Why I Created Schwab Bank

In our earliest days, Schwab focused exclusively on serving investors and their unique needs. As investors first and foremost, they were interested in returns on their money greater than what traditional banking offered.

But, of course, banking plays an important role in everyone's lives, investors included. I realized early on there was an opportunity to offer banking services but with a twist: banking services designed through the eyes of investors like you—a bank that would make the total financial experience at Schwab easier and more convenient. It was important to me that an investors' bank had all the essential services investors needed, all the critical tools for managing a portfolio and financial life. Easy, convenient, a good value. "Let's build a bank for investors," I said at the time. And that's what we did.

One of my rules of thumb for Schwab has always been to make it easy to move money to where it has the greatest utility at any time. It's your money, after all, and that is what an independent-minded investor wants: seamless access, convenience, and control. That proven benefit of an investors' bank remains its core. Clients benefit from the convenience and security of their transactional cash being swept into an FDIC-insured Schwab Bank account (only a bank can offer that level of safety), where they use it for everyday needs or have it at the ready to make an investment. Clients seeking higher returns on investment cash can put their dollars to work in their brokerage account through money market funds, CDs, bonds, or other options with the click of a mouse or a tap on their smartphone.

Because of our focus, there are things our bank doesn't do, such as unsecured or commercial real estate lending. This has kept us conservative and able to be nimble with new services designed for investors like you—for example, our Investor Advantage Pricing that provides discounts on loan rates for qualifying investor clients based on the level of both your investment and banking assets at Schwab.

The bottom line? For investors, a bank designed for investors works. With so much available for investors at Schwab, I think Schwab Bank is one of our hidden gems. New brokerage clients are often surprised to learn about what's available in banking, and we often hear them say, "I can't stand where I bank now—let's make the shift!" Well, as an investor myself, that makes sense to me.

Charles R. Schwab

Founder & Co-Chairman