(Reuters) – Brokerage firm Charles Schwab said on Tuesday its profit rose 44% in the fourth quarter, helped by higher asset management fees, sending its shares up more than 6% in premarket trading of the market.
WHY IT IS IMPORTANT
These results are the first under new CEO Rick Wurster and could set the tone for the company after Walt Bettinger retires as chief executive at the end of 2024, after 16 years at the helm.
Schwab’s diversified business model spans brokerage services, asset management, banking and other financial solutions, and its results often reflect trends in the investment landscape.
CONTEXT
Expectations of lower corporate taxes and deregulation under newly elected U.S. President Donald Trump have sparked a market rally that has boosted Schwab’s assets under management as well as corresponding fees.
IN NUMBERS
The Westlake, Texas-based company’s total client assets increased 19% to $10.1 trillion in the quarter ended Dec. 31.
Schwab’s asset management and administrative fees, from managing mutual funds and exchange-traded funds, increased 22% to $1.51 billion.
Its total net revenues increased 20% to $5.33 billion in the reported quarter.
The company reported adjusted earnings of $1.01 per share in the fourth quarter, compared to $0.68 per share a year earlier.
(Reporting by Atharva Singh and Jaiveer Shekhawat in Bangalore; Editing by Pooja Desai)
