Charles Schwab Investor Services Expanded on Initiatives in 3Q15



Investor Services

Charles Schwab’s (SCHW) Investor Services division reported total client assets of $1.3 trillion in the third quarter of 2015, which is an increase of 1% from 3Q14. Clients in this division added $13.7 billion in new assets.

The Investor Services division’s assets make up 55% of Charles Schwab’s total client assets. The company provides retail brokerage and banking services to individual investors, retirement plan services, and corporate brokerage services under its Investor Services division.

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Focus on financial planning

Charles Schwab focuses on its individual customers’ financial needs and providing customized solutions to these needs. Its prime focus is handling wealth management rather than simply providing the platform for trading activity. The company’s banking services are utilized by brokers, dealers, and clients to maximize the value of its clients’ deposits.

Charles Schwab’s Investor Services added 158,000 retail brokerage accounts, up 12% from 3Q14. Total accounts for the division expanded by 1% to 6.8 million as of September 30, 2015. The company focuses on financial planning for retail customers, holding 29,000 conversations about financial planning in 3Q15.

Charles Schwab launched the Schwab One Visa Chip Platinum debit card, helping clients with enhancing security and reducing the chance of failed transactions. This service works in more than 130 countries where chip readers are now standard.

Offering easy access to information to its clients is key in the brokerage industry. Charles Schwab launched an Apple Watch app that allows clients to access headlines and watchlists, as well as to initiate equity or options trades.

Charles Schwab also added an “Ideas” tab to its software platform, which enables traders and investors to search for asset classes or stocks. This information is based on nine strategic predefined screens that can be used as starting points for potential trade ideas.

Here is how a few of the firm’s peers in the brokerage industry fared in terms of revenue in the last 12 months:

  • Interactive Brokers (IBKR) posted revenue of $1.1 billion.
  • TD Ameritrade (AMTD) posted revenue of $3.1 billion.
  • E*TRADE (ETFC) posted revenue of $1.8 billion.

Together, these companies form 10.8% of the iShares US Broker-Dealers ETF (IAI).


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