Charles Schwab plans to raise $2.5B via debt offering.

Charles Schwab Corp to Raise $2.5 Billion Through Debt Offering

Brokerage firm Charles Schwab Corp has announced its plans to raise up to $2.5 billion through a debt offering. The company will raise the debt in two parts via notes due in 2029 and 2034. Yield-to-maturity on the 2029 and 2034 notes would be 205 basis points and 227 basis points higher than those on the benchmark, risk-free Treasury notes, respectively. BofA Securities, Citigroup, Credit Suisse, Goldman Sachs & Co LLC, J.P. Morgan and Wells Fargo Securities are the joint book-running managers for the offering.

Use of Proceeds

In a filing with the U.S. Securities and Exchange Commission, the brokerage firm stated that it would use the proceeds for “general corporate purposes.”

Financial Performance

Last month, Schwab reported first-quarter profit ahead of analysts’ expectations, boosted by growth in interest income. Its chief executive officer, Walter Bettinger, also allayed concerns about its financial strength. However, shares of the company were down 1.4% at $51.10 in premarket trading, while most other financial stocks were climbing.

Joint Book-Running Managers

BofA Securities, Citigroup, Credit Suisse, Goldman Sachs & Co LLC, J.P. Morgan and Wells Fargo Securities are the joint book-running managers for the offering.