(Reuters) – Brokerage firm Charles Schwab (NYSE: ) said Tuesday that its profit rose 44% in the fourth quarter driven by a jump in asset management fees, sending its shares up more than 6% in premarket trading.
WHY IT’S IMPORTANT
The results are the first under the watch of new CEO Rick Wurster and could set the tone for the company after Walt Bettinger steps down as CEO at the end of 2024, after 16 years at the helm.
Schwab’s diversified business model encompasses brokerage services, asset management, banking and other financial solutions, and its results often reflect trends in the investment environment.
CONTEXT
Expectations of lower corporate taxes and deregulation under US President-elect Donald Trump fueled a market rally that boosted Schwab’s assets under management, as well as corresponding fees.
BY THE NUMBERS
The Westlake, Texas-based firm’s total client assets rose 19% to $10.10 trillion in the three months ended Dec. 31.
Schwab’s asset management and administration fees, earned from managing mutual and exchange-traded funds, rose 22% to $1.51 billion.
Its total net income rose 20% to $5.33 billion in the reported quarter.
The company posted adjusted earnings of $1.01 per share for the fourth quarter, compared with $0.68 per share a year earlier.
