March 16, 2010 / 9:00 PM / in 8 years

UPDATE 1-TD Ameritrade says Q2 earnings looking like Q1

* Low interest rates and volatility pinching online broker

* Shares drop then quickly recover losses after markets

By Jonathan Spicer

NEW YORK, March 16 (Reuters) - TD Ameritrade Holding Corp AMTD.O said on Tuesday earnings in the current quarter “are shaping up much like” earnings in the previous quarter due to low market volatility and interest rates.

In the first quarter, the company earned $136.2 million.

On average, analysts expected TD Ameritrade to report a 20 percent jump in earnings in the current, second quarter, compared to the first quarter, according to Thomson Reuters I/B/E/S.

“So far this quarter, we have continued to see low intra-day volatility and interest rates that have remained at near-zero levels. Consequently, March quarter earnings are shaping up much like the December quarter,” Bill Gerber, the chief financial officer, said in a statement.

The company added it continues to see organic growth.

TD Ameritrade and other online brokers earn less in interest from assets under management when rates are near-zero. Meanwhile, low volatility signals fewer clients are trading in the markets, which hurts revenues.

The average number of client trades per day rose 13 percent in February from the year ago, to 347,000, but were down 18 percent from January 2010. From March 1, 2010 through March 12, the company averaged 369,000 trades per day.

Total client assets last month were $324.0 billion, up 54 percent from a year ago, and up 3 percent from January.

Shares of the company slid about 0.8 percent after the close of markets, when the statement was made, but rebounded to $18.80, where the stock closed regular trading. (Reporting by Jonathan Spicer; editing by Carol Bishopric)

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