Schwab Earnings Hold Up Despite Plunging Trading Revenue, Ambivalent Account Numbers Hot
While Schwab boosted its overall client assets 22% to a whopping $1.6 trillion in the quarter, its profit growth lagged significantly, up only 17%.
The root of the problem: while more investors were parking their money on the Schwab platform, fewer were trading. In terms of account activity, last May was 23% worse for the firm than it was in the previous year, while April and June were flat at best.
In all, trading revenue sank 12% on an annualized basis and 14% quarter over quarter.
They did manage to capture about 80,000 new brokerage accounts, but lost 28,000 retirement plan participants.
And on the advisory side -- the firm's crowning glory, to some analysts -- new assets were hard for affiliated RIAs to come by. Overall advisory AUM surged a healthy 17% year over year, but only edged up 1% from the first quarter.
New advisory assets are still up 4% over last year, but down a disturbing 25% over last quarter.
This Website Is For Financial Professionals Only
- Bravo! A4A Previews The Advisor Portal TD Ameritrade Institutional Will Launch In 4Q2015
- What Do Charles Schwab, Personal Finance, And Rap Music All Have In Common?
- Charles Schwab to Host Live Online Educational Event for Active Traders
- TD Ameritrade Institutional Hires Jim Dario Away From Pershing Advisor Solutions, Where He Led RIA Business Development And Advisor Recruiting