Business Acquisitions (Tables)

12 Months Ended

Dec. 31, 2011

Summary of Preliminary Allocation of Purchase Price to Net Assets of optionsXpress

The following table summarizes the preliminary allocation of the purchase price to the net assets of optionsXpress as of September 1, 2011:

Fair value of common stock issued	$	710
Fair value of equity awards assumed		4
Total consideration paid (1)	$	714
Fair value of net assets acquired	$	207
Preliminary goodwill	$	507

⁽¹⁾  Represents a non-cash investing activity.

Summary of Preliminary Fair Values of Assets Acquired and Liabilities Assumed as of Acquisition Date

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed as of the acquisition date. The allocation of the purchase price is preliminary and subject to further adjustment as information relative to closing date fair values and related tax balances are finalized.

	September 1, 2011
Assets
Cash and cash equivalents	$	84
Cash and investments segregated and on deposit for regulatory purposes		1,074
Receivables from brokers, dealers, and clearing organizations		40
Receivables from brokerage clients		185
Other securities owned - at fair value		32
Intangible assets		285
Other assets		24
Total assets acquired (1)	$	1,724
Liabilities
Payables to brokerage clients	$	1,221
Deferred tax liability		95
Long-term debt (2)		110
Accrued expenses and other liabilities		91
Total liabilities assumed (1)	$	1,517
Net assets acquired	$	207

⁽¹⁾ All assets and liabilities, except for cash and cash equivalents, represent non-cash investing activities.

⁽²⁾ The Company paid off long-term debt acquired from optionsXpress subsequent to the date of acquisition in September 2011.

Summary of Estimated Fair Value and Useful Lives of Intangible Assets Related to the Acquisition

The following table summarizes the preliminary estimated fair value and useful lives of the intangible assets.

September 1, 2011	Estimated Fair Value		Estimated Useful Life (In Years)
Customer relationships	$	200		11
Technology		70		9
Trade name		15		9
Total intangible assets	$	285

Pro Forma Results of Operations

The following table presents unaudited pro forma financial information as if optionsXpress had been acquired on January 1, 2009. Pro forma net income for the year ended December 31, 2011, was adjusted to exclude $16 million, after tax, of acquisition related costs incurred by the Company in 2011. Pro forma net income for the year ended December 31, 2009, was adjusted to include these costs. Additionally, pro forma net income below excludes $15 million, before tax, of acquisition related costs because these costs were incurred by optionsXpress prior to the acquisition date. Pro forma net income also reflects the impact of amortizing purchase accounting adjustments relating to intangible assets, net of tax, of $20 million, $22 million, and $24 million, for the years ended December 31, 2011, 2010, and 2009, respectively.

Year Ended December 31,	2011		2010		2009
Net revenues	$	4,857	$	4,479	$	4,426
Net income	$	896	$	481	$	804
Basic EPS	$	.71	$	.39	$	.66
Diluted EPS	$	.71	$	.38	$	.66