Schwab Investor Services

• Annual revenues increased 18 percent to $3.2 billion

• Pre-tax margin was 32.0 percent, up from 27.6 percent in 2005

Schwab Investor Services meets the needs of the individual investor, offering services online, by phone, or at more than 300 Schwab branches nationwide. In 2006, we served more than 5.2 million accounts and, by year-end, held over $670 billion in client assets.

The Investor Services enterprise also includes other client-focused divisions, including:

• Corporate & Retirement Services which helps companies administer 401(k) and equity compensation plans;
• CyberTrader®, which provides tools for highly active online traders; and
• International and Multicultural Services, which serves U.S.- based Asian and Hispanic investors and operates outside the U.S. with branches in Puerto Rico and London, and a subsidiary in Hong Kong.

1. We enhanced our value. We eliminated many service, maintenance, and “nuisance” fees and ensured that our web equity commissions were competitive.
2. We strengthened client relationships. More than 500,000 clients now have a dedicated Schwab Financial Consultant, and all clients have access to complimentary investing consultations and better online tools.
3. We improved client service. With our new client concierge service, phone professionals reach out to new clients to welcome them to Schwab. We also enabled direct call-back, allowing clients to talk with the same knowledgeable phone-service professional whenever they call back with a related question.
4. We expanded help and guidance. We extended our best market research to all clients and expanded distribution of our quarterly On Investing® magazine to all of our client households.