(ACBJ) - Charles Schwab expects to incur charges of about $400 million to $500 million to shed real estate in San Francisco and other corporate offices across the country as well as to cut jobs and expenses tied to professional services, the company said Monday in a filing with the Securities and Exchange Commission.
The charges primarily stem from employee compensation and benefits and the cost to exit facilities, the company said.
The cost-cutting is expected to result in $500 million in annual run-rate cost savings.
“The company is currently assessing its real estate footprint, and plans to close or downsize certain corporate offices,” the company said in the SEC filing. “In addition, the company plans to reduce its operating costs primarily through lower headcount and professional services."
Schwab is preparing for the final integration of TD Ameritrade, which it purchased in 2020. Schwab declined to comment further on the job cuts.
“We don’t yet have specifics to offer on how many positions will be eliminated,” Schwab spokesperson Mayura Hooper said Monday. “We have said we intend to take a series of actions this year and into 2024 aimed at removing cost and complexity from the firm, including reducing our expense base and streamlining our operating model.
“This will result in eliminating some positions in the coming months, mostly in non-client facing areas.”
Schwab told the San Francisco Business Times in July that it’s shrinking its San Francisco office as part of a broader effort to cut back on its real estate footprint. Schwab is also closing offices Oct. 1 in Atlanta, San Antonio, San Diego, St. Louis and Tampa.
“We will also reduce our footprint by closing floors or closing offices and then relocating within a similar geography in the following locations: Boston, Chicago, Henderson, Nevada, Jersey City, New Jersey and San Francisco,” a Schwab spokesperson said in July.
By Mark Calvey
