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In August 1996, it went public with Robertson, Stephens & Company as the lead underwriter. In 2003, the company changed its name from E-Trade Group Inc. to E-Trade Financial Corporation.
In 2003, the Toronto-Dominion Bank held talks to merge its TD Waterhouse discount brokerage with E-Trade, but the two sides could not come to an agreement over control of the merged entity. In 2005, E-Trade made an unsolicited offer for Ameritrade, currently the second largest US discount broker. Ameritrade instead purchased TD Waterhouse, with TD Bank holding a 39% stake in the new entity.
In August 2005, E-Trade Financial acquired Harrisdirect, formerly a discount brokerage service of Bank of Montreal. Two months later, E-Trade acquired Brown & Company (aka BrownCo), formerly a discount brokerage service of J.P. Morgan for 1.6 billion in cash.
Although E-Trade's management admits that the deal was costly for E-Trade, it removed the risk from those subprime investments and resulted in an infusion of $2.5 billion in cash.
Prior to the subprime mortgage crisis, E-Trade's stock price had reached a 52-week high of $26.08 and had a book value (assets - liabilities / number of shares outstanding) of $9.68 per share. However, on or about November 12, 2007, Citigroup analyst Prashant Bhatia suggested that E-Trade Financial could face a run on its bank operations and a bankruptcy filing, causing the stock to drop heavily.
After the sell-off and the Citadel deal, E-Trade's book value was $4.53 per share (a 52.2% drop), and the shares had reached a 52-week low of $3.46 per share (a 86.7% drop). Bloomberg News reported that E-Trade had lost between 1-2% of their deposits. Moody's reported that E-Trade saw a "17% drop in customer cash and deposits in the month of November". The company implemented a comprehensive turnaround plan at the end of 2007 which included an assessment of its organizational structure, operating expense base and balance sheet transition, along with a customer win-back campaign.
In March 2008, E-Trade named Donald Layton, formerly JPMorgan Chase vice chairman, as its new CEO. Layton had joined E-Trade's board of directors in November 2007, at the same time as the Citadel deal. Layton has been aggressively acting on the turnaround plan and the company has stabilized and is seeing the beginnings of a return to growth. Robert Druskin, a former chief operating officer of Citigroup Inc. was named interim CEO and chairman when Layton retired at the end of 2009 while E-Trade continued to search for a permanent CEO. On April 1, Steven Freiberg former co-CEO of Citigroup's global consumer group and former head of the bank's credit card unit, took the reins as E-Trade's new CEO while Druskin continues in his role as board chairman.
On the day of Steven Freiberg's CEO appointment, the company announced it will seek the approval of its stockholders for a 1-for-10 reverse stock split and a corresponding decrease to the company’s authorized shares of common stock to a total of 400,000,000 shares at the Company’s 2010 Annual Meeting to be held on May 13, 2010.
In July 2008, E-Trade sold its Canadian division to Scotiabank for CAD$444 million, as part of a program of selling off non-core assets.
Lohan believes that her name invokes familiar "single-name" awareness such as Madonna and Oprah, although a spokesman for Grey Group, the company responsible for designing the ad, stated that the character was named after a member of its E-Trade account team. E-Trade's stock price did not noticeably suffer when news of the lawsuit became public, suggesting that the market currently believes that Lohan's suit will not succeed. In July 2010, E-Trade was granted a change of venue from Nassau County, where Lohan filed the suit, to Manhattan. According to Right Celebrity as of September 22, the lawsuit has come to an undisclosed settlement.
Category:Financial services companies of the United States Category:Dot-com Category:Online brokerages Category:Companies established in 1982 Category:Companies based in Palo Alto, California Category:Companies based in New York
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