eTrade 2011 Annual Report Download - page 33

In addition to the items noted above, our success in the future will depend upon, among other things:
• continuing our success in the acquisition, growth and retention of trading customers;
• our ability to generate meaningful growth in the long-term investing customer group;
• our ability to assess and manage credit risk;
• our ability to generate capital sufficient to meet our operating needs at both our bank and our parent
company;
• our ability to assess and manage interest rate risk; and
• disciplined expense control and improved operational efficiency.
Management monitors a number of metrics in evaluating the Company’s performance. The most significant
of these are shown in the table and discussed in the text below:
As of or For the
Year Ended December 31, Variance
2011 2010 2009 2011 vs. 2010
Customer Activity Metrics:(1)
DARTs 157,475 150,532 179,183 5%
Average commission per trade $ 11.01 $ 11.21 $ 11.33 (2)%
Margin receivables (dollars in billions) $ 4.8 $ 5.1 $ 3.7 (6)%
End of period brokerage accounts 2,783,012 2,684,311 2,630,079 4%
Net new brokerage accounts 98,701 54,232 114,273 *
Customer assets (dollars in billions) $ 172.4 $ 176.2 $ 150.5 (2)%
Net new brokerage assets (dollars in billions) $ 9.7 $ 8.1 $ 7.2 *
Brokerage related cash (dollars in billions) $ 27.7 $ 24.5 $ 20.4 13%
Company Financial Metrics:
Corporate cash (dollars in millions) $ 484.4 $ 470.5 $ 393.2 3%
E*TRADE Financial Tier I leverage ratio 5.7% 3.6% N/A 2.1%
E*TRADE Financial Tier I common ratio 9.4% 4.8% N/A 4.6%
E*TRADE Bank Tier I capital ratio 7.8% 7.3% 6.7% 0.5%
Special mention loan delinquencies (dollars in
millions) $ 467.1 $ 589.4 $ 804.5 (21)%
Allowance for loan losses (dollars in millions) $ 822.8 $ 1,031.2 $ 1,182.7 (20)%
Enterprise net interest spread 2.79% 2.91% 2.72% (0.12)%
Enterprise interest-earning assets (average dollars
in billions) $ 42.7 $ 41.1 $ 44.5 4%
* Percentage not meaningful.
(1) The year ended December 31, 2009 presented has been updated to exclude international local market trading.
Customer Activity Metrics
• DARTs are the predominant driver of commissions revenue from our customers.
• Average commission per trade is an indicator of changes in our customer mix, product mix and/or
product pricing.
• Margin receivables represent credit extended to customers to finance their purchases of securities by
borrowing against securities they own. Margin receivables are a key driver of net operating interest income.
• End of period brokerage accounts and net new brokerage accounts are indicators of our ability to attract
and retain brokerage customers.
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