The troubled online broker (and former risky mortgage lender) is reducing balance sheet exposure, by about $1.3 billion in risk from last quarter. Roughly $900 million was related to prepayments or scheduled principal reductions.
The company is also reducing liabilities after those tenders. Its customer cash and deposits fell about $700 million to $33.7 billion. There was roughly a $1 billion increase in brokerage cash that was offset by a $1.7 billion reduction in CSA and other bank deposits. Margin receivables rose to $3.1 billion from $2.4 billion.
Its Q2 loan loss provisions actually fell by $49 million to $405 million, while the total allowance for loan losses was roughly steady at $1.2 billion. Total net charge-offs rose by $53 million to $386 million.
E*TRADE stock closed up over 5% at $1.36 on the day, and shares are up around $1.38 on the day. It is never wise to declare a near-disaster as being over, but this quarterly report and the recapitalization from Citadel is getting to the point that at least a tad more clarity seems easier to fathom compared to recent quarters.
JON C. OGG
Top Gaining Stocks
Top Losing Stocks