Charles Schwab Corp. (NYSE:SCH) became a powerhouse because of its innovation. Then again, the company had a laser focus: providing low-cost, quality services for retail investors.

Well, during the late 1990s, Charles Schwab Corp. veered from its focus, entering a variety of new segments, such as services for the ultrawealthy (with its purchase of U.S. Trust).

Now, it is time to unwind the wayward diversification spree, and the company's namesake, Charles Schwab, is leading the charge. Yesterday, for example, his company announced the sale of Soundview to UBS AG (NYSE:UBS).

The price tag comes to $265 million in cash. In January, Charles Schwab Corp. purchased Soundview for $321 million. That means Charles Schwab Corp. will take a noncash charge for the third quarter of $70 million to $80 million. The company also will take a $75 million to $85 million charge to junk its institutional research segment.

For a good price, UBS can expand its trading capabilities. Actually, trading has emerged as a critical part of many large investment banks, such as Goldman Sachs (NYSE:GS).

Charles Schwab is taking the painful steps of cutting its losses and going back to its retail roots. But the firm has little choice. After all, Charles Schwab has an identity problem; That is, the company is not a full-service firm, like UBS, or a pure discounter like Ameritrade (NASDAQ:AMTD).

Fool contributor Nathan Slaughter predicted Charles Schwab Corp. would make this deal. No doubt the deal indicates that Charles Schwab intends to act with speed -- and is willing to take a loss. In light of this, perhaps Slaughter's other prediction may be soon to follow: the sale of U.S. Trust.

Fool contributor Tom Taulli does not own shares in any of the companies mentioned in this article.