Charles Schwab Charles Schwab’s eponymous founder.

The importance of technology and the move to zero commissions were among the main themes discussed by Schwab chairman and founder Charles Schwab during a keynote session at the Schwab Impact conference at the San Diego Convention Center on Tuesday.

“I hated commissions,” Schwab said while reflecting back on the history of his firm, adding: “I hated them then. I hate them today. And we took ‘em away.”

Returning to the theme, he joked that he’s been out promoting his book “Invested” in recent weeks and there are “no commissions involved.”

Commenting on zero commissions earlier in the same keynote, Walt Bettinger, Schwab CEO and president, said the move to zero commissions announced by Schwab a few weeks ago was the “culmination of, I would say, at least 20 years of planning.” He added: “This was a day that we had been planning for and preparing for, knowing that it would come. Not exactly sure when. But the day would come, and we would only take that step when we were at a point that there would be no tradeoffs.”

And “the idea that we would make this move and, in any way, impact the quality of service or experience is almost foolish,” Bettinger went on to say. “To give up a couple of percent of revenue and imply that there would be any impact of the experience … is absolutely not going to happen,” he argued. The zero commission move was “planned for, built for, prepared for and now implemented — and now we look forward to reaping the benefits of all of that together.”

The firm announced Oct. 1 that, as of Oct. 7, all Schwab clients would be able to buy and sell stocks, exchange-traded funds and options listed in the U.S. or Canada commission-free so long as the trades were done online or via mobile app. In the process, Schwab’s already low $4.95 commission for such trades was eliminated. Schwab Chief Financial Officer Peter Crawford explained in a separate statement at the time that since Schwab cut commissions in 2017, new firms have been “trying to enter” the market charging “zero or low equity commissions” and Schwab did not “want to fall into the trap” of waiting “too long to respond.”

On the tech front, Schwab recalled during his keynote: “I got really comfortable with technology” early on and, although “I’m not a technologist myself,” Schwab “really believed in” it. He added: “I adopted very early on all the innovations that were coming along,” and that’s enabled the firm to create a lot of efficiency over the years, he noted.

Asked what he sees on the horizon, Schwab said: “There’s certainly not going to be many more moves on commissions.” Rather, he said: “I think the focus is really around technology and some of the capabilities that I think we’re able to do.”

One specific area that’s important to Schwab particularly is getting young people started in investing early on, he pointed out. To do that, it’s crucial that they own real stocks — even if it’s just a “fraction of Google or a fraction of Amazon” or Netflix, he said. They could see that stock in their accounts, add to it and get regular reports on it using a firm’s services, he noted, adding: “That’s what I’d like to offer.”

Schwab is also “spending a lot of time and energy” on income management accounts for older clients, he said. “We’re not there yet, [but] some time, I think, early next year, we’ll be introducing that” capability for advisors to help their clients.

The firm, meanwhile, is in the process of building up a lending business for advisors, according to Bettinger. “We’ve had some evolving thinking on this” in recent years, he told attendees.

Conceding “we’ve likely have not been as aggressive in the past as we feel now, he said: “With your coaching, with your encouraging, with you helping identify for us just how critical this capability is as you compete with some of the traditional firms, we’ve really come around to a different viewpoint — that we want to do everything and anything within reason we can do to provide that lending type of capabilities that you need for your clients,” including midsize and ultra-high net worth clients.

“We have some work underway already with a premier team of bankers in place around the country,” but “there’s a lot more hiring to do and people that we will bring into that area of expertise,” he said. That’s because “we do not want you to ever be at a single slice of disadvantage relative to the traditional firms when it comes to lending.”

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