Charles Schwab’s fortune battered by SVB collapse, his wealth to fall more than any other US billionaire in 2023

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Billionaire Brokerage Founder charles schwab has seen his personal fortune plummet following the collapse of Silicon Valley Bank over the weekend.

According to Bloomberg Billionaires IndexSchwab personally lost $3 billion in the wake of the failure of SVB, which tracks the real-time wealth of the richest people on Earth.

Schwab, who founded discount brokerage Charles Schwab Corp in 1971, now has a net worth of $9.99 billion, according to Bloomberg estimates, making him the 183rd richest person in the world.

Schwab’s fortune fell 7.7% on Monday, the Bloomberg Billionaires Index showed, due in part to a drop in the brokerage’s share price — a personal loss of $828 million.

According to the publication, since March 8, Schwab has wiped $3 billion off his net worth. Since the beginning of 2023, he has lost nearly $3.5 billion—meaning his wealth has fallen more than any other American billionaire this year.

Most of Schwab’s fortune is derived from his stake in the company of the same name, where he serves as chairman.

Shares of Charles Schwab fell nearly 12% on Monday as the collapse of SVB triggered a massive selloff of companies in the financial sector. Shares were down more than 20% at one point during Monday’s trading session.

Investors especially fear that companies such as Charles Schwab, which have large bond holdings with long maturities, may be forced to sell such assets at a loss to cover the rush of deposit withdrawals – thus Silicon Valley Bank. can fall into the same trap as

SVB was forced to quickly sell its long-term government bonds as there was not enough liquidity to cover the increase in customer deposit withdrawals. If the lender was able to hold onto those bonds until maturity, he would get his capital back – but selling them before the of the maturity period would mean taking them out at a loss, as rising interest rates pushed down their value. .

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assurance from schwab

Shares of Charles Schwab fell on Monday, despite assurances from Schwab himself and company CEO Walt Bettinger.

In a statement issued on March 13, the pair sought to calm clients and investors by defending its portfolio, assuring stakeholders that the firm remains “a safe, secure and sound financial institution”.

“Schwab’s long-standing reputation as a safe harbor in storms remains intact, driven by record-setting performance, a conservative balance sheet, a strong liquidity position and a diverse base of 34 million+ account holders, who invest with Schwab every day,” said Schwab and Bettinger. “As such, we remain confident in our approach and our ability to help clients through all types of economic environments.”

Shares of Charles Schwab were up nearly 9% in pre-market trading on Tuesday.

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