The Charles Schwab Corp. (NYSE: SCHW) is among the most affected financial firms facing a drop in customer deposits due to the increased interest rate environment in the United States, according to its Q3 2023 report.
This presents a real challenge for a company that relies primarily on clients’ uninvested cash to fund its interest-earning businesses. Charles Schwab’s consumer bank deposits tumbled 28% year-over-year (YoY), causing its net interest revenue to drop 23.5% in the third quarter, which also negatively affected its quarterly revenue of $4.61 billion (-16.2% from Q2).
A recent post on X (Twitter) by the event-driven trader Gurgavin Chandhoke highlights Charles Schwab as the financial company with more accumulated losses in bank deposits since Q3 2022.
BTC YoY performance price chart (1D). Source: TradingView
SCHW price analysis
Meanwhile, Charles Schwab stock has lost more than 25% in both the last quarter and in the year-over-year period mentioned for Bitcoin’s positive price performance. SCHW is trading at $50.87 per share by press time, as opposed to $68.19 per share three months ago, and $68.26 per share on October 21, 2022.
SCHW 3-month price chart. Source: Finbold
Walter William Bettinger, Charles Schwab’s CEO and Co-Chairman, said that the Federal Reserve’s actions are slowing the rate of inflation, but at a significant cost to the markets, to consumers, to investors, and to firms like Schwab. On that, JPMorgan CEO warned we are living in ‘the most dangerous times’.
