Schwab's Net Interest Revenue Declines as Clients Withdraw Cash
Charles Schwab Corp reported a 24% decline in net interest revenue as clients moved cash into higher-yielding products, causing deposits to fall 28% to $284.4 billion in the third quarter. Despite persistently elevated interest rates, the company stated that cash realignment activity is beginning to slow down. Schwab's adjusted earnings per share slightly beat analysts' estimates, and the firm expects an 8-9% decline in full-year 2023 revenue compared to the prior year. The company plans to issue more debt to build up extra liquidity and has identified opportunities for increased efficiency to deliver at least $1 billion of annual expense savings.