E*Trade is a financial services company specialising in online brokerage services. It is the #3 in internet-based share dealing behind Charles Schwab and TD Ameritrade. However, their proposed merger in 2020 to form a mammoth trading giant cast a significant shadow over E*Trade's future. A solution was announced in Feb 2020: the acquisition of E*Trade by banking giant Morgan Stanley for around $13bn in stock. The company was in fact a pioneer in electronic trading, founded originally in 1982 (as TradePlus) to offer direct brokerage by dial-up to owners of the first personal computers. It rebranded as E*Trade in 1992. More recently the company established a high public profile with a long-running and hugely popular marketing campaign (by Grey NY) featuring the "E*Trade Babies". However, it also suffered significantly from the economic problems of late 2000s, notching up steep losses between 2007 and 2010 as a result of an ill-considered move into mortgages and related securities. It was briefly back into profit in 2011, before reporting another large loss in 2012 after early repayments of part of its substantial debt burden. Net revenues topped $2bn in 2010 and 2011 before slipping back. Performance remains mercurial, buffeted by the ebbs and flows of market sentiment, and therefore trading volumes. Michael Pizzi succeeded Karl Roessner as CEO in 2019, becoming E*Trade's 7th CEO since 2007. The group acquired rival trader OptionsHouse in 2016 for $725m to widen its coverage, and that deal, combined with a surge in trading volumes in the wake of Brexit and the Trump election, prompted a sharp increase in performance for the year. In 2018 it acquired custodial service TCA as well as the retail brokerage arm of Capital One. As a result, revenues have soared to record highs of almost $2.9bn in 2018, with net income of $1.05bn. It had around 4.9m brokerage accounts by the end of 2018 and customer assets of over $414bn. However, it would be dwarfed by the merged Schwab/Ameritrade with 24m brokerage accounts and customer assets of $5.1 trillion. Although it operates mainly over the internet, the company also maintains around 30 branch offices in the US.
Capsule checked 2nd December 2019
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Adbrands Daily Update 20th Feb 2020: E*Trade has been rescued from an uncertain future by wealth management and investment banking specialist Morgan Stanley. The latter has agreed to acquire the struggling online broker for $13bn in shares. It is the biggest takeover by any US bank since the 2008 financial crisis. E*Trade will continue to operate under its existing brand within Morgan Stanley's wealth management division, introducing around 5m new retail customers and $360m in assets. It's part of a concerted strategy by Morgan Stanley to widen its coverage to ordinary customers. "We'll take on Schwab. We'll take on Fidelity," said CEO James Gorman. "This isn't about legacy-building; it's about getting [Morgan Stanley] ready for prime time." This new deal follows the acquisition almost exactly a year ago of Solium Capital, which manages employee stock-plans for corporate clients. For E*Trade, the takeover offers an important lifeline. The broker's future had come under serious threat from the expected merger of its two much bigger rivals Schwab and Ameritrade.
Adbrands Social Media 10th Aug 2018: FRIDAY CLASSIC: E*Trade "Babies" by Grey NY (2008). The "E*Trade baby" became one of the iconic marketing campaigns of the late 2000s. First unveiled in January 2008 during the Super Bowl, it carried E*Trade through the global financial crisis that erupted a few months later and then beyond into what would turn out to be a extraordinary seven-year run. Here's the original spot from 2008 - known as 'Whoa!' - and 'Wings', a sequel from the following year, post-credit crunch. ...[Story continues here]..
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