What changed in this filing

/stocks — the workspaceLOADING

Item 3. Quantitative and Qualitative Disclosures About Market Risk

2026-05-08 compared with 2025-11-07 · 366 added, 444 removed, 1172 unchanged (41% of the section changed)

7 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Interest revenue $ 3,962 $ 3,757

28 unchanged sentences

Diluted $ 1.37 $ .99

(1) For additional information on earnings per common shares outstanding for both voting and nonvoting common stock, see Note 16.

(1) For additional information on earnings per common shares outstanding for both voting and nonvoting common stock, see Notes 15 and 17.

See Notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Net income $ 2,479 $ 1,909

19 unchanged sentences

(In Millions, Except Per Share and Share Amounts)

September 30, 2025 December 31, 2024

Cash and cash equivalents $ 30,572 $ 42,083

March 31, 2026 December 31, 2025

Cash and cash equivalents (including resale agreements of $ 6,400 at March 31, 2026)

$ 44,975 $ 46,030

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

agreements of $ 22,245 and $ 10,075 at September 30, 2025 and December 31, 2024,

agreements of $ 18,010 and $ 16,901 at March 31, 2026 and December 31, 2025,

respectively)

2 unchanged sentences

Receivables from brokerage clients — net 106,211 104,660

Available for sale securities (amortized cost of $ 66,698 and $ 89,704 at September 30, 2025 and

Available for sale securities (amortized cost of $ 64,950 and $ 66,225 at March 31, 2026 and

December 31, 2025, respectively;

2 unchanged sentences

Held to maturity securities (including assets pledged of $ 2,578 and $ 1,270 at

September 30, 2025 and December 31, 2024, respectively)

March 31, 2026 and December 31, 2025, respectively)

131,671 133,969

16 unchanged sentences

Preferred stock — $ .01 par value per share;

aggregate liquidation preference of $ 6,871 and

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

aggregate liquidation preference of $ 6,871 at March 31, 2026 and December 31, 2025

Common stock — 3 billion shares authorized;

$ .01 par value per share;

2,074,188,875 and

2,023,295,180 shares issued at September 30, 2025 and December 31, 2024, respectively

2,074,188,875 issued at March 31, 2026 and December 31, 2025

Nonvoting common stock — 300 million shares authorized;

$ .01 par value per share;

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

no shares issued at March 31, 2026 and December 31, 2025

Additional paid-in capital 28,047 27,996

Retained earnings 45,912 44,065

Treasury stock, at cost — 287,497,378 and 242,977,194 shares at September 30, 2025

Treasury stock, at cost — 336,068,055 and 315,863,800 shares at March 31, 2026

and December 31, 2025, respectively

( 20,752 ) ( 18,437 )

Accumulated other comprehensive income (loss) ( 11,798 ) ( 14,848 )

Accumulated other comprehensive loss ( 10,757 ) ( 10,983 )

Total stockholders’ equity 49,234 49,425

9 unchanged sentences

Shares Amount Shares Amount

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

Net income — — — — — — 1,408 — — 1,408

Other comprehensive income (loss), net of tax — — — — — — — — 2,318 2,318

Dividends declared on preferred stock — — — — — — ( 103 ) — — ( 103 )

Dividends declared on common stock — $ .25

— — — — — — ( 460 ) — — ( 460 )

Stock option exercises and other — — — — — ( 6 ) — 16 — 10

Share-based compensation — — — — — 59 — — — 59

Other — — — — — 25 — 5 — 30

Balance at September 30, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,548 $ 36,303 $ ( 11,230 ) $ ( 14,618 ) $ 47,215

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

Net income — — — — — — 2,358 — — 2,358

Other comprehensive income (loss), net of tax — — — — — — — — 793 793

Dividends declared on preferred stock — — — — — — ( 70 ) — — ( 70 )

Dividends declared on common stock — $ .27

— — — — — — ( 492 ) — — ( 492 )

Repurchase of common stock, inclusive of tax — — — — — — — ( 2,777 ) — ( 2,777 )

Stock option exercises and other — — — — — 13 — 19 — 32

Share-based compensation — — — — — 56 — — — 56

Other — — — — — 28 — 5 — 33

Balance at September 30, 2025 $ 6,763 2,074 $ 21 — $ — $ 27,910 $ 42,170 $ ( 15,682 ) $ ( 11,798 ) $ 49,384

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

4 unchanged sentences

— — — — — — ( 492 ) — — ( 492 )

Repurchase of nonvoting common stock,

inclusive of tax — 19 — ( 19 ) — — — ( 1,512 ) — ( 1,512 )

Conversion of nonvoting common stock to

common stock — 32 1 ( 32 ) ( 1 ) — — — — —

Stock option exercises and other — — — — — ( 123 ) — 162 — 39

1 unchanged sentence

Other — — — — — 32 — ( 80 ) — ( 48 )

Balance at September 30, 2024 $ 9,191 2,023 $ 20 51 $ 1 $ 27,548 $ 36,303 $ ( 11,230 ) $ ( 14,618 ) $ 47,215

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

Balance at December 31, 2025 $ 6,763 2,074 $ 21 — $ — $ 27,996 $ 44,065 $ ( 18,437 ) $ ( 10,983 ) $ 49,425

1 unchanged sentence

Other comprehensive income (loss), net of tax — — — — — — — — 226 226

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

Dividends declared on preferred stock — — — — — — ( 70 ) — — ( 70 )

2 unchanged sentences

Repurchase of common stock, inclusive of tax — — — — — — — ( 2,399 ) — ( 2,399 )

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

Conversion of nonvoting common stock to common stock — 32 1 ( 32 ) ( 1 ) — — — — —

Stock option exercises and other — — — — — ( 125 ) — 172 — 47

1 unchanged sentence

Other — — — — — 49 — ( 88 ) — ( 39 )

Balance at September 30, 2025 $ 6,763 2,074 $ 21 — $ — $ 27,910 $ 42,170 $ ( 15,682 ) $ ( 11,798 ) $ 49,384

Balance at March 31, 2026 $ 6,763 2,074 $ 21 — $ — $ 28,047 $ 45,912 $ ( 20,752 ) $ ( 10,757 ) $ 49,234

See Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(in Millions)

Nine Months Ended

September 30,

Three Months Ended

Cash Flows from Operating Activities

23 unchanged sentences

Net change in bank loans ( 3,021 ) ( 1,928 )

Cash paid for acquisition, net of cash acquired ( 577 ) —

Purchases of equipment, office facilities, and property ( 140 ) ( 117 )

12 unchanged sentences

Repayments of long-term debt ( 1,608 ) ( 981 )

Redemption of preferred stock ( 2,458 ) —

Repurchases of common stock and nonvoting common stock ( 2,378 ) ( 1,500 )

11 unchanged sentences

Continued from previous page.

Nine Months Ended

September 30,

Three Months Ended

Supplemental Cash Flow Information

1 unchanged sentence

Changes in accrued equipment, office facilities, and property purchases $ 33 $ 39

Non-cash financing activity:

Common stock repurchased during the period but settled after period end $ 20 $ —

Other Supplemental Cash Flow Information:

Cash paid during the period for:

Cash paid during the year for:

Interest $ 778 $ 1,193

Income taxes $ 955 $ 1,313

Income taxes, net $ 92 $ 41

Amounts included in the measurement of lease liabilities $ 64 $ 63

Leased assets obtained in exchange for new operating lease liabilities $ 46 $ 15

September 30, 2025 September 30, 2024

March 31, 2026 March 31, 2025

Reconciliation of cash, cash equivalents and amounts reported within the balance sheet (1)

4 unchanged sentences

statement of cash flows $ 73,280 $ 61,981

(1) Certain prior year amounts have been reclassified to conform to the current year presentation.

See Note 1 for additional information.

(1) For more information on the nature of restrictions on restricted cash and cash equivalents, see Note 18.

18 unchanged sentences

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, included in Schwab’s 2025 Form 10-K.

Reclassifications :

Beginning in the fourth quarter of 2024, receivables from brokers, dealers, and clearing organizations and payables to brokers, dealers, and clearing organizations are presented separately from other assets and accrued expenses and other liabilities, respectively, in the consolidated balance sheets.

Correspondingly, interest expense related to securities lending is now presented as interest expense on payables to brokers, dealers, and clearing organizations.

Prior period amounts have been reclassified to reflect these changes.

Corresponding presentation changes have been made to the condensed consolidated statements of cash flows and related notes also impacted.

The significant accounting policies are included in Item 8 – Note 2 in the 2025 Form 10-K.

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

New Accounting Standards

Adoption of New Accounting Standards

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

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.

January 1, 2025 The Company does not expect this guidance will have a material impact on its financial statements or related disclosures.

This guidance will be reflected in the annual financial statements for 2025.

There have been no significant changes to these accounting policies during the first three months of 2026.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

New Accounting Standards

Adoption of New Accounting Standards

The Company did not adopt any material new accounting standards during the three months ended March 31, 2026.

New Accounting Standards Not Yet Adopted

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

ASU 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses” Requires additional disclosures about certain expenses including, but not limited to, employee compensation, depreciation, amortization of intangible assets, and selling expenses.

Accounting Standards Update (ASU) 2024-03, “Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses”

Requires additional disclosures about certain expenses including, but not limited to, employee compensation, depreciation, amortization of intangible assets, and selling expenses.

Also requires annual disclosure of how selling expenses are defined.

6 unchanged sentences

Adoption allows retrospective, prospective, or modified transition application, with early adoption permitted.

January 1, 2028 (applies to the annual financial statements and interim periods within those annual reporting periods) The Company is evaluating the impact of this guidance on its financial statements.

January 1, 2028 The Company is evaluating the impact of this guidance on its financial statements.

ASU 2025-09, “Derivatives and Hedging (Topic 815):

Hedge Accounting Improvements”

Clarifies certain aspects of the guidance on hedge accounting and addresses several incremental hedge accounting issues arising from the global reference rate reform.

Adoption should be applied on a prospective basis for all hedging relationships and may be elected for hedging relationships that exist as of the date of adoption.

Upon adoption, entities will be permitted to modify certain critical terms of certain hedging relationships without dedesignating the hedge.

January 1, 2027 The Company is evaluating the impact of this guidance on its financial statements.

Business Acquisition

On March 2, 2026, the Company completed its acquisition of Forge Global Holdings, Inc.

(Forge) for $ 636 million of cash and other consideration.

Forge provides eligible investors with direct and indirect access to shares of private companies through direct share purchase, single company funds, and multicompany funds.

The Company anticipates that incorporating Forge’s private company investment capabilities will enhance Schwab’s ability to meet the evolving needs of investors across our growing client base.

The Company accounted for the Forge acquisition as a business combination under GAAP and accordingly, the purchase price was allocated to the assets acquired and liabilities assumed based on their estimated fair values as of the date of acquisition.

The determination of fair values requires management to make significant estimates and assumptions.

The Company believes that the information available provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, and consideration transferred;

however, due to the timing of and limited time since the close of the acquisition, these estimates are provisional and may be adjusted upon the availability of new information regarding facts and circumstances which existed at the acquisition date.

Any adjustments to the initial estimates of the fair values of the acquired assets and liabilities assumed will be recorded as adjustments to the respective assets and liabilities, with the residual amounts allocated to goodwill, in subsequent periods as prescribed in ASC 805 Business Combinations .

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

The following table summarizes provisional information including the consideration transferred, fair value estimates of the assets acquired and liabilities assumed, and resulting goodwill as of the March 2, 2026 acquisition date:

Fair value of assets acquired:

Cash and cash equivalents $ 39

Acquired intangible assets 310

Other assets 42

Total assets acquired 391

Fair value of liabilities assumed:

Accrued expenses and other liabilities 86

Total liabilities assumed 86

Fair value of net identifiable assets acquired $ 305

Consideration transferred $ 636

Fair value of noncontrolling interest acquired (1)

Fair value of net identifiable assets acquired ( 305 )

Goodwill $ 347

(1) Subsequent to the acquisition date, Schwab purchased the equity interest attributable to the noncontrolling party resulting in the subsidiary becoming 100%-owned by Schwab as of March 31, 2026.

The provisional identifiable intangible assets of $ 310 million are subject to amortization.

The following table summarizes the major classes of intangible assets acquired and their respective estimated fair values and weighted-average useful lives:

Method Used to Estimate Fair Value Fair

Value Weighted-Average Useful Life (Years)

Client relationships Income Approach $ 205 9

Existing technology Replacement Cost Approach 82 3

Data and trade names Income Approach 23 6

Total acquired intangible assets $ 310

Goodwill recorded of $ 347 million, primarily attributable to the expanded product offerings and capabilities anticipated from the Forge acquisition, was assigned to the Investor Services segment and is not deductible for tax purposes.

The Company’s condensed consolidated statements of income include total net revenues and net loss attributable to the Forge acquisition of $ 14 million and $ 6 million, respectively, for the period March 2, 2026 through March 31, 2026.

Certain Forge equity awards, whether vested or unvested, were assumed by the Company upon acquisition.

The awards are subject to the same terms and conditions that were applicable immediately before the acquisition, except for performance-based restricted stock units which were converted into restricted stock units without performance conditions.

The portion of the fair value of the replacement awards related to services provided prior to the acquisition of $ 13 million was accounted for as consideration transferred.

The remaining portion is associated with future services and had a fair value of $ 37 million on the acquisition date, with remaining weighted-average service periods of 2.3 years for restricted stock awards and 2.2 years for restricted stock units.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

Revenue Recognition

1 unchanged sentence

Three Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Net interest revenue

12 unchanged sentences

Payables to brokerage clients (1)

( 56 ) ( 49 )

Other short-term borrowings

4 unchanged sentences

Other interest expense (1)

( 122 ) ( 2 )

Interest expense ( 818 ) ( 1,051 )

1 unchanged sentence

Asset management and administration fees

Mutual funds, ETFs, and CTFs 946 827 2,695 2,370

Mutual funds, ETFs, CTFs, and alternatives (2)

Managed investing solutions 674 569

Other 108 90 301 265

Asset management and administration fees 1,759 1,530

7 unchanged sentences

Total net revenues $ 6,482 $ 5,599

(1) Beginning in the fourth quarter of 2024, this line item includes interest expense related to securities loaned.

(1) Beginning in the fourth quarter of 2025, interest revenue and interest expense from client margin loans and short credits related to certain client long/short strategies from which the Company earns a fixed net yield are presented in other interest revenue and other interest expense.

Interest revenue and interest expense amounts related to these strategies were previously presented in receivables from brokerage clients and payables to brokerage clients, respectively, and 2025 amounts have been reclassified to reflect this change.

(2) Beginning in the first quarter of 2026, alternative investments revenue was moved from other asset management and administration fees to mutual funds, ETFs, CTFs, and alternatives.

Prior period amounts have been reclassified to reflect this change.

See Note 1 for additional information.

For a summary of revenue provided by our reportable segments, see Note 19.

1 unchanged sentence

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 $ 823 million and $ 694 million at September 30, 2025 and December 31, 2024, respectively.

The Company had net contract assets of $ 199 million and $ 216 million at September 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.

For additional discussion of the 2023 IDA agreement, see Note 10.

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 $ 901 million and $ 819 million at March 31, 2026 and December 31, 2025, respectively.

The Company had net contract assets of $ 188 million and $ 193 million at March 31, 2026 and December 31, 2025, 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

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

remaining contractual term as a reduction to bank deposit account fee revenue.

For additional discussion of the 2023 IDA agreement, see Note 11.

Unsatisfied performance obligations :

3 unchanged sentences

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

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Securities borrowed $ 8,593 $ 4,797

Receivables from clearing organizations 3,095 2,327

Receivables for securities failed to deliver 45 40

Other receivables from broker-dealers 88 24

Receivables for securities failed to deliver 32 42

Receivables from brokers, dealers, and clearing organizations $ 11,808 $ 7,190

Deposits for securities loaned $ 26,484 $ 25,131

Payables for securities failed to receive 262 104

Other payables to broker-dealers 651 302

Broker-dealer repurchase agreements 500 50

Payables to clearing organizations 392 115

Payables for securities failed to receive 80 91

Payables to brokers, dealers, and clearing organizations $ 28,107 $ 25,689

See Note 12 for additional information regarding securities lending and borrowing activities.

See Note 13 for additional information regarding securities lending and borrowing activities, and repurchase agreements.

THE CHARLES SCHWAB CORPORATION

3 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:

September 30, 2025 Amortized

March 31, 2026 Amortized

Available for sale securities

9 unchanged sentences

Unallocated portfolio layer method (PLM) fair value basis adjustments (3)

( 2 ) — ( 2 ) —

Total available for sale securities (4)

$ 64,950 $ — $ 3,860 $ 61,090

Held to maturity securities

agency mortgage-backed securities $ 131,155 $ 1,291 $ 9,907 $ 122,539

Treasury securities 516 — 4 512

Total held to maturity securities $ 131,671 $ 1,291 $ 9,911 $ 123,051

8 unchanged sentences

state and municipal securities 595 — 34 561

Foreign government agency securities 533 — 6 527

Non-agency commercial mortgage-backed securities 120 — 7 113

1 unchanged sentence

Unallocated PLM fair value basis adjustments (3)

( 47 ) — ( 47 ) —

Total available for sale securities (4)

$ 66,225 $ 3 $ 3,871 $ 62,357

Held to maturity securities

agency mortgage-backed securities $ 133,563 $ 1,732 $ 9,646 $ 125,649

Treasury securities 406 — — 406

Total held to maturity securities $ 133,969 $ 1,732 $ 9,646 $ 126,055

(1) As of September 30, 2025 and December 31, 2024, approximately 15 % and 35 %, respectively, of the total AFS in corporate debt securities were issued by institutions in the financial services industry.

Approximately 25 % and 16 % of the holdings of these securities were issued by institutions in the information technology industry as of September 30, 2025 and December 31, 2024, respectively.

Approximately 24 % and 18 % of the holdings of these securities were issued by companies in the consumer staples industry as of September 30, 2025 and December 31, 2024, respectively.

(2) Approximately 71 % and 62 % of asset-backed securities held as of September 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 21 % and 25 % of the asset-backed securities held as of September 30, 2025 and December 31, 2024, respectively.

(1) As of March 31, 2026, approximately 28 %, 26 %, and 21 % of total AFS corporate debt securities were issued by institutions in the information technology, consumer staples, and healthcare industries, respectively.

As of December 31, 2025, approximately 28 %, 27 %, and 19 % of total AFS corporate debt securities were issued by institutions in the information technology, consumer staples, and healthcare industries, respectively.

(2) As of March 31, 2026, approximately 62 % and 21 % of total AFS asset-backed securities were collateralized by Federal Family Education Loan Program asset-backed securities and credit card receivables, respectively.

As of December 31, 2025, approximately 70 % and 21 % of total AFS asset-backed securities were collateralized by Federal Family Education Loan Program asset-backed securities and credit card receivables, respectively.

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

See Note 12 for more information on PLM hedge accounting.

At September 30, 2025, our banking subsidiaries had pledged investment securities with a fair value of $ 60.7 billion (collateral value of $ 56.3 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 $ 30.8 billion (collateral value of $ 29.7 billion) as collateral for this facility at September 30, 2025.

(4) Included in cash and cash equivalents on the condensed consolidated balance sheets, but excluded from this table, is $ 291 million of AFS commercial paper and $ 2.0 billion of AFS U.S.

Treasury securities as of March 31, 2026 and December 31, 2025, respectively.

These holdings had maturities of three months or less at the time of acquisition, and an aggregate market value equal to amortized cost.

At March 31, 2026, our banking subsidiaries had pledged investment securities with a fair value of $ 12.9 billion (collateral value of $ 12.0 billion) as collateral to secure borrowing capacity on secured credit facilities with the FHLB (see Note 10).

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 $ 29.7 billion (collateral value of $ 28.6 billion) as collateral for this facility at March 31, 2026.

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 $ 1.7 billion at September 30, 2025.

At September 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 $ 4.1 billion, of which $ 2.0 billion may be sold, repledged, or otherwise used by the counterparties.

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

The fair value and collateral value of these pledged securities was $ 1.6 billion at March 31, 2026.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

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

At March 31, 2026, 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 $ 3.1 billion, of which $ 2.6 billion may be sold, repledged, or otherwise used by the counterparties.

See Notes 10 and 13 for additional information on these repurchase agreements.

At March 31, 2026, the Company had pledged AFS securities consisting of U.S.

Treasury securities with an aggregate fair value of $ 648 million as initial margin on interest rate swaps (see Notes 12 and 13).

2 unchanged sentences

The FCM agreements governing our swaps allow for securities pledged as initial margin to be sold, repledged, or otherwise used by the FCM.

AFS securities with unrealized losses, aggregated by category and period of continuous unrealized loss, are as follows:

AFS investment securities with unrealized losses, aggregated by category and period of continuous unrealized loss, are as follows:

Less than 12 months 12 months or longer Total

September 30, 2025 Fair

March 31, 2026 Fair

Value Unrealized

5 unchanged sentences

Treasury securities 5,720 15 5,314 161 11,034 176

757 — 5,380 226 6,137 226

Corporate debt securities (1)

Asset-backed securities (1)

60 — 4,660 357 4,720 357

Asset-backed securities 629 2 3,845 132 4,474 134

state and municipal securities 31 2 527 31 558 33

12 unchanged sentences

state and municipal securities 27 2 534 32 561 34

Foreign government agency securities — — 527 6 527 6

Non-agency commercial mortgage-backed securities — — 113 7 113 7

1 unchanged sentence

$ 1,736 $ 2 $ 56,197 $ 3,867 $ 57,933 $ 3,869

(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 $ 8 million and $( 47 ) million at September 30, 2025 and December 31, 2024, respectively.

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

(1) Amounts of unrealized losses less than 12 months 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 $( 2 ) million and $ 2 million at March 31, 2026 and December 31, 2025, respectively.

At March 31, 2026, 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 2025 Form 10-K.

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

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

All HTM securities as of September 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 $ 372 million and $ 455 million of accrued interest for AFS and HTM securities as of September 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 nine months ended September 30, 2025, or for the year ended December 31, 2024.

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, 2026 and the year ended December 31, 2025.

None of the Company’s AFS securities held as of March 31, 2026 and December 31, 2025 had an allowance for credit losses.

HTM securities as of March 31, 2026 and December 31, 2025 were U.S.

agency mortgage-backed securities and U.S.

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

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 September 30, 2025:

The Company had $ 398 million and $ 386 million of accrued interest for AFS and HTM securities as of March 31, 2026 and December 31, 2025, 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, 2026, or for the year ended December 31, 2025.

The following table presents the Company’s estimated effective duration, which reflects anticipated future payments, by category at March 31, 2026:

Estimated effective duration, exclusive of derivatives:

AFS investment securities portfolio

AFS and HTM investment securities portfolio 4.0

AFS and HTM investment securities portfolios 3.7

Estimated effective duration, inclusive of derivatives (1) :

AFS investment securities portfolio

AFS and HTM investment securities portfolio 3.8

AFS and HTM investment securities portfolios 3.6

(1) See Note 12 for additional discussion of the Company’s derivatives.

2 unchanged sentences

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

September 30, 2025 Within

March 31, 2026 Within

1 year After 1 year

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agency mortgage-backed securities

$ 583 $ 26,928 $ 21,139 $ 73,889 $ 122,539

Treasury securities — 512 — — 512

Total fair value $ 583 $ 27,440 $ 21,139 $ 73,889 $ 123,051

Total amortized cost $ 583 $ 28,230 $ 21,747 $ 81,111 $ 131,671

(1) For purposes of this table, the amortized cost of AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $ 8 million at September 30, 2025.

(1) For purposes of this table, the amortized cost of AFS securities excludes the unallocated PLM fair value hedge basis adjustments of $( 2 ) million at March 31, 2026.

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

Three Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Proceeds $ 1,541 $ 1,621

6 unchanged sentences

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

September 30, 2025 Current 30-59 days

March 31, 2026 Current 30-59 days

past due 60-89 days

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Total bank loans $ 57,899 $ 34 $ 15 $ 43 $ 92 $ 57,991 $ 36 $ 57,955

(1) First Mortgages and HELOCs include unamortized premiums and discounts and direct origination costs of $ 125 million and $ 112 million at September 30, 2025 and December 31, 2024, respectively.

(2) At September 30, 2025 and December 31, 2024, 41 % and 42 %, respectively, 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 $ 136 million and $ 131 million at March 31, 2026 and December 31, 2025, respectively.

(2) At both March 31, 2026 and December 31, 2025, 41 % 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 September 30, 2025 or December 31, 2024.

At September 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)

(3) There were no loans accruing interest that were contractually 90 days or more past due at March 31, 2026 or December 31, 2025.

Bank-loan related nonperforming assets consisted of the nonaccrual loans presented here and loan modifications to borrowers experiencing financial difficulty were not material at both March 31, 2026 and December 31, 2025.

At March 31, 2026, 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 10).

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

Charge-offs — — — — — —

Recoveries — — — — — —

Provision for credit losses — — — — — —

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

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

Charge-offs — — — — — —

Recoveries — — — — — —

Provision for credit losses — — — — — —

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

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

2 unchanged sentences

Provision for credit losses — — — — — —

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

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

Balance at December 31, 2025 $ 28 $ 1 $ 29 $ — $ 7 $ 36

2 unchanged sentences

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

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

Balance at March 31, 2026 $ 29 $ 1 $ 30 $ — $ 6 $ 36

Consistent with Schwab’s loan charge-off policy for PALs as disclosed in Item 8 – Note 2 of the 2025 Form 10-K, the Company charges off any unsecured balances no later than 90 days past due.

As of September 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 September 30, 2025 and December 31, 2024, and no allowance for credit losses for PALs as of those dates was required.

economy saw lower hiring, a modest inflation gain at the end of the third quarter of 2025, and continued to face a moderately restrictive 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.

As of March 31, 2026, 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, 2026 and December 31, 2025, and no allowance for credit losses for PALs as of those dates was required.

economy experienced soft hiring and steady core inflation at the end of the first quarter of 2026.

Geopolitical unrest persists amid a backdrop of elevated uncertainty due to economic impacts of emerging trade policy and a constrained energy

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

Management’s macroeconomic outlook reflects sustained current benchmark lending rates, with a softening labor market.

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 September 30, 2025, as compared to December 31, 2024.

Bank loan-related nonperforming assets consisted of nonaccrual loans of $ 40 million and $ 35 million at September 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 September 30, 2025 and December 31, 2024, loan modifications to borrowers experiencing financial difficulty were not material.

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

As a result of these factors, we held projected loss rates constant at March 31, 2026, as compared to December 31, 2025.

Credit Quality

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• Borrower Fair Isaac Corporation (FICO) scores at origination (Origination FICO);

• Updated borrower FICO scores (Updated FICO);

• Refreshed borrower FICO scores (Refreshed FICO);

• Loan-to-value (LTV) ratios at origination (Origination LTV);

• Estimated Current LTV ratios (Estimated Current LTV).

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

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

The Estimated Refreshed 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

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

March 31, 2026 2026 2025 2024 2023 2022 pre-2022 Total First Mortgages Revolving HELOCs amortized cost basis HELOCs converted to term loans Total HELOCs

Origination FICO

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Total $ 1,889 $ 5,714 $ 2,555 $ 1,684 $ 5,149 $ 14,278 $ 31,269 $ 312 $ 110 $ 422

Refreshed FICO

<620 $ — $ 7 $ 7 $ 5 $ 21 $ 42 $ 82 $ 3 $ 4 $ 7

3 unchanged sentences

Total $ 1,889 $ 5,714 $ 2,555 $ 1,684 $ 5,149 $ 14,278 $ 31,269 $ 312 $ 110 $ 422

Estimated Current LTV (1)

Estimated Refreshed LTV (1)

≤70% $ 1,376 $ 3,740 $ 1,826 $ 1,390 $ 4,637 $ 14,167 $ 27,136 $ 310 $ 110 $ 420

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Total $ 6,029 $ 2,823 $ 1,796 $ 5,239 $ 14,597 $ 30,484 $ 312 $ 115 $ 427

Refreshed FICO

<620 $ 8 $ 4 $ 3 $ 36 $ 55 $ 106 $ 3 $ 3 $ 6

3 unchanged sentences

Total $ 6,029 $ 2,823 $ 1,796 $ 5,239 $ 14,597 $ 30,484 $ 312 $ 115 $ 427

Estimated Current LTV (1)

≤70% $ 2,402 $ 1,660 $ 4,942 $ 10,747 $ 5,057 $ 24,808 $ 285 $ 136 $ 421

Estimated Refreshed LTV (1)

≤70% $ 3,877 $ 1,989 $ 1,450 $ 4,696 $ 14,483 $ 26,495 $ 310 $ 115 $ 425

6 unchanged sentences

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

At September 30, 2025, $ 25.1 billion of First Mortgage loans had adjustable interest rates.

At March 31, 2026, $ 27.0 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 63 % of the balance of these interest-only loans are not scheduled to reset for three or more years.

At September 30, 2025 and December 31, 2024, Schwab had $ 211 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 March 31, 2026 and December 31, 2025, Schwab had $ 234 million and $ 223 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:

September 30, 2025 Balance

March 31, 2026 Balance

Converted to an amortizing loan by period end (1)

3 unchanged sentences

> 5 years 205

(1) Includes $ 3 million and $ 11 million of HELOCs converted to amortizing loans during the three and nine months ended September 30, 2025, respectively.

At September 30, 2025, $ 328 million of the HELOC portfolio was secured by second liens on the associated properties.

(1) Includes $ 3 million of HELOCs converted to amortizing loans during the three months ended March 31, 2026.

At March 31, 2026, $ 322 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 September 30, 2025, the borrowers on approximately 64 % of HELOC loan balances outstanding only paid the minimum amount due.

At March 31, 2026, the borrowers on approximately 55 % of HELOC loan balances outstanding only paid the minimum amount due.

Variable Interest Entities

As of September 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 of March 31, 2026 and December 31, 2025, 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 September 30, 2025 and 2024, CSB recorded amortization of $ 48 million and $ 37 million, respectively, and recognized tax credits and other tax benefits of $ 62 million and $ 48 million, respectively, associated with these investments.

During the nine months ended September 30, 2025 and 2024, CSB recorded amortization of $ 142 million and $ 117 million, respectively, and recognized tax credits and other tax benefits of $ 188 million and $ 150 million, respectively, associated with these investments.

During the three months ended March 31, 2026 and 2025, CSB recorded amortization of $ 59 million and $ 47 million, respectively, and recognized tax credits and other tax benefits of $ 77 million and $ 61 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.

Tax credits and other tax benefits are reflected as cash flows from operating activities on the condensed consolidated statements of cash flows.

Aggregate assets, liabilities, and maximum exposure to loss

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:

September 30, 2025 December 31, 2024

Aggregate assets, aggregate liabilities, and maximum exposure to loss

The aggregate assets, aggregate 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, 2026 December 31, 2025

assets Aggregate

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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 2026 and 2029.

During the nine months ended September 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.

During the three months ended March 31, 2026 and year ended December 31, 2025, 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:

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Interest-bearing deposits:

7 unchanged sentences

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

The weighted-average interest rates on outstanding time certificates of deposit at September 30, 2025 and December 31, 2024 were 4.21 % and 4.90 %, respectively.

As of September 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 September 30, 2025 mature between October 2025 and January 2026.

The weighted-average interest rates on outstanding time certificates of deposit at March 31, 2026 and December 31, 2025 were 3.77 % and 4.03 %, respectively.

As of March 31, 2026 and December 31, 2025, there were no time deposits that were in excess of FDIC insurance limits or otherwise uninsured.

Time certificates of deposit outstanding at March 31, 2026 mature between April 2026 and June 2026.

CSC Senior Notes:

3 unchanged sentences

Interest for the fixed-to-floating rate Senior Notes is payable semi-annually during the fixed-rate period of the notes and quarterly during the floating-rate period of the notes.

Ameritrade Holding Senior Notes

Ameritrade Holding’s Senior Notes are unsecured obligations.

Ameritrade Holding may redeem some or all of the Senior Notes of each series prior to their maturity, subject to certain restrictions, and the payment of an applicable make-whole premium in certain instances.

Ameritrade Holding LLC Senior Notes:

Ameritrade Holding LLC’s Senior Notes are unsecured obligations.

Ameritrade Holding LLC may redeem some or all of the Senior Notes of each series prior to their maturity, subject to certain restrictions, and the payment of an applicable make-whole premium in certain instances.

Interest is payable semi-annually for the fixed-rate Senior Notes.

2 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 September 30, 2025 and December 31, 2024:

The following table lists long-term debt by instrument outstanding as of March 31, 2026 and December 31, 2025:

Date of Issuance Principal Amount Outstanding

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

CSC Fixed-rate Senior Notes:

3.000 % due March 10, 2025

03/10/15 $ — $ 375

4.200 % due March 24, 2025

03/24/20 — 600

3.625 % due April 1, 2025

09/24/21 — 418

3.850 % due May 21, 2025

05/22/18 — 750

3.450 % due February 13, 2026

42 unchanged sentences

11/17/23 1,300 1,300

4.343 % due November 14, 2031

11/14/25 1,000 1,000

5.853 % due May 19, 2034

2 unchanged sentences

08/24/23 1,350 1,350

Total CSC Senior Notes 20,119 22,262

Ameritrade Holding Fixed-rate Senior Notes:

3.625 % due April 1, 2025

4.914 % due November 14, 2036

11/14/25 1,000 1,000

Total CSC Senior Notes 20,519 22,119

Ameritrade Holding LLC Fixed-rate Senior Notes:

3.300 % due April 1, 2027

2 unchanged sentences

08/16/19 25 25

Total Ameritrade Holding Senior Notes 81 163

Total Ameritrade Holding LLC Senior Notes 81 81

Finance lease liabilities 30 37

3 unchanged sentences

Total long-term debt $ 20,486 $ 22,199

(1) The May 2029 fixed-to-floating rate Senior Notes bear interest at a fixed rate of 5.643 %, payable semi-annually, until the interest reset date on May 19, 2028.

On and after this date, these notes will bear interest at an annual floating rate of SOFR plus 2.210 %, payable quarterly.

(2) The November 2029 fixed-to-floating rate Senior Notes bear interest at a fixed rate of 6.196 %, payable semi-annually, until the interest reset date on November 17, 2028.

On and after this date, these notes will bear interest at an annual floating rate of SOFR plus 1.878 %, payable quarterly.

(3) The May 2034 fixed-to-floating rate Senior Notes bear interest at a fixed rate of 5.853 %, payable semi-annually, until the interest reset date on May 19, 2033.

On and after this date, these notes will bear interest at an annual floating rate of SOFR plus 2.500 %, payable quarterly.

(4) The August 2034 fixed-to-floating rate Senior Notes bear interest at a fixed rate of 6.136 %, payable semi-annually, until the interest reset date on August 24, 2033.

On and after this date, these notes will bear interest at an annual floating rate of SOFR plus 2.010 %, payable quarterly.

(1) Interest rates presented are those in effect at March 31, 2026.

See table below for additional information regarding future interest rates on fixed-to-floating rate Senior Notes.

(2) This represents the amount of fair value hedge basis adjustments related to Senior Notes hedged.

3 unchanged sentences

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

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

The following table details the changes in future interest rates on fixed-to-floating rate Senior Notes as of March 31, 2026:

Maturity Date Fixed Semi-annual Interest Rate Date of Issuance Floating Quarterly Interest Rate Interest Rate Reset Date

May 19, 2029 5.643 % 05/19/23 SOFR + 2.210 %

November 17, 2029 6.196 % 11/17/23 SOFR + 1.878 %

November 14, 2031 4.343 % 11/14/25 SOFR + 0.940 %

May 19, 2034 5.853 % 05/19/23 SOFR + 2.500 %

August 24, 2034 6.136 % 08/24/23 SOFR + 2.010 %

November 14, 2036 4.914 % 11/14/25 SOFR + 1.230 %

Annual maturities on all long-term debt outstanding at March 31, 2026 are as follows:

Thereafter 8,000

9 unchanged sentences

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 $ 850 million and $ 16.7 billion outstanding under these facilities as of September 30, 2025 and December 31, 2024, respectively, and these borrowings had a weighted-average interest rate of 4.11 % and 5.11 %, respectively.

As of September 30, 2025 and December 31, 2024, the collateral pledged provided additional borrowing capacity of $ 75.3 billion and $ 59.8 billion, respectively.

There were no amounts outstanding under these facilities as of March 31, 2026.

There was $ 1.9 billion outstanding under these facilities as of December 31, 2025 and these borrowings had a weighted-average interest rate of 3.90 %.

As of March 31, 2026 and December 31, 2025, the collateral pledged provided additional borrowing capacity of $ 33.5 billion and $ 74.2 billion, respectively.

Other short-term borrowings :

Total other short-term borrowings outstanding at September 30, 2025 and December 31, 2024 were $ 6.5 billion and $ 6.0 billion, respectively, and had a weighted-average interest rate of 4.48 % and 5.21 %, respectively.

Total other short-term borrowings outstanding at March 31, 2026 and December 31, 2025 were $ 12.5 billion and $ 6.9 billion, respectively, and had a weighted-average interest rate of 3.98 % and 4.09 %, 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 $ 4.0 billion and $ 5.5 billion outstanding pursuant to such repurchase agreements at September 30, 2025 and December 31, 2024, respectively.

Repurchase agreements outstanding at September 30, 2025 mature between October 2025 and November 2025.

The Company had $ 3.0 billion and $ 1.3 billion outstanding pursuant to such repurchase agreements at March 31, 2026 and December 31, 2025, respectively.

Repurchase agreements outstanding at March 31, 2026 mature between April 2026 and June 2026.

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 September 30, 2025 and December 31, 2024, our collateral pledged provided total borrowing capacity of $ 29.7 billion and $ 30.5 billion, respectively, of which no amounts were outstanding at the end of either period.

As of March 31, 2026 and December 31, 2025, our collateral pledged provided total borrowing capacity of $ 28.6 billion and $ 29.3 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 $ 800 million gross par value before discount of $ 4 million outstanding at September 30, 2025, and no amounts outstanding at December 31, 2024.

There was $ 4.7 billion gross par value before discount of $ 39 million outstanding at March 31, 2026, and $ 1.9 billion gross par value before discount of $ 32 million outstanding at December 31, 2025.

At the end of the first quarter of 2026, CS&Co received authorization from its Board of Directors to issue up to $ 10.0 billion of unsecured commercial paper notes with maturities of up to 270 days.

There were no amounts outstanding as of March 31, 2026.

CSC and CS&Co also have access to unsecured uncommitted lines of credit with external banks with total borrowing capacity of $ 1.9 billion;

no amounts were outstanding as of September 30, 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 $ 1.8 billion and $ 500 million outstanding at September 30, 2025 and December 31, 2024, respectively.

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

2025 2026 Total

FHLB borrowings $ — $ 850 $ 850

Other short-term borrowings 5,541 1,000 6,541

Total $ 5,541 $ 1,850 $ 7,391

no amounts were outstanding as of March 31, 2026 or December 31, 2025.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

There was $ 4.8 billion and $ 3.8 billion outstanding at March 31, 2026 and December 31, 2025, respectively, pursuant to these agreements.

Annual maturities on other short-term borrowings outstanding at March 31, 2026 are as follows:

Other short-term borrowings $ 12,486

Commitments and Contingencies

3 unchanged sentences

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

CSB purchased First Mortgages of $ 1.7 billion and $ 1.1 billion during the third quarter of 2025 and 2024, respectively, and $ 4.4 billion and $ 2.6 billion during the first nine months of 2025 and 2024, respectively.

CSB purchased HELOCs with commitments of $ 52 million and $ 38 million during the third quarter of 2025 and 2024, respectively, and $ 181 million and $ 121 million during the first nine months of 2025 and 2024, respectively.

CSB purchased First Mortgages of $ 2.0 billion and $ 963 million during the first quarter of 2026 and 2025, respectively.

CSB purchased HELOCs with commitments of $ 62 million and $ 50 million during the first quarter of 2026 and 2025, respectively.

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

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Commitments to extend credit related to unused HELOCs and other lines of credit $ 1,852 $ 1,793

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The 2023 IDA agreement extends the term to sweep balances to the TD Depository Institutions through July 1, 2034, and requires that Schwab maintain certain minimum and maximum insured deposit account balances (IDA balances).

Pursuant to the terms of the agreement, after September 10, 2025, withdrawals of IDA balances are permitted at Schwab’s discretion, subject to an obligation to maintain IDA balances above a minimum of $ 60 billion, with a maximum of $ 90 billion.

In accordance with the agreement, in September 2025, Schwab moved $ 3.0 billion of IDA balances to its balance sheet.

Pursuant to the terms of the agreement, after September 10, 2025, withdrawals of balances are permitted at Schwab’s discretion, subject to an obligation to maintain IDA balances above a minimum of $ 60 billion, with a maximum of $ 90 billion.

In accordance with the agreement, Schwab moved $ 1.1 billion of BDA balances to its balance sheet during the first three months of 2026.

Designation of deposit balances for investment in fixed- or floating-rate instruments under the 2023 IDA agreement is at Schwab’s sole discretion with certain limitations on the amount of fixed-rate obligation amounts.

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 September 30, 2025, the total ending IDA balance was $ 78.6 billion, of which $ 59.7 billion was fixed-rate obligation amounts and $ 18.9 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.

If IDA balances decline below

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

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, 2026, the total ending IDA balance was $ 73.6 billion, of which $ 59.6 billion was fixed-rate obligation amounts and $ 14.0 billion was floating-rate obligation amounts.

As of December 31, 2025, the total ending IDA balance was $ 76.3 billion, of which $ 59.6 billion was fixed-rate obligation amounts and $ 16.7 billion was floating-rate obligation amounts.

Legal contingencies :

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District Court for the Eastern District of Texas on behalf of a putative class of customers who purchased or sold securities through CS&Co or TD Ameritrade, Inc.

(now Ameritrade of New York, Inc.) from October 26, 2020 to the present.

(now part of CS&Co) from October 26, 2020 to the present.

The lawsuit alleges that CSC’s acquisition of Ameritrade violated Section 7 of the Clayton Act because it has resulted in an anticompetitive market for the execution of retail customer orders.

2 unchanged sentences

On December 12, 2024, the parties filed a joint stipulation proposing a settlement of the lawsuit on a class basis under which defendants would commit to certain non-monetary undertakings and payments of plaintiffs’ attorneys’ fees and costs in an amount that would be immaterial.

Approval of the settlement remains pending with the court.

The court granted final approval of the settlement on November 24, 2025, and certain objectors to the settlement have appealed the decision to the Fifth Circuit Court of Appeals.

Derivative Instruments and Hedging Activities

1 unchanged sentence

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, PALs, and Senior Notes.

For a description of how the Company accounts for derivative instruments, see Item 8 – Note 2 in the 2025 Form 10-K.

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Cash flows associated with derivative instruments are reflected as cash flows from operating activities in the condensed consolidated statements of cash flows consistent with the treatment and nature of the items being hedged.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

Fair Value Hedges of Interest Rate Risk

2 unchanged sentences

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 CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

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 $ 40.8 billion and $ 30.9 billion at September 30, 2025 and December 31, 2024, respectively, that were designated as fair value hedges of interest rate risk.

Cash Flow Hedges of Interest Rate Risk

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.

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

Notional Amounts of Derivative Instruments

The Company had outstanding interest rate swaps with aggregate notional amounts of $ 68.2 billion and $ 42.2 billion at March 31, 2026 and December 31, 2025, respectively, that were designated as fair value hedges of interest rate risk.

The Company had outstanding interest rate swaps with aggregate notional amounts of $ 66.5 billion and $ 18.7 billion at March 31, 2026 and December 31, 2025, respectively, that were designated as cash flow 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 $ 16.1 billion at September 30, 2025 that were designated as cash flow hedges of interest rate risk.

While the notional amounts give an indication of the volume of our derivative activity, they do not necessarily provide information on the amount of the underlying exposure being hedged.

For example, we may enter into multiple hedges covering different periods of time but relating to the same underlying principal balances to hedge interest receipts or payments on AFS securities, margin loans, PALs, and Senior Notes.

As a result, at certain times the combined notional amount of hedges may exceed the underlying principal balances.

As of March 31, 2026, through its cash flow hedges, the Company hedged interest receipts on $ 20.0 billion of margin loans with a total notional outstanding of $ 43.6 billion, and interest receipts on $ 19.8 billion of PALs with a total outstanding notional of $ 22.9 billion.

As of March 31, 2026, through fair value hedges, the Company hedged $ 19.5 billion of Senior Notes with a total outstanding notional amount of $ 57.0 billion and $ 11.2 billion of AFS securities with a total outstanding notional amount of $ 11.2 billion.

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:

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Assets Liabilities Assets Liabilities

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(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.

Derivative assets and liabilities as of September 30, 2025 and 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 September 30, 2025, there was a $ 69 million reduction of derivative assets and a $ 139 million reduction of derivative liabilities related to variation margin settlements.

As of March 31, 2026, there was a $ 53 million reduction of derivative assets and a $ 270 million reduction of derivative liabilities related to variation margin settlements.

As of December 31, 2025, there was a $ 93 million reduction of derivative assets and a $ 21 million reduction of derivative liabilities related to variation margin settlements.

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Assets and Liabilities

September 30, 2025 December 31, 2024 September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025 March 31, 2026 December 31, 2025

Line item in which the hedged item is included:

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$ ( 19,370 ) $ ( 20,726 ) $ 101 $ ( 6 )

(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 September 30, 2025 and December 31, 2024, the amortized cost basis of the closed portfolios used in these hedging relationships was $ 2.6 billion and $ 2.5 billion, respectively, of which $ 2.1 billion and $ 2.0 billion was designated in a portfolio layer hedging relationship at September 30, 2025 and December 31, 2024, respectively.

The cumulative basis adjustments associated with these hedging relationships were an increase of $ 8 million and a reduction of $ 47 million of the amortized cost basis of the closed portfolios at September 30, 2025 and December 31, 2024, respectively.

(1) Includes the amortized cost basis of AFS securities included in PLM hedging relationships.

At March 31, 2026 and December 31, 2025, the amortized cost basis of the closed portfolios used in these hedging relationships was $ 995 million and $ 1.1 billion, respectively, of which $ 663 million and $ 771 million was designated in a portfolio layer hedging relationship at March 31, 2026 and December 31, 2025, respectively.

The cumulative basis adjustments associated with these hedging relationships were a reduction of $ 2 million and an increase of $ 2 million of the amortized cost basis of the closed portfolios at March 31, 2026 and December 31, 2025, 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 $ 141 million at September 30, 2025 and $ 2 million at December 31, 2024, which are 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 cumulative amount of fair value hedging adjustments remaining for these securities was a reduction of the amortized cost basis of $ 30 million and $ 26 million at March 31, 2026 and December 31, 2025, respectively, which are 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.

(3) Excludes the carrying amount and fair value hedging adjustment of long-term debt for which hedge accounting has been discontinued.

The cumulative amount of fair value hedging adjustments remaining for long-term debt was an increase of the carrying amount of $ 5 million at September 30, 2025, which is recorded in long-term debt on the condensed consolidated balance sheets and amortized to interest expense over the lives of the borrowings.

The cumulative amount of fair value hedging adjustments remaining for long-term debt was an increase of the carrying amount of $ 4 million and $ 5 million at March 31, 2026 and December 31, 2025, respectively, which is recorded in long-term debt on the condensed consolidated balance sheets and amortized to interest expense over the lives of the borrowings.

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:

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Interest Expense

Three Months Ended September 30, 2025 2024 2025 2024

Gain (loss) on fair value hedging relationships:

Hedged items $ ( 3 ) $ 216 $ 4 $ —

Derivatives designated as hedging instruments (1)

3 ( 214 ) ( 4 ) —

Nine Months Ended September 30, 2025 2024 2025 2024

Three Months Ended March 31, 2026 2025 2026 2025

Gain (loss) on fair value hedging relationships:

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31 ( 161 ) ( 107 ) 27

(1) Interest revenue excludes net income (expense) from periodic interest accruals and receipts (payments) of $ 2 million and $ 34 million for the three and nine months ended September 30, 2025, respectively, and $ 20 million and $ 36 million for the three and nine months ended September 30, 2024, respectively.

Interest expense excludes net income (expense) from periodic interest accruals and receipts (payments) of $( 20 ) million and $( 44 ) million, respectively, for the three and nine months ended September 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 nine months ended September 30, 2024.

(1) Interest revenue excludes net gain (loss) from periodic interest accruals and receipts (payments) of $ 1 million and $ 18 million for the three months ended March 31, 2026 and 2025, respectively.

Interest expense excludes net gain (loss) from periodic interest accruals and receipts (payments) of $ 5 million and $( 10 ) million for the three months ended March 31, 2026 and 2025, respectively.

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 Months Ended Nine Months Ended

September 30, 2025 September 30, 2025

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

Balance at December 31, 2025 $ 49

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

Gain (loss) reclassified from AOCI to interest revenue ( 28 ) ( 45 )

Realized (gain) loss reclassified from AOCI to interest revenue 18

Balance at March 31, 2026 $ ( 158 )

(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 September 30, 2025, the Company estimates that an additional $ 11 million will be reclassified from AOCI as a reduction to interest revenue.

For the twelve months following March 31, 2026, the Company expects to reclassify from AOCI into interest revenue approximately $ 74 million of pre-tax losses.

Financial Instruments Subject to Off-Balance Sheet Credit Risk

Resale agreements :

CS&Co enters into collateralized resale agreements principally with other broker-dealers to meet obligations related to customer protection under SEC Rule 15c3-3.

These collateralized resale agreements could result in losses in the event the counterparty fails to purchase the securities held as collateral for the cash advanced and the fair value of the securities declines.

To mitigate this risk, CS&Co requires that the counterparty deliver securities to a custodian, to be held as collateral, with a fair value at or in excess of the resale price.

CS&Co also sets standards for the credit quality of the

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

Financial Instruments Subject to Off-Balance Sheet Credit Risk

Resale agreements :

Schwab enters into collateralized resale agreements principally with other broker-dealers, which could result in losses in the event the counterparty fails to purchase the securities held as collateral for the cash advanced and the fair value of the securities declines.

To mitigate this risk, Schwab requires that the counterparty deliver securities to a custodian, to be held as collateral, with a fair value at or in excess of the resale price.

Schwab also sets standards for the credit quality of the counterparty, monitors the fair value of the underlying securities as compared to the related receivable, including accrued interest, and requires additional collateral where deemed appropriate.

counterparty, monitors the fair value of the underlying securities as compared to the related receivable, including accrued interest, and requires additional collateral where deemed appropriate.

The collateral provided under these resale agreements is utilized to meet obligations under broker-dealer client protection rules, which place limitations on our ability to access such segregated securities.

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 September 30, 2025 and December 31, 2024 were not subject to master netting arrangements.

For CS&Co 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.

CS&Co’s resale agreements as of March 31, 2026 and December 31, 2025 were not subject to master netting arrangements.

Amounts related to these resale agreements are included in cash and investments segregated and on deposit for regulatory purposes in the condensed consolidated balance sheets.

Schwab’s banking subsidiaries also enter into collateralized resale agreements with the FICC in which they buy securities and agree to resell these securities at a future date at an agreed upon price.

Schwab receives collateral with a fair value equal to or in excess of the carrying value of the related receivables, including accrued interest, and requires additional collateral where deemed appropriate.

Schwab is permitted by contract to repledge or sell collateral received under these resale agreements.

In order to repledge or sell this collateral, the banking subsidiaries would be required to deposit additional securities of an equal amount with the custodian to replace the collateral received and maintain the net position.

T he ability to repledge or sell collateral maintained by the custodian in conjunction with collateralized resale agreements is subject to operational limitations, which may restrict Schwab’s use of the securities.

There were no securities repledged or sold under these arrangements as of March 31, 2026 and December 31, 2025.

These collateralized resale agreements with each counterparty are considered to be enforceable master netting arrangements.

However, we do not net these arrangements.

As such, amounts recognized pursuant to these arrangements are presented gross in the condensed consolidated balance sheet and are included in cash and cash equivalents or other assets in the condensed consolidated balance sheets based upon the maturity date of the transaction.

Securities lending :

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Schwab mitigates this risk by requiring credit approvals for counterparties, monitoring the fair value of securities loaned, and requiring additional cash as collateral when necessary.

In addition, most of our securities lending transactions are through a program with a clearing organization, which guarantees the return of cash to us.

In addition, most of our securities lending transactions are through a program with a clearing organization, which guarantees the return of collateral to us.

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 $ 2.3 billion and $ 674 million at September 30, 2025 and December 31, 2024, respectively.

The fair value of these borrowed securities was $ 8.6 billion and $ 4.6 billion at March 31, 2026 and December 31, 2025, 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, amounts related to securities loaned and securities borrowed are presented gross in the condensed consolidated balance sheets.

Therefore, amounts related to securities borrowed and securities loaned are presented gross in the condensed consolidated balance sheets and are included in receivables from brokers, dealers, and clearing organizations and payables to brokers, dealers, and clearing organizations, respectively, in the condensed consolidated balance sheets.

Repurchase agreements :

Schwab enters into collateralized repurchase agreements with external financial institutions and the FICC in which the Company sells securities and agrees to repurchase these securities on a specified future date at a stated repurchase price.

Schwab’s banking subsidiaries enter into collateralized repurchase agreements with external financial institutions and the FICC in which they sell securities and agree to repurchase these securities on a specified future date at a stated repurchase price.

These repurchase agreements are collateralized by investment securities with a fair value equal to or in excess of the secured borrowing liability.

CS&Co also enters into collateralized repurchase agreements with external financial institutions in which CS&Co utilizes qualifying securities in client margin accounts as collateral.

These repurchase agreements are collateralized by client margin securities with a fair value equal to or in excess of the secured borrowing liability.

Client margin securities are transferred to an independent agent on behalf of CS&Co and the counterparty, who assumes the responsibility of receiving eligible securities and assigning these securities to the counterparty.

Decreases in security prices posted as collateral for repurchase agreements may require Schwab to transfer cash and/or additional securities deemed acceptable by the counterparty.

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However, we do not net these arrangements.

As such, the secured short-term borrowings associated with these collateralized repurchase agreements are presented gross in the condensed consolidated balance sheets.

As such, the secured borrowings associated with these collateralized repurchase agreements are presented gross in the condensed consolidated balance sheets.

Repurchase agreements at Schwab’s banking subsidiaries are included in other short-term borrowings in the consolidated balance sheets and repurchase agreements at CS&Co are included in payables to brokers, dealers, and clearing organizations in the condensed consolidated balance sheets.

Interest rate swaps :

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Schwab pledges investment securities as collateral in order to meet the CCP’s initial margin requirements.

Initial margin is posted through FCMs which serve as the intermediary between CCPs and Schwab.

Initial margin is posted

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

through FCMs which serve as the intermediary between CCPs and Schwab.

Our interest rate swaps are subject to enforceable master netting arrangements allowing a right of setoff within each FCM-CCP relationship;

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Therefore, interest rate swaps are presented gross in the condensed consolidated balance sheets.

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

See Note 12 for additional information on the Company’s interest rate swaps.

THE CHARLES SCHWAB CORPORATION

Notes to Condensed Consolidated Financial Statements

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

The following table presents information about our interest rate swaps, resale agreements, securities lending, repurchase agreements, and other activity depicting the potential effect of rights of setoff between these recognized assets and liabilities.

Collateral disclosed in the table below is limited to the amount of the related recognized asset or liability for each counterparty, even when the collateral value exceeds the gross asset or liability value:

Liabilities Gross Amounts

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Offsetting Collateral

September 30, 2025

March 31, 2026

Resale agreements

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Total $ 30,233 $ — $ 30,233 $ ( 3,069 ) $ ( 26,238 ) $ 926

(1) Included in cash and investments segregated and on deposit for regulatory purposes in the condensed consolidated balance sheets.

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

At September 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 $ 22.7 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.

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

(5) At September 30, 2025 and December 31, 2024, the fair value of initial margin pledged as collateral related to interest rate swaps was $ 311 million and $ 378 million, respectively.

(1) At March 31, 2026 and December 31, 2025, the fair value of collateral received in connection with resale agreements that was available to be repledged or sold was $ 24.8 billion and $ 17.2 billion, respectively.

(2) At March 31, 2026 and December 31, 2025, the fair value of initial margin pledged as collateral related to interest rate swaps was $ 648 million and $ 281 million, respectively.

See Notes 6 and 12 for additional information.

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

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

At September 30, 2025 and December 31, 2024, the fair value of collateral pledged in connection with repurchase agreements was $ 4.2 billion and $ 5.9 billion, respectively.

(3) At March 31, 2026 and December 31, 2025, repurchase agreements outstanding at CS&Co had continuous contractual maturities of 35 - 60 days.

(4) At March 31, 2026 and December 31, 2025, the fair value of collateral pledged in connection with repurchase agreements at the Company’s banking subsidiaries was $ 3.1 billion and $ 1.3 billion, respectively.

See Note 10 for additional information.

(7) Included in payables to brokers, dealers, and clearing organizations in the condensed consolidated balance sheets.

At March 31, 2026 and December 31, 2025, collateral pledged for repurchase agreements outstanding at CS&Co was comprised of equity securities held in client brokerage accounts.

See table below for fair value of client margin securities held in client brokerage accounts pledged as collateral.

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

At September 30, 2025, $ 18.7 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 3.0 billion of securities loaned had contractual maturities of 35 - 95 days.

At March 31, 2026, $ 13.4 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 13.1 billion of securities loaned had contractual maturities of 35 - 95 days.

At December 31, 2025, $ 15.0 billion of securities loaned had overnight and continuous remaining contractual maturities and $ 10.1 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 September 30, 2025 and December 31, 2024.

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

See below for collateral pledged and Note 9 for additional information.

At March 31, 2026 and December 31, 2025, collateral pledged for secured short-term borrowings was comprised of equity securities held in client brokerage accounts.

See below for amount of collateral pledged and Note 10 for additional information.

THE CHARLES SCHWAB CORPORATION

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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:

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Fair value of client securities available to be pledged $ 174,936 $ 155,525

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Collateral for secured short-term borrowings 5,475 4,376

Collateral for repurchase agreements 516 56

Total collateral pledged to third parties $ 91,652 $ 79,286

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 $ 237 million and $ 105 million at September 30, 2025 and December 31, 2024, respectively.

The fair value of fully-paid client securities available and pledged was $ 301 million and $ 217 million at March 31, 2026 and December 31, 2025, respectively.

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

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Assets and Liabilities Measured at Fair Value on a Recurring Basis

Schwab’s assets and liabilities measured at fair value on a recurring basis include:

certain cash equivalents, certain investments segregated and on deposit for regulatory purposes, AFS securities, certain other assets, interest rate swaps, and certain accrued expenses and other liabilities.

Schwab’s assets and liabilities measured at fair value on a recurring basis include certain cash equivalents, certain investments segregated and on deposit for regulatory purposes, AFS securities, certain other assets, interest rate derivatives, and certain accrued expenses and other liabilities.

The Company uses the market approach to determine the fair value of assets and liabilities.

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The repurchase liabilities are included in accrued expenses and other liabilities on the condensed consolidated balance sheets.

The fair values of interest rate swaps are based on market observable interest rate yield curves.

Fair value measurements are priced considering the coupon rate of the fixed leg of the contract and the variable coupon rate on the floating leg of the

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

The fair values of interest rate derivatives are based on market observable interest rate yield curves.

Fair value measurements are priced considering the coupon rate of the fixed leg of the contract and the variable coupon rate on the floating leg of the contract.

Valuation is based on both spot and forward rates on the swap yield curve.

See Note 11 for additional information on the Company’s interest rate swaps.

See Note 12 for additional information on the Company’s interest rate derivatives.

For a description of the fair value hierarchy and Schwab’s fair value methodologies, see Item 8 – Note 2 in the 2025 Form 10-K.

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

The Company did not adjust prices received from the primary independent third-party pricing service at March 31, 2026 or December 31, 2025.

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:

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

March 31, 2026 Level 1 Level 2 Level 3 Balance at

Cash equivalents:

Money market funds $ 21,565 $ — $ — $ 21,565

Commercial paper — 291 — 291

Total cash equivalents 21,565 291 — 21,856

18 unchanged sentences

Total other securities owned 3,015 113 — 3,128

Interest rate swaps — 1 — 1

Total other assets 3,015 114 — 3,129

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Accrued expenses and other liabilities:

Interest rate swaps $ — $ 2 $ — $ 2

Other 2,807 33 — 2,840

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Money market funds $ 13,947 $ — $ — $ 13,947

Treasury securities — 1,989 — 1,989

Total cash equivalents 13,947 1,989 — 15,936

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state and municipal securities — 561 — 561

Foreign government agency securities — 527 — 527

Non-agency commercial mortgage-backed securities — 113 — 113

8 unchanged sentences

Total other securities owned 3,018 144 — 3,162

Interest rate swaps — 1 — 1

Total other assets 3,018 145 — 3,163

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Accrued expenses and other liabilities:

Interest rate swaps $ — $ 1 $ — $ 1

Other 2,804 40 — 2,844

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

September 30, 2025 Carrying

March 31, 2026 Carrying

Amount Level 1 Level 2 Level 3 Balance at

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agency mortgage-backed securities 131,155 — 122,539 — 122,539

Treasury securities 516 — 512 — 512

Total held to maturity securities 131,671 — 123,051 — 123,051

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Other short-term borrowings 12,486 — 12,486 — 12,486

Federal Home Loan Bank borrowings 850 — 850 — 850

Long-term debt 20,456 — 20,292 — 20,292

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agency mortgage-backed securities 133,563 — 125,649 — 125,649

Treasury securities 406 — 406 — 406

Total held to maturity securities 133,969 — 126,055 — 126,055

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Common and Nonvoting Common Stock

During the three months ended March 31, 2026, CSC repurchased 24.3 million shares of its common stock under its $ 20.0 billion authorization for $ 2.4 billion.

As of March 31, 2026 approximately $ 12.1 billion remained on the $ 20.0 billion authorization.

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.

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Concurrent with the completion of the secondary offering, and pursuant to a repurchase agreement dated February 9, 2025, the Company repurchased directly from TD Group US Holdings LLC its remaining 19.2 million shares of nonvoting common stock at a price of $ 77.982 per share for an aggregate repurchase amount of $ 1.5 billion, which settled on February 12, 2025.

The shares of nonvoting common stock automatically converted into common stock upon repurchase and are now held in treasury stock, reducing the number of shares outstanding.

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

The shares of nonvoting common stock automatically converted into common stock upon repurchase and transferred to treasury stock, reducing the number of shares outstanding.

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

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.

On July 24, 2025, CSC publicly announced that its Board of Directors terminated the $ 15.0 billion 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.

During the three months ended September 30, 2025, CSC repurchased 28.9 million shares of its common stock under the new authorization for $ 2.7 billion.

As of September 30, 2025 approximately $ 17.3 billion remained on the new authorization.

THE CHARLES SCHWAB CORPORATION

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

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

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

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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 nine months ended September 30, 2024.

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

Liquidation Preference Per Share Dividend Rate in Effect at September 30, 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 March 31, 2026 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

September 30, 2025 (1)

March 31, 2026 (1)

December 31, 2025 (1)

September 30, 2025 December 31, 2024 Issue Date

March 31, 2026 December 31, 2025 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 (4)

— 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

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(1) Represented by depositary shares.

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

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

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

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Declared Per Share

Three Months Ended March 31,

Declared Per Share

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9.3 1,250.00 9.3 1,250.00

9.3 1,250.00 9.3 1,250.00 28.1 3,750.00 28.1 3,750.00

Total $ 70.1 $ 103.1

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The final dividend was paid on June 2, 2025.

Subsequent to March 31, 2026, on April 22, 2026, the Company issued and sold 1,500,000 depositary shares, each representing a 1/100th ownership interest in a share of 6.100 % fixed-rate reset non-cumulative perpetual preferred stock, Series L, $ .01 par value per share, with a liquidation preference of $ 100,000 per share (equivalent of $ 1,000 per depositary share).

The net proceeds of the offering were approximately $ 1.5 billion, after deducting the underwriting discount and estimated offering expenses.

Subsequent to March 31, 2026, on May 4, 2026, the Company announced that it will redeem on June 1, 2026 all of the 20,554 outstanding shares of its fixed-rate reset non-cumulative perpetual preferred stock, Series I, and the corresponding 2,055,433 depositary shares, each representing a 1/100th interest in a share of the Series I preferred stock.

The depositary shares will be redeemed at a redemption price of $ 1,000 per depositary share for a total of $ 2.1 billion.

The redemption price does not include the regular quarterly dividend that was declared on April 23, 2026 and will be paid separately on June 1, 2026.

THE CHARLES SCHWAB CORPORATION

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

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

Available for sale securities:

Net unrealized gain (loss), net of tax expense (benefit) of $ 577

Other reclassifications included in other revenue, net of tax expense (benefit) of $ 2

Held to maturity securities:

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 134

Balance at September 30, 2024 $ ( 14,618 )

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

Available for sale securities:

Net unrealized gain (loss), net of tax expense (benefit) of $ 173

Other reclassifications included in other revenue, net of tax expense (benefit) of $ 2

Held to maturity securities:

Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 207

Derivatives designated as cash flow hedging instruments:

Net unrealized gain (loss), net of tax expense (benefit) of $ 3

Reclassifications included in interest revenue, net of tax expense (benefit) of $ 7

Balance at September 30, 2025 $ ( 11,798 )

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

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Amortization of amounts previously recorded upon transfer from available for sale, net of tax expense (benefit) of $ 128

Balance at September 30, 2024 $ ( 14,618 )

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

Balance at December 31, 2025 $ ( 10,983 )

1 unchanged sentence

Net unrealized gain (loss), net of tax expense (benefit) of $ 2

Other reclassifications included in other revenue, net of tax expense (benefit) of $ 12

Held to maturity securities:

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

Balance at September 30, 2025 $ ( 11,798 )

Balance at March 31, 2026 $ ( 10,757 )

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

As of September 30, 2025, the total remaining unamortized loss on securities transferred from AFS to HTM included in AOCI was $ 8.5 billion net of tax effect ($ 11.1 billion pre-tax).

As of March 31, 2026, the total remaining unamortized loss on securities transferred from AFS to HTM included in AOCI was $ 7.7 billion net of tax effect ($ 10.1 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.

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As described in Note 15, 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 nine months ended September 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.

Diluted EPS was calculated using the treasury stock method for outstanding stock options and non-vested restricted stock units and the if-converted method for the nonvoting common stock, which assumed conversion of all outstanding nonvoting common stock to common stock.

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

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

As of February 12, 2025, the Company had no remaining nonvoting common stock outstanding.

For details regarding the computations of basic and diluted EPS for the periods presented below, see Item 8 – Note 25 in the 2025 Form 10-K.

EPS under the basic and diluted computations for the three months ended March 31, 2026 is as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

Stock Nonvoting

Common Stock Consolidated

Common Stock Common

Stock Nonvoting

Common Stock Consolidated

Basic earnings per share:

Net income $ 2,479

Preferred stock dividends and other (1)

( 81 ) — ( 81 ) ( 342 ) ( 1 ) ( 343 )

Net income available to common stockholders $ 2,397

Weighted-average common shares outstanding — basic 1,746

Common stock equivalent shares related to stock incentive plans 6

Weighted-average common shares outstanding — diluted (2)

Basic earnings per share $ 1.37

Diluted earnings per share $ 1.37

Net income available to common stockholders $ 2,277 $ — $ 2,277 $ 6,031 $ 19 $ 6,050

Reallocation of net income available to common

stockholders as a result of conversion of nonvoting

to voting shares — — — 19 — —

Allocation of net income available to common stockholders:

$ 2,277 $ — $ 2,277 $ 6,050 $ 19 $ 6,050

Weighted-average common shares outstanding — basic 1,806 — 1,806 1,807 51 1,815

Conversion of nonvoting shares to voting shares — — — 8 — —

Common stock equivalent shares related to stock

incentive plans 5 — 5 5 — 5

Weighted-average common shares outstanding —

1,811 — 1,811 1,820 51 1,820

Diluted earnings per share $ 1.26 $ — $ 1.26 $ 3.33 $ .37 $ 3.33

(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 9 million and 13 million for the three and nine months ended September 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 September 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 nine months ended September 30, 2024 are as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

Stock Nonvoting

Common Stock Common

Stock Nonvoting

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

(2) Antidilutive stock options and restricted stock units excluded from the calculation of diluted EPS totaled 13 million for the three months ended March 31, 2026.

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

Three Months Ended March 31,

Stock Nonvoting Common Stock Consolidated Common Stock

Basic earnings per share:

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Allocation of net income available to common stockholders $ 1,796 $ 17 $ 1,796

$ 1,299 $ 36 $ 3,761 $ 105

Weighted-average common shares outstanding — basic 1,794 51 1,817

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(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 and 18 million for the three and nine months ended September 30, 2024, respectively.

(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.

THE CHARLES SCHWAB CORPORATION

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Regulatory Requirements

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

At March 31, 2026, 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

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

March 31, 2026 Amount Ratio Amount Ratio Amount Ratio (1)

Common Equity Tier 1 Risk-Based Capital $ 35,131 26.3 % N/A $ 6,011 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 September 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%.

As of March 31, 2026 and December 31, 2025, CSC was subject to a stress capital buffer of 2.5% and CSB was required to maintain a capital conservation buffer of 2.5%.

CSC and CSB are also required to maintain a countercyclical capital buffer above the regulatory minimum risk-based capital ratios, which was zero for both periods presented.

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 September 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.

At March 31, 2026 and December 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.

N/A Not applicable.

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

There are no conditions or events since September 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).

Based on its regulatory capital ratios at March 31, 2026 and December 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, 2026 that management believes have changed CSB’s capital category.

CSC’s other banking subsidiaries are 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 September 30, 2025, the balance sheets of CSPB and Trust Bank consisted primarily of investment securities, and the entities held total assets of $ 25.1 billion and $ 9.7 billion, respectively.

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

At March 31, 2026 and December 31, 2025, the balance sheets of CSPB and Trust Bank consisted primarily of investment securities.

At March 31, 2026 and December 31, 2025, CSPB held total assets of $ 27.4 billion and $ 27.0 billion, respectively, and Trust Bank held total assets of $ 10.4 billion for both periods.

Based on their regulatory capital ratios at March 31, 2026 and December 31, 2025, CSPB and Trust Bank are considered well capitalized under their respective regulatory capital rules.

THE CHARLES SCHWAB CORPORATION

1 unchanged sentence

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

As a securities broker-dealer, CS&Co is subject to the SEC’s Uniform Net Capital Rule.

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

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Net capital $ 13,441 $ 13,188

2 unchanged sentences

Net capital in excess of required net capital 10,734 10,629

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 September 30, 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 March 31, 2026.

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.

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Schwab structures the operating segments according to its clients and the services provided to those clients.

The Investor Services segment provides retail brokerage, investment advisory, and banking and trust services to individual investors, and retirement plan and business services, as well as other corporate brokerage services, to businesses and their employees.

The Investor Services segment provides retail brokerage, investment advisory, and banking and trust services to individual investors, retirement plan and business services, as well as other corporate brokerage services, to businesses and their employees.

The Advisor Services segment provides custodial, trading, banking and trust, and support services to independent RIAs, independent retirement advisors, and recordkeepers.

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Investor Services Advisor Services Total

Three Months Ended September 30, 2025 2024 2025 2024 2025 2024

Net interest revenue $ 2,424 $ 1,777 $ 626 $ 445 $ 3,050 $ 2,222

Asset management and administration fees 1,221 1,074 452 402 1,673 1,476

Trading revenue 906 710 89 87 995 797

Bank deposit account fees 196 118 51 34 247 152

Other 136 169 34 31 170 200

Total net revenues 4,883 3,848 1,252 999 6,135 4,847

Expenses Excluding Interest

Compensation and benefits 1,284 1,169 369 353 1,653 1,522

Professional services 235 202 58 54 293 256

Occupancy and equipment 220 211 60 60 280 271

Advertising and market development 60 59 41 42 101 101

Communications 105 103 44 44 149 147

Depreciation and amortization 161 175 51 56 212 231

Amortization of acquired intangible assets 104 105 23 25 127 130

Regulatory fees and assessments 51 70 8 18 59 88

Other 207 221 33 38 240 259

Total expenses excluding interest 2,427 2,315 687 690 3,114 3,005

Income before taxes on income $ 2,456 $ 1,533 $ 565 $ 309 $ 3,021 $ 1,842

Nine Months Ended September 30,

Three Months Ended March 31, 2026 2025 2026 2025 2026 2025

Net interest revenue $ 2,425 $ 2,158 $ 719 $ 548 $ 3,144 $ 2,706

16 unchanged sentences

Income before taxes on income $ 2,509 $ 2,011 $ 679 $ 444 $ 3,188 $ 2,455

(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 third quarter and nine months ended September 30, 2025, and prior-year amounts have been recast to reflect this new basis of segmentation.

Subsequent Events

On November 6, 2025, Schwab announced that it has entered into a definitive agreement to acquire Forge Global Holdings, Inc.

(Forge), operator of a leading private market platform and trading marketplace, in a transaction valued at approximately $ 660 million.

The Company anticipates that incorporating Forge’s private markets capabilities will enhance Schwab’s ability to meet the evolving needs of investors across our growing client base.

The transaction is expected to close in the first half of 2026, subject to customary closing conditions, including approval by Forge’s stockholders and regulatory approvals.

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