Charles Schwab (NYSE: SCHW) reported Q4 EPS of $0.62, $0.02 worse than the analyst estimate of $0.64. Revenue for the quarter came in at $2.6 billion versus the consensus estimate of $2.6 billion.

CFO Peter Crawford commented, “We achieved impressive financial results in 2019 given the somewhat more challenging than expected macroeconomic backdrop and our own pricing decisions. We delivered a record $10.7 billion in total revenue, up 6% year-over-year, which was just shy of the range we outlined at the beginning of the year. Net interest revenue increased 12% from the prior year to $6.5 billion, driven by higher average investment yields – even after the Fed’s rate cuts – and an increase in client cash balances held at our bank and brokerage subsidiaries. While trading revenue declined 19% to $617 million due to our pricing actions, asset management and administration fees of $3.2 billion remained essentially flat year-over-year. Rising balances in third-party mutual funds, along with growing enrollment in our advisory solutions, helped to largely offset declines in Mutual Fund OneSource® and lower money market fund revenue due to sweep transfers to our balance sheet. In response to the environment, we carefully managed our overall 2019 spending to $5.9 billion for the year, including $62 million in severance charges associated with a 3% reduction in our workforce and $25 million in costs relating to our two aforementioned acquisitions. Together, these items contributed roughly a third of our 5% overall expense growth, and we finished the year significantly below our initial 6%-7% outlook. Reflecting our commitment to balancing long-term profitability with reinvesting for growth, we achieved a record 45.2% pre-tax profit margin and a 19% return on equity for the year – our second consecutive year of at least 45% and 19%, respectively.”

Mr. Crawford added, “Disciplined balance sheet management remains core to our strategy as we continue to support business growth and meaningful capital returns across a range of conditions. We entered 2019 with a $4 billion share repurchase authorization, and through year end we had repurchased more than 55 million shares for $2.2 billion –including 6.4 million shares for approximately $230 million during the fourth quarter. By month-end December, our balance sheet assets reached $294 billion, up 5% from month-end September, and down 1% from a year ago; our preliminary consolidated Tier 1 Leverage Ratio was 7.3%. As we look forward to continuing to build Schwab both organically and through our pending transactions, our intent to return excess capital above our long-term operating objective of 6.75%-7.00% remains in place. Overall, our 2019 results emphasize the enduring nature of Schwab’s financial model, which allows us to consistently invest in our capabilities and our clients while building value for stockholders through the business cycle.”

For earnings history and earnings-related data on Charles Schwab (SCHW) click here.