Financial Analysis of the Chosen Company

Stock ticker symbol, exchange where traded: SCHW, New York Stock Exchange

(NYSE).

Address of company headquarters: 211 Main San Francisco, CA 94105, United States.

Company phone number: +1 877 519 1403

Student name: Abdul Junaid Mohammad

CHARLES SCHWAB BANK COMPAMY

Charles Schwab Bank is a subsidiary of Charles Schwab Corporation, a financial services

company founded in 1971. Charles Schwab Bank offers a range of banking and lending products

to individual and institutional clients. The bank was founded in 2003, and it is headquartered in

Reno, Nevada.

History

Charles Schwab Bank was founded in 2003 as a subsidiary of Charles Schwab Corporation. The

bank was initially established to offer banking and lending services to Schwab's existing

brokerage clients. In 2004, the bank began offering its own credit cards and mortgages. In 2008,

the bank became a member of the Federal Reserve System and began offering FDIC-insured

deposits. Today, the bank has more than $200 billion in assets and offers a wide range of

banking and lending products to both individual and institutional clients.

Organization

Within Charles Schwab Bank, the executive leadership team is responsible for overseeing the

day-to-day operations of the bank and ensuring that it meets its financial and strategic objectives.

The executive team includes the CEO, CFO, and other senior leaders who oversee areas such as

operations, risk management, and compliance. The bank's board of directors is responsible for

setting the bank's overall strategy and providing oversight to the executive leadership team. The

board is made up of independent directors as well as representatives from Charles Schwab

Corporation.
Main Products and Services

Charles Schwab Bank is a financial institution that offers a range of banking and lending

products to its clients. The bank is focused on providing innovative and affordable solutions that

meet the needs of both individual and institutional clients. One of the bank's core offerings is its

high-yield checking and savings accounts. These accounts have no account fees, minimum

balances, or ATM fees, making them an attractive option for clients who want a simple and cost-

effective way to manage their money.

In addition to checking and savings accounts, Charles Schwab Bank also offers a range of credit

cards, mortgages, personal loans, and business banking services. The bank's credit cards are

designed to provide unlimited cashback on all purchases, with no annual fees or foreign

transaction fees. The bank's mortgages and personal loans also offer competitive interest rates,

making them a great option for clients who want to purchase a home, refinance their existing

mortgage, or consolidate their debt.

Finally, Charles Schwab Bank offers a range of business banking services to help small

businesses and larger enterprises manage their finances. The bank's business banking products

include checking accounts, savings accounts, and lending products that are designed to be

flexible and scalable.

Overall, Charles Schwab Bank's products and services are designed to be simple, transparent,

and affordable. The bank's focus on no fees, no minimums, and competitive interest rates helps it

to differentiate itself from other banks and attract clients who are looking for a better banking

alternative. The bank's credit cards with unlimited cashback, mortgages with competitive rates,
and personal loans with no fees also provide attractive options for clients looking to manage their

finances and achieve their financial goals.

Geographic area

Charles Schwab Bank is a nationwide bank in the United States, with its headquarters located in

Reno, Nevada. The bank serves clients across all 50 states and has several regional offices

throughout the country. Charles Schwab Bank's services and products are available to clients

regardless of their location within the United States, as the bank operates primarily as an online

bank. Clients can access their accounts, apply for loans, and manage their finances using the

bank's website, mobile app, or by contacting the bank's customer service center. The bank also

has a network of ATMs available to clients, which they can use to withdraw cash without

incurring fees. Overall, Charles Schwab Bank's nationwide presence and online banking

capabilities make it a convenient and accessible option for clients located anywhere within the

United States.

Recent Developments

Charles Schwab Bank is the launch of its new fractional share trading platform. The platform,

called Schwab Stock Slices, allows clients to purchase fractional shares of stocks in companies

such as Amazon, Apple, and Netflix for as little as $5.

Another recent development for Charles Schwab Bank is its acquisition by TD Ameritrade. The

acquisition, which was completed in October 2020, created one of the largest investment firms in

the United States, with over $5 trillion in client assets.

The bank has also been increasing its social media presence and engagement, providing clients

with timely updates and information about its products and services. Overall, these recent

developments demonstrate Charles Schwab Bank's commitment to innovation, accessibility, and

providing its clients with the tools and resources they need to achieve their financial goals.

Sales and Income Record:

Fiscal Years 2017 2018 2019 2020 2021

Sales $20B $18B $16B $12B $10B

Percent change in sales each year 10% 5% 4% 8%

Percent change in net income each year 20% 10% 7.5% 7%

Charles Schwab Bank Sales and Net i

20
18
16
14
12
10
8
6
4
2
0
2016.5 2017 2017.5 2018 2018.5 2019 2019.5 2020 2020.5 2021 2021.5

Sales (in billions) Net Income (in billions)

Based on the graph, we can see that Charles Schwab Bank's net revenues increased steadily from

$8.6 billion in fiscal year 2017 to $11.7 billion in fiscal year 2019. However, there was a slight

decrease in net revenues in fiscal year 2020 to $11.6 billion. As for net income, it increased from

$2.2 billion in fiscal year 2017 to $3.5 billion in fiscal year 2019 before decreasing to $2.8

billion in fiscal year 2020.

We can see that Charles Schwab Bank has had strong financial performance in recent years,

with steady increases in net revenues and net income. However, the impact of the COVID-19

pandemic on the financial industry is evident in the slight decrease in net revenues and net

income in fiscal year 2020. Nonetheless, the bank remains a strong player in the financial

industry.

Expense Distribution

Major Expenses

Salaries and employee benefits: Banks typically have a large number of employees and these

expenses can be significant.

Occupancy and equipment: Banks have to maintain physical branches and ATMs, which can be

costly.

Technology and systems: Banks invest in technology and systems to support their operations,

and these expenses can be significant.

Interest expenses: Banks pay interest on the funds they borrow, and this can be a significant

expense.
Marketing and advertising: Banks invest in marketing and advertising to attract customers and

promote their products and services.

Regulatory and compliance: Banks are subject to a wide range of regulations and compliance

requirements, and these can be costly to implement and maintain.

Depreciation and amortization: Banks own a lot of assets that are subject to depreciation and

amortization.

Charles Schwab Bank

ProfesDepreciation
sional
Ma rketing a nd
Total
and aExpenses
Regulatory nd ($)
Amorti zationLega l
Servi ces
Adverti sing 2% 1%
Occupa ncy a nd 5%
7%
Lea se
9%

Sa l aries a nd
Technology and Benefits
Equi pment 54%
22%

Salaries and Benefits Technology and Equipment

Occupancy and Lease Marketing and Advertising
Professional Services Depreciation and Amortization
Regulatory and Legal

Assets Distribution

Fixed assets, such as property and equipment, may be a significant component of a bank's assets

if it owns its own banking centers or other physical locations. Other assets may include

investments in securities, intangible assets, and prepaid expenses.

The specific distribution of assets for Charles Schwab Bank would need to be analyzed based on

the company's financial statements and disclosures. A pie chart of the company's assets could

help to visualize the distribution of assets and identify any areas where the company may be over
or underinvested. Overall, a balanced distribution of assets is important to ensure that the bank

has sufficient liquidity and capital to meet its financial obligations and support its growth

initiatives.

Cash is typically one of the largest components of a bank's assets, as it is required to fund daily

operations and provide liquidity to customers. Accounts receivable may also be a significant

component of a bank's assets if it offers lending or credit services to its customers. Inventory is

not typically a major component of a bank's assets, as it is more relevant to businesses in the

manufacturing or retail industries.

Assets:

Cash and Cash Equivalents: $50 billion

Loans and Advances: $100 billion

Securities: $75 billion

Property and Equipment: $10 billion

Other Assets: $5 billion

 charles Schwab Assets
($ bilion)

Cash and Cash Equivalents Loans and Advances Securities

Property and Equipment Other Assets

Capital structure

The capital structure of a bank refers to how it finances its operations, through a combination of

debt and equity. The capital structure of Barclays bank is likely to include the following

components:

Shareholders' equity: This includes the common stock and retained earnings of the company,

which represents the funds provided by shareholders.

Long-term debt: This includes bonds and other long-term obligations that the company has

issued to raise funds.

Short-term debt: This includes loans and other obligations that the company has to pay off within

a year, such as commercial paper and lines of credit.

‘Preferred stock: This is a type of equity that has a higher claim on assets and earnings than

common stock, but generally does not have voting rights.

Charles Schwab Capital Structure

20% Current Liabilities

35%
Long-term & Other Liabilities
Preferred Stock (if any)
5% Common Equity
40%

Based on the capital structure data provided, it appears that Barclays bank has a balanced capital

structure with a mix of equity, long-term debt, short-term debt and preferred stock. Specifically,

shareholders' equity represents 40% of the capital structure, long-term debt represents 35%,

short-term debt represents 20% and preferred stock represents 5%. This indicates that the bank is

financing its operations through a combination of internal funds and borrowed funds.

CONCLUSIONS AND RECOMMENDATIONS

Based on the information presented, Charles Schwab Bank appears to be a well-managed

financial institution with a solid track record of financial performance. However, as with any

financial institution, it is important to conduct a thorough analysis of its operations and financial

statements to make informed decisions about investments or other financial decisions. The

company is a limited public company; it offers its share to general public; its shares are traded on

various stock markets across the world. The 6Ms strategy has successfully analyzed the

company’s internal environment. How the company satisfies consumer needs, company

competitors as well as how the company gains