Charles Schwab Corp. deposits tumbled 30% in the first quarter from a year earlier and the firm halted share repurchases amid the worst US banking crisis since 2008.
Customer deposits dropped to $325.7 billion as of March 31, Schwab said Monday in a statement, roughly in line with analysts’ estimates. They fell 11% since the end of last year.
The firm cited “regulatory uncertainty” for its decision to to pause stock buybacks following the collapse last month of three US lenders, including Silicon Valley Bank and Signature Bank.
“Our top priority this quarter was to stay connected to our clients — to help them understand what is happening in the marketplace,” Chief Executive Officer Walt Bettinger said in the statement.
Customers continued to add money to Schwab investment products. Core net new assets totaled $132 billion, including $53 billion in March alone, the second-most ever for that month.
The Federal Reserve’s rapid interest rate hikes encouraged customers to move funds away from Schwab’s low-yielding accounts, which underpin its revenue, in search of higher-rate options elsewhere.
Adjusted earnings per share were 93 cents, 3 cents more than the average estimate of analysts in a Bloomberg survey. Revenue totaled $5.1 billion, compared with Wall Street’s $5.2 billion esimate.
Shares of Schwab rose 2% to $51.90 in early trading at 8:29 a.m. in New York. The stock had tumbled 39% this year through last week.
This article was provided by Bloomberg News.