Charles Schwab Corporation'​s earnings release, entitled, "Schwab Fourth Quarter Net Income of $​597 Million Caps Record Year," as usual, briefly mentions money market funds and cash. It quotes CFO Peter Crawford, "Schwab'​s record 2017 financial results demonstrate the power of our financial formula working as designed: our robust business growth supported strong revenue growth through multiple sources.... We turned this growth into a 15% lift in revenues through record contributions from our two largest revenue sources. Net interest revenue rose 29% to $​4.​3 billion due to rising interest rates as well as growing client cash balances. Asset management and administration fees reached a record $​3.​4 billion, up 11% from 2016, driven by growing balances in advised solutions, mutual funds, and ETFs.... Effective balance sheet management remains core to supporting our success and our 2017 return on equity was 15%, the highest since 2009. Throughout last year, we were mindful of approaching the $​250 billion consolidated asset threshold and the related implications for heightened regulatory requirements. As we aimed for crossing the threshold in 2018, we limited bulk transfers of sweep balances from money market funds to Schwab Bank – which help us more effectively optimize the spread earned on client cash – to $​2.​0 billion, including approximately $​1.​1 billion in the fourth quarter. We also transferred $​2.​9 billion of Schwab One sweep balances, which were already on our balance sheet, to the Bank, including $​400 million in the fourth quarter. Another part of managing our approach to $​250 billion involved the utilization of Federal Home Loan Bank advances to provide temporary funding for Bank portfolio investments that will eventually be supported by bulk transfers. These borrowings, which totaled $​15 billion at year-​end, enabled us to strengthen net interest revenue by getting a head-​start on anticipated 2018 bulk transfers while controlling our approach to the threshold." Schwab'​s earnings showed zero "​fee waivers" for the 4th quarter of 2017 vs. $​31 million in 2016, and waivers of $​10 million in 2017 vs. waivers of $​224 million in 2016. Asset management and admin fees totaled $​863 million in Q4 vs. $​801 million the last quarter of 2016, and they totaled $​3.​392 billion in 2017 vs. $​3.​055 billion in 2016.

Your Name:
Your Email:
Recipient Email(s):

Use a comma or a semicolon to separate

Please retype symbols from the image:

Optional Message

Daily Link Archive