Discount broker Charles Schwab Corp. said Friday its first-quarter profit surged as the economy and stock markets improved.
The results topped Wall Street's expectations.
The San Francisco company said its net income rose to $243 million, or 20 cents a share, in the three months ended March 31, from $6 million, or less than a penny a share, in the year-ago period. The 2010 quarter included a $126 million reserve for class action lawsuits.
Revenue climbed 23 percent to $1.21 billion from $978 million.
On average, analysts polled by FactSet expected earnings of 19 cents per share on $1.18 billion in revenue.
All three of the company's revenue sources — net interest revenue, asset management and administration fees, and trading revenue — increased by double-digits from a year earlier.
Total client assets rose 10 percent to $1.65 billion, a record according to the company. And Schwab's pre-tax profit margin climbed to 32.6 percent, the highest in nine quarters.
Chairman Charles Schwab said investors felt encouraged by upbeat economic indicators, job growth and rising stock markets, which increased 5 percent during the quarter. He noted that Schwab clients reduced the percentage of their assets held in cash to pre-recession levels.
"Although still choppy, the environment is improving and investors are actively engaged with us across all our businesses," Schwab said.
The company said it ended March serving 8.1 million active brokerage accounts, 719,000 bank accounts, and 1.44 million retirement plan participants.
Company shares rose 25 cents to $18.47 in morning trading.
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