Canadian Halal Investor.

NYSE Shariah screener · October 2026

Is The Charles Schwab Corporation (SCHW) Halal?

FAIL

The Charles Schwab Corporation · NYSE: SCHW · Financials

The short answer

No — The Charles Schwab Corporation (SCHW) fails this Shariah stock screen at two gates. First, the business-activity gate: it is a savings and loan holding company whose core business model earns interest on client cash sweeps, margin loans ($165.1B), bank loans ($67.0B), and securities portfolios — interest revenue of $15,504M is about 65% of total net revenues, far above any 5% tolerance. Second, the income gate: FY2025 interest revenue of $15,504M is 64.81% of total net revenues of $23,921M, far above the 5% ceiling. The debt gate passes: borrowings of $37.1B (short-term $13.9B + FHLB $0.5B + long-term debt $22.7B) are about 21.74% of its ~$170.7B market cap ($98.37, October 1, 2026), below the ~33% ceiling. Zoya, Musaffa, and ShariaPortfolio all independently rate Schwab non-compliant. This is a factual screen, not a religious ruling — consult a qualified scholar for personal rulings.

Gate 1 — Business activity: FAIL

The Charles Schwab Corporation (NYSE: SCHW) is a savings and loan holding company headquartered in Westlake, Texas. Through its subsidiaries it provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors, reporting two segments — Investor Services and Advisor Services. Key subsidiaries: broker-dealer Charles Schwab & Co., Inc. (member SIPC) and Charles Schwab Bank, SSB (member FDIC). Scale at June 30, 2026: 39.8M active brokerage accounts, 5.9M workplace plan participant accounts, 2.4M banking accounts, $13.08T in client assets. The business model earns interest on client cash sweeps, margin loans ($165.1B at June 30, 2026), bank loans ($67.0B), and investment securities. Business-screen implication (factual): the primary business is conventional interest-based financial services — interest revenue of $15,504M is about 65% of total net revenues, far above any 5% tolerance. Gate 1 fails. Facts only.

Gate 2 — Debt and cash: PASS

Per Schwab's official Q2 2026 earnings release (July 21, 2026), quarter-end borrowings were $37.1B — other short-term borrowings $13.9B + Federal Home Loan Bank borrowings $0.5B + long-term debt $22.7B. Against a market cap of about $170.7B (1,735M weighted-average basic shares × $98.37 close, October 1, 2026), debt ÷ market cap is about 21.74% — below the ~33% ceiling. Cash and cash equivalents of $40.6B are about 23.79% of market cap. Client bank deposits ($249.7B) and payables to clients/brokers are operational liabilities, not counted as borrowings in this screen. The debt gate passes. Facts only.

Gate 3 — Non-compliant income: FAIL

Schwab's FY2025 Form 10-K (fiscal year ended December 31, 2025) reports interest revenue of $15,504M (cash and investments segregated $1,862M; receivables from brokerage clients $5,700M; AFS securities $1,538M; HTM securities $2,386M; bank loans $2,168M; securities lending $437M; cash and cash equivalents $1,189M; other $224M) against total net revenues of $23,921M — about 64.81%, far above the 5% non-compliant income ceiling. Net interest revenue alone was $11,750M (49.12% of total net revenues). Q2 2026 confirms the pattern: interest revenue $4,432M of total net revenues $7,072M (62.7%). The income gate fails by a wide margin. Facts only.

Key figures used

Frequently asked questions

What does Charles Schwab do?

The Charles Schwab Corporation (NYSE: SCHW) is a savings and loan holding company headquartered in Westlake, Texas. Through its subsidiaries it provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. It reports two segments — Investor Services and Advisor Services — and its main subsidiaries are broker-dealer Charles Schwab & Co., Inc. (member SIPC) and Charles Schwab Bank, SSB (member FDIC). As of June 30, 2026 it had 39.8 million active brokerage accounts, 5.9 million workplace plan participant accounts, 2.4 million banking accounts, and $13.08 trillion in client assets. Its balance sheet earns interest on client cash sweeps, margin loans ($165.1 billion at June 30, 2026), bank loans ($67.0 billion), and investment securities portfolios.

Why does Schwab fail this Shariah stock screen?

Schwab fails at two gates. First, the business-activity gate: its core business model is interest-based financial services — a savings and loan holding company that earns interest on client cash sweeps, margin loans, bank loans, and securities portfolios — and interest revenue ($15,504M) is about 65% of total net revenues, far above any 5% tolerance for non-compliant activity. Second, the income gate: FY2025 interest revenue of $15,504M is 64.81% of total net revenues of $23,921M, far above the 5% ceiling. The debt gate passes: borrowings of $37.1B are 21.74% of its ~$170.7B market cap, below the ~33% ceiling. This is a factual screen, not a religious ruling — consult a qualified scholar for personal rulings.

What is Schwab's interest-bearing debt ratio?

Per Schwab's official Q2 2026 earnings release (July 21, 2026), quarter-end borrowings were: other short-term borrowings $13.9B + Federal Home Loan Bank borrowings $0.5B + long-term debt $22.7B = $37.1B total. Against a market cap of about $170.7B (1,735M weighted-average basic shares × $98.37 close, October 1, 2026), debt ÷ market cap is about 21.74% — below the ~33% ceiling. Cash and cash equivalents of $40.6B are about 23.79% of market cap. Client bank deposits ($249.7B) and payables to clients/brokers are operational liabilities, not counted as borrowings in this screen. The debt gate passes.

What is Schwab's non-compliant income ratio?

Schwab's FY2025 Form 10-K (fiscal year ended December 31, 2025) reports interest revenue of $15,504M (from cash and investments segregated, margin-loan receivables, AFS/HTM securities, bank loans, and securities lending) against total net revenues of $23,921M — 64.81% of revenue, far above the 5% non-compliant income ceiling. Net interest revenue alone was $11,750M (49.12% of total net revenues). Q2 2026 confirms the pattern: interest revenue $4,432M of total net revenues $7,072M (62.7%). The income gate fails by a wide margin.

Do Zoya, Musaffa, or ShariaPortfolio cover Schwab?

All three cover Schwab and all three rate it non-compliant. Zoya's public SCHW page flags it as not Shariah-compliant (as of September 2026), citing FY2025 interest income of $15,504M — 56.02% of its combined revenue total per Zoya's metric (note: the page's auto-generated FAQ text is partly contradictory, so the headline flag is what is reported). Musaffa covers the company (via its London listing 0L3I.L) and classifies it as not halal as of September 2026. ShariaPortfolio's screener lists SCHW as not Shariah Compliant because of its involvement in Investment Banking & Brokerage Services (NEC). This page applies the screen independently from Schwab's own filings.

Sources

Screened 2026-10-01 from published company figures and market data. Figures change; this page is educational, not financial advice and not a religious ruling.

Screened with our two-gate Shariah screening methodology (business-activity gate, then AAOIFI-style financial ratios).