(Bloomberg) — Charles Schwab Corp. climbed on Tuesday, paring the earlier day’s declines, after Chief Executive Officer Walt Bettinger told CNBC he bought 50,000 shares for his account.
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The stock closed 9.2% higher at $56.68, reversing a 12% drop on Monday after the firm sought to reassure investors that it has enough liquidity to weather the fallout from the collapse of the Silicon Valley bank.
“Our bank is very conservatively managed,” Bettinger told CNBC. “If you look at the bank’s holdings, we have about 10% of client deposits outstanding.”
Schwab, like the Silicon Valley bank, has a large investment securities portfolio and is sitting on significant paper losses in its held-to-maturity books. The firm transferred approximately $189 billion of securities maturing in 2022, and had an unrealized loss of $14 billion on that portfolio of agency mortgage-backed securities at the end of the year. Unlike SVB, however, most of Schwab’s customer deposits are insured by the Federal Deposit Insurance Corporation.
(Updated with closing share price in second paragraph.)
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