As part of a major executive changing of the guard, Charles Schwab announced today that its longtime head of advisor services, Bernie Clark, would resign as of June 28. Clark will transition from head of Advisor Services to an advisory role to the firm, according to a press release.

Clark will be succeeded by Jon Beatty, current chief operating officer of the advisor services unit. Beatty will also join the firm's executive council. At the same time, Schwab will name Tom Bradley as chief client officer for the advisor services business, reporting to Beatty. Bradley, who served for almost two decades as CEO of TD Ameritrade Institutional, is currently a managing director for advisor services.

Beatty has spent more than 20 years at Schwab, all of them in various roles advancing the growth and success of independent advisors.  For more than 10 years, he has been in executive positions and is currently the business's chief operating officer, the release said. Bradley joined Schwab shortly after the announcement of the acquisition of Ameritrade in early 2020. 

“Recently, Bernie Clark came to me and suggested that with the Ameritrade integration for advisors complete, and the exceptionally sound footing of the Advisor Services business at Schwab, it was time to make a transition in his duties at the firm,” Schwab CEO Walt Bettinger said in a prepared statement. “His impact on the independent investment advisor industry is arguably unmatched, leading the industry from its infancy to become one of the fastest growing segments of the investment services world."

Bettinger also praised Clark for developing talent in the RIA custodian business. "He has also mentored and developed a strong bench of leaders, including Jon Beatty and Tom Bradley, who share his passion for the industry and will continue to deliver on our commitments to the independent investment advisors we serve," Bettinger continued. "I'm pleased that Bernie will continue to serve in an executive advisory position offering his wisdom and counsel to me personally, as well as the entire leadership team."

In other changes at Schwab, Peter Crawford, the firm’s CFO, has decided to retire after 22 years, the release said. He will be succeeded by Mike Verdeschi after a transition period.

Joe Martinetto will transition from his role as chief operating officer to assume the role of executive chairperson of Schwab Banks. The release said Martinetto will not replaced at this time. Instead, his responsibilities “will be assumed by other leaders at the firm.”

In 2023, Schwab Banks was forced to wrestle with the problem of "cash sorting." Schwab earns a huge persentage of its profits from so-called sweep accounts, or money market funds that pay paltry yields and where dividends and interest payments are "swept" until investors determine where to re-invest the funds.

During the 2010-2022 era of ultra-low interest rates, investors had fewer options to earn safe yields on CD's and other instruments. But as the Fed began to raise interest, CD's and money market funds started offering attractive yields of 4% or more. Consequently, investors shifted their money out of sweep account into these vehicles. Many banks suffered profit declines and a few, like Silicon Valley Bank, failed. Schwab managed its way through the crisis but its stock price suffered.