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Notes from Schwab’s 2021 Winter Business Update


February 5, 2021

By Rob Farmer, Schwab Corporate Communications

A wide-ranging leadership lineup from the Charles Schwab Corporation offered a deep-dive into the recent performance of the company and a look at the road ahead during the company’s annual Winter Business Update for investors and analysts who follow the company, held on February 2.

Schwab’s executives illuminated a picture of how the firm delivered solid financial results against the many uncertainties arising last year. The speakers also described how the firm plans to capture the opportunities that will shape the next decade of investing, including advice solutions, high-net-worth (HNW) products, and thematic investing.

Walt quote

“The 2020 environment was unique, creating both uncertainty and opportunity for investors. Not everything was ideal; Schwab was nevertheless able to deliver solid financial results against a challenging backdrop. Our focused, consistent strategy was more important than ever in enabling the firm to show strong performance while also pushing forward on key initiatives to add scale, unlock client-friendly monetization opportunities, and bolster our ability to meet specific needs across segments. We were honored that a growing number of clients entrusted us with their financial futures.”

Walt Bettinger, President and Chief Executive Officer
Walt Bettinger, Chief Executive Officer, Charles Schwab

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Schwab continued to advance on its key strategic initiatives in 2020, including creating scale and efficiency by, among other notable accomplishments, completing the milestone acquisitions of USAA, Wasmer Schroeder, and TD Ameritrade. Bettinger described the recent work delivering specialized lending solutions to clients, and empowering traders with the self-directed tools and resources they need, finding monetization opportunities, supporting sustainable asset-based fees and revenue diversification, and continuing its client-segmentation efforts with enhanced product and service capabilities for more affluent clients within its retail and independent advisor (RIA) channels. Recounting the busy year delivering on its priorities, Bettinger said, “Each of the acquisitions we’ve made or …the enhanced capabilities we announced in 2020, fit very clearly into one or more of these three strategic initiatives.”

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Note:  SMA = Separately Managed Account.  B = billions. M = millions.  1. As of May 31, 2020.

Technology is an important driver in delivering the scale and efficiency inherent in the acquisitions. Neesha Hathi, Schwab’s Chief Digital Officer, helped illustrate the progress being made toward fully realizing that potential. Hathi pointed out that the company’s digital transformation journey was underway a few years ago, which enabled Schwab to be well positioned heading into the pandemic. “We saw significant increase in online account opens,” she said, “with many clients engaging with us digitally for the first time.”

Hathi reported that Schwab delivered hundreds of client experience enhancements over the past year, benefiting retail clients as well as RIAs and the investors they serve. In 2020, she said, 92 percent of retail accounts were opened online, resulting in an 11 percent year-on-year decline in phone calls. Meanwhile, advisors opened more than 40,000 accounts online last year. When clients connect with Schwab digitally it also improves operating efficiency from the Schwab side, which further enables the scale and efficiency expected from the integrated firm. Hathi also described the migration to mobile by Schwab’s clients, saying, “in any given month between 38 percent and 42 percent of our clients are only using a mobile device in our retail business.”

Neesha Quote

“Schwab delivered hundreds of client experience enhancements over the past year, benefiting retail clients as well as RIAs and the investors they serve.”

Neesha Hathi, Executive Vice President and Chief Digital Officer

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Important foundational work toward the future took place in 2020. As Jonathan Craig, Schwab’s EVP of investor services and marketing, said, “We continued to innovate across the clients' spectrum with many new products and solutions.” He mentioned Schwab Intelligent Income™ and Schwab Stock Slices™ as examples of important launches that took place against the ever-changing landscape of last year.

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Craig also discussed the progress made also made toward blending the Schwab and TDA branch networks, with an eye toward optimizing client coverage and locations. Despite the remote environment we’ve all experienced over the past year, many clients still “want a live and local relationship,” he said, “and we believe in that. He added, “Having a branch in the community is a good reminder that Schwab supports that community in a very, very real way."

Jonathan quote

"We are very well-positioned going into 2021 and beyond. Ultimately, what we are building is a true retail leader that brings together the best of advice, trading, and relationships all under one roof."

Jonathan Craig, Senior Executive Vice President, Investor Services and Marketing

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Looking to the year ahead and beyond, Walt Bettinger underscored the commitment to a strategy that is shaped by three key themes: broad, macro-trends, current and evolving client views, and the competitive landscape. “Our view is that client relationships and trust are what is most important to our business,” he said. “Brand alone will not be successful enough to encourage new clients to try a firm. Clients no longer accept trade-offs or compromises.” On the competitive landscape, Bettinger offered, “Scale is important in determining the winners in our industry. A breadth of offering and capabilities are important as consumers look for convenience.”

Schwab’s uncompromising core strategy was a prevailing theme for the day at the Business Update, as Bettinger and each of the leaders who spoke tied back to that tenet. The commitment to that strategy clearly resonated with investors as well as independent advisors in 2020 as Schwab helped them navigate unprecedented challenges.

Closing out the event, Peter Crawford, Schwab’s chief financial officer, reminded listeners that “Despite recent challenges, our strategy has not changed. In fact, our priorities are quite consistent with what we have been focused on for over 40 years. Our success in 2020 puts us in a very strong position as we enter 2021.

“These are highly uncertain times,” he said, “and they have tested us. As well as we’ve performed, there is no one here declaring victory. There is a lot more work to do. But we’ve never been more confident about the future.”


The information provided here is for general informational purposes only and should not be considered an offer or solicitation or advice to buy or sell Schwab stock.

Investing involves risk, including loss of principal.