Charel Schwab to acquire Td Ameritrade for $25bn

Charles Schwab is acquiring US online brokerage TD Ameritrade for $25bn, as a brutal price war forces the industry to consolidate.

This acquisition will create a group of $5tn in assets.

Walter Bettinger CEO of Schwab is set to run the combined company and Tim Hockey, TD Ameritrade’s ceo  said he would step down next February.

Both Schwab and TD Ameritrade have slashed trading fees to zero as they face insurgents such as stock-trading app Robinhood that have chipped away at their dominance.

TD Ameritrade’s shares dropped sharply last month  after its latest round of cost-cutting and the race is on to cut fees for trading shares as the industry  grapples with low interest rates which cut the profits brokers make from money sitting in customers’ accounts.

Schwab already the biggest online brokerage with more than 10m active accounts has pushed into asset management and doubled down on offering investment advice as fees from trading shares are disappearing.