NEW YORK – Charles Schwab Corp. (SCH) on Tuesday said its board removed David Pottruck (search) as chief executive and replaced him with Charles "Chuck" Schwab (search), the discount brokerage's chairman and founder.
Pottruck, 57, said in a statement that Schwab's board had decided it was time for him to "step aside." He has been at the company for 20 years and became sole CEO when Charles "Chuck" Schwab left the co-CEO position in January 2003.
Schwab, 67, will return to the CEO post in addition to his role as chairman, the company said.
"There's been a lot of shareholder value which either has been destroyed or has gone away under Dave," Ken Worthington, an analyst at CIBC World Markets, said. "At the end of the day your job there is to make money for shareholders."
Pottruck became co-CEO in January 1998. Schwab's stock price currently trades at a lower price per share than it did when he took that post, and it has fallen 84 percent from an April 1999 high of $51.65.
Last month, Schwab warned of lower-than-expected quarterly profit, marking the latest in a string of profit warnings by the company over the past two years.
"The last few years have been difficult in the securities markets, and I accept the board's decision that it's time for me to step aside," Pottruck said in the statement. "After taking some time off with my family, I'll start thinking about the next step in my career."
The San Francisco-based company, which has $998 billion in client assets, also said its second-quarter profit fell 10 percent from a year earlier.
Schwab reported net income of $113 million, or 8 cents a share, compared with $126 million, or 9 cents per share, in the year-earlier period.
Wall Street analysts had been expecting a profit of 10 cents per share, according to Reuters Estimates.
Schwab said second-quarter revenue edged up to $1.11 billion from $1.02 billion.
Daily average commission trades fell 20 percent from the first quarter, however, underscoring a lack of enthusiasm by individual investors.