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TD Ameritrade’s Net Interest Revenue and Operating Expenses


Jan. 25 2018, Updated 5:50 p.m. ET

Total operating expenses

In 1Q18, TD Ameritrade (AMTD) incurred total operating expenses of $921 million, compared with $506 million in fiscal 1Q17. For its acquisition of Scottrade, the company incurred expenses of $179 million. These expenses comprised professional service expenses of $8 million, employment expenses of $81 million, and other operating expenses of $85 million.

TD Ameritrade incurred other expenses of $33 million in fiscal 1Q18. Of this total, $13 million was corporate treasury losses. Reinvestment yields were greater than selling yields.

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Net interest revenue

Between 1Q17 and 1Q18, TD Ameritrade’s interest revenue from segregated cash rose to $28 million from $7 million, and its interest revenue from client margin balances rose to $191 million from $108 million.

Its net interest revenue from securities lending and borrowing rose to $53 million from $33 million, and its net interest revenue from other cash and interest-earning securities rose to $6 million from $3 million. TD Ameritrade’s interest expenses for clients’ credit balances stood at $2 million in fiscal 1Q18.

Whereas TD Ameritrade has a market capitalization of $31.7 billion, peers (XLF) Raymond James Financial (RJF), Financial Engines (FNGN), and CBOE Global Markets (CBOE) have market caps of $13.5 billion, $1.9 billion, and $15.3 billion, respectively.


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