Charles Schwab Expands Target-Date Collective Trust Fund Line-up for Retirement Plan Clients

Launch of New Index Target-Date Funds Provides Plan Sponsors with More Choice

Friday, June 13, 2008 7:50 am PDT



Public Company Information:


SAN FRANCISCO--(BUSINESS WIRE)--Charles Schwab announced today that Charles Schwab Trust Company (CSTC) has expanded its offering of target-date collective trust funds1 for retirement plans to include the Schwab Indexed Retirement Trust Funds, which primarily use index strategies. The Schwab Indexed Retirement Trust Funds are passively managed collective trust funds, managed and distributed by CSTC, a division of Charles Schwab Bank, that use primarily passively-managed investment strategies (index funds) in building their asset allocation models. The funds, designed specifically for investment by defined contribution plan participants, are tied to target retirement dates 2010 to 2050 in five-year increments.

The Schwab Indexed Retirement Trust Funds are comprised of a mix of index-based collective trust funds and a stable value portfolio. Similar to the Schwab Managed Retirement Trust Funds, CSTC's actively managed target-date collective trust funds for defined contribution plans, each fund is a comprehensive portfolio that uses sub-advisors, which gives Schwab the flexibility to replace underperforming portfolios and can increase the comfort level of plan sponsors who prefer a multiple manager strategy. In addition, the funds collective trust structure helps keep costs low, another key benefit for plan sponsors and participants.

We have seen very high adoption of target-date retirement funds with nearly 70 percent of Schwab Retirement Plan Services clients making them available to their participants, said John Sturiale, investment officer for Schwabs collective trust funds for retirement plan clients. Were expanding our offer to include these passively managed funds to give plan sponsors more choice and flexibility in the types of investments they can make available to their employees.

The Schwab Indexed Retirement Trust Funds have no minimum balance requirements and have an all-in operating expense ratio of 0.18 percent. The investments in the fund portfolios are allocated among Russell 1000 Value, Russell 1000 Growth, Russell 2000, MSCI EAFE, and Lehman Aggregate Bond index-based collective trust funds offered by Mellon Capital Management, one of the nations largest tax-exempt index managers; and the stable value strategy is managed by CSTC.

The funds are distributed both directly to eligible, qualified retirement plan clients of CSTC and Charles Schwab & Co., Inc., and are also available for trading by other retirement providers through the National Securities Clearing Corporation (NSCC).

The funds portfolios are designed to become more conservative over time, reaching 40 percent equity and 60 percent fixed income at each of the target dates, with the goal of balancing risk and return. The funds continue to become more conservative for 20 years beyond the target retirement dates. Once they reach 25 percent stock and 75 percent fixed income allocations, the allocations no longer change.

For more information about the funds, visit

About Schwab Corporate & Retirement Services

Schwab Corporate & Retirement Services, a division of Charles Schwab & Co., Inc., provides a broad range of investing services through the workplace, including employer-sponsored retirement plans direct to corporations or through a nationwide network of more than 300 retirement Third Party Administrators (TPAs). The division also offers the Schwab Personal Choice Retirement Account® and provides employee equity compensation plan services and corporate brokerage services, in addition to a range of recordkeeping, custodial and trustee services, which are available through Charles Schwab Trust Company, a division of Charles Schwab Bank. Schwab Corporate & Retirement Services also includes Charles Schwab Clearing Services (CSCS), which provides mutual fund trading, settlement, and related clearing services to a small number of banks, brokerage firms and trust companies. As of March 31, 2008, assets held in Schwab Corporate & Retirement Services stood at $227.8 billion.

About Charles Schwab

The Charles Schwab Corporation (Nasdaq:SCHW) is a leading provider of financial services, with more than 300 offices and 7.2 million client brokerage accounts, 1.3 million corporate retirement plan participants, 344,000 banking accounts, and $1.5 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,, 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 Schwab Institutional division. The Charles Schwab Bank (member FDIC) provides banking and mortgage services and products. More information is available at

© 2008 Charles Schwab Bank. All rights reserved. (0608-3092)

1 The Schwab Managed Retirement Trust Funds, Schwab Indexed Retirement Trust Funds, Schwab Institutional Trust Funds®, and Charles Schwab Stable Value Fund are collective trust funds distributed by Charles Schwab Trust Company (CSTC), a division of Charles Schwab Bank. CSTC acts as trustee and manager of the Funds. The Funds are not mutual funds, and their units are not registered under the 1933 Act, as amended or applicable securities laws of any state or other jurisdiction. The Funds are not registered under Investment Company Act of 1940, as amended, or other applicable law, and unit holders are not entitled to the protections of the 1940 Act. The Funds are not insured by CSTC, any of its affiliates, the FDIC or any other person. As defined in the Funds Declaration of Trust and Participation Agreement documents, the Funds are available for investment by eligible, qualified retirement plan trusts only. The unit value of the Funds will fluctuate, and investors may lose money. Various asset classes of the underlying funds, such as small-cap and international, may carry additional risks.


Charles Schwab
Michael Cianfrocca, 415-667-3252

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