Regulatory Requirements

9 Months Ended

Sep. 30, 2021

Regulatory Capital Requirements Under Banking Regulations [Abstract]

Regulatory Requirements

Regulatory Requirements

At September 30, 2021, CSC and CSB met all of their respective capital requirements. The regulatory capital and ratios for CSC (consolidated) and CSB are as follows:

	Actual				Minimum to be Well Capitalized				Minimum Capital Requirement
September 30, 2021	Amount		Ratio		Amount		Ratio		Amount		Ratio (1)
CSC
Common Equity Tier 1 Risk-Based Capital	$	26,616	19.6	%	N/A				$	6,117	4.5	%
Tier 1 Risk-Based Capital	36,570		26.9	%	N/A				8,156		6.0	%
Total Risk-Based Capital	36,591		26.9	%	N/A				10,875		8.0	%
Tier 1 Leverage	36,570		6.3	%	N/A				23,052		4.0	%
Supplementary Leverage Ratio	36,570		6.3	%	N/A				17,485		3.0	%
CSB
Common Equity Tier 1 Risk-Based Capital	$	26,498	26.1	%	$	6,589	6.5	%	$	4,562	4.5	%
Tier 1 Risk-Based Capital	26,498		26.1	%	8,110		8.0	%	6,082		6.0	%
Total Risk-Based Capital	26,512		26.2	%	10,137		10.0	%	8,110		8.0	%
Tier 1 Leverage	26,498		7.1	%	18,700		5.0	%	14,960		4.0	%
Supplementary Leverage Ratio	26,498		7.0	%	N/A				11,384		3.0	%
December 31, 2020
CSC
Common Equity Tier 1 Risk-Based Capital	$	22,916	18.5	%	N/A				$	5,575	4.5	%
Tier 1 Risk-Based Capital	30,649		24.7	%	N/A				7,433		6.0	%
Total Risk-Based Capital	30,688		24.8	%	N/A				9,910		8.0	%
Tier 1 Leverage	30,649		6.3	%	N/A				19,396		4.0	%
Supplementary Leverage Ratio	30,649		6.2	%	N/A				14,744		3.0	%
CSB
Common Equity Tier 1 Risk-Based Capital	$	17,526	19.2	%	$	5,919	6.5	%	$	4,098	4.5	%
Tier 1 Risk-Based Capital	17,526		19.2	%	7,285		8.0	%	5,464		6.0	%
Total Risk-Based Capital	17,558		19.3	%	9,106		10.0	%	7,285		8.0	%
Tier 1 Leverage	17,526		5.5	%	15,979		5.0	%	12,783		4.0	%
Supplementary Leverage Ratio	17,526		5.4	%	N/A				9,763		3.0	%

(1) Under the Basel III capital rule, CSC and CSB are also required to maintain a capital conservation buffer and a countercyclical capital buffer above the regulatory minimum risk-based capital ratios. The capital conservation buffer and countercyclical capital buffer were 2.5% and zero percent, respectively, for both periods presented. If either buffer falls below the minimum requirement, the Company would be subject to limits on capital distributions and discretionary bonus payments to executive officers. At September 30, 2021, the minimum capital requirement plus capital conservation buffer and countercyclical capital buffer for Common Equity Tier 1 Risk-Based Capital, Tier 1 Risk-Based Capital, and Total Risk-Based Capital ratios were 7.0%, 8.5%, and 10.5%, respectively.

N/A Not applicable.

Based on its regulatory capital ratios at September 30, 2021, CSB is considered well capitalized (the highest category) under its respective regulatory capital rules. There are no conditions or events since September 30, 2021 that management believes have changed CSB’s capital category.

At September 30, 2021, the balance sheets of CSPB and Charles Schwab Trust Bank (Trust Bank) consisted primarily of investment securities, and the entities held total assets of $35.6 billion and $14.7 billion, respectively. Based on their regulatory capital ratios, at September 30, 2021, CSPB and Trust Bank are considered well capitalized under their respective regulatory capital rules.

Net capital and net capital requirements for CS&Co, TDAC, and TD Ameritrade, Inc., are as follows:

	September 30, 2021		December 31, 2020
CS&Co
Net capital	$	4,281	$	3,117
Minimum dollar requirement	1.000		1.000
2% of aggregate debit balances	913		616
Net capital in excess of required net capital	$	3,368	$	2,501
TDAC
Net capital	$	5,299	$	4,040
Minimum dollar requirement	1.500		1.500
2% of aggregate debit balances	1,007		748
Net capital in excess of required net capital	$	4,292	$	3,292
TD Ameritrade, Inc.
Net capital	$	675	$	350
Minimum dollar requirement	0.250		0.250
2% of aggregate debit balances	—		—
Net capital in excess of required net capital	$	675	$	350

Pursuant to the SEC’s Customer Protection Rule and other applicable regulations, Schwab had cash and investments segregated for the exclusive benefit of clients at September 30, 2021. The SEC’s Customer Protection Rule requires broker-dealers to segregate client fully-paid securities and cash balances not collateralizing margin positions and not swept to money market funds or bank deposit accounts. Amounts included in cash and investments segregated and on deposit for regulatory purposes represent actual balances on deposit. Cash and cash equivalents included in cash and investments segregated and on deposit for regulatory purposes are presented as part of Schwab’s cash balances in the condensed consolidated statements of cash flows.