Client assets hit the heights at Schwab

The Charles Schwab Corp. last week reported increases in net revenue and profits for the first quarter, driven by a return of the individual investor to the market. Net revenue was up 23% for the quarter, to $1.2 billion, compared with a year ago. Net income hit $243 million, up $6 million from the first quarter of 2010, when the company took a write-off from the YieldPlus fund settlement. Schwab clients “have now reduced the percentage of their assets ... in cash to pre-crisis levels,” chairman Charles Schwab said in a statement. Client assets continued to hit record levels. Total assets at the firm as of March 31 were $1.65 billion.

RIAs BROUGHT IN $14.2B

Assets at Schwab's adviser custody unit, called Advisor Services, hit a record $688.6 billion. Its RIA firms raked in $14.2 billion in net new assets during the quarter. Schwab's discount-brokerage business held $714.8 billion in assets and brought in $5.7 billion in net new funds. Total assets at the firm first recovered to pre-crisis levels a year ago. Schwab officials said the company is well-positioned for rising interest rates. Low rates have hurt securities firms, since interest earnings are a key revenue component. “We believe [Schwab] has the most leverage to rising rates of any name we cover,” Ticonderoga Securities analyst Douglas Sipkin said in an April 15 report. E-mail Dan Jamieson at djamieson@investmentnews.com.