What changed in this filing

/stocks — the workspaceLOADING

Item 3. Quantitative and Qualitative Disclosures About Market Risk

2025-08-08 compared with 2025-05-09 · 340 added, 194 removed, 1260 unchanged (30% of the section changed)

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Interest revenue $ 3,787 $ 3,817 $ 7,544 $ 7,758

34 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net income $ 2,126 $ 1,332 $ 4,035 $ 2,694

6 unchanged sentences

from available for sale 561 583 1,099 1,147

Change in net unrealized gain (loss) on derivatives designated as cash flow

hedging instruments:

Net unrealized gain (loss) ( 15 ) — ( 15 ) —

Reclassifications included in interest revenue 17 — 17 —

Other 5 ( 2 ) 6 ( 10 )

7 unchanged sentences

(In Millions, Except Per Share and Share Amounts)

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Cash and cash equivalents $ 32,195 $ 42,083

Cash and investments segregated and on deposit for regulatory purposes (including resale

agreements of $ 14,302 and $ 10,075 at March 31, 2025 and December 31, 2024,

respectively)

agreements of $ 19,557 and $ 10,075 at June 30, 2025 and December 31, 2024, respectively)

45,568 38,221

1 unchanged sentence

Receivables from brokerage clients — net 82,785 85,374

Available for sale securities (amortized cost of $ 80,467 at March 31, 2025 and

$ 89,704 at December 31, 2024;

including assets pledged of $ 371 and $ 378 ,

respectively)

Available for sale securities (amortized cost of $ 72,604 and $ 89,704 at June 30, 2025 and

December 31, 2024, respectively;

including assets pledged of $ 225 and $ 378 , respectively)

67,612 82,994

Held to maturity securities (including assets pledged of $ 5,756 at March 31, 2025

and $ 5,920 at December 31, 2024)

Held to maturity securities (including assets pledged of $ 5,160 and $ 5,920 at June 30, 2025 and

December 31, 2024, respectively)

139,684 146,453

16 unchanged sentences

Preferred stock — $ .01 par value per share;

aggregate liquidation preference of $ 9,329

at March 31, 2025 and December 31, 2024

aggregate liquidation preference of $ 6,871 and

$ 9,329 at June 30, 2025 and December 31, 2024, respectively

Common stock — 3 billion shares authorized;

$ .01 par value per share;

2,074,188,875 and 2,023,295,180 shares issued at March 31, 2025 and December 31, 2024,

2,074,188,875 and 2,023,295,180 shares issued at June 30, 2025 and December 31, 2024,

Nonvoting common stock — 300 million shares authorized;

$ .01 par value per share;

no shares issued at March 31, 2025 and 50,893,695 shares issued at December 31, 2024

no shares issued at June 30, 2025 and 50,893,695 shares issued at December 31, 2024

Additional paid-in capital 27,813 27,639

Retained earnings 40,374 37,568

Treasury stock, at cost — 258,216,076 and 242,977,194 shares at March 31, 2025

Treasury stock, at cost — 259,743,035 and 242,977,194 shares at June 30, 2025

and December 31, 2024, respectively

12 unchanged sentences

Shares Amount Shares Amount

Balance at December 31, 2023 $ 9,191 2,023 $ 20 51 $ 1 $ 27,330 $ 33,901 $ ( 11,354 ) $ ( 18,131 ) $ 40,958

Balance at March 31, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,358 $ 34,701 $ ( 11,283 ) $ ( 17,576 ) $ 42,412

Net income — — — — — — 1,332 — — 1,332

6 unchanged sentences

Other — — — — — 43 — 15 — 58

Balance at June 30, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,470 $ 35,458 $ ( 11,251 ) $ ( 16,936 ) $ 43,953

Balance at March 31, 2025 $ 9,191 2,074 $ 21 — $ — $ 27,664 $ 38,882 $ ( 12,626 ) $ ( 13,621 ) $ 49,511

Net income — — — — — — 2,126 — — 2,126

Other comprehensive income (loss), net of tax — — — — — — — — 1,030 1,030

Redemption of preferred stock ( 2,428 ) — — — — — ( 30 ) — — ( 2,458 )

Dividends declared on preferred stock — — — — — — ( 115 ) — — ( 115 )

Dividends declared on common stock — $ .27

— — — — — — ( 493 ) — — ( 493 )

Repurchase of common stock, inclusive of tax — — — — — — — ( 353 ) — ( 353 )

Stock option exercises and other — — — — — 34 — 36 — 70

Share-based compensation — — — — — 65 — — — 65

Other — — — — — 50 4 14 — 68

Balance at June 30, 2025 $ 6,763 2,074 $ 21 — $ — $ 27,813 $ 40,374 $ ( 12,929 ) $ ( 12,591 ) $ 49,451

Accumulated Other Comprehensive Income (Loss)

Preferred Stock Common Stock Nonvoting

Common Stock Additional Paid-in Capital Retained Earnings Treasury Stock,

at cost Total

Shares Amount Shares Amount

Balance at December 31, 2023 $ 9,191 2,023 $ 20 51 $ 1 $ 27,330 $ 33,901 $ ( 11,354 ) $ ( 18,131 ) $ 40,958

4 unchanged sentences

— — — — — — ( 919 ) — — ( 919 )

Stock option exercises and other — — — — — ( 116 ) — 159 — 43

Share-based compensation — — — — — 190 — — — 190

Other — — — — — 66 — ( 56 ) — 10

Balance at June 30, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,470 $ 35,458 $ ( 11,251 ) $ ( 16,936 ) $ 43,953

Balance at December 31, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,639 $ 37,568 $ ( 11,196 ) $ ( 14,848 ) $ 48,375

Net income — — — — — — 4,035 — — 4,035

Other comprehensive income (loss), net of tax — — — — — — — — 2,257 2,257

Redemption of preferred stock ( 2,428 ) — — — — — ( 30 ) — — ( 2,458 )

Dividends declared on preferred stock — — — — — — ( 218 ) — — ( 218 )

Dividends declared on common stock — $ .54

— — — — — — ( 985 ) — — ( 985 )

Repurchase of common stock, inclusive of tax — — — — — — — ( 353 ) — ( 353 )

Repurchase of nonvoting common stock, inclusive of tax — 19 — ( 19 ) — — — ( 1,512 ) — ( 1,512 )

3 unchanged sentences

Other — — — — — 82 4 ( 66 ) — 20

Balance at March 31, 2025 $ 9,191 2,074 $ 21 — $ — $ 27,664 $ 38,882 $ ( 12,626 ) $ ( 13,621 ) $ 49,511

Balance at June 30, 2025 $ 6,763 2,074 $ 21 — $ — $ 27,813 $ 40,374 $ ( 12,929 ) $ ( 12,591 ) $ 49,451

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(in Millions)

Three Months Ended

Six Months Ended

Cash Flows from Operating Activities

37 unchanged sentences

Repayments of long-term debt ( 2,237 ) ( 3,670 )

Redemption of preferred stock ( 2,458 ) —

Repurchases of common stock and nonvoting common stock ( 1,833 ) —

Dividends paid ( 1,203 ) ( 1,137 )

Proceeds from stock options exercised 109 43

Repurchase of nonvoting common stock ( 1,500 ) —

Other financing activities ( 95 ) ( 84 )

8 unchanged sentences

Continued from previous page.

Three Months Ended

Six Months Ended

Supplemental Cash Flow Information

1 unchanged sentence

Changes in accrued equipment, office facilities, and property purchases $ 47 $ ( 24 )

Non-cash financing activity:

Common stock repurchased during the period but settled after period end $ 17 $ —

Other Supplemental Cash Flow Information:

4 unchanged sentences

Leased assets obtained in exchange for new operating lease liabilities $ 55 $ 110

March 31, 2025 March 31, 2024

June 30, 2025 June 30, 2024

Reconciliation of cash, cash equivalents and amounts reported within the balance sheet (2)

32 unchanged sentences

The significant accounting policies are included in Item 8 – Note 2 in the 2024 Form 10-K.

There have been no significant changes to these accounting policies during the first three months of 2025.

There have been no significant changes to these accounting policies during the first six months of 2025.

New Accounting Standards

1 unchanged sentence

Standard Description Date of Adoption Effects on the Financial Statements or Other Significant Matters

ASU 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures” Expands annual income tax disclosures, primarily by enhancing the rate reconciliation table and requiring additional disaggregated information about income taxes paid.

Accounting Standards Update (ASU) 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”

Expands annual income tax disclosures, primarily by enhancing the rate reconciliation table and requiring additional disaggregated information about income taxes paid.

Adoption allows retrospective or prospective application.

14 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Net interest revenue

23 unchanged sentences

Managed investing solutions 589 510 1,158 1,013

Other 97 88 193 175

Asset management and administration fees 1,570 1,383 3,100 2,731

13 unchanged sentences

Contract balances :

Receivables from contracts with customers within the scope of Accounting Standards Codification (ASC) 606 Revenue From Contracts With Customers (ASC 606), are included in other assets on the condensed consolidated balance sheets, and totaled $ 752 million and $ 694 million at March 31, 2025 and December 31, 2024, respectively.

The Company had net contract assets of $ 210 million and $ 216 million at March 31, 2025 and December 31, 2024, respectively, related to the buy down of fixed-rate obligation amounts pursuant to the 2023 IDA agreement.

Receivables from contracts with customers within the scope of Accounting Standards Codification (ASC) 606 Revenue From Contracts With Customers (ASC 606), are included in other assets on the condensed consolidated balance sheets, and totaled $ 754 million and $ 694 million at June 30, 2025 and December 31, 2024, respectively.

The Company had net contract assets of $ 205 million and $ 216 million at June 30, 2025 and December 31, 2024, respectively, related to the buy down of fixed-rate obligation amounts pursuant to the 2023 IDA agreement.

These amounts are included in other assets on the condensed consolidated balance sheets and are amortized on a straight-line basis over the remaining contractual term as a reduction to bank deposit account fee revenue.

8 unchanged sentences

Receivables from and payables to brokers, dealers, and clearing organizations are detailed below:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Receivables from clearing organizations $ 2,602 $ 1,670

6 unchanged sentences

Other payables to broker-dealers 627 37

Payables to clearing organizations 143 127

Payables for securities failed to receive 175 104

Payables to clearing organizations 144 127

Payables to brokers, dealers, and clearing organizations

6 unchanged sentences

The amortized cost, gross unrealized gains and losses, and fair value of the Company’s AFS and HTM investment securities are as follows:

March 31, 2025 Amortized

June 30, 2025 Amortized

Available for sale securities

10 unchanged sentences

Unallocated portfolio layer method fair value basis adjustments (3)

( 28 ) — ( 28 ) —

Total available for sale securities $ 72,604 $ 2 $ 4,994 $ 67,612

$ 80,467 $ 1 $ 5,640 $ 74,828

Held to maturity securities

16 unchanged sentences

Total available for sale securities $ 89,704 $ 1 $ 6,711 $ 82,994

$ 89,704 $ 1 $ 6,711 $ 82,994

Held to maturity securities

1 unchanged sentence

Total held to maturity securities $ 146,453 $ 146 $ 13,994 $ 132,605

(1) As of March 31, 2025 and December 31, 2024, approximately 28 % and 35 %, respectively, of the total AFS in corporate debt securities were issued by institutions in the financial services industry.

Approximately 22 % and 16 % of the holdings of these securities were issued by institutions in the information technology industry as of March 31, 2025 and December 31, 2024, respectively.

(2) Approximately 72 % and 62 % of asset-backed securities held as of March 31, 2025 and December 31, 2024, respectively, were Federal Family Education Loan Program Asset-Backed Securities.

Asset-backed securities collateralized by credit card receivables represented approximately 18 % and 25 % of the asset-backed securities held as of March 31, 2025 and December 31, 2024, respectively.

(1) As of June 30, 2025 and December 31, 2024, approximately 26 % and 35 %, respectively, of the total AFS in corporate debt securities were issued by institutions in the financial services industry.

Approximately 21 % and 16 % of the holdings of these securities were issued by institutions in the information technology industry as of June 30, 2025 and December 31, 2024, respectively.

Approximately 20 % and 18 % of the holdings of these securities were issued by companies in the consumer staples industry as of June 30, 2025 and December 31, 2024, respectively.

(2) Approximately 74 % and 62 % of asset-backed securities held as of June 30, 2025 and December 31, 2024, respectively, were Federal Family Education Loan Program Asset-Backed Securities.

Asset-backed securities collateralized by credit card receivables represented approximately 19 % and 25 % of the asset-backed securities held as of June 30, 2025 and December 31, 2024, respectively.

(3) This represents the amount of portfolio layer method (PLM) fair value hedge basis adjustments related to AFS securities hedged in a closed portfolio.

See Note 11 for more information on PLM hedge accounting.

At March 31, 2025, our banking subsidiaries had pledged investment securities with a fair value of $ 63.0 billion (collateral value of $ 58.1 billion) as collateral to secure borrowing capacity on secured credit facilities with the FHLB (see Note 9).

Our banking subsidiaries also pledge investment securities as collateral to secure borrowing capacity at the Federal Reserve discount window, and had pledged securities with a fair value of $ 31.6 billion (collateral value of $ 30.4 billion) as collateral for this facility at March 31, 2025.

At June 30, 2025, our banking subsidiaries had pledged investment securities with a fair value of $ 61.3 billion (collateral value of $ 56.9 billion) as collateral to secure borrowing capacity on secured credit facilities with the FHLB (see Note 9).

Our banking subsidiaries also pledge investment securities as collateral to secure borrowing capacity at the Federal Reserve discount window, and had pledged securities with a fair value of $ 31.1 billion (collateral value of $ 29.9 billion) as collateral for this facility at June 30, 2025.

The Company also pledges investment securities issued by federal agencies to secure certain trust deposits.

The fair value and collateral value of these pledged securities was $ 1.5 billion at March 31, 2025.

At March 31, 2025, our banking subsidiaries had pledged HTM securities as collateral under repurchase agreements with external financial institutions.

The fair value and collateral value of these pledged securities was $ 1.7 billion at June 30, 2025.

At June 30, 2025, our banking subsidiaries had pledged HTM securities as collateral under repurchase agreements with external financial institutions and the FICC.

HTM securities pledged were U.S.

agency mortgage-backed securities with an aggregate amortized cost of $ 5.8 billion.

Securities pledged as collateral under these repurchase agreements may be sold, repledged, or otherwise used by the counterparties.

See Notes 9 and 12 for additional information on these repurchase agreements.

agency mortgage-backed securities with an aggregate

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

At March 31, 2025, the Company had pledged AFS securities consisting of U.S.

amortized cost of $ 6.2 billion, of which $ 5.2 billion may be sold, repledged, or otherwise used by the counterparties.

See Notes 9 and 12 for additional information on these repurchase agreements.

At June 30, 2025, the Company had pledged AFS securities consisting of U.S.

Treasury securities with an aggregate fair value of $ 225 million as initial margin on interest rate swaps (see Notes 11 and 12).

4 unchanged sentences

Less than 12 months 12 months or longer Total

March 31, 2025 Fair

June 30, 2025 Fair

Value Unrealized

10 unchanged sentences

state and municipal securities 27 3 530 39 557 42

Foreign government agency securities — — 326 3 326 3

Non-agency commercial mortgage-backed securities — — 111 10 111 10

16 unchanged sentences

(1) Unrealized losses less than 12 months amounts were less than $ 500 thousand.

(2) For purposes of this table, unrealized losses on AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $ 28 million and $ 47 million at March 31, 2025 and December 31, 2024, respectively.

At March 31, 2025, substantially all rated securities in the investment portfolios were investment grade.

(2) For purposes of this table, unrealized losses on AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $ 9 million and $( 47 ) million at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025, substantially all rated securities in the investment portfolios were investment grade.

agency mortgage-backed securities do not have explicit credit ratings;

3 unchanged sentences

For a description of management’s quarterly evaluation of AFS securities in unrealized loss positions, see Item 8 – Note 2 in the 2024 Form 10-K.

No amounts were recognized as credit loss expense and no securities were written down to fair value through earnings for the three months ended March 31, 2025 and the year ended December 31, 2024.

None of the Company’s AFS securities held as of March 31, 2025 and December 31, 2024 had an allowance for credit losses.

All HTM securities as of March 31, 2025 and December 31, 2024 were U.S.

No amounts were recognized as credit loss expense and no securities were written down to fair value through earnings for the six months ended June 30, 2025 and the year ended December 31, 2024.

None of the Company’s AFS securities held as of June 30, 2025 and December 31, 2024 had an allowance for credit losses.

All HTM securities as of June 30, 2025 and December 31, 2024 were U.S.

agency mortgage-backed securities and therefore had no allowance for credit losses because expected nonpayment of the amortized cost basis is zero.

The Company had $ 418 million and $ 455 million of accrued interest for AFS and HTM securities as of March 31, 2025 and December 31, 2024, respectively.

The Company had $ 388 million and $ 455 million of accrued interest for AFS and HTM securities as of June 30, 2025 and December 31, 2024, respectively.

These amounts are excluded from the amortized cost basis and fair market value of AFS and HTM securities and included in other assets on the condensed consolidated balance sheets.

There were no writeoffs of accrued interest receivable on AFS and HTM securities during the three months ended March 31, 2025, or for the year ended December 31, 2024.

There were no writeoffs of accrued interest receivable on AFS and HTM securities during the six months ended June 30, 2025, or for the year ended December 31, 2024.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

The following table presents the Company’s estimated effective duration, which reflects anticipated future payments, by category at March 31, 2025:

The following table presents the Company’s estimated effective duration, which reflects anticipated future payments, by category at June 30, 2025:

Estimated effective duration, exclusive of derivatives:

4 unchanged sentences

AFS and HTM investment securities portfolio 3.8

(1) See Note 11 for additional discussion on the Company’s derivatives.

(1) See Note 11 for additional discussion of the Company’s derivatives.

In the table below, mortgage-backed securities and other asset-backed securities have been allocated to maturity groupings based on final contractual maturities.

1 unchanged sentence

The maturities of AFS and HTM investment securities are as follows:

March 31, 2025 Within

June 30, 2025 Within

1 year After 1 year

18 unchanged sentences

Total amortized cost $ 394 $ 17,507 $ 29,655 $ 92,128 $ 139,684

(1) For purposes of this table, the amortized cost of AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $ 28 million at March 31, 2025.

(1) For purposes of this table, the amortized cost of AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $ 9 million at June 30, 2025.

Proceeds and gross realized gains and losses from sales of AFS investment securities are as follows:

Three Months Ended

June 30, Six Months Ended

2025 2024 2025 2024

Proceeds $ 2,584 $ 854 $ 4,205 $ 2,043

6 unchanged sentences

The composition of bank loans and delinquency analysis by portfolio segment and class of financing receivable is as follows:

March 31, 2025 Current 30-59 days

June 30, 2025 Current 30-59 days

past due 60-89 days

22 unchanged sentences

Total bank loans $ 45,150 $ 45 $ 6 $ 35 $ 86 $ 45,236 $ 21 $ 45,215

(1) First Mortgages and HELOCs include unamortized premiums and discounts and direct origination costs of $ 115 million and $ 112 million at March 31, 2025 and December 31, 2024, respectively.

(2) At both March 31, 2025 and December 31, 2024, 42 % of the First Mortgage and HELOC portfolios were concentrated in California.

(1) First Mortgages and HELOCs include unamortized premiums and discounts and direct origination costs of $ 120 million and $ 112 million at June 30, 2025 and December 31, 2024, respectively.

(2) At both June 30, 2025 and December 31, 2024, 42 % of the First Mortgage and HELOC portfolios were concentrated in California.

These loans have performed in a manner consistent with the portfolio as a whole.

(3) There were no loans accruing interest that were contractually 90 days or more past due at March 31, 2025 or December 31, 2024.

At March 31, 2025, CSB had pledged the full balance of First Mortgages and HELOCs pursuant to a blanket lien status collateral arrangement to secure borrowing capacity on a secured credit facility with the FHLB (see Note 9).

(3) There were no loans accruing interest that were contractually 90 days or more past due at June 30, 2025 or December 31, 2024.

At June 30, 2025, CSB had pledged the full balance of First Mortgages and HELOCs pursuant to a blanket lien status collateral arrangement to secure borrowing capacity on a secured credit facility with the FHLB (see Note 9).

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Changes in the allowance for credit losses on bank loans were as follows:

First Mortgages HELOCs Total residential real estate Pledged asset lines Other Total

Balance at December 31, 2023 $ 32 $ 2 $ 34 $ — $ 4 $ 38

Balance at March 31, 2024 $ 27 $ 1 $ 28 $ — $ 4 $ 32

Charge-offs — — — — — —

1 unchanged sentence

Provision for credit losses ( 13 ) — ( 13 ) — 1 ( 12 )

Balance at June 30, 2024 $ 14 $ 1 $ 15 $ — $ 5 $ 20

Balance at March 31, 2025 $ 14 $ 1 $ 15 $ — $ 6 $ 21

Charge-offs — — — — — —

Recoveries — — — — — —

Provision for credit losses 1 — 1 — — 1

Balance at June 30, 2025 $ 15 $ 1 $ 16 $ — $ 6 $ 22

Balance at December 31, 2023 $ 32 $ 2 $ 34 $ — $ 4 $ 38

2 unchanged sentences

Provision for credit losses ( 18 ) ( 1 ) ( 19 ) — 1 ( 18 )

Balance at March 31, 2025 $ 14 $ 1 $ 15 $ — $ 6 $ 21

Consistent with Schwab’s loan charge-off policy for pledged asset lines (PALs) as disclosed in Item 8 – Note 2 of the 2024 Form 10-K, the Company charges off any unsecured balances no later than 90 days past due.

As of March 31, 2025, substantially all PALs are also subject to the collateral maintenance practical expedient under ASC 326 Financial Instruments — Credit Losses .

All PALs were fully collateralized by securities with fair values in excess of borrowings as of March 31, 2025 and December 31, 2024, and no allowance for credit losses for PALs as of those dates was required.

economy saw steady hiring and moderating inflation in the first quarter of 2025, but continued to face tight monetary policy and geopolitical unrest amid a backdrop of elevated uncertainty around the economic impact of trade policy.

Management’s macroeconomic outlook reflects sustained current benchmark lending rates, with unemployment remaining relatively flat and modest home price appreciation.

Though higher mortgage rates are softening demand and reducing borrower

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

affordability, we expect constrained housing supply to keep home prices relatively stable.

Balance at June 30, 2024 $ 14 $ 1 $ 15 $ — $ 5 $ 20

Balance at December 31, 2024 $ 14 $ 1 $ 15 $ — $ 6 $ 21

Charge-offs — — — — — —

Recoveries — — — — — —

Provision for credit losses 1 — 1 — — 1

Balance at June 30, 2025 $ 15 $ 1 $ 16 $ — $ 6 $ 22

Consistent with Schwab’s loan charge-off policy for PALs as disclosed in Item 8 – Note 2 of the 2024 Form 10-K, the Company charges off any unsecured balances no later than 90 days past due.

As of June 30, 2025, substantially all PALs are also subject to the collateral maintenance practical expedient under ASC 326 Financial Instruments — Credit Losses .

All PALs were fully collateralized by securities with fair values in excess of borrowings as of June 30, 2025 and December 31, 2024, and no allowance for credit losses for PALs as of those dates was required.

economy saw steady hiring and a modest inflation gain at the end of the second quarter of 2025, but continued to face tight monetary policy and geopolitical unrest amid a backdrop of elevated uncertainty relating to economic impacts of emerging trade policy.

Management’s macroeconomic outlook reflects sustained current benchmark lending rates, with a softening labor market and modest home price appreciation.

Though higher mortgage rates are easing demand and reducing borrower affordability, we expect constrained housing supply to keep home prices relatively stable.

Furthermore, credit quality metrics in the Company’s bank loans portfolio remain very strong.

As a result of these factors, we held projected loss rates constant at March 31, 2025, as compared to December 31, 2024.

Bank loan-related nonperforming assets consisted of nonaccrual loans of $ 30 million and $ 35 million at March 31, 2025 and December 31, 2024, respectively.

As a result of these factors, we held projected loss rates constant at June 30, 2025, as compared to December 31, 2024.

Bank loan-related nonperforming assets consisted of nonaccrual loans of $ 37 million and $ 35 million at June 30, 2025 and December 31, 2024, respectively.

Nonaccrual loans include nonaccrual troubled debt restructurings recorded prior to the adoption of ASU 2022-02, “ Financial Instruments — Credit Losses :

Troubled Debt Restructurings and Vintage Disclosures” on January 1, 2023.

At both March 31, 2025 and December 31, 2024, loan modifications to borrowers experiencing financial difficulty were not material.

At both June 30, 2025 and December 31, 2024, loan modifications to borrowers experiencing financial difficulty were not material.

Credit Quality

5 unchanged sentences

• Estimated Current LTV ratios (Estimated Current LTV).

Borrowers’ FICO scores are provided by an independent third-party credit reporting service and are generally updated quarterly.

The Origination LTV and Estimated Current LTV for a HELOC include any first lien mortgage outstanding on the same property at the time of the HELOC’s origination.

The Estimated Current LTV for each loan is updated on a monthly basis by reference to a home price appreciation index.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Borrowers’ FICO scores are provided by an independent third-party credit reporting service and are generally updated quarterly.

The Origination LTV and Estimated Current LTV for a HELOC include any first lien mortgage outstanding on the same property at the time of the HELOC’s origination.

The Estimated Current LTV for each loan is updated on a monthly basis by reference to a home price appreciation index.

The credit quality indicators of the Company’s First Mortgages and HELOCs are detailed below:

First Mortgages Amortized Cost Basis by Origination Year

March 31, 2025 2025 2024 2023 2022 2021 pre-2021 Total First Mortgages Revolving HELOCs amortized cost basis HELOCs converted to term loans Total HELOCs

June 30, 2025 2025 2024 2023 2022 2021 pre-2021 Total First Mortgages Revolving HELOCs amortized cost basis HELOCs converted to term loans Total HELOCs

Origination FICO

18 unchanged sentences

>90% – ≤100% 1 — — 10 1 2 14 — — —

>100% — — — 2 1 — 3 — — —

Total $ 2,536 $ 3,272 $ 1,982 $ 5,460 $ 10,542 $ 4,750 $ 28,542 $ 297 $ 126 $ 423

34 unchanged sentences

(1) Represents the LTV for the full line of credit (drawn and undrawn) for revolving HELOCs.

At March 31, 2025, $ 23.4 billion of First Mortgage loans had adjustable interest rates.

At June 30, 2025, $ 24.2 billion of First Mortgage loans had adjustable interest rates.

Substantially all of these mortgages have initial fixed interest rates for three to ten years and interest rates that typically adjust every six to twelve months pursuant to the terms of the loan thereafter.

1 unchanged sentence

The interest rates on approximately 76 % of the balance of these interest-only loans are not scheduled to reset for three or more years.

At March 31, 2025 and December 31, 2024, Schwab had $ 180 million and $ 171 million, respectively, of accrued interest on bank loans, which is excluded from the amortized cost basis of bank loans and included in other assets on the condensed consolidated balance sheets.

At June 30, 2025 and December 31, 2024, Schwab had $ 193 million and $ 171 million, respectively, of accrued interest on bank loans, which is excluded from the amortized cost basis of bank loans and included in other assets on the condensed consolidated balance sheets.

The HELOC product has a 30-year loan term with an initial draw period of ten years from the date of origination.

5 unchanged sentences

The following table presents when current outstanding HELOCs will convert to amortizing loans:

March 31, 2025 Balance

June 30, 2025 Balance

Converted to an amortizing loan by period end (1)

3 unchanged sentences

> 5 years 203

(1) Includes $ 3 million of HELOCs converted to amortizing loans during the three months ended March 31, 2025.

At March 31, 2025, $ 329 million of the HELOC portfolio was secured by second liens on the associated properties.

(1) Includes $ 5 million and $ 9 million of HELOCs converted to amortizing loans during the three and six months ended June 30, 2025, respectively.

At June 30, 2025, $ 332 million of the HELOC portfolio was secured by second liens on the associated properties.

Second lien mortgage loans typically possess a higher degree of credit risk given the subordination to the first lien holder in the event of default.

In addition to the credit monitoring activities described previously, Schwab also monitors credit risk by reviewing the delinquency status of the first lien loan on the associated property.

At March 31, 2025, the borrowers on approximately 61 % of HELOC loan balances outstanding only paid the minimum amount due.

At June 30, 2025, the borrowers on approximately 62 % of HELOC loan balances outstanding only paid the minimum amount due.

Variable Interest Entities

As of March 31, 2025 and December 31, 2024, substantially all of Schwab’s involvement with variable interest entities (VIEs) is through CSB’s Community Reinvestment Act (CRA) related investments and most of these are related to Low-Income Housing Tax Credit (LIHTC) investments.

As of June 30, 2025 and December 31, 2024, substantially all of Schwab’s involvement with variable interest entities (VIEs) is through CSB’s Community Reinvestment Act (CRA) related investments and most of these are related to Low-Income Housing Tax Credit (LIHTC) investments.

As part of CSB’s community reinvestment initiatives, CSB invests in funds that make equity investments in multifamily affordable housing properties and receives tax credits and other tax benefits for these investments.

During the three months ended March 31, 2025 and 2024, CSB recorded amortization of $ 47 million and $ 42 million, respectively, and recognized tax credits and other tax benefits of $ 61 million and $ 53 million, respectively, associated with these investments.

During the three months ended June 30, 2025 and 2024, CSB recorded amortization of $ 47 million and $ 38 million, respectively, and recognized tax credits and other tax benefits of $ 65 million and $ 49 million, respectively, associated with these investments.

During the six months ended June 30, 2025 and 2024, CSB recorded amortization of $ 94 million and $ 80 million, respectively, and recognized tax credits and other tax benefits of $ 126 million and $ 102 million, respectively, associated with these investments.

The amortization, as well as the tax credits and other tax benefits, are included in taxes on income on the condensed consolidated statements of income.

2 unchanged sentences

The aggregate assets, liabilities, and maximum exposure to loss from those VIEs in which Schwab holds a variable interest, but is not the primary beneficiary, are summarized in the table below:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

assets Aggregate

13 unchanged sentences

Schwab’s funding of these remaining commitments is dependent upon the occurrence of certain conditions, and Schwab expects to pay substantially all of these commitments between 2025 and 2028.

During the three months ended March 31, 2025 and year ended December 31, 2024, Schwab did not provide or intend to provide financial or other support to the VIEs that it was not contractually required to provide.

During the six months ended June 30, 2025 and year ended December 31, 2024, Schwab did not provide or intend to provide financial or other support to the VIEs that it was not contractually required to provide.

THE CHARLES SCHWAB CORPORATION

3 unchanged sentences

Bank deposits consist of interest-bearing and non-interest-bearing deposits as follows:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Interest-bearing deposits:

Deposits swept from brokerage accounts $ 200,291 $ 210,575

Checking 15,079 15,593

Time certificates of deposit (1)

12,720 27,701

Checking 16,016 15,593

Savings and other 3,678 4,015

3 unchanged sentences

(1) Time certificates of deposit consist of brokered CDs.

The weighted-average interest rates on outstanding time certificates of deposit at March 31, 2025 and December 31, 2024 were 4.82 % and 4.90 %, respectively.

As of March 31, 2025 and December 31, 2024, there were no time deposits that were in excess of FDIC insurance limits or otherwise uninsured.

Time certificates of deposit outstanding at March 31, 2025 mature between April 2025 and November 2025.

The weighted-average interest rates on outstanding time certificates of deposit at June 30, 2025 and December 31, 2024 were 4.32 % and 4.90 %, respectively.

As of June 30, 2025 and December 31, 2024, there were no time deposits that were in excess of FDIC insurance limits or otherwise uninsured.

Time certificates of deposit outstanding at June 30, 2025 mature between July 2025 and December 2025.

CSC Senior Notes

10 unchanged sentences

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

The following table lists long-term debt by instrument outstanding as of March 31, 2025 and December 31, 2024:

The following table lists long-term debt by instrument outstanding as of June 30, 2025 and December 31, 2024:

Date of Issuance Principal Amount Outstanding

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

CSC Fixed-rate Senior Notes:

82 unchanged sentences

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Annual maturities on all long-term debt outstanding at March 31, 2025 are as follows:

Annual maturities on all long-term debt outstanding at June 30, 2025 are as follows:

Thereafter 6,500

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Amounts available under these facilities are dependent on the amount of bank loans and the value of certain investment securities that are pledged as collateral.

There was $ 11.5 billion and $ 16.7 billion outstanding under these facilities as of March 31, 2025 and December 31, 2024, respectively, and these borrowings had a weighted-average interest rate of 4.60 % and 5.11 %, respectively.

As of March 31, 2025 and December 31, 2024, the collateral pledged provided additional borrowing capacity of $ 65.0 billion and $ 59.8 billion, respectively.

There was $ 9.0 billion and $ 16.7 billion outstanding under these facilities as of June 30, 2025 and December 31, 2024, respectively, and these borrowings had a weighted-average interest rate of 4.40 % and 5.11 %, respectively.

As of June 30, 2025 and December 31, 2024, the collateral pledged provided additional borrowing capacity of $ 67.3 billion and $ 59.8 billion, respectively.

Other short-term borrowings :

Total other short-term borrowings outstanding at March 31, 2025 and December 31, 2024 were $ 6.9 billion and $ 6.0 billion, respectively, and had a weighted-average interest rate of 4.65 % and 5.21 %, respectively.

Total other short-term borrowings outstanding at June 30, 2025 and December 31, 2024 were $ 8.5 billion and $ 6.0 billion, respectively, and had a weighted-average interest rate of 4.49 % and 5.21 %, respectively.

Additional information regarding our other short-term borrowings facilities is described below.

The Company may engage with external financial institutions and the FICC in repurchase agreements collateralized by investment securities as another source of short-term liquidity.

The Company had $ 5.5 billion outstanding pursuant to such repurchase agreements at March 31, 2025 and December 31, 2024, respectively.

Repurchase agreements outstanding at March 31, 2025 mature between April 2025 and August 2025.

The Company had $ 6.0 billion and $ 5.5 billion outstanding pursuant to such repurchase agreements at June 30, 2025 and December 31, 2024, respectively.

Repurchase agreements outstanding at June 30, 2025 mature between July 2025 and October 2025.

Our banking subsidiaries have access to funding through the Federal Reserve discount window.

Amounts available are dependent upon the value of certain investment securities that are pledged as collateral.

As of March 31, 2025 and December 31, 2024, our collateral pledged provided total borrowing capacity of $ 30.4 billion and $ 30.5 billion, respectively, of which no amounts were outstanding at the end of either period.

As of June 30, 2025 and December 31, 2024, our collateral pledged provided total borrowing capacity of $ 29.9 billion and $ 30.5 billion, respectively, of which no amounts were outstanding at the end of either period.

CSC has the ability to issue up to $ 5.0 billion of commercial paper notes with maturities of up to 270 days.

There was $ 950 million gross par value before discount of $ 15 million outstanding at March 31, 2025, and no amounts outstanding at December 31, 2024.

There was $ 2.0 billion gross par value before discount of $ 19 million outstanding at June 30, 2025, and no amounts outstanding at December 31, 2024.

CSC and CS&Co also have access to unsecured uncommitted lines of credit with external banks with total borrowing capacity of $ 1.7 billion;

no amounts were outstanding as of March 31, 2025 or December 31, 2024.

CS&Co maintains secured uncommitted lines of credit, under which CS&Co may borrow on a short-term basis and pledge either client margin securities or firm securities as collateral, based on the terms of the agreements, under which there was $ 500 million outstanding at March 31, 2025 and December 31, 2024, respectively.

Annual maturities on FHLB borrowings and other short-term borrowings outstanding at March 31, 2025 are as follows:

no amounts were outstanding as of June 30, 2025 or December 31, 2024.

Annual maturities on FHLB borrowings and other short-term borrowings outstanding at June 30, 2025 are as follows:

FHLB borrowings $ 9,000

9 unchanged sentences

Under the Program, CSB purchases certain First Mortgages and HELOCs that are originated by Rocket Mortgage, LLC.

CSB purchased First Mortgages of $ 963 million and $ 680 million during the first quarter of 2025 and 2024, respectively.

CSB purchased HELOCs with commitments of $ 50 million and $ 36 million during the first quarter of 2025 and 2024, respectively.

CSB purchased First Mortgages of $ 1.7 billion and $ 851 million during the second quarter of 2025 and 2024, respectively, and $ 2.7 billion and $ 1.5 billion during the first six months of 2025 and 2024, respectively.

CSB purchased HELOCs with commitments of $ 79 million and $ 47 million during the second quarter of 2025 and 2024, respectively, and $ 129 million and $ 83 million during the first six months of 2025 and 2024, respectively.

The Company’s commitments to extend credit on lines of credit and to purchase First Mortgages are as follows:

March 31, 2025 December 31, 2024

Commitments to extend credit related to unused HELOCs, PALs, and other lines of credit $ 1,900 $ 1,895

June 30, 2025 December 31, 2024

Commitments to extend credit related to unused HELOCs and other lines of credit $ 1,840 $ 1,895

Commitments to purchase First Mortgage loans 959 511

18 unchanged sentences

The Company’s ability to migrate these balances to its balance sheet is dependent on multiple factors including having sufficient capital levels to sustain these incremental deposits and certain binding limitations specified in the 2023 IDA agreement.

During the first three months of 2025, Schwab did not move IDA balances to its balance sheet.

During the first six months of 2025, Schwab did not move insured deposit account balances (IDA balances) to its balance sheet.

The 2023 IDA agreement extended the agreement term to sweep balances to the TD Depository Institutions through July 1, 2034, and requires that Schwab maintain minimum and maximum IDA balances as follows:

4 unchanged sentences

If IDA balances decline below the required IDA balance minimum as described above, Schwab would be required to make a nonperformance payment to the TD Depository Institutions pursuant to the terms of the 2023 IDA agreement.

As of March 31, 2025, the total ending IDA balance was $ 83.7 billion, of which $ 64.9 billion was fixed-rate obligation amounts and $ 18.8 billion was floating-rate obligation amounts.

As of December 31, 2024, the total ending IDA balance was $ 87.6 billion, of which $ 66.6 billion was fixed-rate obligation amounts and $ 21.0 billion was floating-rate obligation amounts.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

As of June 30, 2025, the total ending IDA balance was $ 82.2 billion, of which $ 63.7 billion was fixed-rate obligation amounts and $ 18.5 billion was floating-rate obligation amounts.

As of December 31, 2024, the total ending IDA balance was $ 87.6 billion, of which $ 66.6 billion was fixed-rate obligation amounts and $ 21.0 billion was floating-rate obligation amounts.

Legal contingencies :

27 unchanged sentences

The Company utilizes derivative instruments to manage interest rate risk exposures that arise from business activities related to changes in fair values or the receipt and payment of future known and uncertain cash amounts due to changes in interest rates.

The Company uses derivative instruments to manage changes in the fair values of, as well as changes in the amounts and/or timing of known or expected cash receipts and payments related to, our AFS investment portfolio and Senior Notes.

For a description of how the Company accounts for derivative instruments, see Item 8 – Note 2 in the 2024 Form 10-K.

3 unchanged sentences

The Company is exposed to changes in the fair value of its fixed-rate AFS securities and Senior Notes, as well as its fixed-to-floating rate Senior Notes during the fixed-rate period, due to changes in benchmark interest rates.

The Company uses cleared interest rate swaps to manage its exposure to changes in fair value of these instruments attributable to changes in the designated benchmark interest rate.

Cleared interest rate swaps designated as fair value hedges of AFS securities involve the payment of fixed-rate amounts to a CCP in exchange for the Company receiving floating-rate payments over the life of the agreements.

The Company uses cleared

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

interest rate swaps to manage its exposure to changes in fair value of these instruments attributable to changes in the designated benchmark interest rate.

Cleared interest rate swaps designated as fair value hedges of Senior Notes involve the receipt of fixed-rate amounts from a CCP in exchange for the Company’s floating-rate payments over the life of the agreements.

The Company had outstanding interest rate swaps with aggregate notional amounts of $ 33.9 billion and $ 30.9 billion at March 31, 2025 and December 31, 2024, respectively, that were designated as fair value hedges of interest rate risk.

The Company had outstanding interest rate swaps with aggregate notional amounts of $ 32.6 billion and $ 30.9 billion at June 30, 2025 and December 31, 2024, respectively, that were designated as fair value hedges of interest rate risk.

The notional amount is the basis upon which the pay-fixed/receive-float and receive-fixed/pay-float payments are determined;

however, the amount is not exchanged.

Cash Flow Hedges of Interest Rate Risk

Beginning in the second quarter of 2025, the Company uses cleared interest rate swaps designated as cash flows hedges as part of its interest rate risk management strategy to add stability to interest revenue and to manage its exposure to interest rate movements.

Interest rate swaps designated as cash flow hedges involve the receipt of fixed-rate amounts from a CCP in exchange for the Company’s floating-rate payments over the life of the agreements without exchange of the underlying notional amount.

Such derivatives are used to hedge the variable cash flows associated with Schwab’s PALs.

The Company had outstanding interest rate swaps with aggregate notional amounts of $ 10.0 billion at June 30, 2025 that were designated as cash flow hedges of interest rate risk.

Fair Values of Derivative Instruments

The table below presents the gross fair values of the Company’s interest rate swaps designated as hedging instruments on the condensed consolidated balance sheets:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Assets Liabilities Assets Liabilities

2 unchanged sentences

(1) Derivative assets are included in other assets and derivative liabilities are included in accrued expenses and other liabilities on the condensed consolidated balance sheets.

Amounts were less than $ 500 thousand as of December 31, 2024.

Derivative assets as of June 30, 2025 and derivative assets and liabilities as of December 31, 2024 were less than $ 500 thousand.

(2) Includes reductions related to variation margin settlements.

Settlements on derivative positions cleared through CCPs are reflected as reductions to the associated derivative asset and liability balances.

As of March 31, 2025, there was a $ 191 million reduction of derivative assets and a $ 42 million reduction of derivative liabilities related to variation margin settlements.

As of June 30, 2025, there was a $ 28 million reduction of derivative assets and a $ 130 million reduction of derivative liabilities related to variation margin settlements.

As of December 31, 2024, there was a $ 295 million reduction of derivative assets and a $ 10 million reduction of derivative liabilities related to variation margin settlements.

5 unchanged sentences

Assets and Liabilities

March 31, 2025 December 31, 2024 March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024 June 30, 2025 December 31, 2024

Line item in which the hedged item is included:

3 unchanged sentences

(1) Includes the amortized cost basis of closed portfolios of AFS securities used to designate hedging relationships in which the hedged item is the stated amount of assets in the closed portfolios anticipated to be outstanding for the designated hedge period.

At March 31, 2025 and December 31, 2024, the amortized cost basis of the closed portfolios used in these hedging relationships was $ 2.4 billion and $ 2.5 billion, respectively, of which $ 2.0 billion was designated in a portfolio layer hedging relationship at both March 31, 2025 and December 31, 2024.

The cumulative basis adjustments associated with these hedging relationships were a reduction of the amortized cost basis of the closed portfolios of $ 28 million and $ 47 million at March 31, 2025 and December 31, 2024, respectively.

At June 30, 2025 and December 31, 2024, the amortized cost basis of the closed portfolios used in these hedging relationships was $ 2.7 billion and $ 2.5 billion, respectively, of which $ 2.1 billion and $ 2.0 billion was designated in a portfolio layer hedging relationship at June 30, 2025 and December 31, 2024, respectively.

The cumulative basis adjustments associated with these hedging relationships were an increase of $ 9 million and a reduction of $ 47 million of the amortized cost basis of the closed portfolios at June 30, 2025 and December 31, 2024, respectively.

(2) Excludes the amortized cost and fair value hedging adjustment of AFS securities for which hedge accounting has been discontinued.

The cumulative amount of fair value hedging adjustments remaining for these securities was a reduction of the amortized cost basis of $ 2 million at March 31, 2025 and December 31, 2024, which is recorded in AFS securities on the condensed consolidated balance sheets and amortized to interest revenue as a yield adjustment over the lives of the securities.

The table below presents the effect of the Company’s interest rate swaps on the condensed consolidated statements of income:

The cumulative amount of fair value hedging adjustments remaining for these securities was a reduction of the amortized cost basis of $ 150 million at June 30, 2025 and $ 2 million at December 31, 2024, which is recorded in AFS securities on the condensed consolidated balance sheets and amortized to interest revenue as a yield adjustment over the lives of the securities.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

The table below presents the effect of the Company’s interest rate swaps designated as fair value hedges on the condensed consolidated statements of income:

Location and Amount of Gain (Loss) Recognized in Income

1 unchanged sentence

Interest Expense

Three Months Ended March 31, 2025 2024 2025 2024

Three Months Ended June 30, 2025 2024 2025 2024

Gain (loss) on fair value hedging relationships:

2 unchanged sentences

( 94 ) 38 ( 9 ) —

(1) Interest revenue excludes net income (expense) from periodic interest accruals and receipts (payments) of $ 18 million and $ 3 million for the three months ended March 31, 2025 and 2024, respectively.

Interest expense excludes net income (expense) from periodic interest accruals and receipts (payments) of $( 10 ) million for the three months ended March 31, 2025.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Six Months Ended June 30, 2025 2024 2025 2024

Gain (loss) on fair value hedging relationships:

Hedged items $ 255 $ ( 197 ) $ ( 16 ) $ —

Derivatives designated as hedging instruments (1)

( 255 ) 195 18 —

(1) Interest revenue excludes net income (expense) from periodic interest accruals and receipts (payments) of $ 14 million and $ 32 million for the three and six months ended June 30, 2025, respectively, and $ 13 million and $ 16 million for the three and six months ended June 30, 2024, respectively.

Interest expense excludes net income (expense) from periodic interest accruals and receipts (payments) of $( 14 ) million and $( 24 ) million, respectively, for the three and six months ended June 30, 2025.

We began designating swaps as fair value hedges of Senior Notes in the fourth quarter of 2024.

As such, there was no impact to interest expense from periodic interest accruals and receipts (payments) for the three and six months ended June 30, 2024.

Effects of Cash Flow Hedge Accounting

The table below presents the effect of the Company’s interest rate swaps designated as cash flow hedges on AOCI and the condensed consolidated statements of income:

Three and Six Months Ended

June 30, 2025

Gain (loss) recognized in other comprehensive income (1)

Gain (loss) reclassified from AOCI to interest revenue ( 17 )

(1) Included in net unrealized gain (loss) on derivatives designated as cash flow hedging instruments on the condensed consolidated statements of comprehensive income.

For the twelve months following June 30, 2025, the Company estimates that an additional $ 28 million will be reclassified from AOCI as a reduction to interest revenue.

Financial Instruments Subject to Off-Balance Sheet Credit Risk

5 unchanged sentences

For Schwab to repledge or sell this collateral, we would be required to deposit cash and/or securities of an equal amount into our segregated reserve bank accounts in order to meet our segregated cash and investments requirement.

Schwab’s resale agreements as of March 31, 2025 and December 31, 2024 were not subject to master netting arrangements.

Schwab’s resale agreements as of June 30, 2025 and December 31, 2024 were not subject to master netting arrangements.

Securities lending :

5 unchanged sentences

We also borrow securities from other broker-dealers to fulfill short sales by brokerage clients and deliver cash to the lender in exchange for the securities.

The fair value of these borrowed securities was $ 550 million and $ 674 million at March 31, 2025 and December 31, 2024, respectively.

The fair value of these borrowed securities

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

was $ 1.6 billion and $ 674 million at June 30, 2025 and December 31, 2024, respectively.

Our securities lending transactions are subject to enforceable master netting arrangements with other broker-dealers;

however, we do not net securities lending transactions.

Therefore, the securities loaned and securities borrowed are presented gross in the condensed consolidated balance sheets.

Therefore, amounts related to securities loaned and securities borrowed are presented gross in the condensed consolidated balance sheets.

Repurchase agreements :

27 unchanged sentences

Offsetting Collateral

March 31, 2025

June 30, 2025

Resale agreements (1)

33 unchanged sentences

(2) Actual collateral was greater than or equal to the value of the related assets.

At March 31, 2025 and December 31, 2024, the fair value of collateral received in connection with resale agreements that are available to be repledged or sold was $ 14.6 billion and $ 10.3 billion, respectively.

At June 30, 2025 and December 31, 2024, the fair value of collateral received in connection with resale agreements that are available to be repledged or sold was $ 20.0 billion and $ 10.3 billion, respectively.

(3) Included in receivables from brokers, dealers, and clearing organizations in the condensed consolidated balance sheets.

(4) Derivative assets are included in other assets and derivative liabilities are included in accrued expenses and other liabilities in the condensed consolidated balance sheets.

Amounts were less than $ 500 thousand as of December 31, 2024.

(5) At March 31, 2025 and December 31, 2024, the fair value of initial margin pledged as collateral related to interest rate swaps was $ 371 million and $ 378 million, respectively.

Derivative assets as of June 30, 2025 and derivative assets and liabilities as of December 31, 2024 were less than $ 500 thousand.

(5) At June 30, 2025 and December 31, 2024, the fair value of initial margin pledged as collateral related to interest rate swaps was $ 225 million and $ 378 million, respectively.

See Notes 5 and 11 for additional information.

1 unchanged sentence

Actual collateral value was greater than or equal to the value of the related liabilities.

At March 31, 2025 and December 31, 2024, the fair value of collateral pledged in connection with repurchase agreements was $ 5.8 billion and $ 5.9 billion, respectively.

At June 30, 2025 and December 31, 2024, the fair value of collateral pledged in connection with repurchase agreements was $ 6.3 billion and $ 5.9 billion, respectively.

See Note 9 for additional information.

1 unchanged sentence

Securities loaned are predominantly comprised of equity securities held in client brokerage accounts.

At March 31, 2025, $ 9.4 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 5.3 billion of securities loaned had contractual maturities of 35 - 95 days.

At June 30, 2025, $ 13.4 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 4.2 billion of securities loaned had contractual maturities of 18 - 95 days.

At December 31, 2024, $ 8.8 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 4.3 billion of securities loaned had contractual maturities of 35 - 95 days.

The cash collateral received from counterparties under securities lending transactions was equal to or greater than the market value of the securities loaned at March 31, 2025 and December 31, 2024.

The cash collateral received from counterparties under securities lending transactions was equal to or greater than the market value of the securities loaned at June 30, 2025 and December 31, 2024.

(8) Included in other short-term borrowings in the condensed consolidated balance sheets.

6 unchanged sentences

The following table summarizes the fair value of client securities that were available, under such regulations, that could have been used as collateral, as well as the fair value of securities that we had pledged to third parties under such regulations and from securities borrowed transactions:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Fair value of client securities available to be pledged $ 115,551 $ 116,258

7 unchanged sentences

Excludes amounts available and pledged for securities lending from fully-paid client securities.

The fair value of fully-paid client securities available and pledged was $ 138 million and $ 105 million at March 31, 2025 and December 31, 2024, respectively.

The fair value of fully-paid client securities available and pledged was $ 324 million and $ 105 million at June 30, 2025 and December 31, 2024, respectively.

(1) Securities pledged to fulfill client margin requirements for open option contracts established with the Options Clearing Corporation.

35 unchanged sentences

For a description of the fair value hierarchy and Schwab’s fair value methodologies, see Item 8 – Note 2 in the 2024 Form 10-K.

The Company did not adjust prices received from the primary independent third-party pricing service at March 31, 2025 or December 31, 2024.

The Company did not adjust prices received from the primary independent third-party pricing service at June 30, 2025 or December 31, 2024.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables present the fair value hierarchy for assets and liabilities measured at fair value on a recurring basis:

March 31, 2025 Level 1 Level 2 Level 3 Balance at

June 30, 2025 Level 1 Level 2 Level 3 Balance at

Cash equivalents:

21 unchanged sentences

Total other securities owned 2,588 140 — 2,728

Interest rate swaps — 2 — 2

Total other assets 2,588 140 — 2,728

43 unchanged sentences

The following tables present the fair value hierarchy for other financial instruments:

March 31, 2025 Carrying

June 30, 2025 Carrying

Amount Level 1 Level 2 Level 3 Balance at

49 unchanged sentences

Stockholders’ Equity

On February 12, 2025, TD Group US Holdings LLC, an affiliate of TD Bank, completed a secondary public offering of the Company’s common shares through which TD Group US Holdings sold 133.8 million shares of the Company’s common stock and 31.7 million shares of the Company’s nonvoting common stock, which automatically converted into common stock.

Common and Nonvoting Common Stock

On February 12, 2025, TD Group US Holdings LLC, an affiliate of TD Bank, completed a secondary public offering of the Company’s common shares through which TD Group US Holdings LLC sold 133.8 million shares of the Company’s common stock and 31.7 million shares of the Company’s nonvoting common stock, which automatically converted into common stock.

The offering was completed at a price of $ 79.25 per share, for an aggregate amount of $ 13.1 billion.

3 unchanged sentences

These shares were purchased under CSC’s $ 15.0 billion share repurchase authorization.

The share repurchase authorization does not have an expiration date and as of March 31, 2025, approximately $ 7.2 billion remained on the authorization.

There were no repurchases of CSC’s common stock during the three months ended March 31, 2024.

Share repurchases, net of issuances, are subject to a nondeductible excise tax which was recognized as a direct and incremental cost associated with these transactions.

For repurchases of common stock, the tax is recorded as part of the cost basis of the treasury stock repurchased, resulting in no impact to the condensed consolidated statements of income.

Through the completion of the secondary offering and the Company’s repurchase of nonvoting common stock, TD Bank disposed of all of its common shares of CSC and as of March 31, 2025, the Company has no remaining nonvoting common stock outstanding.

Through the completion of the secondary offering and the Company’s repurchase of nonvoting common stock, TD Bank disposed of all of its common shares of CSC and as of February 12, 2025, the Company had no remaining nonvoting common stock outstanding.

CSC repurchased an additional 3.9 million shares of its common stock for $ 351 million during the three months ended June 30, 2025.

These shares were purchased under CSC’s $ 15.0 billion share repurchase authorization and as of June 30, 2025, approximately $ 6.9 billion remained on the authorization.

Subsequent to June 30, 2025, on July 24, 2025, CSC publicly announced that its Board of Directors terminated the existing share repurchase authorization and replaced it with a new authorization to repurchase up to $ 20.0 billion of common stock.

The new share repurchase authorization does not have an expiration date.

There were no repurchases of CSC’s common stock during the three and six months ended June 30, 2024.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Share repurchases, net of issuances, are subject to a nondeductible excise tax which was recognized as a direct and incremental cost associated with these transactions.

For repurchases of common stock, the tax is recorded as part of the cost basis of the treasury stock repurchased, resulting in no impact to the condensed consolidated statements of income.

Preferred Stock

On June 2, 2025, the Company redeemed all of the 24,580 outstanding shares of its fixed-rate reset non-cumulative perpetual preferred stock, Series G, and the corresponding 2,457,964 depositary shares, each representing a 1/100th interest in a share of the Series G preferred stock.

The depositary shares were redeemed at a redemption price of $ 1,000 per depositary share for a total of $ 2.5 billion.

The difference between the total redemption price and the prior carrying value of the Series G preferred stock resulted in a $ 30 million deemed dividend that was included in the calculation of EPS.

There were no redemptions of CSC’s preferred stock during the three and six months ended June 30, 2024.

The Company’s preferred stock issued and outstanding is as follows:

Liquidation Preference Per Share Dividend Rate in Effect at March 31, 2025 Earliest Redemption Date Date at Which Dividend Rate Resets or Becomes Floating Reset / Floating-Rate

Liquidation Preference Per Share Dividend Rate in Effect at June 30, 2025 Earliest Redemption Date Date at Which Dividend Rate Resets or Becomes Floating Reset / Floating-Rate

Margin Over Reset / Floating-Rate

Shares Issued and Outstanding (in ones) at Carrying Value at

March 31, 2025 (1)

June 30, 2025 (1)

December 31, 2024 (1)

March 31, 2025 December 31, 2024 Issue Date

June 30, 2025 December 31, 2024 Issue Date

Series D 750,000 750,000 $ 1,000 $ 728 $ 728 03/07/16 5.95 % 06/01/21 N/A N/A N/A

2 unchanged sentences

Series F 4,884 4,884 100,000 481 481 10/31/17 5.000 % 12/01/27 12/01/27 3 M LIBOR (5)

24,580 24,580 100,000 2,428 2,428 04/30/20 5.375 % 06/01/25 06/01/25 5 -Year Treasury

— 24,580 — — 2,428 04/30/20 — — — — —

22,267 22,267 100,000 2,200 2,200 12/11/20 4.000 % 12/01/30 12/01/30 10 -Year Treasury

4 unchanged sentences

(1) Represented by depositary shares.

(2) The dividend rate for Series G, Series I, and Series K resets on each five-year anniversary from the first reset date.

(2) Series G was redeemed on June 2, 2025.

(3) The dividend rate for Series H resets on each ten-year anniversary from the first reset date.

(4) The dividend rate for Series I and Series K resets on each five-year anniversary from the first reset date.

(5) The reset/floating-rate for Series F will be determined by the calculation agent prior to the commencement of the floating-rate period using what the calculation agent determines to be the industry-accepted substitute or successor base rate to LIBOR.

1 unchanged sentence

Dividends declared on the Company’s preferred stock are as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Declared Per Share

$ 11.1 $ 14.88 $ 11.1 $ 14.88 $ 22.3 $ 29.76 $ 22.3 $ 29.76

4 unchanged sentences

6.7 11.13 6.7 11.13 13.4 22.26 13.4 22.26

9.5 1,250.00 9.5 1,250.00 18.8 2,500.00 18.8 2,500.00

Total $ 115.3 $ 115.3 $ 218.4 $ 218.4

1 unchanged sentence

(2) Dividends paid semi-annually until December 1, 2027 and quarterly thereafter.

(3) Series G was redeemed on June 2, 2025.

Prior to redemption, dividends were paid quarterly.

The final dividend was paid on June 2, 2025.

THE CHARLES SCHWAB CORPORATION

4 unchanged sentences

AOCI balances and the components of other comprehensive income (loss) are as follows:

Balance at December 31, 2023 $ ( 18,131 )

Balance at March 31, 2024 $ ( 17,576 )

Available for sale securities:

3 unchanged sentences

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 131

Balance at June 30, 2024 $ ( 16,936 )

Balance at March 31, 2025 $ ( 13,621 )

Available for sale securities:

Net unrealized gain (loss), net of tax expense (benefit) of $ 116

Other reclassifications included in other revenue, net of tax expense (benefit) of $ 8

Held to maturity securities:

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 61

Derivatives designated as cash flow hedging instruments:

Net unrealized gain (loss), net of tax expense (benefit) of $( 4 )

Reclassifications included in interest revenue, net of tax expense (benefit) of $ 4

Balance at June 30, 2025 $ ( 12,591 )

Balance at December 31, 2023 $ ( 18,131 )

4 unchanged sentences

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 253

Balance at March 31, 2025 $ ( 13,621 )

Balance at June 30, 2024 $ ( 16,936 )

Balance at December 31, 2024 $ ( 14,848 )

Available for sale securities:

Net unrealized gain (loss), net of tax expense (benefit) of $ 369

Other reclassifications included in other revenue, net of tax expense (benefit) of $ 10

Held to maturity securities:

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 189

Derivatives designated as cash flow hedging instruments:

Net unrealized gain (loss), net of tax expense (benefit) of $( 4 )

Reclassifications included in interest revenue, net of tax expense (benefit) of $ 4

Balance at June 30, 2025 $ ( 12,591 )

(1) Tax expense (benefit) was less than $ 500 thousand.

As of March 31, 2025, the total remaining unamortized loss on securities transferred from AFS to HTM included in AOCI was $ 9.3 billion net of tax effect ($ 12.2 billion pre-tax).

As of June 30, 2025, the total remaining unamortized loss on securities transferred from AFS to HTM included in AOCI was $ 8.8 billion net of tax effect ($ 11.7 billion pre-tax).

This loss is being amortized over the remaining lives of the securities, offsetting amortization of the securities’ premiums or discounts, and resulting in no impact to net income.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

Earnings Per Common Share

As described in Note 14, TD Bank disposed of all of its common shares of CSC during the first quarter of 2025, including its holdings of nonvoting common stock.

As of February 12, 2025, the Company had no remaining nonvoting common stock outstanding and accordingly, no dividends were paid on nonvoting common stock during the three months ended March 31, 2025.

As of February 12, 2025, the Company had no remaining nonvoting common stock outstanding and accordingly, no dividends were paid on nonvoting common stock during the six months ended June 30, 2025.

For the computations of basic and diluted EPS, undistributed net income of the Company was allocated on a proportionate basis to the voting and nonvoting common stock, as the distribution rights of the two classes were identical.

1 unchanged sentence

For further details surrounding the EPS computations, see Item 8 – Note 26 in the 2024 Form 10-K.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

The computations of basic and diluted EPS for common stock and nonvoting common stock for the three months ended March 31, 2025 are as follows:

Three Months Ended March 31,

Common Stock Nonvoting Common Stock Consolidated Common Stock

The computations of basic and diluted EPS for common stock and nonvoting common stock for the three and six months ended June 30, 2025 are as follows:

Three Months Ended

June 30, Six Months Ended

Stock Nonvoting

Common Stock Consolidated

Common Stock Common

Stock Nonvoting

Common Stock Consolidated

Basic earnings per share:

7 unchanged sentences

Net income available to common stockholders $ 1,977 $ — $ 1,977 $ 3,756 $ 17 $ 3,773

Reallocation of net income available to common stockholders as a result of

conversion of nonvoting to voting shares 17 — —

Reallocation of net income available to common

stockholders as a result of conversion of nonvoting

to voting shares — — — 17 — —

Allocation of net income available to common stockholders:

2 unchanged sentences

Conversion of nonvoting shares to voting shares — — — 12 — —

Common stock equivalent shares related to stock incentive plans 5 — 5

Weighted-average common shares outstanding — diluted (2)

Common stock equivalent shares related to stock

incentive plans 5 — 5 6 — 6

Weighted-average common shares outstanding —

1,822 — 1,822 1,825 51 1,825

1 unchanged sentence

(1) Includes preferred stock dividends and undistributed earnings and dividends allocated to non-vested restricted stock units.

(2) Antidilutive stock options and restricted stock units excluded from the calculation of diluted EPS totaled 14 million for the three months ended March 31, 2025.

As of March 31, 2024, the Company had voting and nonvoting common stock outstanding.

The computations of basic and diluted EPS for the two classes for the three months ended March 31, 2024 are as follows:

Three Months Ended March 31,

Common Stock Nonvoting Common Stock

(2) Antidilutive stock options and restricted stock units excluded from the calculation of diluted EPS totaled 9 million and 13 million for the three and six months ended June 30, 2025, respectively.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

(Tabular Amounts in Millions, Except Per Share Data, Ratios, or as Noted)

As of June 30, 2024, the Company had voting and nonvoting common stock outstanding.

The computations of basic and diluted EPS for the two classes for the three and six months ended June 30, 2024 are as follows:

Three Months Ended

June 30, Six Months Ended

Stock Nonvoting

Common Stock Common

Stock Nonvoting

Basic earnings per share:

10 unchanged sentences

Allocation of net income available to common stockholders:

$ 1,211 $ 34 $ 2,462 $ 69

Weighted-average common shares outstanding — basic 1,777 51 1,776 51

2 unchanged sentences

Weighted-average common shares outstanding — diluted (2)

1,834 51 1,832 51

Diluted earnings per share $ .66 $ .66 $ 1.34 $ 1.34

(1) Includes preferred stock dividends and undistributed earnings and dividends allocated to non-vested restricted stock units.

(2) Antidilutive stock options and restricted stock units excluded from the calculation of diluted EPS totaled 18 million for the three months ended March 31, 2024.

(2) Antidilutive stock options and restricted stock units excluded from the calculation of diluted EPS totaled 13 million and 18 million for the three and six months ended June 30, 2024, respectively.

THE CHARLES SCHWAB CORPORATION

2 unchanged sentences

Regulatory Requirements

At March 31, 2025, CSC and its banking subsidiaries met all of their respective capital requirements.

At June 30, 2025, CSC and its banking subsidiaries met all of their respective capital requirements.

Regulatory capital and ratios for CSC (consolidated) and CSB are as follows:

1 unchanged sentence

Well Capitalized Minimum Capital Requirement

March 31, 2025 Amount Ratio Amount Ratio Amount Ratio (1)

June 30, 2025 Amount Ratio Amount Ratio Amount Ratio (1)

Common Equity Tier 1 Risk-Based Capital $ 37,504 33.0 % N/A $ 5,116 4.5 %

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(1) Under risk-based capital rules, CSC and CSB are also required to maintain additional capital buffers above the regulatory minimum risk-based capital ratios.

As of March 31, 2025, CSC was subject to a stress capital buffer of 2.5%.

As of June 30, 2025, CSC was subject to a stress capital buffer of 2.5%.

In addition, CSB is required to maintain a capital conservation buffer of 2.5%.

1 unchanged sentence

If a buffer falls below the minimum requirement, CSC and CSB would be subject to increasingly strict limits on capital distributions and discretionary bonus payments to executive officers.

At March 31, 2025, the minimum capital ratio requirements for both CSC and CSB, inclusive of their respective buffers, were 7.0%, 8.5%, and 10.5% for Common Equity Tier 1 Risk-Based Capital, Tier 1 Risk-Based Capital, and Total Risk-Based Capital, respectively.

At June 30, 2025, the minimum capital ratio requirements for both CSC and CSB, inclusive of their respective buffers, were 7.0%, 8.5%, and 10.5% for Common Equity Tier 1 Risk-Based Capital, Tier 1 Risk-Based Capital, and Total Risk-Based Capital, respectively.

N/A Not applicable.

Based on its regulatory capital ratios at March 31, 2025, CSB is considered well capitalized (the highest category) under its respective regulatory capital rules.

There are no conditions or events since March 31, 2025 that management believes have changed CSB’s capital category.

Based on its regulatory capital ratios at June 30, 2025, CSB is considered well capitalized (the highest category) under its respective regulatory capital rules.

There are no conditions or events since June 30, 2025 that management believes have changed CSB’s capital category.

CSC’s other banking subsidiaries are Charles Schwab Premier Bank, SSB (CSPB) and Charles Schwab Trust Bank (Trust Bank).

CSPB is a Texas-chartered state savings bank that provides banking and custody services, and Trust Bank is a Nevada state-chartered savings bank that provides trust and custody services.

At March 31, 2025, the balance sheets of CSPB and Trust Bank consisted primarily of investment securities, and the entities held total assets of $ 25.3 billion and $ 9.8 billion, respectively.

Based on their regulatory capital ratios, at March 31, 2025, CSPB and Trust Bank are considered well capitalized under their respective regulatory capital rules.

At June 30, 2025, the balance sheets of CSPB and Trust Bank consisted primarily of investment securities, and the entities held total assets of $ 24.4 billion and $ 9.7 billion, respectively.

Based on their regulatory capital ratios, at June 30, 2025, CSPB and Trust Bank are considered well capitalized under their respective regulatory capital rules.

THE CHARLES SCHWAB CORPORATION

2 unchanged sentences

Net capital and net capital requirements for CS&Co are as follows:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Net capital $ 12,043 $ 11,112

2 unchanged sentences

Net capital in excess of required net capital 9,888 9,063

Pursuant to the SEC’s Customer Protection Rule and other applicable regulations, Schwab had cash and investments segregated for the exclusive benefit of clients at March 31, 2025.

Pursuant to the SEC’s Customer Protection Rule and other applicable regulations, Schwab had cash and investments segregated for the exclusive benefit of clients at June 30, 2025.

The SEC’s Customer Protection Rule requires broker-dealers to segregate client fully-paid securities and cash balances not collateralizing margin positions and not swept to money market funds or bank deposit accounts.

19 unchanged sentences

Investor Services Advisor Services Total

Three Months Ended March 31, 2025 2024 2025 2024 2025 2024

Three Months Ended June 30, 2025 2024 2025 2024 2025 2024

Net interest revenue $ 2,244 $ 1,736 $ 578 $ 422 $ 2,822 $ 2,158

16 unchanged sentences

Income before taxes on income $ 2,274 $ 1,434 $ 529 $ 313 $ 2,803 $ 1,747

Six Months Ended June 30,

Net interest revenue $ 4,402 $ 3,502 $ 1,126 $ 889 $ 5,528 $ 4,391

Asset management and administration fees 2,258 1,976 842 755 3,100 2,731

Trading revenue 1,657 1,405 203 189 1,860 1,594

Bank deposit account fees 385 260 107 76 492 336

Other 378 310 92 68 470 378

Total net revenues 9,080 7,453 2,370 1,977 11,450 9,430

Expenses Excluding Interest

Compensation and benefits 2,476 2,311 732 677 3,208 2,988

Professional services 445 400 115 100 560 500

Occupancy and equipment 427 399 117 114 544 513

Advertising and market development 134 132 70 63 204 195

Communications 233 218 96 95 329 313

Depreciation and amortization 327 371 105 90 432 461

Amortization of acquired intangible assets 210 234 48 25 258 259

Regulatory fees and assessments 132 170 34 51 166 221

Other 411 362 80 73 491 435

Total expenses excluding interest 4,795 4,597 1,397 1,288 6,192 5,885

Income before taxes on income $ 4,285 $ 2,856 $ 973 $ 689 $ 5,258 $ 3,545

(1) In connection with certain changes in Schwab’s organizational management structure, in the fourth quarter of 2024, the Retirement Business Services business unit was transferred from the Advisor Services segment to the Investor Services segment.

Accordingly, amounts related to the Retirement Business Services business unit are included within Investor Services for the first quarter of 2025, and prior-year amounts have been recast to reflect this new basis of segmentation.

Accordingly, amounts related to the Retirement Business Services business unit are included within Investor Services for the second quarter and six months ended June 30, 2025, and prior-year amounts have been recast to reflect this new basis of segmentation.

THE CHARLES SCHWAB CORPORATION

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk