Schwab launches index-tracking ETF family

* To let customers trade funds commission-free

* Line-up includes three international funds

* CEO Bettinger calls launch "only the first step"

NEW YORK, Nov 2 (Reuters) - Discount brokerage Charles Schwab Corp (SCHW.O) unveiled a line of eight index- tracking, exchange-traded funds on Monday with managements fees mostly lower than competing ETFs from State Street, Barclays and Vanguard.

Schwab, the nation's largest discount brokerage, also said it would let its own customers trade its new funds commission free.

A new large-cap U.S. equity fund, for example, carries a management fee of just 8 basis points versus fees of 9 to 13 basis points charged on similar ETFs by competitors, the discount brokerage said.

The new fund line-up includes three internationally focused funds and five focused on U.S. stock markets.

Schwab Chief Executive Walter Bettinger said the first set of funds was "only the first step" and promised "additional ETF solutions very soon."

He compared the commission free offering to Schwab's move to start selling mutual funds without a commission about 20 years ago.

Schwab starts out at the back of the pack among ETF managers. Barclays and state street already manage several hundred billion dollars of ETFs.

Schwab said about 20 percent of all ETF trading by small investors already occurs at its brokerage service. (Reporting by Aaron Pressman; editing by Andre Grenon)