More Choices and Competitive Investment Products with Charles Schwab Agreement

July 25, 2019

USAA has selected the Charles Schwab Corporation to acquire assets of USAA Investment Management Company (IMCO), which includes brokerage and managed portfolio accounts. The transaction is expected to close in 2020.

Schwab puts clients at the heart of everything it does, offering 24/7/365 support from representatives who consistently are recognized for their service. Schwab will provide members with a broad range of products, services and approaches to meet different investors’ needs and financial goals. It also offers some of the lowest costs in the industry and no brokerage account minimums.

USAA members do not need to take any action at this time and can continue to interact with USAA as they do today. USAA will communicate any necessary changes throughout the transition.

“Our mission is to facilitate the financial security of the military community through highly competitive products. This agreement with Schwab can help enhance our members’ financial futures with a client-first approach that offers access to more choices in investment products,” said Stuart Parker, CEO of USAA. “We are committed to making this a seamless transition for members and providing opportunities for employees. USAA remains focused on providing award-winning member service and advice on products and services across P&C, banking and life insurance.” 

About the Agreement

Schwab has entered into a definitive agreement to acquire assets of USAA’s Investment Management Company (IMCO) for $1.8B in cash, which includes brokerage and managed portfolio accounts. Net proceeds from this transaction will be used to further benefit the USAA membership. For example, USAA will invest appropriately to improve the competitiveness of its banking and insurance products, as well as look to distribute an appropriate amount in the annual member distribution process. The companies have also agreed to enter into a long-term referral agreement, effective at closing of the acquisition, that would make Schwab the exclusive wealth management and brokerage provider for USAA members. 

Schwab intends to offer roles to a significant number of USAA employees to continue to serve members.

Walt Bettinger, president and CEO of Schwab, said in a press release, “We are honored to be entrusted with serving the financial needs of USAA’s members.  We have long admired USAA’s mission to enhance the financial security of our country’s military service men and women and their families.  Both of our companies share a commitment to integrity and service, and both have strong track records of achievement for those we serve, which is why we believe this relationship makes so much sense for everyone involved.”

Victory Capital Agreement

Previously, USAA selected Victory Capital to acquire the USAA Asset Management Company (AMCO), which included the USAA Mutual Fund and ETF businesses as well as the USAA 529 College Savings Plan. The transaction recently closed on July 1 and will take approximately 12 to 18 months for the full technology systems conversion and the transition of USAA Mutual Fund accounts to Victory Capital.

For more on the agreements with Schwab and Victory Capital, please visit usaa.com/investmentupdate. 

Investing involves risk, including potential loss of principal.

Use of the term "member" or "membership" refers to membership in USAA Membership Services and does not convey any legal or ownership rights in USAA. Restrictions apply and are subject to change.

USAA Wealth Management is a service of USAA. USAA means United Services Automobile Association and its affiliates. Financial advice provided by USAA Financial Advisors, Inc. (FAI), a registered broker-dealer, USAA Investment Management Company (IMCO), a registered broker-dealer and investment adviser, and for insurance, USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Agency in California, License # OE36312). Investment products and services offered by IMCO and FAI. Life insurance and annuities provided by USAA Life Insurance Co., San Antonio, TX, and in NY by USAA Life Insurance Co of New York, Highland falls, NY. Other life and health insurance from select companies offered through USAA Life General Agency, Inc. (known in CA (license #0782231) and in NY as USAA Health and Life Insurance Agency). Banking products offered by USAA Federal Savings Bank and USAA Savings Bank, both FDIC insured. Trust services provided by USAA Federal Savings Bank

USAA Managed Portfolios – UMP® (UMP) is a managed account program offered by USAA Investment Management Company (IMCO), a registered investment adviser. Brokerage services are provided by IMCO, a registered broker-dealer, Member FINRA, SIPC and brokerage accounts are carried by National Financial Services, LLC, Member NYSE, SIPC. The UMP Brochure, which describes the Program, investment options, risks, and fees and the Brochure Supplement, which identifies supervised personnel responsible for advice, are available by calling 1-800- 531-1345.