Jared Watson's avatar
$20.2m follower assets
My Take: Schwab CEO on CNBC

My Take:
Not only is a bank run not happening at Schwab, clients are depositing assets at an record rate. On Friday alone clients deposited $4B net new assets - and have averaged $2B per day in March.

Bettinger also bought 50,000 shares at market open today according to Sarah Eisen of CNBC.

Nathan Worden's avatar
He's buying shares, that's a good sign
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Jared Watson's avatar
@nathanworden only a couple milli but a nice sign nonetheless
Alejandro Rodriguez's avatar
They're still somewhat at risk due to their large bond portfolio and rising interest rates.
Andy Buchanan's avatar
@alejandro_r don't you think the Fed will lower rates now that theres fear of banking contagion?
Alejandro Rodriguez's avatar
@andybuchanan No. I bet they'll still raise a quarter point. There's no contagion.
Jonathan's avatar
@alejandro_r Who knows what the Fed will do.
Jared Watson's avatar
@alejandro_r my understanding is that their bond portfolio has significantly shorter duration than banks like SVB did. Rising interest rates are good for the company since 60%+ of their revenue is from net interest iirc.
Alejandro Rodriguez's avatar
@wjared I think SCHW had a shorter duration bond portfolio than SVB, but they still had mostly longer-dated securities for its portfolio. Trying to find where I read that though.
Dante Keilani's avatar
CNBC doing their part to tamp down bank runs by massively featuring the words "Schwab CEO BOUGHT THE STOCK"— even though it was just a couple million dollars worth. Headlines like this probably help stop bank runs more than anything else.
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Jared Watson's avatar
@kygo interesting conspiracy theory. What’s your take on Schwab’s financial health?
Dante Keilani's avatar
@wjared No risk of immanent failure. But too many bonds with super low interest rates. Doing fine, but not fantastic.
Chip Lunderburg's avatar
Schwabs client base is completely different from Silicon Valley Bank (which was startups). You're not going to see a VC-Twitter induced bank run on Charles Schwab like you did $SIVB
Jared Watson's avatar
@chip_lunderburg right - zero percent chance Schwab has a bank run with their clientele. People don’t get it.
Josiah Racklin's avatar
"There's a difference between a brokerage operation and a banking operation"

A bank takes deposits and invests those proceeds. Brokerage assets are completely different. Brokerage assets are segregated— not commingled with bank assets. The brokerage assets are not being lent out.

Schwab also has bank assets, but the holdings of the bank to not mix with Schwab's brokerage assets.
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Yegor's avatar
Why is everyone shorting Schwab?



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