Schwab gains, Citigroup plummets
Charles Schwab reported that its third-quarter net income increased sixfold. Meanwhile, earnings at Citigroup fell 57%.
Charles Schwab Corp. reported its third quarter net income increased sixfold because of its sale of U.S. Trust to the Bank of America Corp. of Charlotte, N.C. Meanwhile, earnings at Citigroup Inc. fell 57% during the quarter.
Schwab said that net income totaled $1.5 billion, including a $1.2 billion after-tax gain from the sale, compared with $1.07 billion during the comparable period during the previous year.
The San Francisco-based brokerage company said income from continuing operations, which excludes the sale of U.S. Trust, increased $323 million, or 27 cents per share, compared with $230 million, or 18 cents per share during the previous year.
Net revenue increased to $1.29 billion from $1.07 billion during the year-ago period.
New and existing clients brought $37.3 billion in new assets to Schwab during the quarter, marking a 66% increase from last year.
Total client assets reached a record $1.44 trillion as of Sept. 30.
Citigroup Inc., the largest U.S. financial services company, said that net income fell $2.8 billion, or 47 cents per share, down from $5.51 billion, or $1.10, a year earlier, resulting from losses in subprime and leveraged loans as well as fixed-income trading and its U.S. consumer business. Citigroup is based in New York.
Net Revenue increased 6% to $22.66 billion, while operating expenses increased 22% to $14.56 billion.
The results included pre-tax write-downs of $1.35 billion for leveraged loans, $1.56 billion for subprime mortgages, and $635 million in fixed income trading.
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