Schwab Reports Monthly Activity Highlights

Tuesday, September 15, 2009 5:45 am PDT

Dateline:

SAN FRANCISCO

Public Company Information:

NASDAQ:
SCHW

SAN FRANCISCO--(BUSINESS WIRE)--The Charles Schwab Corporation released its Monthly Market Activity Report today. Company highlights for the month of August 2009 include:

  • Net new assets brought to the company by new and existing clients in August 2009 totaled $8.5 billion.
  • Total client assets were $1.318 trillion as of month-end August, down 6% from August 2008 and up 3% from July 2009.
  • Client daily average trades were 334.3 thousand in August 2009, up 24% from August 2008 and up 15% from July 2009.

CFO Joe Martinetto commented, “We remain encouraged by investor engagement and our core client metrics - during August, new brokerage accounts at Schwab were up 5% from July levels at 61,000, net new assets reached $8.5 billion, including $2.2 billion from a new Mutual Fund Clearing client, and daily average trading activity increased by 15% sequentially to 334,000. This sustained engagement helps keep the company positioned for stronger financial performance when the environment improves.”

Mr. Martinetto added, “Balanced against those positives, headwinds persist - thus far in the third quarter, trading activity is running below second quarter levels, and further declines in short-term interest rates have placed additional near-term pressure on our revenues. As discussed previously, declining yields in the company’s proprietary money market mutual funds are leading to increased management fee waivers. We currently anticipate these waivers will reach approximately $80 million for the third quarter, up from $30 million in the prior quarter, which leads us to expect a sequential decline in asset management and administration fees of as much as 8 to 10%. These waivers will likely remain at heightened levels until rates begin to increase. We’ve also discussed how the lower rate environment has reduced investment portfolio yields, which in turn could result in a modest 2 to 4% sequential reduction in third quarter net interest revenue even as we continue to grow our client base.”

This press release contains forward looking statements relating to the company’s financial performance, money market fund fee waivers, asset management and administration fees, and net interest revenue that reflect management’s current expectations. Achievement of these expectations is subject to risks and uncertainties that could cause actual results to differ materially from the expressed expectations. Important factors that may cause such differences include, but are not limited to, substantial changes in: interest rates, client holdings of money market mutual funds, net new client assets brought to Schwab, or client asset values, as well as other factors set forth in the company’s Form 10-Q for the period ending June 30, 2009.

The SMART report can be viewed with its accompanying 12-month data at http://www.aboutschwab.com/investor/financials/financial_reports.html

About Charles Schwab

The Charles Schwab Corporation (Nasdaq:SCHW) is a leading provider of financial services, with more than 300 offices and 7.6 million client brokerage accounts, 1.5 million corporate retirement plan participants, 646,000 banking accounts, and $1.3 trillion in client assets. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, http://www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through its Advisor Services division. The Charles Schwab Bank (member FDIC) provides banking and mortgage services and products. More information is available at www.schwab.com.

Contact:

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

Corporate Public Relations
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888-767-5432

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