attributed in part
to the growth in the asset management business.

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