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Schwab Reports Fourth Quarter Net Income Up 51% Year-Over-Year

The Charles Schwab Corporation announced today that its net income for the fourth quarter of 2013 was $319 million, up 10% from $290 million for the third quarter of 2013, and up 51% from $211 million for the fourth quarter of 2012. Net income for the twelve months ended December 31, 2013 was $1.1 billion, up 15% from the year-earlier period. The company’s 2012 financial results include a pre-tax gain of $70 million, or $44 million after-tax, relating to the resolution of a vendor dispute and a non-recurring state tax benefit of $20 million.
 

Three Months Ended
   

Twelve Months Ended
 

--December 31,--

%

--December 31,--

%

Financial Highlights
 

2013
 

2012
 

Change
 

2013
 

2012
 

Change
   
Net revenues (in millions) $ 1,435 $ 1,215 18 % $ 5,435 $ 4,883 11 %
Net income (in millions) $ 319 $ 211 51 % $ 1,071 $ 928 15 %
Diluted earnings per common share $ .23 $ .15 53 % $ .78 $ .69 13 %
Pre-tax profit margin 34.7 % 28.3 % 31.4 % 29.7 %

Return on average common stockholders’ equity (annualized)
13 % 9 % 11 % 11 %
                                 

CEO Walt Bettinger commented, “After a long period of progress masked by environmental headwinds, our standout financial performance in 2013 more clearly reflected the significant growth we’ve achieved with our “through clients’ eyes” strategy. Our contemporary full-service investing model helped drive further expansion of our client base, leading to $5.4 billion in net revenues and net income that exceeded $1 billion for the first time since 2008. We met our financial expectations for the year: revenue growth of 11% exceeded the rise in expenses by over 2 percentage points – the high end of our target range; our pre-tax profit margin was consistent with our objective of at least 30%; and earnings per share reached $0.78, north of our mid-$0.70s goal.”

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