Brokers Report First-Quarter Windfall

Providing more evidence of Wall Street’s blockbuster first quarter, Merrill Lynch & Co., the nation’s biggest brokerage, on Tuesday reported its biggest quarterly profit ever.

Discount broker Charles Schwab Corp. said its first-quarter earnings nearly tripled from a year ago. PaineWebber Group Inc. said profit more than doubled to a record quarterly level.

The surge was widely anticipated. Wall Street analysts are expecting a record quarter for total industry profits thanks to a robust stock market and new highs in corporate debt and equity underwriting.

Merrill said it earned $277.5 million, or $2.39 a share, in the January-March period, up 53% from $181 million, or $1.62 a share, a year earlier.

Revenue rose 24% to $2.2 billion from $1.79 billion, helped by an 85% gain in investment banking revenue.

The company said it was the leading underwriter of corporate debt and equity, taxable debt, common stock, initial public offerings and disclosed new issues fees.

The parent of the brokerage PaineWebber Inc. reported its best quarter ever, with profit of $74.3 million, or $1.53 a share, up from $31.6 million, or 68 cents a share, a year earlier.

Revenue rose 39% to $658.7 million from $474.8 million in the first three months of 1991.

Schwab, based in San Francisco, reported net income of $29.7 million, or 75 cents a share, up from $10.6 million, or 27 cents a share, in the 1991 period. Revenue climbed 74% to $219.9 million from $126.1 million.

Schwab attributed the gain to a 62% rise in commission revenue as average daily trading activity rose 47% in the period.