(Reuters) - Brokerage Charles Schwab's second-quarter profit fell 2%, hurt by higher interest paid on client deposits and its own borrowings.

WHY IT'S IMPORTANT

With the U.S. Federal Reserve holding onto interest rates, companies such as Charles Schwab ( SCHW ) have been paying higher interests on deposits.

Meanwhile, Charles Schwab ( SCHW ) raked in higher fees, which partially offset the drop in quarterly profit.

BY THE NUMBERS

The Westlake, Texas-based company's total client assets rose 17% to $9.41 trillion in the three months ended June 30, compared with $8.02 trillion a year earlier.

Charles Schwab's ( SCHW ) net interest revenue fell 6% to $2.16 billion.

The company's asset management and administration fees, earned from managing mutual funds and exchange-traded funds, increased 18% to $1.38 billion. Charles Schwab's ( SCHW ) second-quarter net revenue rose 1% to $4.69 billion.

On an adjusted basis, the company posted a quarterly profit of $1.47 billion, or 73 cents per share, compared with $1.49 billion, or 75 cents per share, a year earlier.

MARKET REACTION

Charles Schwab's ( SCHW ) shares were down 6.5% at $70.23 in early trading.