jumped 7% Monday after the brokerage set plans for a $3.5 billion capital restructuring that includes a special dividend and a big buyback.
The news follows the company's sale of U.S. Trust, its wealth management unit, to
Bank of America
. Schwab received $2.7 billion in proceeds from the deal, which closed Sunday.
Schwab said Monday that it will return $1.2 billion to shareholders through a $1-a-share special dividend. In addition, it plans a $2.3 billion share repurchase through a modified Dutch auction, and it will offer up to $750 million in debt.
The buyback will be for up to 84 million shares, representing about 7% of the San Francisco company's stock. Founder Charles Schwab will sell up to 18 million of his shares after the tender offer, but he will still retain about an 18% stake in the company.
The dividend, meanwhile, will be paid Aug. 24 to shareholders of record July 24.
Shares of Charles Schwab were up $1.42, or 6.9%, to $21.94 in recent trading.