“we expect if rates fall, the amount drawn on the PAL will increase.”

In context

“ents continue to turn to Schwab Wealth Advisory in record numbers. We also recently began introducing a discretionary option for Schwab Wealth Advisory clients, which will help us meet even more of the comprehensive wealth management needs of investors. Clients continue to have strong interest in our other wealth offerings, including our Wasmer Schroeder fixed income strategies, where year-to-date net flows are up nearly 60% compared to last year. Clients are also increasingly turning to us for their borrowing needs, powering strong growth and adoption of our Pledged Asset Line or PAL. PAL balances reached a record $15.7 billion, an increase of 16% over last year. Notably, former Ameritrade clients represent 44% of PAL balance growth. Our account originations are up 57% year-over-year and we expect if rates fall, the amount drawn on the PAL will increase. The increased adoption is in large part due to the digital enhancements that we’ve made to the process. Nearly 90% of PALs are now digitally originated and more than 40% of retail applications are now initiated by a financial consultant compared to less than 5% just a few years ago. This makes it easier on our clients and helps FC deepen relationships with our clients. The entire process from the time a client opens an application to when they can access their loan takes on average just one and a half business days and only minutes for most loans. This industry leading offer is delighting our clients and client promoter scores have increased roughly 30 percentage points in this product since 2021. With Client Segmentation, we’re focused on serving distinct retail and advisor client groups”