2006 Annual Report

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Schwab Financial Products

2006 Highlights
  • Total client assets in mutual funds rose 20 percent to $590 billion
  • Client assets in Schwab Funds® and Laudus Funds™ grew 28 percent to $191 billion

 

Schwab Financial Products (SFP) develops the products and services needed to serve individual investors, independent advisors, and corporate retirement plans.

  • Client assets in Mutual Fund OneSource® funds grew 18 percent to $163 billion. It remains the country’s largest “supermarket” of no-transaction-fee mutual funds.
  • Charles Schwab Bank completed a record year with assets of $11 billion; outstanding mortgage, home equity loans, and secured lines of credit of $2.4 billion; and first mortgage originations of $1.2 billion.
  • Total assets in separately managed accounts rose 25 percent to nearly $33 billion.

 

    Our money management subsidiary, Charles Schwab Investment Management (CSIM), is one of the nation’s largest money market fund managers. CSIM provides oversight for the institutional-style, sub-advised Laudus Funds family and manages 69 Schwab Funds mutual funds, including nine funds that utilize our award-winning Schwab Equity Ratings® for investment selection. As of year- end, all nine of those funds have beaten their benchmarks since inception or conversion to Schwab Equity Ratings.

     

    At mid-year, we introduced Schwab Managed Portfolios, a suite of diversified portfolios that combine mutual funds based on Schwab Equity Ratings with funds chosen from Mutual Fund OneSource. Schwab’s money managers create and maintain these portfolios for individuals with as little as $50,000 to invest, offering professional advice at half the price offered by our largest competitor. It has been our most successful launch of any advice product.

     

    During the year, we launched the Schwab Inflation Protected Fund™ and the Laudus Rosenberg International Discovery Fund. In March, the Schwab Premier Equity Fund® was closed to new investors, based on strong demand in just its first year. We also expanded access to research tools and trading to 22 hours a day, seven days a week, for CDs purchased through our Schwab BondSource™ platform.

     

    We began 2007 by announcing the acquisition of Global Real Analytics, LLC, a leader in applied real estate analytics and Commercial Real Estate Index products, and have already filed a registration statement for our first Schwab Global Real Estate Fund.™ Among other planned launches are three new “fundamental” index funds – a first for Schwab.