Customer accounts grew 14% to 200,000 from the year-ago quarter. Customer equity increased 11%, to $28.6 billion, from the year-ago quarter. Net interest income decreased 2% from the year-ago quarter as a result of lower customer debit balances. Compared to the same period last year customer borrowings to support trading positions were $800 million lower, ending the quarter at $8.5 billion. Pretax profit margin was 53% for this quarter, up from 52% in the same period last year. Total DARTs (1) for cleared and execution-only customers increased 5% to 427,000 from the year-ago quarter. Cleared DARTs were 399,000 in this quarter, 6% higher than the same period last year.

Market Making

Market Making segment income before income taxes decreased 60%, to $24 million, for the quarter ended June 30, 2012 from the same period in 2011. This decrease was driven by currency translation loss, which contributed 98% of the decline, reflecting $41 million loss in this quarter, compared to a $7 million loss in the year-ago quarter. Currency translation effects are reported as part of Trading Gains in the Market Making segment.

In this quarter we observed slightly better market making conditions with higher volatility levels and wider bid-offer spreads in U.S. options. Pretax profit margin was 26% in this quarter, compared to 47% in the same quarter last year. Market Making options contract volume increased 28% , while futures and stock volumes were little changed from the year-ago quarter.

Effects of Foreign Currency Diversification

In connection with our currency strategy, we have determined to base our net worth in GLOBALs, a basket of major currencies in which we hold our equity. In this quarter, our currency hedging program decreased our comprehensive earnings as the U.S. dollar value of the GLOBAL decreased by approximately 1.9%. The effects of currency hedging are reported as components of (1) Market Making Trading Gains and (2) Other Comprehensive Income, described below.

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