Schwab to cut staff and close offices to save $500M a year

Schwab to cut staff and close offices to save $500M a year
The downsizing will cost Schwab $400 million to $500 million, it says in a regulatory filing.
AUG 21, 2023
By  Bloomberg

Charles Schwab Corp. is planning to cut jobs and close or downsize offices to achieve at least $500 million in annual cost savings as the brokerage responds to investor pressure.

The company will close or cut down on some real estate and reduce employee head count, Westlake, Texas-based Schwab said Monday in a regulatory filing. Schwab said it will incur costs of roughly $400 million to $500 million, “primarily related to employee compensation and benefits and facility exit costs,” as a result of the cuts.

“We have said, we intend to take a series of actions this year and into 2024 aimed at removing cost and complexity from the firm, including reducing our expense base and streamlining our operating model,” Mayura Hooper, spokesperson for Schwab, said in an emailed statement. “This will result in eliminating some positions in the coming months, mostly in non-client facing areas.  We don’t yet have specifics to offer on how many positions will be eliminated.”

Schwab said earlier this month that it’s experiencing temporarily lower net flows of client money as the brokerage sees attrition of some retail and advisory clients’ assets while it integrates TD Ameritrade into its business. 

The company has faced scrutiny from investors in recent months, particularly after the March collapse of several midsize U.S. lenders focused attention on unrealized losses from securities held on bank balance sheets. 

Preferred stocks positioned for upside and yield, says Cohen & Steers strategist

Latest News

Farther debuts AI investment proposal tool for advisors to win clients
Farther debuts AI investment proposal tool for advisors to win clients

"Im glad to see that from a regulatory perspective, we're going to get the ability to show we're responsible [...] we'll have a little bit more freedom to innovate," Farther co-founder Brad Genser told InvestmentNews.

Barred ex-Merrill Lynch advisor arrested in alleged $2.6M theft of former Miami Dolphin Pro Bowler
Barred ex-Merrill Lynch advisor arrested in alleged $2.6M theft of former Miami Dolphin Pro Bowler

Former advisor Isaiah Williams allegedly used the stolen funds from ex-Dolphins defensive safety Reshad Jones for numerous personal expenses, according to police and court records.

Are you optimally efficient?
Are you optimally efficient?

Taking a systematic approach to three key practice areas can help advisors gain confidence, get back time, and increase their opportunities.

Advisor moves: Father-son duo leaves Raymond James for LPL, RayJay adds Merrill Lynch alum in Florida
Advisor moves: Father-son duo leaves Raymond James for LPL, RayJay adds Merrill Lynch alum in Florida

Meanwhile, Osaic lures a high-net-worth advisor from Commonwealth in the Pacific Northwest.

Beacon Pointe adds six RIAs in two-month acquisition spree, boosting AUM by $2.7B
Beacon Pointe adds six RIAs in two-month acquisition spree, boosting AUM by $2.7B

The deals, which include its first stake in Ohio, push the national women-led firm up to $47 billion in assets.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.