Schwab Announces 2008 Highlights for Institutional Services

Record Year for New 401(k) Plan Participants and Newly Independent Advisors

Friday, January 16, 2009 8:00 am PST



Public Company Information:


SAN FRANCISCO--(BUSINESS WIRE)--Despite difficult market and economic conditions, Charles Schwab’s business-to-business Institutional Services division evidenced great strength and impressive growth in 2008. Schwab broke two records in bringing in more than 200,000 401(k) plan participants and winning an unparalleled $13 billion in assets from investment advisors who chose to leave established financial firms and set up shop as independent registered investment advisors. Net new assets for the entire Institutional Services division in 2008 totaled more than $78 billion, bringing total assets under management to $654.4 billion.

Schwab Advisor Services Continues to Grow as Market Leader

One of two units within Institutional Services, Schwab Advisor Services ( serves more than 5,500 independent investment advisory firms and custodies $477.2 billion as of the end of 2008. Its net new assets for the year totaled more than $60 billion. This net new asset figure includes the record $13 billion from 123 advisor teams who turned independent with Schwab in 2008.

“The strong net new asset numbers we saw this year speak not only to the increasing appeal of the independent model among successful investment advisors, but also to the continued success that independent advisors are having in the marketplace,” said Jim McCool, executive vice president and head of Schwab Institutional Services.

Other key metrics for the year included:

  • Strong client satisfaction: advisors are twice as likely to recommend Schwab over competitors, and service is the number one reason they would recommend Schwab1;
  • A record year for Schwab’s separately managed accounts platform with $5.7 billion in net new assets, $5.3 billion of which came from independent advisors; and
  • A total of $1.4 billion in assets using Schwab trust services.

Key product and program enhancements for 2008 included:

  • More than 2000 advisor clients used Schwab’s GrowthPoint practice management program, which includes new performance management tools for advisors and expanding access to third party resources for marketing and business development, human capital, and transitions.
  • Schwab held more than 100 events designed to help advisors with practice management in 2008.
  • Schwab launched Business Start-up Solutions, a comprehensive platform of services and discounts designed to smooth the transition for advisors turning independent.
  • Following Schwab Performance Technologies’® acquisition of Etelligent Consulting Inc., Schwab re-launched the outsourced portfolio management and reporting solution as PortfolioServices. As of the end of 2008, 131 advisory firms were using PortfolioServices as their back office solution.
  • Schwab continued to make investments in technology services and resources to help advisors increase their operating efficiency and data security. Among the enhancements in 2008 were one-time password authentication cards that were ordered by more than 4,700 firms and a new online tool now in use by more than 50% of advisors that provides real-time information on the status of new account and asset transfer requests.

Schwab Corporate & Retirement Services Brings in Record Level of Plan Participants

Schwab Corporate & Retirement Services (, which provides retirement, equity compensation, and other financial services to corporations and their employees, continued its impressive growth and expansion in 2008. The group brought in more than $18 billion in net new assets, bringing total assets under management for Schwab Corporate & Retirement Services to $177.2 billion.

“We experienced tremendous success in 2008, particularly among large companies who are looking to Schwab not only to serve as 401(k) plan administrator, but also as a resource to help their employees manage their overall finances,” said McCool. “We also have kept a laser focus on serving our existing clients, who are looking to us for guidance and leadership in this challenging economic environment.”

Key metrics for 2008 included:

  • A record year for retirement plan participant growth, adding more than 200,000 net new participants to a total of 1.4 million;
  • Eighteen percent growth year-over-year in stock plan participant accounts, adding approximately 15,000 net new accounts in 2008; and
  • More than $6 billion in net new assets from third party administrators (TPAs) who use Schwab’s services.

Key service and product enhancements for 2008 included:

  • Schwab unveiled the Schwab Savings Fundamentals, an eight-step plan designed to help individuals prioritize and manage their short and long-term personal and financial goals, including how a workplace retirement plan should fit into an individual’s savings objectives.
  • In conjunction with CFO Research Services, Schwab released a 401(k) study entitled, “A Shared Benefit: Employer Views on the Value of 401(k) Plans,” revealing that the majority of senior finance executives view 401(k) plans as a significant tool for strengthening both their workforces and their companies. The study also found that employers are playing an increasingly important role in helping employees make the most of their 401(k) plan.
  • Schwab expanded its 401(k) plan benchmarking program to include some of its largest TPA clients. In total, Schwab’s benchmarking data, which includes both participating plan sponsor and TPA clients, represents two million plan participants and 2,400 plans with the intention to expand to more TPAs in 2009.
  • The Charles Schwab Trust Company expanded its offering of target-date collective trust funds for retirement plans to include the Schwab Indexed Retirement Trust Funds™, which primarily use index strategies.
  • Schwab launched a completely re-designed version of Schwab Equity Award Center®. The new website has an intuitive user interface that makes it easier for stock plan participants to accomplish tasks, including viewing awards, performing transactions, and learning about equity compensation.

About Charles Schwab

The Charles Schwab Corporation (Nasdaq:SCHW) is a leading provider of financial services, with more than 300 offices and 7.4 million client brokerage accounts, 1.4 million corporate retirement plan participants, 447,000 banking accounts, and $1.1 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. The Charles Schwab Bank (member FDIC) provides banking and mortgage services and products. More information is available at (0109-7559)

All numbers and data contained in the above press release are as of December 31, 2008 and are based on internal Schwab reporting metrics unless otherwise noted.

The Schwab Managed Retirement Trust Funds™, the Schwab Indexed Retirement Trust Funds, the Schwab Institutional Trust Funds®, and the Charles Schwab Stable Value Fund™ are collective trust funds managed and distributed by Charles Schwab Trust Company (CSTC), a division of Charles Schwab Bank. CSTC acts as trustee, manager, and distributor of the Funds and is responsible for the selection, monitoring and replacement of the Funds' investment sub-advisors. The Funds are not mutual funds, and their units are not registered under the Securities Act of 1933, 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.

Schwab Performance Technologies (“SPT”), like Schwab, is a subsidiary of The Charles Schwab Corporation. Schwab provides brokerage services, while SPT licenses software and provides related technology products and services. PortfolioServices is a product of SPT.

1 Schwab Institutional Client Promoter Score, Benchmarking Study Q3-08


Charles Schwab
Lindsay Tiles, 415-667-3997

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