Schwab Reports Monthly Activity Highlights

Friday, March 12, 2010 5:45 am PST

Dateline:

SAN FRANCISCO

Public Company Information:

NYSE:
SCHW

SAN FRANCISCO--(BUSINESS WIRE)--The Charles Schwab Corporation released its Monthly Market Activity Report today. Company highlights for the month of February 2010 include:

  • Net new assets brought to the company by new and existing clients in February 2010 totaled $7.9 billion.
  • Total client assets were $1.432 trillion as of month-end February, up 37% from February 2009 and up 2% from January 2010.
  • Client daily average trades were 302.6 thousand in February 2010, down 14% from February 2009 and down 15% from January 2010.

CFO Joe Martinetto commented, “Our progress in building stronger client relationships remains very much on track and we are increasingly convinced that the interest rate headwinds pressuring our revenues are cresting. We are proceeding with our plans to invest more aggressively for growth this year, and we expect first quarter 2010 compensation expense to rise by approximately 8% sequentially as we selectively add project-related and client-facing staff and payroll tax accruals resume with the new year. We also intend to increase our first quarter marketing investment by approximately 25% over fourth quarter levels as we ramp up a new national advertising campaign heading into tax season, traditionally a period of strong IRA growth for us.”

Mr. Martinetto added, “While the revenue pressures we face may be cresting, they have yet to subside. As expected, management fee waivers on our money market mutual funds are likely to creep up by approximately 15% between the fourth and first quarters due to the continuing impact of reinvesting maturing assets at lower rates. Overall, we currently expect that our first quarter earnings per share will be up to $0.04 lower than our fourth quarter 2009 results.”

Mr. Martinetto concluded, “With a mending economy, stabilizing interest rate environment, and strong business momentum, we continue to view 2010 as a year to actively pursue our growth opportunities. We remain well positioned to demonstrate improving financial performance as the year progresses even if short-term interest rates do not rise from current levels.”

This press release contains forward looking statements relating to interest rates, compensation and marketing expenses, money market fund fee waivers and the company’s financial performance in the first and subsequent quarters of 2010 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, the company’s actual hiring activity and marketing outlays during the first quarter of 2010; substantial changes in: interest rates, client holdings of money market mutual funds, net new client assets brought to Schwab, or client asset values; the extent of any additional impairment losses on the company’s investment portfolio or loss reserves on its loan portfolio; and the extent of any charges associated with legal matters, as well as other factors set forth in the company’s Form 10-K for the period ending December 31, 2009.

About Charles Schwab

The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of financial services, with more than 300 offices and 7.8 million client brokerage accounts, 1.5 million corporate retirement plan participants, 753,000 banking accounts, and $1.4 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. Named Highest in Investor Satisfaction by J.D. Power and Associates, its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through its Advisor Services division. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. More information is available at www.schwab.com.

Contact:

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

Corporate Public Relations
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