CLEVELAND, April 21 /PRNewswire-FirstCall/ --
- Net loss from continuing operations narrows to $.11 per common share
- Net interest margin increases to 3.19%
- Nonperforming loans decrease by $122 million from fourth quarter of 2009 to 3.69% of portfolio loans
- Net charge-offs decline $186 million from fourth quarter of 2009
- Loan loss reserve at $2.4 billion, or 4.34% of total loans
- Capital and liquidity positions remain strong
- Tier 1 common equity and Tier 1 risk-based capital ratios of 7.53% and 12.96%, respectively
- $5.3 billion in new or renewed lending commitments originated
KeyCorp (NYSE: KEY) today announced a first quarter net loss from continuing operations attributable to Key common shareholders of $98 million, or $.11 per common share. These results compare to a net loss from continuing operations attributable to Key common shareholders of $507 million, or $1.03 per common share, for the first quarter of 2009. The first quarter of 2009 was negatively impacted by an $847 million loan loss provision and a $196 million ($164 million after tax) intangible assets impairment charge.
A lower provision for loan losses and continued expense control resulted in a narrowing of Key’s first-quarter loss when compared to the fourth quarter of 2009. Net charge-offs declined by $186 million, and nonperforming loans showed continued improvement decreasing by $122 million from December 31, 2009. Key also experienced reduced expenses due to lower personnel expense and efficiency initiative efforts as well as a decrease in the provision for losses on lending-related commitments.
“These results are encouraging and reflect our persistent focus over recent quarters to ensure that Key emerges strong and ready to grow as the economic recovery continues to take hold,” said Chief Executive Officer Henry L. Meyer III. “Particularly notable in the results is the improvement in net interest margin, a decrease in nonperforming loans for the second quarter in a row, and good expense control.”
Meyer continued: “We are positioning Key for an improving economy. We have reduced our risk, continue to emphasize our core relationship businesses, and our balance sheet reflects strong capital, liquidity and loan loss reserve levels.”
At March 31, 2010, Key’s estimated Tier 1 common equity and Tier 1 risk-based capital ratios were 7.53% and 12.96%, respectively.
The Company originated approximately $5.3 billion in new or renewed lending commitments to consumers and businesses during the quarter.
Key continues to invest in its relationship businesses, including its 14-state branch network. Meyer noted that Key opened eight new branches in the first quarter, expects to open an additional 32 new branches during the remainder of 2010, and continues to modernize its existing branches. The new and modernized branches underscore Key’s relationship strategy by leveraging its branch network to offer the full breadth of solutions, expertise, services and products that Key has to offer. Additionally, Key received recognition from Corporate Insight’s 2009 Bank Monitor which highlights firms that excel in key areas of the online banking experience. Key had previously been named a Customer Service Champion by BusinessWeek in its March 2009 edition. The Company is positioning its branch and online capabilities to enhance growth as the economy turns.
During the quarter, Christopher M. Gorman was promoted to senior executive vice president and head of Key’s National Banking business. He also became vice chairman of KeyBank National Association. Mr. Gorman has been with Key for the past 19 years and was most recently president of KeyBanc Capital Markets. In his new role, Gorman is responsible for Key's corporate, investment banking, capital markets, commercial real estate and equipment finance businesses.
The following table shows Key’s continuing and discontinued operating results for the three-month periods ended March 31, 2010, December 31, 2009, and March 31, 2009.
Results of Operations |
||||||||
Three months ended |
||||||||
in millions, except per share amounts |
3-31-10 |
12-31-09 |
3-31-09 |
|||||
Summary of operations |
||||||||
Income (loss) from continuing operations attributable to Key |
$ (57) |
$ (217) |
$ (459) |
|||||
Income (loss) from discontinued operations, net of taxes (a) |
2 |
(7) |
(29) |
|||||
Net income (loss) attributable to Key |
$ (55) |
$ (224) |
$ (488) |
|||||
Income (loss) from continuing operations attributable to Key |
$ (57) |
$ (217) |
$ (459) |
|||||
Less: |
Dividends on Series A Preferred Stock |
6 |
5 |
12 |
||||
Cash dividends on Series B Preferred Stock |
31 |
31 |
32 |
|||||
Amortization of discount on Series B Preferred Stock |
4 |
5 |
4 |
|||||
Income (loss) from continuing operations attributable to Key common shareholders |
(98) |
(258) |
(507) |
|||||
Income (loss) from discontinued operations, net of taxes (a) |
2 |
(7) |
(29) |
|||||
Net income (loss) attributable to Key common shareholders |
$ (96) |
$ (265) |
$ (536) |
|||||
Per common share — assuming dilution |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ (.11) |
$ (.30) |
$ (1.03) |
|||||
Income (loss) from discontinued operations, net of taxes (a) |
-- |
(.01) |
(.06) |
|||||
Net income (loss) attributable to Key common shareholders (b) |
$ (.11) |
$ (.30) |
$ (1.09) |
|||||
(a) In September 2009, management made the decision to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank National Association. In April 2009, management made the decision to curtail the operations of Austin Capital Management, Ltd., an investment subsidiary that specializes in managing hedge fund investments for its institutional customer base. As a result of these decisions, Key has accounted for these businesses as discontinued operations. Included in the loss from discontinued operations for the three-month period ended March 31, 2009, is a $23 million after tax, or $.05 per common share, charge for intangible assets impairment related to Austin Capital Management. |
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(b) Earnings per share may not foot due to rounding. |
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As shown in the following table, the comparability of Key’s earnings for the current, prior and year-ago quarters is affected by several significant items.
Significant Items Affecting the Comparability of Earnings |
|||||||||||||||||||
First Quarter 2010 |
Fourth Quarter 2009 |
First Quarter 2009 |
|||||||||||||||||
in millions, except per share amounts |
Pre-tax Amount |
After-tax Amount |
Impact on EPS |
Pre-tax Amount |
After-tax Amount |
Impact on EPS |
Pre-tax Amount |
After-tax Amount |
Impact on EPS |
||||||||||
Provision for loan losses less (in excess of) net charge-offs |
$ 109 |
$ 68 |
$.08 |
$ (48) |
$ (31) |
$ (.04) |
$ (387) |
$ (242) |
$ (.49) |
||||||||||
Net gains (losses) from principal investing (a) |
21 |
13 |
.02 |
44 |
28 |
.03 |
(63) |
(39) |
(.08) |
||||||||||
Realized and unrealized gains (losses) on loan and securities portfolios held for sale or trading |
(11) |
(7) |
(.01) |
(92) |
(58) |
(.07) |
-- |
-- |
-- |
||||||||||
Credits related to IRS audits and leveraged lease tax litigation |
-- |
-- |
-- |
-- |
106 |
.12 |
-- |
-- |
-- |
||||||||||
(Provision) credit for losses on lending-related commitments |
2 |
1 |
-- |
(27) |
(17) |
(.02) |
-- |
-- |
-- |
||||||||||
Noncash charge for intangible assets impairment |
-- |
-- |
-- |
-- |
-- |
-- |
(196) |
(b) |
(164) |
(b) |
(.33) |
(b) |
|||||||
Gain from sale/redemption of Visa Inc. shares |
-- |
-- |
-- |
-- |
-- |
-- |
105 |
65 |
.13 |
||||||||||
(a) Excludes principal investing results attributable to noncontrolling interests. |
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(b) Excludes a $27 million ($23 million after tax, or $.05 per common share) charge for intangible assets impairment related to the discontinued operations of Austin Capital Management, Ltd. |
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EPS = Earnings per common share |
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SUMMARY OF CONTINUING OPERATIONS
Taxable-equivalent net interest income was $632 million for the first quarter of 2010, and the net interest margin was 3.19%. These results compare to taxable-equivalent net interest income of $595 million and a net interest margin of 2.79% for the first quarter of 2009. The improvement in the net interest margin is primarily attributable to lower funding costs and improved yields on loans. During the past year the Company has experienced an improvement in the mix of deposits, resulting in a lower level of higher costing certificates of deposit and an increase in lower costing transaction accounts. The Company expects this change in funding mix to continue as higher costing certificates of deposit mature and are repriced to current market rates. This repricing and changing the mix of deposits should continue to benefit the Company’s net interest margin for the remaining quarters of 2010. Funding costs were also reduced by maturities of long-term debt and the 2009 exchanges of retail trust preferred securities for Key common shares.
Compared to the fourth quarter of 2009, taxable-equivalent net interest income decreased by $5 million, and the net interest margin rose by 15 basis points. The increase in the net interest margin resulting from the improved funding mix was mostly offset by the lower day count and reduced average earning assets in the first quarter of 2010 compared to the fourth quarter of 2009.
Key’s noninterest income was $450 million for the first quarter of 2010, compared to $478 million for the year-ago quarter. The decrease reflects a $105 million gain from the sale of Visa Inc. shares during the first quarter of 2009. In addition, operating lease income and gains on leased equipment decreased by $14 million and $18 million, respectively, compared to the first quarter of 2009 due to a lower level of leasing activity. Net gains of $37 million in the first quarter of 2010 from principal investing (including results attributable to noncontrolling interests), compared to net losses of $72 million for the same period last year, partially offset this decline in noninterest income.
The major components of Key’s fee-based income for the past five quarters are shown in the following table.
Fee-based Income – Major Components |
||||||||||
in millions |
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
|||||
Trust and investment services income |
$114 |
$117 |
$113 |
$119 |
$110 |
|||||
Service charges on deposit accounts |
76 |
82 |
83 |
83 |
82 |
|||||
Operating lease income |
47 |
52 |
55 |
59 |
61 |
|||||
Letter of credit and loan fees |
40 |
52 |
46 |
44 |
38 |
|||||
Corporate-owned life insurance income |
28 |
36 |
26 |
25 |
27 |
|||||
Electronic banking fees |
27 |
27 |
27 |
27 |
24 |
|||||
Insurance income |
18 |
16 |
18 |
16 |
18 |
|||||
Net gains (losses) from principal investing |
37 |
80 |
(6) |
(6) |
(72) |
|||||
Investment banking and capital markets income (loss) |
9 |
(47) |
(26) |
14 |
17 |
|||||
Compared to the fourth quarter of 2009, noninterest income decreased by $19 million. This lower noninterest income resulted from a decrease of $43 million in principal investing results (including results attributable to noncontrolling interests), a $12 million decrease in letter of credit and loan fees, an $8 million decrease in income from corporate owned life insurance as well as decreases in various other miscellaneous income components. The negative effect of these factors was partially offset by a $56 million increase in results from investment banking and capital markets activities that was primarily attributable to changes in the fair values of certain commercial real estate related investments in the fourth quarter of 2009.
Key’s noninterest expense was $785 million for the first quarter of 2010, compared to $927 million for the same period last year. Noninterest expense for the first quarter of 2009 was adversely affected by an intangible assets impairment charge of $196 million. Excluding this charge, noninterest expense for the current quarter was up $54 million, or 7%, from the year-ago quarter. Personnel expense increased by $3 million while nonpersonnel expense rose by $51 million, reflecting increases of $26 million in costs associated with OREO, including write-downs and losses on sales, and various other expense categories.
Compared to the fourth quarter of 2009, noninterest expense decreased by $86 million. Personnel expense decreased by $38 million, due largely to lower incentive compensation. Nonpersonnel expense decreased by $48 million, reflecting a decrease in the provision for losses on lending-related commitments of $29 million, a $25 million reduction in professional fees and a decrease in operating lease expense of $11 million. These items were partially offset by a $22 million increase in various other expense categories.
ASSET QUALITY
Key’s provision for loan losses was $413 million for the first quarter of 2010, compared to $847 million for the year-ago quarter and $756 million for the fourth quarter of 2009. Key’s allowance for loan losses was $2.4 billion, or 4.34% of total loans, at March 31, 2010, compared to 4.31% at December 31, 2009, and 2.88% at March 31, 2009.
Selected asset quality statistics for Key for each of the past five quarters are presented in the following table.
Selected Asset Quality Statistics from Continuing Operations |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Net loan charge-offs |
$522 |
$708 |
$587 |
$502 |
$460 |
||||||
Net loan charge-offs to average loans |
3.67 |
% |
4.64 |
% |
3.59 |
% |
2.93 |
% |
2.60 |
% |
|
Allowance for loan losses |
$2,425 |
$2,534 |
$2,485 |
$2,339 |
$2,016 |
||||||
Allowance for credit losses (a) |
2,544 |
2,655 |
2,579 |
2,404 |
2,070 |
||||||
Allowance for loan losses to period-end loans |
4.34 |
% |
4.31 |
% |
4.00 |
% |
3.48 |
% |
2.88 |
% |
|
Allowance for credit losses to period-end loans |
4.55 |
4.52 |
4.15 |
3.58 |
2.96 |
||||||
Allowance for loan losses to nonperforming loans |
117.43 |
115.87 |
108.52 |
107.05 |
116.20 |
||||||
Allowance for credit losses to nonperforming loans |
123.20 |
121.40 |
112.62 |
110.02 |
119.31 |
||||||
Nonperforming loans at period end |
$2,065 |
$2,187 |
$2,290 |
$2,185 |
$1,735 |
||||||
Nonperforming assets at period end |
2,428 |
2,510 |
2,799 |
2,548 |
1,994 |
||||||
Nonperforming loans to period-end portfolio loans |
3.69 |
% |
3.72 |
% |
3.68 |
% |
3.25 |
% |
2.48 |
% |
|
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
4.31 |
4.25 |
4.46 |
3.77 |
2.84 |
||||||
(a) Includes the allowance for loan losses plus the liability for credit losses on lending-related commitments. |
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Net loan charge-offs for the quarter totaled $522 million, or 3.67% of average loans. These results compare to $460 million, or 2.60%, for the same period last year and $708 million, or 4.64%, for the previous quarter.
Key’s net loan charge-offs by loan type for each of the past five quarters are shown in the following table.
Net Loan Charge-offs from Continuing Operations |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Commercial, financial and agricultural |
$126 |
$218 |
$168 |
$168 |
$232 |
||||||
Real estate - commercial mortgage |
106 |
165 |
81 |
87 |
21 |
||||||
Real estate - construction |
157 |
181 |
216 |
133 |
104 |
||||||
Commercial lease financing |
21 |
39 |
27 |
22 |
18 |
||||||
Total commercial loans |
410 |
603 |
492 |
410 |
375 |
||||||
Home equity - Community Banking |
30 |
27 |
25 |
24 |
17 |
||||||
Home equity - Other |
17 |
19 |
20 |
18 |
15 |
||||||
Marine |
38 |
33 |
25 |
29 |
32 |
||||||
Other |
27 |
26 |
25 |
21 |
21 |
||||||
Total consumer loans |
112 |
105 |
95 |
92 |
85 |
||||||
Total net loan charge-offs |
$522 |
$708 |
$587 |
$502 |
$460 |
||||||
Net loan charge-offs to average loans from continuing operations |
3.67 |
% |
4.64 |
% |
3.59 |
% |
2.93 |
% |
2.6 |
% |
|
Net loan charge-offs from discontinued operations - education lending business |
$36 |
$36 |
$38 |
$37 |
$32 |
||||||
Compared to the fourth quarter of 2009, net loan charge-offs in the commercial loan portfolio decreased by $193 million. The decrease was attributable to declines in both the commercial, financial and agricultural and real estate commercial mortgage and construction lines of business. The level of net charge-offs in the consumer portfolio rose by $7 million. As shown in the table on page 6, Key’s exit loan portfolio accounted for $153 million, or 29%, of Key’s total net loan charge-offs for the first quarter of 2010. Net charge-offs in the exit portfolio increased by $12 million from the fourth quarter of 2009. Management expects net charge-offs to remain elevated in 2010, but to continue to improve from the first quarter level in future quarters.
At March 31, 2010, Key’s nonperforming loans totaled $2.1 billion and represented 3.69% of period-end portfolio loans, compared to 3.72% at December 31, 2009, and 2.48% at March 31, 2009. Nonperforming assets at March 31, 2010, totaled $2.4 billion and represented 4.31% of portfolio loans, OREO and other nonperforming assets, compared to 4.25% at December 31, 2009, and 2.84% at March 31, 2009. The following table illustrates the trend in Key’s nonperforming assets by loan type over the past five quarters.
Nonperforming Assets from Continuing Operations |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Commercial, financial and agricultural |
$558 |
$586 |
$679 |
$700 |
$595 |
||||||
Real estate - commercial mortgage |
579 |
614 |
566 |
454 |
310 |
||||||
Real estate - construction |
607 |
641 |
702 |
716 |
546 |
||||||
Commercial lease financing |
99 |
113 |
131 |
122 |
109 |
||||||
Total consumer loans |
222 |
233 |
212 |
193 |
175 |
||||||
Total nonperforming loans |
2,065 |
2,187 |
2,290 |
2,185 |
1,735 |
||||||
Nonperforming loans held for sale |
195 |
116 |
304 |
145 |
72 |
||||||
OREO and other nonperforming assets |
168 |
207 |
205 |
218 |
187 |
||||||
Total nonperforming assets |
$2,428 |
$2,510 |
$2,799 |
$2,548 |
$1,994 |
||||||
Restructured loans included in nonperforming loans (a) |
$226 |
$364 |
$65 |
$7 |
-- |
||||||
Nonperforming assets from discontinued operations - education lending business |
43 |
14 |
12 |
3 |
3 |
||||||
Nonperforming loans to period-end portfolio loans |
3.69 |
% |
3.72 |
% |
3.68 |
% |
3.25 |
% |
2.48 |
% |
|
Nonperforming assets to period-end portfolio loans, plus OREO and other nonperforming assets |
4.31 |
4.25 |
4.46 |
3.77 |
2.84 |
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(a) Restructured loans (i.e. troubled debt restructurings) are those for which Key, for reasons related to a borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. These concessions are made to improve the collectability of the loan and generally take the form of a reduction of the interest rate, extension of the maturity date or reduction in the principal balance. |
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Nonperforming assets decreased during the first quarter of 2010 which represents the second quarterly decline. Most of the reduction came from nonperforming loans and OREO in the commercial real estate line of business. These reductions were offset in part by an increase in nonperforming loans held for sale. As shown in the following table, Key’s exit loan portfolio accounted for $499 million, or 21%, of Key’s total nonperforming assets at March 31, 2010, compared to $599 million, or 24%, at December 31, 2009.
The composition of Key’s exit loan portfolio at March 31, 2010, and December 31, 2009, the net charge-offs recorded on this portfolio for the first quarter of 2010 and the fourth quarter of 2009, and the nonperforming status of these loans at March 31, 2010, and December 31, 2009, are shown in the following table.
Exit Loan Portfolio from Continuing Operations |
||||||||||||||
Balance on |
||||||||||||||
Balance |
Change |
Net Loan |
Nonperforming |
|||||||||||
Outstanding |
3-31-10 vs. |
Charge-offs |
Status |
|||||||||||
in millions |
3-31-10 |
12-31-09 |
12-31-09 |
1Q10 |
4Q09 |
3-31-10 |
12-31-09 |
|||||||
Residential properties -- homebuilder |
$269 |
$379 |
$(110) |
$44 |
$53 |
$167 |
$211 |
|||||||
Residential properties -- held for sale |
40 |
52 |
(12) |
-- |
-- |
40 |
52 |
|||||||
Total residential properties |
309 |
431 |
(122) |
44 |
53 |
207 |
263 |
|||||||
Marine and RV floor plan |
339 |
427 |
(88) |
28 |
16 |
66 |
93 |
|||||||
Commercial lease financing (a) |
2,685 |
2,875 |
(190) |
22 |
17 |
191 |
195 |
|||||||
Total commercial loans |
3,333 |
3,733 |
(400) |
94 |
86 |
464 |
551 |
|||||||
Home equity -- Other |
795 |
838 |
(43) |
17 |
19 |
18 |
20 |
|||||||
Marine |
2,636 |
2,787 |
(151) |
38 |
33 |
16 |
26 |
|||||||
RV and other consumer |
201 |
216 |
(15) |
4 |
3 |
1 |
2 |
|||||||
Total consumer loans |
3,632 |
3,841 |
(209) |
59 |
55 |
35 |
48 |
|||||||
Total exit loans in loan portfolio |
$6,965 |
$7,574 |
$(609) |
$153 |
$141 |
$499 |
$599 |
|||||||
Discontinued operations -- education lending business |
$6,268 |
(b) |
$3,957 |
$2,311 |
$36 |
$36 |
$42 |
$13 |
||||||
(a) Includes the business aviation, commercial vehicle, office products, construction and industrial leases, and Canadian lease financing portfolios; and all remaining balances related to lease in, lease out; sale in, sale out; service contract leases and qualified technological equipment leases. |
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(b) Includes loans in Key’s education loan securitization trusts consolidated upon the adoption of new consolidation accounting guidance on January 1, 2010. |
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CAPITAL
Key’s risk-based capital ratios included in the following table continued to exceed all “well-capitalized” regulatory benchmarks at March 31, 2010.
Capital Ratios |
|||||||||||
3-31-10 |
12-31-09 |
9-30-09 |
6-30-09 |
3-31-09 |
|||||||
Tier 1 common equity (a) |
7.53 |
% |
7.50 |
% |
7.64 |
% |
7.36 |
% |
5.62 |
% |
|
Tier 1 risk-based capital (a) |
12.96 |
12.75 |
12.61 |
12.57 |
11.22 |
||||||
Total risk-based capital (a) |
17.11 |
16.95 |
16.65 |
16.67 |
15.18 |
||||||
Tangible common equity to tangible assets |
7.37 |
7.56 |
7.58 |
7.35 |
6.06 |
||||||
(a) March 31, 2010 ratio is estimated. |
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As shown in the preceding table, at March 31, 2010, Key had a Tier 1 common equity ratio of 7.53%, a Tier 1 risk-based capital ratio of 12.96%, and a tangible common equity ratio of 7.37%.
Transactions that caused the change in Key’s outstanding common shares over the past five quarters are summarized in the following table.
Summary of Changes in Common Shares Outstanding |
||||||||||
in thousands |
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
|||||
Shares outstanding at beginning of period |
878,535 |
878,559 |
797,246 |
498,573 |
495,002 |
|||||
Common shares exchanged for capital securities |
-- |
-- |
81,278 |
46,338 |
-- |
|||||
Common shares exchanged for Series A Preferred Stock |
-- |
-- |
-- |
46,602 |
-- |
|||||
Common shares issued |
-- |
-- |
-- |
205,439 |
-- |
|||||
Shares reissued (returned) under employee benefit plans |
517 |
(24) |
35 |
294 |
3,571 |
|||||
Shares outstanding at end of period |
879,052 |
878,535 |
878,559 |
797,246 |
498,573 |
|||||
During the first quarter of 2010, Key made a $31 million cash dividend payment to the U.S. Treasury Department. During 2009, Key made four quarterly dividend payments aggregating $125 million to the U.S. Treasury Department as a participant in the U.S. Treasury’s Capital Purchase Program.
LINE OF BUSINESS RESULTS
The following table shows the contribution made by each major business group to Key’s taxable-equivalent revenue from continuing operations and income (loss) from continuing operations attributable to Key for the periods presented. The specific lines of business that comprise each of the major business groups are described under the heading “Line of Business Descriptions.” During the first quarter of 2010, Key re-aligned its reporting structure for its business groups. Previously, Consumer Finance consisted mainly of portfolios which were identified as exit or run-off portfolios and were included in Key’s National Banking segment. Effective for all periods presented, Key is reflecting the results of these exit portfolios in Other Segments. The automobile dealer floor plan business, previously included in Consumer Finance, has been re-aligned with the Commercial Banking line of business within the Community Banking segment. In addition, other previously identified exit portfolios included in the National Banking segment, including $309 million of homebuilder loans from the Real Estate Capital line of business and $2.685 billion of commercial leases from the Equipment Finance line of business, have been moved to Other Segments. For more detailed financial information pertaining to each business group and its respective lines of business, see the tables at the end of this release.
Major Business Groups |
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Percent change 1Q10 vs. |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
1Q09 |
4Q09 |
1Q09 |
||||||
Revenue from continuing operations (TE) |
|||||||||||
Community Banking |
$599 |
$629 |
$612 |
(4.8) |
% |
(2.1) |
% |
||||
National Banking (a) |
376 |
342 |
423 |
9.9 |
(11.1) |
||||||
Other Segments |
96 |
128 |
(39) |
(25.0) |
N/M |
||||||
Total Segments |
1,071 |
1,099 |
996 |
(2.5) |
7.5 |
||||||
Reconciling Items (b) |
11 |
7 |
77 |
57.1 |
(85.7) |
||||||
Total |
$1,082 |
$1,106 |
$1,073 |
(2.2) |
% |
.8 |
% |
||||
Income (loss) from continuing operations attributable to Key |
|||||||||||
Community Banking |
$5 |
$(41) |
$12 |
N/M |
(58.3) |
% |
|||||
National Banking (a) |
(33) |
(211) |
(394) |
84.4 |
% |
91.6 |
|||||
Other Segments |
(46) |
(58) |
(162) |
20.7 |
71.6 |
||||||
Total Segments |
(74) |
(310) |
(544) |
76.1 |
86.4 |
||||||
Reconciling Items (b) |
17 |
93 |
85 |
(81.7) |
(80.0) |
||||||
Total |
$(57) |
$(217) |
$(459) |
73.7 |
% |
87.6 |
% |
||||
(a) National Banking’s results for the first quarter of 2009 include a noncash charge for intangible assets impairment of $196 million ($164 million after tax). |
|||||||||||
(b) Reconciling Items for the first quarter of 2009 included a $105 million ($65 million after tax) gain from the sale of Key’s remaining equity interest in Visa Inc. |
|||||||||||
TE = Taxable Equivalent, N/M = Not Meaningful |
|||||||||||
Community Banking |
|||||||||||
Percent change 1Q10 vs. |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
1Q09 |
4Q09 |
1Q09 |
||||||
Summary of operations |
|||||||||||
Net interest income (TE) |
$412 |
$431 |
$423 |
(4.4) |
% |
(2.6) |
% |
||||
Noninterest income |
187 |
198 |
189 |
(5.6) |
(1.1) |
||||||
Total revenue (TE) |
599 |
629 |
612 |
(4.8) |
(2.1) |
||||||
Provision for loan losses |
142 |
230 |
141 |
(38.3) |
.7 |
||||||
Noninterest expense |
468 |
492 |
468 |
(4.9) |
-- |
||||||
Income (loss) before income taxes (TE) |
(11) |
(93) |
3 |
88.2 |
N/M |
||||||
Allocated income taxes and TE adjustments |
(16) |
(52) |
(9) |
69.2 |
% |
(77.8) |
|||||
Net income (loss) attributable to Key |
$5 |
$(41) |
$12 |
N/M |
(58.3) |
% |
|||||
Average balances |
|||||||||||
Loans and leases |
$27,769 |
$28,321 |
$31,275 |
(1.9) |
% |
(11.2) |
% |
||||
Total assets |
30,873 |
31,048 |
34,171 |
(.6) |
(9.7) |
||||||
Deposits |
51,459 |
52,640 |
51,655 |
(2.2) |
(.4) |
||||||
Assets under management at period end |
$18,248 |
$17,709 |
$14,205 |
3.0 |
% |
28.5 |
% |
||||
TE = Taxable Equivalent, N/M = Not Meaningful |
|||||||||||
Additional Community Banking Data |
Percent change 1Q10 vs. |
||||||||||
dollars in millions |
1Q10 |
4Q09 |
1Q09 |
4Q09 |
1Q09 |
||||||
Average deposits outstanding |
|||||||||||
NOW and money market deposit accounts |
$18,650 |
$17,930 |
$17,376 |
4.0 |
% |
7.3 |
% |
||||
Savings deposits |
1,814 |
1,785 |
1,721 |
1.6 |
5.4 |
||||||
Certificates of deposit ($100,000 or more) |
7,363 |
8,165 |
8,491 |
(9.8) |
(13.3) |
||||||
Other time deposits |
12,559 |
13,708 |
14,723 |
(8.4) |
(14.7) |
||||||
Deposits in foreign office |
502 |
529 |
714 |
(5.1) |
(29.7) |
||||||
Noninterest-bearing deposits |
10,571 |
10,523 |
8,630 |
.5 |
22.5 |
||||||
Total deposits |
$51,459 |
$52,640 |
$51,655 |
(2.2) |
% |
(.4) |
% |
||||
Home equity loans |
|||||||||||
Average balance |
$9,967 |
$10,101 |
$10,277 |
||||||||
Weighted-average loan-to-value ratio (at date of origination) |
70 |
% |
70 |
% |
70 |
% |
|||||
Percent first lien positions |
53 |
53 |
53 |
||||||||
Other data |
|||||||||||
Branches |
1,014 |
1,007 |
989 |
||||||||
Automated teller machines |
1,501 |
1,495 |
1,479 |
||||||||
Community Banking Summary of Operations
Community Banking recorded net income attributable to Key of $5 million for the first quarter of 2010, compared to net income attributable to Key of $12 million for the year-ago quarter. Decreases in net interest income and noninterest income caused the decline.
Taxable-equivalent net interest income declined by $11 million, or 3%, from the first quarter of 2009, due to a reduction in average earning assets which declined by $4 billion or 11%, from the year-ago quarter. Average deposits declined slightly from the first quarter of 2009. The mix of deposits has changed reflecting strong growth in noninterest-bearing deposits and negotiable order of withdrawal (“NOW”) accounts, as higher-costing certificates of deposit originated in prior years mature and reprice to current market rates.
Noninterest income decreased by $2 million, or 1%, from the year-ago quarter, due to lower service charges on deposits and an increase in the reserve for credit losses from client derivatives. These factors were partially offset by higher income from trust and investment services, letter of credit fees and electronic banking fees. Assets under management have increased 29% from the same period one year ago.
The provision for loan losses increased slightly compared to the first quarter of 2009. Community Banking’s provision for loan losses for the first quarter of 2010 exceeded its net loan charge-offs by $26 million as consumer and business clients continue to experience lingering effects from the economic downturn and elevated unemployment levels.
Noninterest expense remained flat from the year-ago quarter. Lower personnel costs, marketing, office supplies and printing, and a reduction in the provision for losses on lending-related commitments were offset by increases in FDIC deposit insurance, occupancy cost, and various other expense categories.
National Banking |
|||||||||||
Percent change 1Q10 vs. |
|||||||||||
dollars in millions |
1Q10 |
4Q09 |
1Q09 |
4Q09 |
1Q09 |
||||||
Summary of operations |
|||||||||||
Net interest income (TE) |
$197 |
$210 |
$224 |
(6.2) |
% |
(12.1) |
% |
||||
Noninterest income |
179 |
132 |
199 |
35.6 |
(10.1) |
||||||
Total revenue (TE) |
376 |
342 |
423 |
9.9 |
(11.1) |
||||||
Provision for loan losses |
161 |
382 |
511 |
(57.9) |
(68.5) |
||||||
Noninterest expense (a) |
270 |
299 |
428 |
(9.7) |
(36.9) |
||||||
Income (loss) before income taxes (TE) |
(55) |
(339) |
(516) |
83.8 |
89.3 |
||||||
Allocated income taxes and TE adjustments |
(22) |
(128) |
(121) |
82.8 |
81.8 |
||||||
Net income (loss) |
(33) |
(211) |
(395) |
84.4 |
91.6 |
||||||
Less: Net income (loss) attributable to noncontrolling interests |
-- |
-- |
(1) |
-- |
N/M |
||||||
Net income (loss) attributable to Key |
$(33) |
$(211) |
$(394) |
84.4 |
% |
91.6 |
% |
||||
Average balances |
|||||||||||
Loans and leases |
$22,440 |
$24,011 |
$29,697 |
(6.5) |
% |
(24.4) |
% |
||||
Loans held for sale |
240 |
431 |
482 |
(44.3) |
(50.2) |
||||||
Total assets |
26,269 |
28,253 |
37,208 |
(7.0) |
(29.4) |
||||||
Deposits |
12,398 |
13,241 |
11,945 |
(6.4) |
3.8 |
||||||
Assets under management at period end |
$47,938 |
$49,230 |
$45,959 |
(2.6) |
% |
4.3 |
% |
||||
(a) National Banking’s results for the first quarter of 2009 include a noncash charge for intangible assets impairment of $196 million ($164 million after tax). |
|||||||||||
TE = Taxable Equivalent, N/M = Not Meaningful |
|||||||||||
National Banking Summary of Operations
National Banking recorded a net loss attributable to Key of $33 million for the first quarter of 2010, compared to a $394 million net loss attributable to Key for the same period one year ago. During the first quarter of 2009, results were adversely affected by an intangible assets impairment charge of $196 million ($164 million after tax). Also contributing to the improvement in the first quarter of 2010 was a substantial decrease in the provision for loan losses, partially offset by lower net interest income and noninterest income.
Taxable-equivalent net interest income decreased by $27 million, or 12%, from the first quarter of 2009, primarily due to lower earning assets, partially offset by improved earning asset spreads. Average earning assets decreased by $8 billion, or 24%, from the year-ago quarter, reflecting reductions in the commercial and held-for-sale portfolios.
Noninterest income declined by $20 million, or 10%, from the first quarter of 2009. Dealer trading and derivatives income decreased $26 million, primarily due to an increase in the reserve for credit losses from client derivatives of $21 million. Operating lease revenue was also $8 million lower than the first quarter of 2009.
The provision for loan losses in the first quarter of 2010 was $161 million compared to $511 million for the same period one year ago. For the second quarter in a row, National Banking experienced an improvement in nonperforming assets.
Excluding the intangible assets impairment charge in the first quarter of 2009, noninterest expense increased by $38 million, or 16%, from the first quarter of 2009, caused primarily by higher costs associated with OREO.
Other Segments
Other Segments consist of Corporate Treasury, Key’s Principal Investing unit and various exit portfolios which were previously included within the National Banking segment. These exit portfolios were moved to Other Segments during the first quarter of 2010. Prior periods have been adjusted to conform with the current reporting of the financial information for each segment. Other Segments generated a net loss attributable to Key of $46 million for the first quarter of 2010, compared to a net loss attributable to Key of $162 million for the same period last year. These results reflect net gains from principal investing attributable to Key of $21 million during the current quarter, compared to net losses of $63 million in the year-ago quarter as well as a reduction in the loan loss provision for the exit portfolios.
Line of Business Descriptions
Community Banking
Regional Banking provides individuals with branch-based deposit and investment products, personal finance services and loans, including residential mortgages, home equity and various types of installment loans. This line of business also provides small businesses with deposit, investment and credit products, and business advisory services.
Regional Banking also offers financial, estate and retirement planning, and asset management services to assist high-net-worth clients with their banking, trust, portfolio management, insurance, charitable giving and related needs.
Commercial Banking provides midsize businesses with products and services that include commercial lending, cash management, equipment leasing, investment and employee benefit programs, succession planning, access to capital markets, derivatives and foreign exchange.
National Banking
Real Estate Capital and Corporate Banking Services consists of two business units, Real Estate Capital and Corporate Banking Services.
Real Estate Capital is a national business that provides construction and interim lending, permanent debt placements and servicing, equity and investment banking, and other commercial banking products and services to developers, brokers and owner-investors. This unit deals primarily with nonowner-occupied properties (i.e., generally properties in which at least 50% of the debt service is provided by rental income from nonaffiliated third parties). Real Estate Capital emphasizes providing clients with finance solutions through access to the capital markets.
Corporate Banking Services provides cash management, interest rate derivatives, and foreign exchange products and services to clients served by both the Community Banking and National Banking groups. Through its Public Sector and Financial Institutions businesses, Corporate Banking Services also provides a full array of commercial banking products and services to government and not-for-profit entities, and to community banks. A variety of cash management services, including the processing of tuition payments for private schools, are provided through the Global Treasury Management unit.
Equipment Finance meets the equipment leasing needs of companies worldwide and provides equipment manufacturers, distributors and resellers with financing options for their clients. Lease financing receivables and related revenues are assigned to other lines of business (primarily Institutional and Capital Markets, and Commercial Banking) if those businesses are principally responsible for maintaining the relationship with the client.
Institutional and Capital Markets, through its KeyBanc Capital Markets unit, provides commercial lending, treasury management, investment banking, derivatives, foreign exchange, equity and debt underwriting and trading, and syndicated finance products and services to large corporations and middle-market companies.
Through its Victory Capital Management unit, Institutional and Capital Markets also manages or offers advice regarding investment portfolios for a national client base, including corporations, labor unions, not-for-profit organizations, governments and individuals. These portfolios may be managed in separate accounts, common funds or the Victory family of mutual funds.
Cleveland-based KeyCorp (NYSE: KEY) is one of the nation’s largest bank-based financial services companies, with assets of approximately $95 billion at March 31, 2010. Key companies provide investment management, retail and commercial banking, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally. In 2009, KeyBank was awarded its seventh consecutive “Outstanding” rating for economic development achievements under the Community Reinvestment Act, the only national bank among the 50 largest in the United States to achieve this distinction from the Office of the Comptroller of the Currency. Key has also been recognized for excellence in numerous areas of the multi-channel customer banking experience, including Corporate Insight's 2009 Bank Monitor for online service. For more information about Key, visit https://www.key.com/.
Notes to Editors:
A live Internet broadcast of KeyCorp’s conference call to discuss quarterly results and currently anticipated earnings trends and to answer analysts' questions can be accessed through the Investor Relations section at https://www.key.com/ir at 9:00 a.m. ET, on Wednesday, April 21, 2010. An audio replay of the call will be available through April 28, 2010.
For up-to-date company information, media contacts and facts and figures about Key’s lines of business visit our Media Newsroom at https://www.key.com/newsroom.
This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Key’s financial condition, results of operations, earnings outlook, asset quality trends and profitability. Forward-looking statements are not historical facts but instead represent only management’s current expectations and forecasts regarding future events, many of which, by their nature, are inherently uncertain and outside of Key’s control. Key’s actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Factors that could cause Key’s actual results to differ materially from those described in the forward-looking statements can be found in Key’s Annual Report on Form 10-K for the year ended December 31, 2009, which has been filed with the Securities and Exchange Commission and is available on Key’s website (www.key.com) and on the Securities and Exchange Commission’s website (www.sec.gov). Forward-looking statements are not guarantees of future performance and should not be relied upon as representing management's views as of any subsequent date. Key does not undertake any obligation to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.
Financial Highlights (dollars in millions, except per share amounts) |
|||||||||||
Three months ended |
|||||||||||
3-31-10 |
12-31-09 |
3-31-09 |
|||||||||
Summary of operations |
|||||||||||
Net interest income (TE) |
$ 632 |
$ 637 |
$ 595 |
(a) |
|||||||
Noninterest income |
450 |
469 |
478 |
||||||||
Total revenue (TE) |
1,082 |
1,106 |
1,073 |
||||||||
Provision for loan losses |
413 |
756 |
847 |
||||||||
Noninterest expense |
785 |
871 |
927 |
||||||||
Loss from continuing operations attributable to Key |
(57) |
(217) |
(459) |
||||||||
Income (loss) from discontinued operations, net of taxes (b) |
2 |
(7) |
(29) |
||||||||
Net loss attributable to Key |
(55) |
(224) |
(488) |
(a) |
|||||||
Loss from continuing operations attributable to Key common shareholders |
$ (98) |
$ (258) |
$ (507) |
||||||||
Income (loss) from discontinued operations, net of taxes (b) |
2 |
(7) |
(29) |
||||||||
Net loss attributable to Key common shareholders |
(96) |
(265) |
(536) |
(a) |
|||||||
Per common share |
|||||||||||
Loss from continuing operations attributable to Key common shareholders |
$ (.11) |
$ (.30) |
$ (1.03) |
||||||||
Income (loss) from discontinued operations, net of taxes (b) |
-- |
(.01) |
(.06) |
||||||||
Net loss attributable to Key common shareholders |
(.11) |
(.30) |
(1.09) |
||||||||
Loss from continuing operations attributable to Key common shareholders — assuming dilution |
(.11) |
(.30) |
(1.03) |
||||||||
Income (loss) from discontinued operations, net of taxes — assuming dilution (b) |
-- |
(.01) |
(.06) |
||||||||
Net loss attributable to Key common shareholders — assuming dilution |
(.11) |
(.30) |
(1.09) |
(a) |
|||||||
Cash dividends paid |
.01 |
.01 |
.0625 |
||||||||
Book value at period end |
9.01 |
9.04 |
13.82 |
||||||||
Tangible book value at period end |
7.91 |
7.94 |
11.76 |
||||||||
Market price at period end |
7.75 |
5.55 |
7.87 |
||||||||
Performance ratios |
|||||||||||
From continuing operations: |
|||||||||||
Return on average total assets |
(.26) |
% |
(.94) |
% |
(1.87) |
% |
|||||
Return on average common equity |
(4.95) |
(12.60) |
(28.26) |
||||||||
Net interest margin (TE) |
3.19 |
3.04 |
2.79 |
(a) |
|||||||
From consolidated operations: |
|||||||||||
Return on average total assets |
(.23) |
% |
(.93) |
% |
(1.91) |
% (a) |
|||||
Return on average common equity |
(4.85) |
(12.94) |
(29.87) |
(a) |
|||||||
Net interest margin (TE) |
3.13 |
3.00 |
2.77 |
||||||||
Capital ratios at period end |
|||||||||||
Key shareholders' equity to assets |
11.17 |
% |
11.43 |
% |
10.19 |
% |
|||||
Tangible Key shareholders' equity to tangible assets |
10.26 |
10.50 |
9.23 |
||||||||
Tangible common equity to tangible assets |
7.37 |
7.56 |
6.06 |
||||||||
Tier 1 common equity (c) |
7.53 |
7.50 |
5.62 |
||||||||
Tier 1 risk-based capital (c) |
12.96 |
12.75 |
11.22 |
||||||||
Total risk-based capital (c) |
17.11 |
16.95 |
15.18 |
||||||||
Leverage (c) |
11.56 |
11.72 |
11.19 |
||||||||
Asset quality — from continuing operations |
|||||||||||
Net loan charge-offs |
$ 522 |
$ 708 |
$ 460 |
||||||||
Net loan charge-offs to average loans |
3.67 |
% |
4.64 |
% |
2.60 |
% |
|||||
Allowance for loan losses |
$ 2,425 |
$ 2,534 |
$ 2,016 |
||||||||
Allowance for credit losses |
2,544 |
2,655 |
2,070 |
||||||||
Allowance for loan losses to period-end loans |
4.34 |
% |
4.31 |
% |
2.88 |
% |
|||||
Allowance for credit losses to period-end loans |
4.55 |
4.52 |
2.96 |
||||||||
Allowance for loan losses to nonperforming loans |
117.43 |
115.87 |
116.20 |
||||||||
Allowance for credit losses to nonperforming loans |
123.20 |
121.40 |
119.31 |
||||||||
Nonperforming loans at period end |
$ 2,065 |
$ 2,187 |
$ 1,735 |
||||||||
Nonperforming assets at period end |
2,428 |
2,510 |
1,994 |
||||||||
Nonperforming loans to period-end portfolio loans |
3.69 |
% |
3.72 |
% |
2.48% |
% |
|||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
4.31 |
4.25 |
2.84 |
||||||||
Trust and brokerage assets |
|||||||||||
Assets under management |
$ 66,186 |
$ 66,939 |
$ 60,164 |
||||||||
Nonmanaged and brokerage assets |
19,201 |
27,190 |
21,786 |
||||||||
Other data |
|||||||||||
Average full-time equivalent employees |
15,772 |
15,973 |
17,468 |
||||||||
Branches |
1,014 |
1,007 |
989 |
||||||||
Taxable-equivalent adjustment |
$ 7 |
$ 7 |
$ 6 |
||||||||
(a) |
The following table entitled "GAAP to Non-GAAP Reconciliations" presents certain earnings data and performance ratios, excluding charges related to intangible assets impairment, and the tax treatment of certain leveraged lease financing transactions disallowed by the IRS. The table also shows the computations of certain financial measures related to "tangible common equity" and "Tier 1 common equity." The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. |
||||||||||
(b) |
In September 2009, management made the decision to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank National Association. In April 2009, management made the decision to curtail the operations of Austin Capital Management, Ltd., an investment subsidiary that specializes in managing hedge fund investments for its institutional customer base. As a result of these decisions, Key has accounted for these businesses as discontinued operations. |
||||||||||
(c) |
3-31-10 ratio is estimated. |
||||||||||
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles |
|||||||||||
GAAP to Non-GAAP Reconciliations (dollars in millions, except per share amounts) |
|
The table below presents certain earnings data and performance ratios, excluding (credits) charges related to intangible assets impairment and the tax treatment of certain leveraged lease financing transactions disallowed by the IRS. Management believes that eliminating the effects of significant items that are generally nonrecurring facilitates the analysis of results by presenting them on a more comparable basis. The table also shows the computations of certain financial measures related to “tangible common equity” and “Tier 1 common equity.” The tangible common equity ratio has become a focus of some investors and management believes that this ratio may assist investors in analyzing Key’s capital position absent the effects of intangible assets and preferred stock. Traditionally, the banking regulators have assessed bank and bank holding company capital adequacy based on both the amount and composition of capital, the calculation of which is prescribed in federal banking regulations. As a result of the Supervisory Capital Assessment Program, the Federal Reserve has focused its assessment of capital adequacy on a component of Tier 1 capital, known as Tier 1 common equity. Because the Federal Reserve has long indicated that voting common shareholders’ equity (essentially Tier 1 capital less preferred stock, qualifying capital securities and noncontrolling interests in subsidiaries) generally should be the dominant element in Tier 1 capital, such a focus is consistent with existing capital adequacy guidelines and does not imply a new or ongoing capital standard. Because the Tier 1 common equity is neither formally defined by GAAP nor prescribed in amount by federal banking regulations, this measure is considered to be a non-GAAP financial measure. Since analysts and banking regulators may assess Key’s capital adequacy using tangible common equity and Tier 1 common equity, management believes it is useful to provide investors the ability to assess Key’s capital adequacy on these same bases. The table also reconciles the GAAP performance measures to the corresponding non-GAAP measures. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. To mitigate these limitations, Key has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components and to ensure that Key’s performance is properly reflected to facilitate period-to-period comparisons. Although these non-GAAP financial measures are frequently used by investors in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP. |
|
Three months ended |
||||||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||||||
Net income (loss) |
||||||||||
Net income (loss) attributable to Key (GAAP) |
$ (55) |
$ (224) |
$ (488) |
|||||||
Charges (credits) related to intangible assets impairment, after tax |
-- |
-- |
164 |
|||||||
Charges (credits) related to leveraged lease tax litigation, after tax |
-- |
(80) |
-- |
|||||||
Net income (loss) attributable to Key, excluding charges (credits) related to intangible assets impairment and leveraged lease tax litigation (non-GAAP) |
$ (55) |
$ (304) |
$ (324) |
|||||||
Preferred dividends and amortization of discount on preferred stock |
$ 41 |
$ 41 |
$ 48 |
|||||||
Net income (loss) attributable to Key common shareholders (GAAP) |
$ (96) |
$ (265) |
$ (536) |
|||||||
Net income (loss) attributable to Key common shareholders, excluding charges (credits) related to intangible assets impairment and leveraged lease tax litigation (non-GAAP) |
(96) |
(345) |
(372) |
|||||||
Per common share |
||||||||||
Net income (loss) attributable to Key common shareholders — assuming dilution (GAAP) |
$ (.11) |
$ (.30) |
$ (1.09) |
|||||||
Net income (loss) attributable to Key common shareholders, excluding charges (credits) related to intangible assets impairment and leveraged lease tax litigation — assuming dilution (non-GAAP) |
(.11) |
(.39) |
(.76) |
|||||||
Performance ratios from consolidated operations |
||||||||||
Return on average total assets: (a) |
||||||||||
Average total assets |
$ 95,578 |
$ 95,975 |
$ 103,815 |
|||||||
Return on average total assets (GAAP) |
(.23) |
% |
(.93) |
% |
(1.91) |
% |
||||
Return on average total assets, excluding charges (credits) related to intangible assets impairment and leveraged lease tax litigation (non-GAAP) |
(.23) |
(1.26) |
(1.27) |
|||||||
Return on average common equity: (a) |
||||||||||
Average common equity |
$ 8,024 |
$ 8,125 |
$ 7,277 |
|||||||
Return on average common equity (GAAP) |
(4.85) |
% |
(12.94) |
% |
(29.87) |
% |
||||
Return on average common equity, excluding charges (credits) related to intangible assets impairment and leveraged lease tax litigation (non-GAAP) |
(4.85) |
(16.85) |
(20.73) |
|||||||
Three months ended |
||||||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||||||
Tangible common equity to tangible assets at period end |
||||||||||
Key shareholders’ equity (GAAP) |
$ 10,641 |
$ 10,663 |
$ 9,968 |
|||||||
Less: |
Intangible assets |
963 |
967 |
1,029 |
(d) |
|||||
Preferred Stock, Series B |
2,434 |
2,430 |
2,418 |
|||||||
Preferred Stock, Series A |
291 |
291 |
658 |
|||||||
Tangible common equity (non-GAAP) |
$ 6,953 |
$ 6,975 |
$ 5,863 |
|||||||
Total assets (GAAP) |
$ 95,303 |
$ 93,287 |
$ 97,834 |
|||||||
Less: |
Intangible assets |
963 |
967 |
1,029 |
(d) |
|||||
Tangible assets (non-GAAP) |
$ 94,340 |
$ 92,320 |
$ 96,805 |
|||||||
Tangible common equity to tangible assets ratio (non-GAAP) |
7.37 |
% |
7.56 |
% |
6.06 |
% |
||||
Tier 1 common equity at period end |
||||||||||
Key shareholders' equity (GAAP) |
$ 10,641 |
$ 10,663 |
$ 9,968 |
|||||||
Qualifying capital securities |
1,791 |
1,791 |
2,582 |
|||||||
Less: |
Goodwill |
917 |
917 |
917 |
||||||
Accumulated other comprehensive income (loss) (b) |
(25) |
(48) |
111 |
|||||||
Other assets (c) |
765 |
632 |
184 |
|||||||
Total Tier 1 capital (regulatory) |
10,775 |
10,953 |
11,338 |
|||||||
Less: |
Qualifying capital securities |
1,791 |
1,791 |
2,582 |
||||||
Preferred Stock, Series B |
2,434 |
2,430 |
2,418 |
|||||||
Preferred Stock, Series A |
291 |
291 |
658 |
|||||||
Total Tier 1 common equity (non-GAAP) |
$ 6,259 |
$ 6,441 |
$ 5,680 |
|||||||
Net risk-weighted assets (regulatory) (c), (e) |
$ 83,171 |
$ 85,881 |
$ 101,077 |
|||||||
Tier 1 common equity ratio (non-GAAP) (e) |
7.53 |
% |
7.50 |
% |
5.62 |
% |
||||
(a) |
Income statement amount has been annualized in calculation of percentage. |
|||||||||
(b) |
Includes net unrealized gains or losses on securities available for sale (except for net unrealized losses on marketable equity securities), net gains or losses on cash flow hedges, and amounts resulting from the December 31, 2006, adoption and subsequent application of the applicable accounting guidance for defined benefit and other postretirement plans. |
|||||||||
(c) |
Other assets deducted from Tier 1 capital and net risk-weighted assets consist of disallowed deferred tax assets of $651 million at March 31, 2010, and $514 million at December 31, 2009, disallowed intangible assets (excluding goodwill), and deductible portions of nonfinancial equity investments. |
|||||||||
(d) |
Includes $2 million of other intangible assets classified as “discontinued assets” on the balance sheet. |
|||||||||
(e) |
3-31-10 amount or ratio is estimated. |
|||||||||
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles |
||||||||||
Consolidated Balance Sheets (dollars in millions) |
||||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||||
Assets |
||||||||
Loans |
$ 55,913 |
$ 58,770 |
$ 70,003 |
|||||
Loans held for sale |
556 |
443 |
671 |
|||||
Securities available for sale |
16,553 |
16,641 |
8,363 |
|||||
Held-to-maturity securities |
22 |
24 |
25 |
|||||
Trading account assets |
1,034 |
1,209 |
1,279 |
|||||
Short-term investments |
4,345 |
1,743 |
2,917 |
|||||
Other investments |
1,525 |
1,488 |
1,464 |
|||||
Total earning assets |
79,948 |
80,318 |
84,722 |
|||||
Allowance for loan losses |
(2,425) |
(2,534) |
(2,016) |
|||||
Cash and due from banks |
619 |
471 |
624 |
|||||
Premises and equipment |
872 |
880 |
847 |
|||||
Operating lease assets |
652 |
716 |
889 |
|||||
Goodwill |
917 |
917 |
917 |
|||||
Other intangible assets |
46 |
50 |
110 |
|||||
Corporate-owned life insurance |
3,087 |
3,071 |
2,994 |
|||||
Derivative assets |
1,063 |
1,094 |
1,707 |
|||||
Accrued income and other assets |
4,150 |
4,096 |
2,615 |
|||||
Discontinued assets |
6,374 |
4,208 |
4,425 |
|||||
Total assets |
$ 95,303 |
$ 93,287 |
$ 97,834 |
|||||
Liabilities |
||||||||
Deposits in domestic offices: |
||||||||
NOW and money market deposit accounts |
$ 25,068 |
$ 24,341 |
$ 23,599 |
|||||
Savings deposits |
1,873 |
1,807 |
1,795 |
|||||
Certificates of deposit ($100,000 or more) |
10,188 |
10,954 |
13,250 |
|||||
Other time deposits |
12,010 |
13,286 |
14,791 |
|||||
Total interest-bearing deposits |
49,139 |
50,388 |
53,435 |
|||||
Noninterest-bearing deposits |
15,364 |
14,415 |
11,641 |
|||||
Deposits in foreign office — interest-bearing |
646 |
768 |
801 |
|||||
Total deposits |
65,149 |
65,571 |
65,877 |
|||||
Federal funds purchased and securities sold under repurchase agreements |
1,927 |
1,742 |
1,565 |
|||||
Bank notes and other short-term borrowings |
446 |
340 |
2,285 |
|||||
Derivative liabilities |
1,103 |
1,012 |
927 |
|||||
Accrued expense and other liabilities |
2,089 |
2,007 |
1,891 |
|||||
Long-term debt |
11,177 |
11,558 |
14,978 |
|||||
Discontinued liabilities |
2,490 |
124 |
137 |
|||||
Total liabilities |
84,381 |
82,354 |
87,660 |
|||||
Equity |
||||||||
Preferred stock, Series A |
291 |
291 |
658 |
|||||
Preferred stock, Series B |
2,434 |
2,430 |
2,418 |
|||||
Common shares |
946 |
946 |
584 |
|||||
Common stock warrant |
87 |
87 |
87 |
|||||
Capital surplus |
3,724 |
3,734 |
2,464 |
|||||
Retained earnings |
5,098 |
5,158 |
6,160 |
|||||
Treasury stock, at cost |
(1,958) |
(1,980) |
(2,500) |
|||||
Accumulated other comprehensive income (loss) |
19 |
(3) |
97 |
|||||
Key shareholders' equity |
10,641 |
10,663 |
9,968 |
|||||
Noncontrolling interests |
281 |
270 |
206 |
|||||
Total equity |
10,922 |
10,933 |
10,174 |
|||||
Total liabilities and equity |
$ 95,303 |
$ 93,287 |
$ 97,834 |
|||||
Common shares outstanding (000) |
879,052 |
878,535 |
498,573 |
|||||
Consolidated Statements of Income (dollars in millions, except per share amounts) |
||||||||
Three months ended |
||||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||||
Interest income |
||||||||
Loans |
$ 710 |
$ 749 |
$ 840 |
|||||
Loans held for sale |
4 |
6 |
8 |
|||||
Securities available for sale |
150 |
150 |
100 |
|||||
Held-to-maturity securities |
1 |
-- |
1 |
|||||
Trading account assets |
11 |
12 |
13 |
|||||
Short-term investments |
2 |
3 |
3 |
|||||
Other investments |
14 |
13 |
12 |
|||||
Total interest income |
892 |
933 |
977 |
|||||
Interest expense |
||||||||
Deposits |
212 |
246 |
300 |
|||||
Federal funds purchased and securities sold under repurchase agreements |
1 |
1 |
1 |
|||||
Bank notes and other short-term borrowings |
3 |
3 |
6 |
|||||
Long-term debt |
51 |
53 |
81 |
|||||
Total interest expense |
267 |
303 |
388 |
|||||
Net interest income |
625 |
630 |
589 |
|||||
Provision for loan losses |
413 |
756 |
847 |
|||||
Net interest income (expense) after provision for loan losses |
212 |
(126) |
(258) |
|||||
Noninterest income |
||||||||
Trust and investment services income |
114 |
117 |
110 |
|||||
Service charges on deposit accounts |
76 |
82 |
82 |
|||||
Operating lease income |
47 |
52 |
61 |
|||||
Letter of credit and loan fees |
40 |
52 |
38 |
|||||
Corporate-owned life insurance income |
28 |
36 |
27 |
|||||
Net securities gains (losses) |
3 |
(a) |
1 |
(a) |
(14) |
|||
Electronic banking fees |
27 |
27 |
24 |
|||||
Gains on leased equipment |
8 |
15 |
26 |
|||||
Insurance income |
18 |
16 |
18 |
|||||
Net gains (losses) from loan sales |
4 |
(5) |
7 |
|||||
Net gains (losses) from principal investing |
37 |
80 |
(72) |
|||||
Investment banking and capital markets income (loss) |
9 |
(47) |
17 |
|||||
Gain from sale/redemption of Visa Inc. shares |
-- |
-- |
105 |
|||||
Gain (loss) related to exchange of common shares for capital securities |
-- |
-- |
-- |
|||||
Other income |
39 |
43 |
49 |
|||||
Total noninterest income |
450 |
469 |
478 |
|||||
Noninterest expense |
||||||||
Personnel |
362 |
400 |
359 |
|||||
Net occupancy |
66 |
67 |
66 |
|||||
Operating lease expense |
39 |
50 |
50 |
|||||
Computer processing |
47 |
49 |
47 |
|||||
Professional fees |
38 |
63 |
34 |
|||||
FDIC assessment |
37 |
37 |
30 |
|||||
OREO expense, net |
32 |
25 |
6 |
|||||
Equipment |
24 |
25 |
22 |
|||||
Marketing |
13 |
22 |
14 |
|||||
Provision (credit) for losses on lending-related commitments |
(2) |
27 |
-- |
|||||
Intangible assets impairment |
-- |
-- |
196 |
|||||
Other expense |
129 |
106 |
103 |
|||||
Total noninterest expense |
785 |
871 |
927 |
|||||
Income (loss) from continuing operations before income taxes |
(123) |
(528) |
(707) |
|||||
Income taxes |
(82) |
(347) |
(238) |
|||||
Income (loss) from continuing operations |
(41) |
(181) |
(469) |
|||||
Income (loss) from discontinued operations, net of taxes |
2 |
(7) |
(29) |
|||||
Net income (loss) |
(39) |
(188) |
(498) |
|||||
Less: Net income (loss) attributable to noncontrolling interests |
16 |
36 |
(10) |
|||||
Net income (loss) attributable to Key |
$ (55) |
$ (224) |
$ (488) |
|||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ (98) |
$ (258) |
$ (507) |
|||||
Net income (loss) attributable to Key common shareholders |
(96) |
(265) |
(536) |
|||||
Per common share |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ (.11) |
$ (.30) |
$ (1.03) |
|||||
Income (loss) from discontinued operations, net of taxes |
-- |
(.01) |
(.06) |
|||||
Net income (loss) attributable to Key common shareholders |
(.11) |
(.30) |
(1.09) |
|||||
Per common share — assuming dilution |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ (.11) |
$ (.30) |
$ (1.03) |
|||||
Income (loss) from discontinued operations, net of taxes |
-- |
(.01) |
(.06) |
|||||
Net income (loss) attributable to Key common shareholders |
(.11) |
(.30) |
(1.09) |
|||||
Cash dividends declared per common share |
$ .01 |
$ .01 |
$ .0625 |
|||||
Weighted-average common shares outstanding (000) |
874,386 |
873,268 |
492,813 |
|||||
Weighted-average common shares and potential common shares outstanding (000) |
874,386 |
873,268 |
492,813 |
|||||
(a) |
For the three months ended March 31, 2010, and December 31, 2009, Key did not have impairment losses related to securities. |
|||||||
Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations (dollars in millions) |
||||||||||||||||||||||||
First Quarter 2010 |
Fourth Quarter 2009 |
First Quarter 2009 |
||||||||||||||||||||||
Average |
Average |
Average |
||||||||||||||||||||||
Balance |
Interest |
(a) |
Yield/Rate |
(a) |
Balance |
Interest |
(a) |
Yield/Rate |
(a) |
Balance |
Interest |
(a) |
Yield/Rate |
(a) |
||||||||||
Assets |
||||||||||||||||||||||||
Loans: (b), (c) |
||||||||||||||||||||||||
Commercial, financial and agricultural |
$ 18,796 |
$ 222 |
4.78 |
% |
$ 19,817 |
$ 232 |
4.63 |
% |
$ 26,427 |
$ 278 |
4.26 |
% |
||||||||||||
Real estate — commercial mortgage |
10,430 |
128 |
4.98 |
10,853 |
132 |
4.84 |
10,965 |
(g) |
140 |
5.20 |
||||||||||||||
Real estate — construction |
4,537 |
45 |
4.07 |
5,246 |
62 |
4.70 |
7,511 |
(g) |
84 |
4.54 |
||||||||||||||
Commercial lease financing |
7,195 |
93 |
5.19 |
7,598 |
97 |
5.10 |
8,790 |
94 |
4.28 |
|||||||||||||||
Total commercial loans |
40,958 |
488 |
4.82 |
43,514 |
523 |
4.77 |
53,693 |
596 |
4.50 |
|||||||||||||||
Real estate — residential mortgage |
1,803 |
26 |
5.65 |
1,781 |
26 |
5.80 |
1,776 |
27 |
6.00 |
|||||||||||||||
Home equity: |
||||||||||||||||||||||||
Community Banking |
9,967 |
105 |
4.26 |
10,101 |
109 |
4.28 |
10,277 |
114 |
4.49 |
|||||||||||||||
Other |
816 |
15 |
7.57 |
862 |
16 |
7.54 |
1,036 |
19 |
7.55 |
|||||||||||||||
Total home equity loans |
10,783 |
120 |
4.51 |
10,963 |
125 |
4.53 |
11,313 |
133 |
4.77 |
|||||||||||||||
Consumer other — Community Banking |
1,162 |
36 |
12.63 |
1,185 |
32 |
11.06 |
1,225 |
32 |
10.56 |
|||||||||||||||
Consumer other: |
||||||||||||||||||||||||
Marine |
2,713 |
42 |
6.15 |
2,866 |
44 |
6.16 |
3,331 |
52 |
6.24 |
|||||||||||||||
Other |
209 |
4 |
7.76 |
224 |
5 |
7.81 |
274 |
5 |
7.97 |
|||||||||||||||
Total consumer other |
2,922 |
46 |
6.27 |
3,090 |
49 |
6.28 |
3,605 |
57 |
6.37 |
|||||||||||||||
Total consumer loans |
16,670 |
228 |
5.51 |
17,019 |
232 |
5.44 |
17,919 |
249 |
5.61 |
|||||||||||||||
Total loans |
57,628 |
716 |
5.02 |
60,533 |
755 |
4.96 |
71,612 |
845 |
4.77 |
|||||||||||||||
Loans held for sale |
390 |
4 |
4.43 |
618 |
6 |
3.35 |
686 |
8 |
4.89 |
|||||||||||||||
Securities available for sale (b), (e) |
16,312 |
151 |
3.73 |
15,937 |
151 |
3.82 |
8,127 |
101 |
5.05 |
|||||||||||||||
Held-to-maturity securities (b) |
23 |
1 |
8.20 |
24 |
-- |
3.34 |
25 |
1 |
9.84 |
|||||||||||||||
Trading account assets |
1,186 |
11 |
3.86 |
1,315 |
12 |
3.72 |
1,348 |
13 |
3.97 |
|||||||||||||||
Short-term investments |
2,806 |
2 |
.28 |
3,682 |
3 |
.23 |
2,450 |
3 |
.47 |
|||||||||||||||
Other investments (e) |
1,498 |
14 |
3.32 |
1,465 |
13 |
3.21 |
1,523 |
12 |
2.80 |
|||||||||||||||
Total earning assets |
79,843 |
899 |
4.54 |
83,574 |
940 |
4.47 |
85,771 |
983 |
4.63 |
|||||||||||||||
Allowance for loan losses |
(2,603) |
(2,525) |
(1,895) |
|||||||||||||||||||||
Accrued income and other assets |
11,454 |
10,785 |
15,448 |
|||||||||||||||||||||
Discontinued assets — education lending business |
6,884 |
4,141 |
4,491 |
|||||||||||||||||||||
Total assets |
$ 95,578 |
$ 95,975 |
$ 103,815 |
|||||||||||||||||||||
Liabilities |
||||||||||||||||||||||||
NOW and money market deposit accounts |
$ 24,722 |
$ 23 |
.37 |
$ 24,910 |
25 |
.39 |
$ 23,957 |
38 |
.65 |
|||||||||||||||
Savings deposits |
1,828 |
-- |
.06 |
1,801 |
1 |
.06 |
1,744 |
-- |
.09 |
|||||||||||||||
Certificates of deposit ($100,000 or more) (f) |
10,538 |
88 |
3.39 |
11,675 |
103 |
3.49 |
12,455 |
121 |
3.93 |
|||||||||||||||
Other time deposits |
12,611 |
100 |
3.23 |
13,753 |
117 |
3.39 |
14,737 |
140 |
3.85 |
|||||||||||||||
Deposits in foreign office |
693 |
1 |
.30 |
711 |
-- |
.31 |
1,259 |
1 |
.21 |
|||||||||||||||
Total interest-bearing deposits |
50,392 |
212 |
1.71 |
52,850 |
246 |
1.84 |
54,152 |
300 |
2.24 |
|||||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,790 |
1 |
.32 |
1,657 |
1 |
.31 |
1,545 |
1 |
.31 |
|||||||||||||||
Bank notes and other short-term borrowings |
490 |
3 |
2.41 |
418 |
3 |
3.03 |
4,405 |
6 |
.58 |
|||||||||||||||
Long-term debt (f) |
7,001 |
51 |
3.16 |
8,092 |
53 |
2.91 |
10,431 |
81 |
3.39 |
|||||||||||||||
Total interest-bearing liabilities |
59,673 |
267 |
1.83 |
63,017 |
303 |
1.94 |
70,533 |
388 |
2.25 |
|||||||||||||||
Noninterest-bearing deposits |
14,941 |
14,655 |
11,094 |
|||||||||||||||||||||
Accrued expense and other liabilities |
3,064 |
3,097 |
7,139 |
|||||||||||||||||||||
Discontinued liabilities — education lending business (d) |
6,884 |
4,141 |
4,491 |
|||||||||||||||||||||
Total liabilities |
84,562 |
84,910 |
93,257 |
|||||||||||||||||||||
Equity |
||||||||||||||||||||||||
Key shareholders' equity |
10,747 |
10,843 |
10,352 |
|||||||||||||||||||||
Noncontrolling interests |
269 |
222 |
206 |
|||||||||||||||||||||
Total equity |
11,016 |
11,065 |
10,558 |
|||||||||||||||||||||
Total liabilities and equity |
$ 95,578 |
$ 95,975 |
$ 103,815 |
|||||||||||||||||||||
Interest rate spread (TE) |
2.71 |
% |
2.53 |
% |
2.38 |
% |
||||||||||||||||||
Net interest income (TE) and net interest margin (TE) |
632 |
3.19 |
% |
637 |
3.04 |
% |
595 |
2.79 |
% |
|||||||||||||||
TE adjustment (b) |
7 |
7 |
6 |
|||||||||||||||||||||
Net interest income, GAAP basis |
$ 625 |
$ 630 |
$ 589 |
|||||||||||||||||||||
Average balances have not been adjusted prior to the third quarter of 2009 to reflect Key’s January 1, 2008, adoption of the applicable accounting guidance related to the offsetting of certain derivative contracts on the consolidated balance sheet. |
||||||||||||||||||||||||
(a) Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (e) below, calculated using a matched funds transfer pricing methodology. |
||||||||||||||||||||||||
(b) Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%. |
||||||||||||||||||||||||
(c) For purposes of these computations, nonaccrual loans are included in average loan balances. |
||||||||||||||||||||||||
(d) Discontinued liabilities include the liabilities of the education lending business and the dollar amount of any additional liabilities assumed necessary to support the assets associated with this business. |
||||||||||||||||||||||||
(e) Yield is calculated on the basis of amortized cost. |
||||||||||||||||||||||||
(f) Rate calculation excludes basis adjustments related to fair value hedges. |
||||||||||||||||||||||||
(g) In late March 2009, Key transferred $1.5 billion of loans from the construction portfolio to the commercial mortgage portfolio in accordance with regulatory guidelines pertaining to the classification of loans that have reached a completed status. |
||||||||||||||||||||||||
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles |
||||||||||||||||||||||||
Noninterest Income (in millions) |
||||||
Three months ended |
||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||
Trust and investment services income (a) |
$ 114 |
$ 117 |
$ 110 |
|||
Service charges on deposit accounts |
76 |
82 |
82 |
|||
Operating lease income |
47 |
52 |
61 |
|||
Letter of credit and loan fees |
40 |
52 |
38 |
|||
Corporate-owned life insurance income |
28 |
36 |
27 |
|||
Net securities gains (losses) |
3 |
1 |
(14) |
|||
Electronic banking fees |
27 |
27 |
24 |
|||
Gains on leased equipment |
8 |
15 |
26 |
|||
Insurance income |
18 |
16 |
18 |
|||
Net gains (losses) from loan sales |
4 |
(5) |
7 |
|||
Net gains (losses) from principal investing |
37 |
80 |
(72) |
|||
Investment banking and capital markets income (loss) (a) |
9 |
(47) |
17 |
|||
Gain from sale/redemption of Visa Inc. shares |
-- |
-- |
105 |
|||
Other income: |
||||||
Credit card fees |
3 |
2 |
3 |
|||
Miscellaneous income |
36 |
41 |
46 |
|||
Total other income |
39 |
43 |
49 |
|||
Total noninterest income |
$ 450 |
$ 469 |
$ 478 |
|||
(a) Additional detail provided in tables below. |
||||||
Trust and Investment Services Income (in millions) |
||||||
Three months ended |
||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||
Brokerage commissions and fee income |
$ 33 |
$ 31 |
$ 38 |
|||
Personal asset management and custody fees |
37 |
37 |
33 |
|||
Institutional asset management and custody fees |
44 |
49 |
39 |
|||
Total trust and investment services income |
$ 114 |
$ 117 |
$ 110 |
|||
Investment Banking and Capital Markets Income (Loss) (in millions) |
||||||
Three months ended |
||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||
Investment banking income |
$ 16 |
$ 29 |
$ 11 |
|||
Income (loss) from other investments |
1 |
(66) |
(8) |
|||
Dealer trading and derivatives income (loss) |
(16) |
(21) |
1 |
|||
Foreign exchange income |
8 |
11 |
13 |
|||
Total investment banking and capital markets income (loss) |
$ 9 |
$ (47) |
$ 17 |
|||
Noninterest Expense (dollars in millions) |
||||||
Three months ended |
||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||
Personnel (a) |
$ 362 |
$ 400 |
$ 359 |
|||
Net occupancy |
66 |
67 |
66 |
|||
Operating lease expense |
39 |
50 |
50 |
|||
Computer processing |
47 |
49 |
47 |
|||
Professional fees |
38 |
63 |
34 |
|||
FDIC assessment |
37 |
37 |
30 |
|||
OREO expense, net |
32 |
25 |
6 |
|||
Equipment |
24 |
25 |
22 |
|||
Marketing |
13 |
22 |
14 |
|||
Provision (credit) for losses on lending-related commitments |
(2) |
27 |
-- |
|||
Intangible assets impairment |
-- |
-- |
196 |
|||
Other expense: |
||||||
Postage and delivery |
7 |
8 |
8 |
|||
Franchise and business taxes |
7 |
5 |
9 |
|||
Telecommunications |
6 |
6 |
7 |
|||
Miscellaneous expense |
109 |
87 |
79 |
|||
Total other expense |
129 |
106 |
103 |
|||
Total noninterest expense |
$ 785 |
$ 871 |
$ 927 |
|||
Average full-time equivalent employees (b) |
15,772 |
15,973 |
17,468 |
|||
(a) Additional detail provided in table below. |
||||||
(b) The number of average full-time equivalent employees has not been adjusted for discontinued operations. |
||||||
Personnel Expense (in millions) |
||||||
Three months ended |
||||||
3-31-10 |
12-31-09 |
3-31-09 |
||||
Salaries |
$ 222 |
$ 229 |
$ 223 |
|||
Incentive compensation |
47 |
76 |
36 |
|||
Employee benefits |
74 |
75 |
83 |
|||
Stock-based compensation |
14 |
15 |
9 |
|||
Severance |
5 |
5 |
8 |
|||
Total personnel expense |
$ 362 |
$ 400 |
$ 359 |
|||
Loan Composition (dollars in millions) |
|||||||||||||
Percent change 3-31-10 vs. |
|||||||||||||
3-31-10 |
12-31-09 |
3-31-09 |
12-31-09 |
3-31-09 |
|||||||||
Commercial, financial and agricultural |
$ 18,015 |
$ 19,248 |
$ 25,405 |
(6.4) |
% |
(29.1) |
% |
||||||
Commercial real estate: |
|||||||||||||
Commercial mortgage |
10,467 |
10,457 |
12,057 |
(a) |
.1 |
(13.2) |
|||||||
Construction |
3,990 |
4,739 |
6,208 |
(a) |
(15.8) |
(35.7) |
|||||||
Total commercial real estate loans |
14,457 |
15,196 |
18,265 |
(4.9) |
(20.8) |
||||||||
Commercial lease financing |
6,964 |
7,460 |
8,553 |
(6.6) |
(18.6) |
||||||||
Total commercial loans |
39,436 |
41,904 |
52,223 |
(5.9) |
(24.5) |
||||||||
Real estate — residential mortgage |
1,812 |
1,796 |
1,759 |
.9 |
3.0 |
||||||||
Home equity: |
|||||||||||||
Community Banking |
9,892 |
10,048 |
10,281 |
(1.6) |
(3.8) |
||||||||
Other |
795 |
838 |
1,007 |
(5.1) |
(21.1) |
||||||||
Total home equity loans |
10,687 |
10,886 |
11,288 |
(1.8) |
(5.3) |
||||||||
Consumer other — Community Banking |
1,141 |
1,181 |
1,215 |
(3.4) |
(6.1) |
||||||||
Consumer other: |
|||||||||||||
Marine |
2,636 |
2,787 |
3,256 |
(5.4) |
(19.0) |
||||||||
Other |
201 |
216 |
262 |
(6.9) |
(23.3) |
||||||||
Total consumer other |
2,837 |
3,003 |
3,518 |
(5.5) |
(19.4) |
||||||||
Total consumer loans |
16,477 |
16,866 |
17,780 |
(2.3) |
(7.3) |
||||||||
Total loans (b) |
$ 55,913 |
$ 58,770 |
$ 70,003 |
(4.9) |
% |
(20.1) |
% |
||||||
Loans Held for Sale Composition (dollars in millions) |
||||||||||||||
Percent change 3-31-10 vs. |
||||||||||||||
3-31-10 |
12-31-09 |
3-31-09 |
12-31-09 |
3-31-09 |
||||||||||
Commercial, financial and agricultural |
$ 25 |
$ 14 |
$ 24 |
78.6 |
% |
4.2 |
% |
|||||||
Real estate — commercial mortgage |
265 |
171 |
301 |
55.0 |
(12.0) |
|||||||||
Real estate — construction |
147 |
92 |
151 |
59.8 |
(2.6) |
|||||||||
Commercial lease financing |
27 |
27 |
10 |
-- |
170.0 |
|||||||||
Real estate — residential mortgage |
92 |
139 |
183 |
(33.8) |
(49.7) |
|||||||||
Automobile |
-- |
-- |
2 |
-- |
(100.0) |
|||||||||
Total loans held for sale (c) |
$ 556 |
(d) |
$ 443 |
(d) |
$ 671 |
25.5 |
% |
(17.1) |
% |
|||||
(a ) |
In late March 2009, Key transferred $1.5 billion of loans from the construction portfolio to the commercial mortgage portfolio in accordance with regulatory guidelines pertaining to the classification of loans that have reached a completed status. |
|||||||||||||
(b) |
Excluded at March 31, 2010, December 31, 2009, and March 31, 2009, are loans in the amount of $6.0 billion, $3.5 billion and $3.7 billion, respectively, related to the discontinued operations of the education lending business. |
|||||||||||||
(c) |
Excluded at March 31, 2010, December 31, 2009, and March 31, 2009, are loans held for sale in the amount of $246 million, $434 million, and $453 million, respectively, related to the discontinued operations of the education lending business. |
|||||||||||||
(d) |
The beginning balance at December 31, 2009 of $443 million increased by new originations in the amount of $509 million, net transfers from held to maturity in the amount of $109 million and decreased by loan sales of $488 million, transfers to OREO/valuation adjustments of $11 million, and loan payments of $6 million for an ending balance of $556 million at March 31, 2010. |
|||||||||||||
Summary of Loan Loss Experience from Continuing Operations (dollars in millions) |
|||||||
Three months ended |
|||||||
3-31-10 |
12-31-09 |
3-31-09 |
|||||
Average loans outstanding |
$ 57,628 |
$ 60,533 |
$ 71,612 |
||||
Allowance for loan losses at beginning of period |
$ 2,534 |
$ 2,485 |
$ 1,629 |
||||
Loans charged off: |
|||||||
Commercial, financial and agricultural |
139 |
232 |
244 |
||||
Real estate -- commercial mortgage |
109 |
166 |
22 |
||||
Real estate -- construction |
157 |
187 |
104 |
||||
Total commercial real estate loans |
266 |
353 |
126 |
||||
Commercial lease financing |
25 |
45 |
22 |
||||
Total commercial loans |
430 |
630 |
392 |
||||
Real estate -- residential mortgage |
7 |
9 |
3 |
||||
Home equity: |
|||||||
Community Banking |
31 |
28 |
18 |
||||
Other |
18 |
20 |
15 |
||||
Total home equity loans |
49 |
48 |
33 |
||||
Consumer other -- Community Banking |
18 |
17 |
14 |
||||
Consumer other: |
|||||||
Marine |
48 |
41 |
39 |
||||
Other |
5 |
5 |
6 |
||||
Total consumer other |
53 |
46 |
45 |
||||
Total consumer loans |
127 |
120 |
95 |
||||
Total loans charged off |
557 |
750 |
487 |
||||
Recoveries: |
|||||||
Commercial, financial and agricultural |
13 |
14 |
12 |
||||
Real estate -- commercial mortgage |
3 |
1 |
1 |
||||
Real estate -- construction |
- |
6 |
- |
||||
Total commercial real estate loans |
3 |
7 |
1 |
||||
Commercial lease financing |
4 |
6 |
4 |
||||
Total commercial loans |
20 |
27 |
17 |
||||
Real estate -- residential mortgage |
- |
1 |
- |
||||
Home equity: |
|||||||
Community Banking |
1 |
1 |
1 |
||||
Other |
1 |
1 |
- |
||||
Total home equity loans |
2 |
2 |
1 |
||||
Consumer other -- Community Banking |
2 |
2 |
1 |
||||
Consumer other: |
|||||||
Marine |
10 |
8 |
7 |
||||
Other |
1 |
2 |
1 |
||||
Total consumer other |
11 |
10 |
8 |
||||
Total consumer loans |
15 |
15 |
10 |
||||
Total recoveries |
35 |
42 |
27 |
||||
Net loan charge-offs |
(522) |
(708) |
(460) |
||||
Provision for loan losses |
413 |
756 |
847 |
||||
Foreign currency translation adjustment |
- |
1 |
- |
||||
Allowance for loan losses at end of period |
$ 2,425 |
$ 2,534 |
$ 2,016 |
||||
Liability for credit losses on lending-related commitments at beginning of period |
$ 121 |
$ 94 |
$ 54 |
||||
Provision (credit) for losses on lending-related commitments |
(2) |
27 |
- |
||||
Liability for credit losses on lending-related commitments at end of period (a) |
$ 119 |
$ 121 |
$ 54 |
||||
Total allowance for credit losses at end of period |
$ 2,544 |
$ 2,655 |
$ 2,070 |
||||
Net loan charge-offs to average loans |
3.67 |
% |
4.64 |
% |
2.60 |
% |
|
Allowance for loan losses to period-end loans |
4.34 |
4.31 |
2.88 |
||||
Allowance for credit losses to period-end loans |
4.55 |
4.52 |
2.96 |
||||
Allowance for loan losses to nonperforming loans |
117.43 |
115.87 |
116.20 |
||||
Allowance for credit losses to nonperforming loans |
123.20 |
121.40 |
119.31 |
||||
Discontinued operations -- education lending business: |
|||||||
Loans charged off |
$ 37 |
$ 37 |
$ 33 |
||||
Recoveries |
1 |
1 |
1 |
||||
Net loan charge-offs |
$ (36) |
$ (36) |
$ (32) |
||||
(a) Included in "accrued expense and other liabilities" on the balance sheet. |
|||||||
Summary of Nonperforming Assets and Past Due Loans From Continuing Operations (dollars in millions) |
||||||||||
3-31-10 |
12-31-09 |
9-30-09 |
6-30-09 |
3-31-09 |
||||||
Commercial, financial and agricultural |
$ 558 |
$ 586 |
$ 679 |
$ 700 |
$ 595 |
|||||
Real estate -- commercial mortgage |
579 |
614 |
566 |
454 |
310 |
|||||
Real estate -- construction |
607 |
641 |
702 |
716 |
546 |
|||||
Total commercial real estate loans |
1,186 |
1,255 |
1,268 |
1,170 |
856 |
|||||
Commercial lease financing |
99 |
113 |
131 |
122 |
109 |
|||||
Total commercial loans |
1,843 |
1,954 |
2,078 |
1,992 |
1,560 |
|||||
Real estate -- residential mortgage |
72 |
73 |
68 |
46 |
39 |
|||||
Home equity: |
||||||||||
Community Banking |
111 |
107 |
103 |
101 |
91 |
|||||
Other |
18 |
21 |
21 |
20 |
19 |
|||||
Total home equity loans |
129 |
128 |
124 |
121 |
110 |
|||||
Consumer other -- Community Banking |
4 |
4 |
4 |
5 |
3 |
|||||
Consumer other: |
||||||||||
Marine |
16 |
26 |
15 |
19 |
21 |
|||||
Other |
1 |
2 |
1 |
2 |
2 |
|||||
Total consumer other |
17 |
28 |
16 |
21 |
23 |
|||||
Total consumer loans |
222 |
233 |
212 |
193 |
175 |
|||||
Total nonperforming loans |
2,065 |
2,187 |
2,290 |
2,185 |
1,735 |
|||||
Nonperforming loans held for sale |
195 |
116 |
304 |
145 |
72 |
|||||
OREO |
175 |
191 |
187 |
182 |
147 |
|||||
Allowance for OREO losses |
(45) |
(23) |
(40) |
(11) |
(4) |
|||||
OREO, net of allowance |
130 |
168 |
147 |
171 |
143 |
|||||
Other nonperforming assets |
38 |
39 |
58 |
47 |
44 |
|||||
Total nonperforming assets |
$ 2,428 |
$ 2,510 |
$ 2,799 |
$ 2,548 |
$ 1,994 |
|||||
Accruing loans past due 90 days or more |
$ 434 |
$ 331 |
$ 375 |
$ 552 |
$ 435 |
|||||
Accruing loans past due 30 through 89 days |
639 |
933 |
1,071 |
1,081 |
1,313 |
|||||
Restructured loans included in nonperforming loans (a) |
226 |
364 |
65 |
7 |
- |
|||||
Nonperforming assets from discontinued operations -- education lending business |
43 |
14 |
12 |
3 |
3 |
|||||
Nonperforming loans to period-end portfolio loans |
3.69% |
3.72% |
3.68% |
3.25% |
2.48% |
|||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
4.31 |
4.25 |
4.46 |
3.77 |
2.84 |
|||||
(a) Restructured loans (i.e. troubled debt restructurings) are those for which Key, for reasons related to a borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. These concessions are made to improve the collectability of the loan and generally take the form of a reduction of the interest rate, extension of the maturity date or reduction in the principal balance. |
||||||||||
Summary of Changes in Nonperforming Loans From Continuing Operations (in millions) |
||||||||||
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Balance at beginning of period |
$ 2,187 |
$ 2,290 |
$ 2,185 |
$ 1,735 |
$ 1,221 |
|||||
Loans placed on nonaccrual status |
746 |
1,141 |
1,160 |
1,227 |
1,166 |
|||||
Charge-offs |
(557) |
(750) |
(619) |
(540) |
(487) |
|||||
Loans sold |
(15) |
(70) |
(4) |
(12) |
(15) |
|||||
Payments |
(102) |
(237) |
(294) |
(142) |
(105) |
|||||
Transfers to OREO |
(20) |
(98) |
(91) |
(45) |
(32) |
|||||
Transfers to nonperforming loans held for sale |
(59) |
(23) |
(5) |
(30) |
-- |
|||||
Transfers to other nonperforming assets |
(3) |
(4) |
(29) |
-- |
-- |
|||||
Loans returned to accrual status |
(112) |
(62) |
(13) |
(8) |
(13) |
|||||
Balance at end of period |
$ 2,065 |
$ 2,187 |
$ 2,290 |
$ 2,185 |
$ 1,735 |
|||||
Summary of Changes in Nonperforming Loans Held For Sale From Continuing Operations (in millions) |
||||||||||
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Balance at beginning of period |
$ 116 |
$ 304 |
$ 145 |
$ 72 |
$ 88 |
|||||
Transfers in |
129 |
71 |
216 |
79 |
2 |
|||||
Loans sold |
(38) |
(228) |
(45) |
(1) |
- |
|||||
Transfers to OREO |
(6) |
- |
- |
(1) |
(12) |
|||||
Valuation adjustments |
(6) |
(15) |
(10) |
(4) |
(6) |
|||||
Loans returned to accrual status/other |
- |
(16) |
(2) |
- |
- |
|||||
Balance at end of period |
$ 195 |
$ 116 |
$ 304 |
$ 145 |
$ 72 |
|||||
Summary of Changes in Other Real Estate Owned, Net of Allowance, From Continuing Operations (in millions) |
||||||||||
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
||||||
Balance at beginning of period |
$ 168 |
$ 147 |
$ 171 |
$ 143 |
$ 107 |
|||||
Properties acquired -- nonperforming loans |
26 |
98 |
91 |
46 |
44 |
|||||
Valuation adjustments |
(28) |
(12) |
(36) |
(9) |
(3) |
|||||
Properties sold |
(36) |
(65) |
(79) |
(9) |
(5) |
|||||
Balance at end of period |
$ 130 |
$ 168 |
$ 147 |
$ 171 |
$ 143 |
|||||
(a) Properties acquired consist of those related to performing and nonperforming loans. |
||||||||||
Line of Business Results (dollars in millions) |
|||||||||||||||
Community Banking |
|||||||||||||||
Percent change 1Q10 vs. |
|||||||||||||||
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
4Q09 |
1Q09 |
|||||||||
Summary of operations |
|||||||||||||||
Total revenue (TE) |
$ 599 |
$ 629 |
$ 632 |
$ 632 |
$ 612 |
(4.8) |
% |
(2.1) |
% |
||||||
Provision for loan losses |
142 |
230 |
160 |
199 |
141 |
(38.3) |
.7 |
||||||||
Noninterest expense |
468 |
492 |
491 |
496 |
468 |
(4.9) |
-- |
||||||||
Net income (loss) attributable to Key |
5 |
(41) |
(1) |
(29) |
12 |
N/M |
(58.3) |
||||||||
Average loans and leases |
27,769 |
28,321 |
29,126 |
30,305 |
31,275 |
(1.9) |
(11.2) |
||||||||
Average deposits |
51,459 |
52,640 |
53,068 |
52,786 |
51,655 |
(2.2) |
(.4) |
||||||||
Net loan charge-offs |
116 |
148 |
103 |
114 |
89 |
(21.6) |
30.3 |
||||||||
Net loan charge-offs to average loans |
1.69 |
% |
2.07 |
% |
1.40 |
% |
1.51 |
% |
1.15 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 597 |
$ 544 |
$ 559 |
$ 512 |
$ 499 |
9.7 |
19.6 |
||||||||
Return on average allocated equity |
.54 |
% |
(4.52) |
% |
(.11) |
% |
(3.18) |
% |
1.37 |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
8,187 |
8,227 |
8,472 |
8,709 |
8,939 |
(.5) |
(8.4) |
||||||||
Supplementary information (lines of business) |
|||||||||||||||
Regional Banking |
|||||||||||||||
Total revenue (TE) |
$ 490 |
$ 512 |
$ 528 |
$ 529 |
$ 509 |
(4.3) |
% |
(3.7) |
% |
||||||
Provision for loan losses |
115 |
139 |
93 |
166 |
68 |
(17.3) |
69.1 |
||||||||
Noninterest expense |
422 |
429 |
430 |
439 |
411 |
(1.6) |
2.7 |
||||||||
Net income (loss) attributable to Key |
(18) |
(18) |
14 |
(37) |
29 |
-- |
N/M |
||||||||
Average loans and leases |
18,753 |
19,076 |
19,347 |
19,745 |
20,004 |
(1.7) |
(6.3) |
||||||||
Average deposits |
46,197 |
47,569 |
48,551 |
48,717 |
47,784 |
(2.9) |
(3.3) |
||||||||
Net loan charge-offs |
96 |
82 |
78 |
72 |
52 |
17.1 |
84.6 |
||||||||
Net loan charge-offs to average loans |
2.08 |
% |
1.71 |
% |
1.60 |
% |
1.46 |
% |
1.05 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 327 |
$ 319 |
$ 289 |
$ 245 |
$ 205 |
2.5 |
59.5 |
||||||||
Return on average allocated equity |
(2.99) |
% |
(3.07) |
% |
2.40 |
% |
(6.41) |
% |
5.22 |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
7,836 |
7,877 |
8,120 |
8,339 |
8,565 |
(.5) |
(8.5) |
||||||||
Commercial Banking |
|||||||||||||||
Total revenue (TE) |
$ 109 |
$ 117 |
$ 104 |
$ 103 |
$ 103 |
(6.8) |
% |
5.8 |
% |
||||||
Provision for loan losses |
27 |
91 |
67 |
33 |
73 |
(70.3) |
(63.0) |
||||||||
Noninterest expense |
46 |
63 |
61 |
57 |
57 |
(27.0) |
(19.3) |
||||||||
Net income (loss) attributable to Key |
23 |
(23) |
(15) |
8 |
(17) |
N/M |
N/M |
||||||||
Average loans and leases |
9,016 |
9,245 |
9,779 |
10,560 |
11,271 |
(2.5) |
(20.0) |
||||||||
Average deposits |
5,262 |
5,071 |
4,517 |
4,069 |
3,871 |
3.8 |
35.9 |
||||||||
Net loan charge-offs |
20 |
66 |
25 |
42 |
37 |
(69.7) |
(45.9) |
||||||||
Net loan charge-offs to average loans |
.90 |
% |
2.83 |
% |
1.01 |
% |
1.60 |
% |
1.33 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 270 |
$ 225 |
$ 270 |
$ 267 |
$ 294 |
20.0 |
(8.2) |
||||||||
Return on average allocated equity |
7.29 |
% |
(7.19) |
% |
(4.54) |
% |
2.39 |
% |
(5.28) |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
351 |
350 |
352 |
370 |
374 |
.3 |
(6.1) |
||||||||
National Banking |
|||||||||||||||
Percent change 1Q10 vs. |
|||||||||||||||
1Q10 |
4Q09 |
3Q09 |
2Q09 |
1Q09 |
4Q09 |
1Q09 |
|||||||||
Summary of operations |
|||||||||||||||
Total revenue (TE) |
$ 376 |
$ 342 |
$ 383 |
$ 447 |
$ 423 |
9.9 |
% |
(11.1) |
% |
||||||
Provision for loan losses |
161 |
382 |
439 |
494 |
511 |
(57.9) |
(68.5) |
||||||||
Noninterest expense |
270 |
299 |
323 |
292 |
428 |
(9.7) |
(36.9) |
||||||||
Net income (loss) attributable to Key |
(33) |
(211) |
(234) |
(210) |
(394) |
84.4 |
91.6 |
||||||||
Average loans and leases |
22,440 |
24,011 |
26,715 |
28,586 |
29,697 |
(6.5) |
(24.4) |
||||||||
Average loans held for sale |
240 |
431 |
368 |
393 |
482 |
(44.3) |
(50.2) |
||||||||
Average deposits |
12,398 |
13,241 |
13,289 |
13,004 |
11,945 |
(6.4) |
3.8 |
||||||||
Net loan charge-offs |
251 |
411 |
357 |
252 |
239 |
(38.9) |
5.0 |
||||||||
Net loan charge-offs to average loans |
4.54 |
% |
6.79 |
% |
5.30 |
% |
3.54 |
% |
3.26 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 1,285 |
$ 1,326 |
$ 1,510 |
$ 1,217 |
$ 770 |
(3.1) |
66.9 |
||||||||
Return on average allocated equity |
(3.89) |
% |
(22.66) |
% |
(23.90) |
% |
(21.41) |
% |
(40.22) |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
2,409 |
2,434 |
2,508 |
2,581 |
2,661 |
(1.0) |
(9.5) |
||||||||
Supplementary information (lines of business) |
|||||||||||||||
Real Estate Capital and Corporate Banking Services |
|||||||||||||||
Total revenue (TE) |
$ 144 |
$ 93 |
$ 136 |
$ 192 |
$ 185 |
54.8 |
% |
(22.2) |
% |
||||||
Provision for loan losses |
145 |
304 |
336 |
414 |
438 |
(52.3) |
(66.9) |
||||||||
Noninterest expense |
114 |
112 |
96 |
111 |
190 |
1.8 |
(40.0) |
||||||||
Net income (loss) attributable to Key |
(72) |
(202) |
(183) |
(207) |
(320) |
64.4 |
77.5 |
||||||||
Average loans and leases |
12,340 |
13,256 |
14,321 |
15,144 |
15,717 |
(6.9) |
(21.5) |
||||||||
Average loans held for sale |
115 |
228 |
201 |
182 |
206 |
(49.6) |
(44.2) |
||||||||
Average deposits |
9,817 |
10,587 |
10,833 |
10,663 |
10,163 |
(7.3) |
(3.4) |
||||||||
Net loan charge-offs |
207 |
381 |
276 |
212 |
173 |
(45.7) |
19.7 |
||||||||
Net loan charge-offs to average loans |
6.80 |
% |
11.40 |
% |
7.65 |
% |
5.61 |
% |
4.46 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 1,067 |
$ 1,094 |
$ 1,184 |
$ 1,023 |
$ 622 |
(2.5) |
71.5 |
||||||||
Return on average allocated equity |
(14.08) |
% |
(35.45) |
% |
(30.49) |
% |
(34.17) |
% |
(56.11) |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
1,074 |
1,088 |
1,103 |
1,118 |
1,160 |
(1.3) |
(7.4) |
||||||||
Equipment Finance |
|||||||||||||||
Total revenue (TE) |
$ 61 |
$ 66 |
$ 59 |
$ 65 |
$ 66 |
(7.6) |
% |
(7.6) |
% |
||||||
Provision for loan losses |
4 |
65 |
75 |
42 |
41 |
(93.8) |
(90.2) |
||||||||
Noninterest expense |
48 |
59 |
88 |
61 |
56 |
(18.6) |
(14.3) |
||||||||
Net income (loss) attributable to Key |
6 |
(36) |
(65) |
(24) |
(19) |
N/M |
N/M |
||||||||
Average loans and leases |
4,574 |
4,610 |
5,010 |
5,051 |
5,031 |
(.8) |
(9.1) |
||||||||
Average loans held for sale |
1 |
-- |
20 |
18 |
8 |
100.0 |
(87.5) |
||||||||
Average deposits |
6 |
7 |
6 |
9 |
9 |
(14.3) |
(33.3) |
||||||||
Net loan charge-offs |
18 |
21 |
30 |
29 |
22 |
(14.3) |
(18.2) |
||||||||
Net loan charge-offs to average loans |
1.60 |
% |
1.81 |
% |
2.38 |
% |
2.30 |
% |
1.77 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 111 |
$ 122 |
$ 118 |
$ 105 |
$ 89 |
(9.0) |
24.7 |
||||||||
Return on average allocated equity |
6.59 |
% |
(39.02) |
% |
(66.98) |
% |
(26.09) |
% |
(16.94) |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
605 |
626 |
661 |
679 |
688 |
(3.4) |
(12.1) |
||||||||
Institutional and Capital Markets |
|||||||||||||||
Total revenue (TE) |
$ 171 |
$ 183 |
$ 188 |
$ 190 |
$ 172 |
(6.6) |
% |
(.6) |
% |
||||||
Provision for loan losses |
12 |
13 |
28 |
38 |
32 |
(7.7) |
(62.5) |
||||||||
Noninterest expense |
108 |
128 |
139 |
120 |
182 |
(15.6) |
(40.7) |
||||||||
Net income (loss) attributable to Key |
33 |
27 |
14 |
21 |
(55) |
22.2 |
N/M |
||||||||
Average loans and leases |
5,526 |
6,145 |
7,384 |
8,391 |
8,949 |
(10.1) |
(38.3) |
||||||||
Average loans held for sale |
124 |
203 |
147 |
193 |
268 |
(38.9) |
(53.7) |
||||||||
Average deposits |
2,575 |
2,647 |
2,450 |
2,332 |
1,773 |
(2.7) |
45.2 |
||||||||
Net loan charge-offs |
26 |
9 |
51 |
11 |
44 |
188.9 |
(40.9) |
||||||||
Net loan charge-offs to average loans |
1.91 |
% |
.58 |
% |
2.74 |
% |
.53 |
% |
1.99 |
% |
N/A |
N/A |
|||
Nonperforming assets at period end |
$ 107 |
$ 110 |
$ 208 |
$ 89 |
$ 59 |
(2.7) |
81.4 |
||||||||
Return on average allocated equity |
13.38 |
% |
10.03 |
% |
4.97 |
% |
7.41 |
% |
(18.51) |
% |
N/A |
N/A |
|||
Average full-time equivalent employees |
730 |
720 |
744 |
784 |
813 |
1.4 |
(10.2) |
||||||||
TE = Taxable Equivalent, N/A = Not Applicable, N/M = Not Meaningful |
|||||||||||||||
SOURCE KeyCorp
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