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Tuesday, 17 April, 2001, 17:09 GMT 18:09 UK
Charles Schwab profit down 63%
Charles Schwab, co-chief executive, Charles Schwab
Schwab has not lost his shirt on the stock market
Profits at Charles Schwab, the world's largest discount and online brokerage, have plunged 63%, as customers shun trading after being burnt by the stock market slump.

Schwab, which last month said it would lay off as much as 13% of its workforce, posted profits of $120m in the first quarter compared with profits of $323m last year.

The company reported that while customers assets fell 15% to $806bn as the falling stock prices cut into portfolio values, its own revenues from managing investors' money rose by 10%.

The results were within analysts expectations.

"The difficult securities market environment that emerged late last year continued into early 2001, and our clients' daily average revenue trades declined to their lowest level since the fourth quarter of 1999," co-Chief Executive Charles Schwab said in a statement.

Despite the market conditions, Schwab opened 280,000 new customer accounts in the quarter valued at $31bn, bringing its total account base to 7.6m, a 9% increase from March 2000.

Share troubles

Brokerage revenues have plummeted along with the Nasdaq index, which fell nearly 26% in the first quarter.

Schwab shares fell 46% during the first quarter.

The company warned in March that between 2,750 to 3,400 jobs will be cut from the work force of around 26,000.

The discount brokerage had earlier in the year asked half of its 26,000 US staff to stay at home on three Fridays in February and March - either on unpaid leave or on vacation - to avoid the job cuts.

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