Charles Schwab Corp. said November 17 that it had created a new business unit called Institutional Services that will combine its RIA, TPA, and corporate benefits plan sponsor units under the leadership of executive VP Jim McCool. McCool, who had headed Schwab’s Corporate and Retirements Services unit, replaces Charles Goldman, who as executive VP had headed Schwab Institutional since May 2007 but has now left the company. McCool joined Schwab in 1995 when it acquired The Hampton Company, the retirement plan services company founded by now Schwab CEO Walt Bettinger; McCool was one of that firm’s first employees.
Alison Wertheim, Schwab VP of corporate public relations, said the realignment “doesn’t change our strategy or our commitment” to RIAs. “There will be synergies” created by the combination, she said, but stressed that this is “not a cost-cutting move.”
In the release announcing the change, Bettinger said that “There are clear synergies between serving independent investment advisors, corporate benefit plan sponsors, and third party retirement plan recordkeepers. Our new Institutional Services unit will bring together all of our `business to business’ services and enable us to leverage strong expertise we have in both groups.”
On November 14, Schwab Corp said it had decided not to apply to participate in the Treasury Department’s TARP program, with Chairman Charles Schwab noting that the firm possesses “a strong and flexible balance sheet with multiple sources of liquidity and strong credit ratings.”
In its monthly activity report for October, released November 14, Schwab Corp. said it had net new assets of $6.6 billion for the month, that client daily average trades were up 56% from the year-earlier period to 498,200, and that it had added 91,000 new brokerage accounts, up 26% from September 2008. However, total client assets stood at $1.160 trillion as of month-end October, down 22% from October 2007 and off 11% from September 2008.
McCool, who will need to relocate from Ohio to northern California as part of his new responsibilities, is scheduled to speak during a Schwab Webcast with top management of the firm for institutional investors on November 19 from 8:30 AM-1:00 PM Pacific Time at www.schwabevents.com.