TO MY FELLOW STOCKHOLDERS,
To manage through the financial crisis of 2008, Schwab maintained a conservative approach to risk management, strict expense controls, and a relentless focus on serving our clients. As our 2008 results clearly show, that common-sense approach continued to make a difference for millions of Americans.

New and existing Schwab clients brought in $11 3 billion in net new assets for the year – a number that was certainly impacted by the financial crisis, but still averaged a very healthy $2 billion per week in net new assets coming to Schwab. Of that total, independent advisors accounted for more than half, or $60 billion in net new assets, including a record $13 billion from advisors who chose to leave established financial firms and set up shop as independent registered investment advisors.

Another $18 billion in net new assets came from employers who work with Schwab to provide retirement services to their employees, with the balance of $35 billion in net new assets coming directly from individual investors.

As of December 31, 2008, total client assets stood at $1.14 trillion, down from $1.45 trillion at year-end 2007 as a result of the broad market declines that were upon us by the fourth quarter of the year.

But there were also bright spots during that difficult quarter. In October, during one of the worst months ever for the U.S. stock market, individual investors opened nearly 30,000 net new brokerage accounts at Schwab, up 88 percent over October 2007. For the full year, investors opened more than 889,000 new brokerage accounts, up 10 percent year-over-year, while total brokerage accounts rose 5 percent to 7.4 million.

Corporate and Retirement Services added a record 200,000 participants in 401(k) plans, boosting our total to 1.4 million participants – a 17 percent increase over the prior year.

Charles Schwab Bank also continued to grow as banking accounts increased 71 percent to 447,000 at year-end. The bank’s balance sheet assets of $25.4 billion were up 72 percent year-over-year.

It’s clear that people are voting with their pocketbooks. And for every vote of confidence in Schwab, we are grateful and profoundly aware of the responsibility that comes with it. ...

Download Charles Schwab 2008 Annual Report

PDF format, 2.7MB, 124Pages.

The Charles Schwab Corporation
101 Montgomery Street
San Francisco, CA 94104
(415) 636-7000
www.schwab.com
www.aboutschwab.com

Letter From the CEO
2008 Results
Letter From the CFO
Financial Highlights
Growth In Client Assets & Accounts
Executive Management
Form 10-K
Board of Directors
Corporate Contacts & Information

Schwab On Investing, Free Latest Digital Issue

2008 FINANCIAL RESULTS
Based on these strong client metrics, The Charles Schwab Corporation posted a second consecutive year of record financial operating results. For the 12 months ending December 31, 2008, results included the following:

Net revenues of $5.2 billion, up 3 percent versus the prior year.
Income from continuing operations of $1.2 billion, for a 10 percent year-over-year gain.
Diluted earnings per share from continuing operations of $1.06, up 15 percent from 92 cents per share the prior year.
A record pre-tax profit margin of 39.4 percent, compared to 37.1 percent one year ago.

ABOUT THE CHARLES SCHWAB CORPORATION

The Charles Schwab Corporation (NASDAQ: SCHW), based in San Francisco, California is a company founded as a traditional (brick-and-mortar) brokerage house, and which today is one of the world's largest discount brokers.

Schwab offers the same services as traditional brokerages but with lower commissions and fees than many other brokers. The company serves some 7 million individual and institutional clients, with $1.39 trillion in assets (as of March 31, 2008), from some 300 offices in the U.S. Clients can also access its services via telephone, wireless device, and the Internet.

Besides discount brokerage, the firm offers a wide range of investment research, mutual funds, annuities, bond trading, and now checking and mortgages through its Charles Schwab Bank.

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