KeyCorp Reports Third Quarter 2018 Net Income Of $468 Million, Or $.45 Per Common Share
Cash efficiency ratio of 58.7%
Return on average tangible common equity of 16.8%
CLEVELAND, Oct. 18, 2018 /PRNewswire/ -- KeyCorp (NYSE: KEY) today announced third quarter net income from continuing operations attributable to Key common shareholders of $468 million, or $.45 per common share, compared to $464 million, or $.44 per common share, for the second quarter of 2018 and $349 million, or $.32 per common share, for the third quarter of 2017.
"Our solid third quarter results reflect our success in growing and expanding client relationships, driving efficiency across the organization, and staying true to our moderate risk profile. This quarter, our return on tangible common equity ratio was 16.8%, and our cash efficiency ratio was 58.7%, both an improvement of over 300 basis points from last year.
"Our Community Bank and Corporate Bank both contributed to our year-over-year revenue growth of 3%, which demonstrates our competitive positioning and the success of our distinctive relationship-based business model. Expense management remains a priority, as we continue to execute on our cost initiatives, which allows us to reinvest into our businesses.
"Credit quality and capital remain strengths, with solid credit trends this quarter and disciplined capital management. Importantly, we increased our common share dividend 42% during the third quarter – from $.12 to $.17. We remain dedicated to delivering results for our shareholders, as we focus on maintaining our moderate risk profile, and staying diligent in managing credit quality as we move through different parts of the business cycle."
- Beth Mooney, Chairman and CEO
Selected Financial Highlights |
|||||||||||||||
dollars in millions, except per share data |
Change 3Q18 vs. |
||||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
|||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
468 |
$ |
464 |
$ |
349 |
.9 |
% |
34.1 |
% |
|||||
Income (loss) from continuing operations attributable to Key common shareholders per |
.45 |
.44 |
.32 |
2.3 |
40.6 |
||||||||||
Return on average tangible common equity from continuing operations (a) |
16.81 |
% |
16.73 |
% |
12.21 |
% |
N/A |
N/A |
|||||||
Return on average total assets from continuing operations |
1.40 |
1.41 |
1.07 |
N/A |
N/A |
||||||||||
Common Equity Tier 1 ratio (b) |
9.93 |
10.13 |
10.26 |
N/A |
N/A |
||||||||||
Book value at period end |
$ |
13.33 |
$ |
13.29 |
$ |
13.18 |
.3 |
% |
1.1 |
% |
|||||
Net interest margin (TE) from continuing operations |
3.18 |
% |
3.19 |
% |
3.15 |
% |
N/A |
N/A |
|||||||
(a) |
The table entitled "GAAP to Non-GAAP Reconciliations" in the attached financial supplement presents the computations of certain financial measures related to "Return on average tangible common equity from continuing operations." The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. |
(b) |
9/30/2018 ratio is estimated. |
TE = Taxable Equivalent, N/A = Not Applicable |
INCOME STATEMENT HIGHLIGHTS |
||||||||||||||
Revenue |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Net interest income (TE) |
$ |
993 |
$ |
987 |
$ |
962 |
.6 |
% |
3.2 |
% |
||||
Noninterest income |
609 |
660 |
592 |
(7.7) |
2.9 |
|||||||||
Total revenue |
$ |
1,602 |
$ |
1,647 |
$ |
1,554 |
(2.7) |
% |
3.1 |
% |
||||
TE = Taxable Equivalent |
Taxable-equivalent net interest income was $993 million for the third quarter of 2018, and the net interest margin was 3.18%, compared to taxable-equivalent net interest income of $962 million and a net interest margin of 3.15% for the third quarter of 2017, reflecting the benefit from higher interest rates and higher earning asset balances. Third quarter 2018 net interest income included $26 million of purchase accounting accretion, a decline of $22 million from the third quarter of 2017.
Compared to the second quarter of 2018, taxable-equivalent net interest income increased by $6 million, and the net interest margin declined by one basis point. Both net interest income and the net interest margin benefited from higher interest rates. One additional day in the third quarter further benefited net interest income. These benefits were offset by lower loan fees, an expected decline in purchase accounting accretion, and an elevated level of liquidity, reflecting higher short-term and seasonal deposits, as well as commercial loan paydowns.
Noninterest Income |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Trust and investment services income |
$ |
117 |
$ |
128 |
$ |
135 |
(8.6) |
% |
(13.3) |
% |
||||
Investment banking and debt placement fees |
166 |
155 |
141 |
7.1 |
17.7 |
|||||||||
Service charges on deposit accounts |
85 |
91 |
91 |
(6.6) |
(6.6) |
|||||||||
Operating lease income and other leasing gains |
35 |
(6) |
16 |
N/M |
118.8 |
|||||||||
Corporate services income |
52 |
61 |
54 |
(14.8) |
(3.7) |
|||||||||
Cards and payments income |
69 |
71 |
75 |
(2.8) |
(8.0) |
|||||||||
Corporate-owned life insurance income |
34 |
32 |
31 |
6.3 |
9.7 |
|||||||||
Consumer mortgage income |
9 |
7 |
7 |
28.6 |
28.6 |
|||||||||
Mortgage servicing fees |
19 |
22 |
21 |
(13.6) |
(9.5) |
|||||||||
Other income |
23 |
99 |
21 |
(76.8) |
9.5 |
|||||||||
Total noninterest income |
$ |
609 |
$ |
660 |
$ |
592 |
(7.7) |
% |
2.9 |
% |
||||
N/M = Not meaningful |
Key's noninterest income was $609 million for the third quarter of 2018, compared to $592 million for the year-ago quarter. Growth was primarily driven by a $25 million increase in investment banking and debt placement fees, related to strength in advisory fees, including benefit from the acquisition of Cain Brothers, as well as organic growth. Operating lease and other leasing gains increased $19 million related to higher volume and lease residual losses in the year-ago period. A decline in trust and investment services income, impacted by the sale of Key Insurance and Benefits Services in the second quarter of 2018, partially offset the increases. Cards and payments income and service charges on deposit accounts both declined $6 million, driven by the 2018 adoption of the revenue recognition accounting standard.
Compared to the second quarter of 2018, noninterest income decreased by $51 million. The decline was primarily related to a $78 million gain from the sale of Key Insurance and Benefits Services in the prior quarter, reported in other income. Trust and investment services income declined $11 million, primarily impacted by the sale of Key Insurance and Benefits Services, and corporate services income declined $9 million from lower derivative income. Partially offsetting these items was a $41 million increase in operating lease income and other leasing gains, related to a lease residual loss in the prior quarter. Additionally, investment banking and debt placement fees continue to show momentum, as fees increased $11 million, largely related to strength in advisory and loan syndication fees.
Noninterest Expense |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Personnel expense |
$ |
553 |
$ |
586 |
$ |
559 |
(5.6) |
% |
(1.1) |
% |
||||
Nonpersonnel expense |
411 |
407 |
433 |
1.0 |
(5.1) |
|||||||||
Total noninterest expense |
$ |
964 |
$ |
993 |
$ |
992 |
(2.9) |
% |
(2.8) |
% |
||||
Key's noninterest expense was $964 million for the third quarter of 2018, compared to $992 million in the year-ago quarter. The third quarter of 2017 included $36 million of merger-related charges. Excluding these charges, the increase in expenses from the year-ago period was largely related to growth from the Cain Brothers acquisition and other investments throughout the year. This growth offset the realization of cost savings efforts across the franchise.
Key's noninterest expense was $964 million for the third quarter of 2018, compared to $993 million in the prior quarter. The decrease was largely driven by a $33 million decline in personnel expense, including lower severance and incentive compensation expense. Additionally, business services and professional fees declined by $8 million, partially offset by an increase in other expense.
BALANCE SHEET HIGHLIGHTS
Average Loans |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Commercial and industrial (a) |
$ |
44,749 |
$ |
45,030 |
$ |
41,416 |
(.6) |
% |
8.0 |
% |
||||
Other commercial loans |
20,471 |
20,394 |
21,598 |
.4 |
(5.2) |
|||||||||
Home equity loans |
11,415 |
11,601 |
12,314 |
(1.6) |
(7.3) |
|||||||||
Other consumer loans |
11,832 |
11,619 |
11,486 |
1.8 |
3.0 |
|||||||||
Total loans |
$ |
88,467 |
$ |
88,644 |
$ |
86,814 |
(.2) |
% |
1.9 |
% |
||||
(a) |
Commercial and industrial average loan balances include $128 million, $126 million, and $117 million of assets from commercial credit cards at September 30, 2018, June 30, 2018, and September 30, 2017, respectively. |
Average loans were $88.5 billion for the third quarter of 2018, an increase of $1.7 billion compared to the third quarter of 2017, reflecting broad-based growth in commercial and industrial loans, partially offset by higher paydowns in commercial real estate balances and home equity lines of credit.
Compared to the second quarter of 2018, average loans decreased by $177 million, driven by continued levels of lower utilization and elevated paydowns. Period-end loan balances grew $1.0 billion compared to the prior quarter, reflecting increased momentum, as growth in commercial and industrial loans and commercial real estate balances increased near the end of the third quarter.
Average Deposits |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Non-time deposits |
$ |
92,414 |
$ |
91,538 |
$ |
92,039 |
1.0 |
% |
.4 |
% |
||||
Certificates of deposit ($100,000 or more) |
8,186 |
7,516 |
6,402 |
8.9 |
27.9 |
|||||||||
Other time deposits |
5,026 |
4,949 |
4,664 |
1.6 |
7.8 |
|||||||||
Total deposits |
$ |
105,626 |
$ |
104,003 |
$ |
103,105 |
1.6 |
% |
2.4 |
% |
||||
Cost of total deposits |
.53 |
% |
.43 |
% |
.28 |
% |
N/A |
N/A |
||||||
N/A = Not Applicable |
Average deposits totaled $105.6 billion for the third quarter of 2018, an increase of $2.5 billion compared to the year-ago quarter, reflecting growth in higher-yielding deposit products, as well as strength in Key's retail banking franchise and growth from commercial relationships.
Compared to the second quarter of 2018, average deposits increased by $1.6 billion, reflecting growth from retail and commercial relationships, as well as short-term and seasonal deposit inflows.
ASSET QUALITY |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Net loan charge-offs |
$ |
60 |
$ |
60 |
$ |
32 |
— |
87.5 |
% |
|||||
Net loan charge-offs to average total loans |
.27 |
% |
.27 |
% |
.15 |
% |
N/A |
N/A |
||||||
Nonperforming loans at period end (a) |
$ |
645 |
$ |
545 |
$ |
517 |
18.3 |
% |
24.8 |
|||||
Nonperforming assets at period end (a) |
674 |
571 |
556 |
18.0 |
21.2 |
|||||||||
Allowance for loan and lease losses |
887 |
887 |
880 |
— |
.8 |
|||||||||
Allowance for loan and lease losses to nonperforming loans (a) |
137.5 |
% |
162.8 |
% |
170.2 |
% |
N/A |
N/A |
||||||
Provision for credit losses |
$ |
62 |
$ |
64 |
$ |
51 |
(3.1) |
% |
21.6 |
% |
||||
(a) |
Nonperforming loan balances exclude $606 million, $629 million, and $783 million of purchased credit impaired loans at September 30, 2018, June 30, 2018, and September 30, 2017, respectively. |
N/A = Not Applicable |
Key's provision for credit losses was $62 million for the third quarter of 2018, compared to $51 million for the third quarter of 2017 and $64 million for the second quarter of 2018. Key's allowance for loan and lease losses was $887 million, or .99% of total period-end loans at September 30, 2018, compared to 1.02% at September 30, 2017, and 1.01% at June 30, 2018.
Net loan charge-offs for the third quarter of 2018 totaled $60 million, or .27% of average total loans. These results compare to $32 million, or .15%, for the third quarter of 2017, and $60 million, or .27%, for the second quarter of 2018.
At September 30, 2018, Key's nonperforming loans totaled $645 million, which represented .72% of period-end portfolio loans. These results compare to .60% at September 30, 2017, and .62% at June 30, 2018. Nonperforming assets at September 30, 2018, totaled $674 million, and represented .75% of period-end portfolio loans and OREO and other nonperforming assets. These results compare to .64% at September 30, 2017, and .65% at June 30, 2018.
CAPITAL
Key's estimated risk-based capital ratios included in the following table continued to exceed all "well-capitalized" regulatory benchmarks at September 30, 2018.
Capital Ratios |
||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
||||
Common Equity Tier 1 (a) |
9.93 |
% |
10.13 |
% |
10.26 |
% |
Tier 1 risk-based capital (a) |
11.09 |
10.95 |
11.11 |
|||
Total risk based capital (a) |
12.97 |
12.83 |
13.09 |
|||
Tangible common equity to tangible assets (b) |
8.05 |
8.32 |
8.49 |
|||
Leverage (a) |
10.05 |
9.87 |
9.83 |
|||
(a) |
9/30/2018 ratio is estimated. |
(b) |
The table entitled "GAAP to Non-GAAP Reconciliations" in the attached financial supplement presents the computations of certain financial measures related to "tangible common equity." The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. See below for further information on the Regulatory Capital Rules. |
Key's capital position remained strong in the third quarter. As shown in the preceding table, at September 30, 2018, Key's estimated Common Equity Tier 1 and Tier 1 risk-based capital ratios stood at 9.93% and 11.09%, respectively. Key's tangible common equity ratio was 8.05% at September 30, 2018.
As a "standardized approach" banking organization, Key's mandatory compliance with the final Basel III capital framework for U.S. banking organizations (the "Regulatory Capital Rules") began on January 1, 2015, subject to transitional provisions extending to January 1, 2019. Key's estimated Common Equity Tier 1 ratio as calculated under the fully phased-in Regulatory Capital Rules was 9.85% at September 30, 2018. This estimate exceeds the fully phased-in required minimum Common Equity Tier 1 and Capital Conservation Buffer of 7.00%.
Summary of Changes in Common Shares Outstanding |
||||||||||||
in thousands |
Change 3Q18 vs. |
|||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||
Shares outstanding at beginning of period |
1,058,944 |
1,064,939 |
1,092,739 |
(.6) |
% |
(3.1) |
% |
|||||
Open market repurchases and return of shares under employee |
(25,418) |
(6,259) |
(15,298) |
306.1 |
66.2 |
|||||||
Shares issued under employee compensation plans (net of cancellations) |
761 |
264 |
1,598 |
188.3 |
(52.4) |
|||||||
Shares outstanding at end of period |
1,034,287 |
1,058,944 |
1,079,039 |
(2.3) |
% |
(4.1) |
% |
|||||
N/M = Not Meaningful |
Consistent with Key's 2018 Capital Plan, during the third quarter of 2018, Key declared a dividend of $.17 per common share, reflecting a 42% increase from the prior quarter. Key also completed $542 million of common share repurchases during the quarter.
LINE OF BUSINESS RESULTS
The following table shows the contribution made by each major business segment to Key's taxable-equivalent revenue from continuing operations and income (loss) from continuing operations attributable to Key for the periods presented. For more detailed financial information pertaining to each business segment, see the tables at the end of this release.
Major Business Segments |
|||||||||||||||
dollars in millions |
Change 3Q18 vs. |
||||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
|||||||||||
Revenue from continuing operations (TE) |
|||||||||||||||
Key Community Bank |
$ |
994 |
$ |
997 |
$ |
945 |
(.3) |
% |
5.2 |
% |
|||||
Key Corporate Bank |
574 |
542 |
561 |
5.9 |
2.3 |
||||||||||
Other Segments |
24 |
37 |
42 |
(35.1) |
(42.9) |
||||||||||
Total segments |
1,592 |
1,576 |
1,548 |
1.0 |
2.8 |
||||||||||
Reconciling Items (a) |
10 |
71 |
6 |
(85.9) |
66.7 |
||||||||||
Total |
$ |
1,602 |
$ |
1,647 |
$ |
1,554 |
(2.7) |
% |
3.1 |
% |
|||||
Income (loss) from continuing operations attributable to Key |
|||||||||||||||
Key Community Bank |
$ |
241 |
$ |
243 |
$ |
163 |
(.8) |
% |
47.9 |
% |
|||||
Key Corporate Bank |
199 |
167 |
190 |
19.2 |
4.7 |
||||||||||
Other Segments |
22 |
25 |
21 |
(12.0) |
4.8 |
||||||||||
Total segments |
462 |
435 |
374 |
6.2 |
23.5 |
||||||||||
Reconciling Items (b) |
20 |
44 |
(11) |
(54.5) |
N/M |
||||||||||
Total |
$ |
482 |
$ |
479 |
$ |
363 |
.6 |
% |
32.8 |
% |
|||||
(a) |
Reconciling items consists primarily of the gain on the sale of Key Insurance and Benefits Services for the second quarter of 2018. |
(b) |
Reconciling items consists primarily of the gain on the sale of Key Insurance and Benefits Services for the second quarter of 2018, the unallocated portion of merger-related charges for the third quarter of 2017, and items not allocated to the business segments because they do not reflect their normal operations. |
TE = Taxable Equivalent, N/M = Not Meaningful |
Key Community Bank |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Summary of operations |
||||||||||||||
Net interest income (TE) |
$ |
726 |
$ |
715 |
$ |
673 |
1.5 |
% |
7.9 |
% |
||||
Noninterest income |
268 |
282 |
272 |
(5.0) |
(1.5) |
|||||||||
Total revenue (TE) |
994 |
997 |
945 |
(.3) |
5.2 |
|||||||||
Provision for credit losses |
43 |
38 |
59 |
13.2 |
(27.1) |
|||||||||
Noninterest expense |
635 |
640 |
626 |
(.8) |
1.4 |
|||||||||
Income (loss) before income taxes (TE) |
316 |
319 |
260 |
(.9) |
21.5 |
|||||||||
Allocated income taxes (benefit) and TE adjustments |
75 |
76 |
97 |
(1.3) |
(22.7) |
|||||||||
Net income (loss) attributable to Key |
$ |
241 |
$ |
243 |
$ |
163 |
(.8) |
% |
47.9 |
% |
||||
Average balances |
||||||||||||||
Loans and leases |
$ |
47,862 |
$ |
47,985 |
$ |
47,614 |
(.3) |
% |
.5 |
% |
||||
Total assets |
51,740 |
51,867 |
51,642 |
(.2) |
.2 |
|||||||||
Deposits |
82,259 |
80,930 |
79,563 |
1.6 |
3.4 |
|||||||||
Assets under management at period end |
$ |
40,575 |
$ |
39,663 |
$ |
38,660 |
2.3 |
% |
5.0 |
% |
||||
TE = Taxable Equivalent |
Additional Key Community Bank Data |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Noninterest income |
||||||||||||||
Trust and investment services income |
$ |
90 |
$ |
92 |
$ |
85 |
(2.2) |
% |
5.9 |
% |
||||
Service charges on deposit accounts |
72 |
77 |
78 |
(6.5) |
(7.7) |
|||||||||
Cards and payments income |
59 |
59 |
65 |
— |
(9.2) |
|||||||||
Other noninterest income |
47 |
54 |
44 |
(13.0) |
6.8 |
|||||||||
Total noninterest income |
$ |
268 |
$ |
282 |
$ |
272 |
(5.0) |
% |
(1.5) |
% |
||||
Average deposit balances |
||||||||||||||
NOW and money market deposit accounts |
$ |
45,967 |
$ |
45,112 |
$ |
44,481 |
1.9 |
% |
3.3 |
% |
||||
Savings deposits |
4,923 |
5,078 |
5,165 |
(3.1) |
(4.7) |
|||||||||
Certificates of deposit ($100,000 or more) |
5,608 |
5,232 |
4,195 |
7.2 |
33.7 |
|||||||||
Other time deposits |
5,019 |
4,934 |
4,657 |
1.7 |
7.8 |
|||||||||
Noninterest-bearing deposits |
20,742 |
20,574 |
21,065 |
.8 |
(1.5) |
|||||||||
Total deposits |
$ |
82,259 |
$ |
80,930 |
$ |
79,563 |
1.6 |
% |
3.4 |
% |
||||
Home equity loans |
||||||||||||||
Average balance |
$ |
11,317 |
$ |
11,496 |
$ |
12,182 |
||||||||
Combined weighted-average loan-to-value ratio (at date of origination) |
70 |
% |
70 |
% |
69 |
% |
||||||||
Percent first lien positions |
60 |
60 |
60 |
|||||||||||
Other data |
||||||||||||||
Branches |
1,166 |
1,177 |
1,208 |
|||||||||||
Automated teller machines |
1,518 |
1,537 |
1,588 |
|||||||||||
Key Community Bank Summary of Operations (3Q18 vs. 3Q17)
- Positive operating leverage compared to the prior year
- Net income increased $78 million, or 47.9%, from the prior year
- Average commercial and industrial loans increased $831 million, or 4.4%, from the prior year
Key Community Bank recorded net income attributable to Key of $241 million for the third quarter of 2018, compared to $163 million for the year-ago quarter, benefiting from momentum in Key's core businesses and a lower tax rate as a result of tax reform.
Taxable-equivalent net interest income increased by $53 million, or 7.9%, from the third quarter of 2017. The increase in net interest income was primarily attributable to the benefit from higher interest rates and balance sheet growth, partially offset by lower purchase accounting accretion. Average loans and leases increased $248 million, or .5%, largely driven by a $831 million, or 4.4%, increase in commercial and industrial loans, partially offset by a continued decline in home equity, in line with industry trends. Additionally, average deposits increased $2.7 billion, or 3.4%, driven by growth across multiple businesses, from the third quarter of 2017.
Noninterest income decreased $4 million, or 1.5%, from the year-ago quarter driven by lower service charges on deposit accounts and cards and payments income, which were impacted by revenue recognition changes. This was partially offset by higher trust and investment services income, which increased primarily due to higher assets under management from market growth.
The provision for credit losses decreased by $16 million, or 27.1%, from the third quarter of 2017. Net loan charge-offs increased $2 million, or 4.9%, from the third quarter of 2017, as overall credit quality remained stable.
Noninterest expense increased $9 million, or 1.4%, from the year-ago quarter. Personnel expense increased, primarily driven by higher production related incentive compensation and ongoing investments, including residential mortgage.
Key Corporate Bank |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Summary of operations |
||||||||||||||
Net interest income (TE) |
$ |
273 |
$ |
277 |
$ |
292 |
(1.4) |
% |
(6.5) |
% |
||||
Noninterest income |
301 |
265 |
269 |
13.6 |
11.9 |
|||||||||
Total revenue (TE) |
574 |
542 |
561 |
5.9 |
2.3 |
|||||||||
Provision for credit losses |
20 |
28 |
(11) |
(28.6) |
N/M |
|||||||||
Noninterest expense |
316 |
325 |
303 |
(2.8) |
4.3 |
|||||||||
Income (loss) before income taxes (TE) |
238 |
189 |
269 |
25.9 |
(11.5) |
|||||||||
Allocated income taxes and TE adjustments |
39 |
22 |
79 |
77.3 |
(50.6) |
|||||||||
Net income (loss) attributable to Key |
$ |
199 |
$ |
167 |
$ |
190 |
19.2 |
% |
4.7 |
% |
||||
Average balances |
||||||||||||||
Loans and leases |
$ |
39,714 |
$ |
39,709 |
$ |
38,021 |
— |
4.5 |
% |
|||||
Loans held for sale |
1,042 |
1,299 |
1,521 |
(19.8) |
% |
(31.5) |
||||||||
Total assets |
46,860 |
47,212 |
45,257 |
(.7) |
3.5 |
|||||||||
Deposits |
21,056 |
21,057 |
21,559 |
— |
(2.3) |
|||||||||
TE = Taxable Equivalent, N/M = Not Meaningful |
Additional Key Corporate Bank Data |
||||||||||||||
dollars in millions |
Change 3Q18 vs. |
|||||||||||||
3Q18 |
2Q18 |
3Q17 |
2Q18 |
3Q17 |
||||||||||
Noninterest income |
||||||||||||||
Trust and investment services income |
$ |
27 |
$ |
29 |
$ |
34 |
(6.9) |
% |
(20.6) |
% |
||||
Investment banking and debt placement fees |
162 |
153 |
137 |
5.9 |
18.2 |
|||||||||
Operating lease income and other leasing gains |
34 |
(10) |
13 |
N/M |
161.5 |
|||||||||
Corporate services income |
37 |
44 |
40 |
(15.9) |
(7.5) |
|||||||||
Service charges on deposit accounts |
13 |
13 |
13 |
— |
— |
|||||||||
Cards and payments income |
10 |
12 |
10 |
(16.7) |
— |
|||||||||
Payments and services income |
60 |
69 |
63 |
(13.0) |
(4.8) |
|||||||||
Mortgage servicing fees |
15 |
19 |
18 |
(21.1) |
(16.7) |
|||||||||
Other noninterest income |
3 |
5 |
4 |
(40.0) |
(25.0) |
|||||||||
Total noninterest income |
$ |
301 |
$ |
265 |
$ |
269 |
13.6 |
% |
11.9 |
% |
||||
N/M = Not Meaningful |
Key Corporate Bank Summary of Operations (3Q18 vs. 3Q17)
- Commercial and industrial loans up $2.6 billion, or 11.4%, from prior year
- Investment banking and debt placement fees up $25 million, or 18.2%, from prior year
Key Corporate Bank recorded net income attributable to Key of $199 million for the third quarter of 2018, compared to $190 million for the year-ago quarter.
Taxable-equivalent net interest income decreased by $19 million, or 6.5%, compared to the third quarter of 2017. This decline is primarily related to $7 million of lower purchase accounting accretion, as well as loan spread compression. Average loan and lease balances increased $1.7 billion, or 4.5%, from the year-ago quarter, driven by broad-based growth in commercial and industrial loans, partially offset by a continued decline in home equity. Average deposit balances decreased $503 million, or 2.3%, from the year-ago quarter, driven by the managed exit of higher cost corporate and public sector deposits offsetting growth in core deposits.
Noninterest income was up $32 million, or 11.9%, from the prior year. Investment banking and debt placement fees increased $25 million related to the acquisition of Cain Brothers and organic growth. Operating lease income and other leasing gains increased $21 million due to higher volumes, as well as lease residual losses in the year-ago period. These increases were slightly offset by lower trust and investment services income of $7 million, as well as $3 million declines in both mortgage fees due to lower transactional fees and corporate services income due to lower derivatives income.
During the third quarter of 2018, the provision for credit losses increased $31 million, compared to the third quarter of 2017, mostly due to higher net loan charge-offs.
Noninterest expense increased by $13 million, or 4.3%, from the third quarter of 2017. The increase from the prior year was largely related to acquisitions and investments made throughout the year driving increases in personnel expense and intangible amortization, as well as higher operating lease expense, driven by increased volume.
Other Segments
Other Segments consist of Corporate Treasury, Key's Principal Investing unit, and various exit portfolios. Other Segments generated net income attributable to Key of $22 million for the third quarter of 2018, compared to $21 million for the same period last year.
*****
KeyCorp's roots trace back 190 years to Albany, New York. Headquartered in Cleveland, Ohio, Key is one of the nation's largest bank-based financial services companies, with assets of approximately $138.8 billion at September 30, 2018.
Key provides deposit, lending, cash management, and investment services to individuals and businesses in 15 states under the name KeyBank National Association through a network of over 1,100 branches and more than 1,500 ATMs. Key also provides a broad range of sophisticated corporate and investment banking products, such as merger and acquisition advice, public and private debt and equity, syndications and derivatives to middle market companies in selected industries throughout the United States under the KeyBanc Capital Markets trade name. For more information, visit https://www.key.com/. KeyBank is Member FDIC.
This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements do not relate strictly to historical or current facts. Forward-looking statements usually can be identified by the use of words such as "goal," "objective," "plan," "expect," "assume," "anticipate," "intend," "project," "believe," "estimate," or other words of similar meaning. Forward-looking statements provide our current expectations or forecasts of future events, circumstances, results, or aspirations. Forward-looking statements, by their nature, are subject to assumptions, risks and uncertainties, many of which are outside of our control. Our actual results may differ materially from those set forth in our forward-looking statements. There is no assurance that any list of risks and uncertainties or risk factors is complete. Factors that could cause Key's actual results to differ from those described in the forward-looking statements can be found in KeyCorp's Form 10-K for the year ended December 31, 2017, as well as in KeyCorp's subsequent SEC filings, all of which have been filed with the Securities and Exchange Commission (the "SEC") and are available on Key's website (www.key.com/ir) and on the SEC's website (www.sec.gov). These factors may include, among others: deterioration of commercial real estate market fundamentals, adverse changes in credit quality trends, declining asset prices, a reversal of the U.S. economic recovery due to financial, political, or other shocks, and the extensive regulation of the U.S. financial services industry. Any forward-looking statements made by us or on our behalf speak only as of the date they are made and we do not undertake any obligation to update any forward-looking statement to reflect the impact of subsequent events or circumstances. |
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 Thursday, October 18, 2018. An audio replay of the call will be available through October 28, 2018.
*****
KeyCorp
Third Quarter 2018
Financial Supplement
Financial Highlights |
|||||||||||
(dollars in millions, except per share amounts) |
|||||||||||
Three months ended |
|||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
|||||||||
Summary of operations |
|||||||||||
Net interest income (TE) |
$ |
993 |
$ |
987 |
$ |
962 |
|||||
Noninterest income |
609 |
660 |
592 |
||||||||
Total revenue (TE) |
1,602 |
1,647 |
1,554 |
||||||||
Provision for credit losses |
62 |
64 |
51 |
||||||||
Noninterest expense |
964 |
993 |
992 |
||||||||
Income (loss) from continuing operations attributable to Key |
482 |
479 |
363 |
||||||||
Income (loss) from discontinued operations, net of taxes (a) |
— |
3 |
1 |
||||||||
Net income (loss) attributable to Key |
482 |
482 |
364 |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
468 |
464 |
349 |
||||||||
Income (loss) from discontinued operations, net of taxes (a) |
— |
3 |
1 |
||||||||
Net income (loss) attributable to Key common shareholders |
468 |
467 |
350 |
||||||||
Per common share |
|||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
.45 |
$ |
.44 |
$ |
.32 |
|||||
Income (loss) from discontinued operations, net of taxes (a) |
— |
— |
— |
||||||||
Net income (loss) attributable to Key common shareholders (b) |
.45 |
.44 |
.32 |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution |
.45 |
.44 |
.32 |
||||||||
Income (loss) from discontinued operations, net of taxes — assuming dilution (a) |
— |
— |
— |
||||||||
Net income (loss) attributable to Key common shareholders — assuming dilution (b) |
.45 |
.44 |
.32 |
||||||||
Cash dividends declared |
.17 |
.12 |
.095 |
||||||||
Book value at period end |
13.33 |
13.29 |
13.18 |
||||||||
Tangible book value at period end |
10.59 |
10.59 |
10.52 |
||||||||
Market price at period end |
19.89 |
19.54 |
18.82 |
||||||||
Performance ratios |
|||||||||||
From continuing operations: |
|||||||||||
Return on average total assets |
1.40 |
% |
1.41 |
% |
1.07 |
% |
|||||
Return on average common equity |
13.36 |
13.29 |
9.74 |
||||||||
Return on average tangible common equity (c) |
16.81 |
16.73 |
12.21 |
||||||||
Net interest margin (TE) |
3.18 |
3.19 |
3.15 |
||||||||
Cash efficiency ratio (c) |
58.7 |
58.8 |
62.2 |
||||||||
From consolidated operations: |
|||||||||||
Return on average total assets |
1.39 |
% |
1.40 |
% |
1.06 |
% |
|||||
Return on average common equity |
13.36 |
13.37 |
9.77 |
||||||||
Return on average tangible common equity (c) |
16.81 |
16.84 |
12.25 |
||||||||
Net interest margin (TE) |
3.16 |
3.17 |
3.13 |
||||||||
Loan to deposit (d) |
87.0 |
86.9 |
86.2 |
||||||||
Capital ratios at period end |
|||||||||||
Key shareholders' equity to assets |
10.96 |
% |
10.96 |
% |
11.15 |
% |
|||||
Key common shareholders' equity to assets |
9.93 |
10.21 |
10.40 |
||||||||
Tangible common equity to tangible assets (c) |
8.05 |
8.32 |
8.49 |
||||||||
Common Equity Tier 1 (e) |
9.93 |
10.13 |
10.26 |
||||||||
Tier 1 risk-based capital (e) |
11.09 |
10.95 |
11.11 |
||||||||
Total risk-based capital (e) |
12.97 |
12.83 |
13.09 |
||||||||
Leverage (e) |
10.05 |
9.87 |
9.83 |
||||||||
Asset quality — from continuing operations |
|||||||||||
Net loan charge-offs |
$ |
60 |
$ |
60 |
$ |
32 |
|||||
Net loan charge-offs to average loans |
.27 |
% |
.27 |
% |
.15 |
% |
|||||
Allowance for loan and lease losses |
$ |
887 |
$ |
887 |
$ |
880 |
|||||
Allowance for credit losses |
947 |
945 |
937 |
||||||||
Allowance for loan and lease losses to period-end loans |
.99 |
% |
1.01 |
% |
1.02 |
% |
|||||
Allowance for credit losses to period-end loans |
1.06 |
1.07 |
1.08 |
||||||||
Allowance for loan and lease losses to nonperforming loans (f) |
137.5 |
162.8 |
170.2 |
||||||||
Allowance for credit losses to nonperforming loans (f) |
146.8 |
173.4 |
181.2 |
||||||||
Nonperforming loans at period-end (f) |
$ |
645 |
$ |
545 |
$ |
517 |
|||||
Nonperforming assets at period-end (f) |
674 |
571 |
556 |
||||||||
Nonperforming loans to period-end portfolio loans (f) |
.72 |
% |
.62 |
% |
.60 |
% |
|||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets (f) |
.75 |
.65 |
.64 |
||||||||
Trust assets |
|||||||||||
Assets under management |
$ |
40,575 |
$ |
39,663 |
$ |
38,660 |
|||||
Other data |
|||||||||||
Average full-time equivalent employees |
18,150 |
18,376 |
18,548 |
||||||||
Branches |
1,166 |
1,177 |
1,208 |
||||||||
Taxable-equivalent adjustment |
$ |
7 |
$ |
8 |
$ |
14 |
Financial Highlights (continued) |
||||||||
(dollars in millions, except per share amounts) |
||||||||
Nine months ended |
||||||||
9/30/2018 |
9/30/2017 |
|||||||
Summary of operations |
||||||||
Net interest income (TE) |
$ |
2,932 |
$ |
2,878 |
||||
Noninterest income |
1,870 |
1,822 |
||||||
Total revenue (TE) |
4,802 |
4,700 |
||||||
Provision for credit losses |
187 |
180 |
||||||
Noninterest expense |
2,963 |
3,000 |
||||||
Income (loss) from continuing operations attributable to Key |
1,377 |
1,094 |
||||||
Income (loss) from discontinued operations, net of taxes (a) |
5 |
6 |
||||||
Net income (loss) attributable to Key |
1,382 |
1,100 |
||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
1,334 |
$ |
1,038 |
||||
Income (loss) from discontinued operations, net of taxes (a) |
5 |
6 |
||||||
Net income (loss) attributable to Key common shareholders |
1,339 |
1,044 |
||||||
Per common share |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
1.28 |
$ |
.96 |
||||
Income (loss) from discontinued operations, net of taxes (a) |
.01 |
.01 |
||||||
Net income (loss) attributable to Key common shareholders (b) |
1.27 |
.97 |
||||||
Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution |
1.26 |
.95 |
||||||
Income (loss) from discontinued operations, net of taxes — assuming dilution (a) |
.01 |
.01 |
||||||
Net income (loss) attributable to Key common shareholders — assuming dilution (b) |
1.26 |
.96 |
||||||
Cash dividends paid |
.395 |
.275 |
||||||
Performance ratios |
||||||||
From continuing operations: |
||||||||
Return on average total assets |
1.35 |
% |
1.10 |
% |
||||
Return on average common equity |
12.81 |
9.89 |
||||||
Return on average tangible common equity (c) |
16.16 |
12.36 |
||||||
Net interest margin (TE) |
3.17 |
3.19 |
||||||
Cash efficiency ratio (c) |
60.1 |
62.4 |
||||||
From consolidated operations: |
||||||||
Return on average total assets |
1.35 |
% |
1.09 |
% |
||||
Return on average common equity |
12.86 |
9.95 |
||||||
Return on average tangible common equity (c) |
16.22 |
12.43 |
||||||
Net interest margin (TE) |
3.15 |
3.17 |
||||||
Asset quality — from continuing operations |
||||||||
Net loan charge-offs |
$ |
174 |
$ |
156 |
||||
Net loan charge-offs to average total loans |
.26 |
% |
.24 |
% |
||||
Other data |
||||||||
Average full-time equivalent employees |
18,354 |
18,427 |
||||||
Taxable-equivalent adjustment |
23 |
39 |
(a) |
In September 2009, management decided to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank National Association. |
(b) |
Earnings per share may not foot due to rounding. |
(c) |
The following table entitled "GAAP to Non-GAAP Reconciliations" presents the computations of certain financial measures related to "tangible common equity" and "cash efficiency." The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. For further information on the Regulatory Capital Rules, see the "Capital" section of this release. |
(d) |
Represents period-end consolidated total loans and loans held for sale divided by period-end consolidated total deposits. |
(e) |
September 30, 2018, ratio is estimated. |
(f) |
Nonperforming loan balances exclude $606 million, $629 million, and $783 million of purchased credit impaired loans at September 30, 2018, June 30, 2018, and September 30, 2017, respectively. |
GAAP to Non-GAAP Reconciliations
(dollars in millions)
The table below presents certain non-GAAP financial measures related to "tangible common equity," "return on average tangible common equity," "Common Equity Tier 1," "pre-provision net revenue," and "cash efficiency ratio."
The tangible common equity ratio and the return on average tangible common equity ratio have been a focus for some investors, and management believes these ratios may assist investors in analyzing Key's capital position without regard to 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 the composition of capital, the calculation of which is prescribed in federal banking regulations. In October 2013, the federal banking regulators published the final Basel III capital framework for U.S. banking organizations (the "Regulatory Capital Rules"). The Regulatory Capital Rules require higher and better-quality capital and introduced a new capital measure, "Common Equity Tier 1," a non-GAAP financial measure. The mandatory compliance date for Key as a "standardized approach" banking organization began on January 1, 2015, subject to transitional provisions extending to January 1, 2019.
The table also shows the computation for pre-provision net revenue, which is not formally defined by GAAP. Management believes that eliminating the effects of the provision for credit losses makes it easier to analyze the results by presenting them on a more comparable basis.
The cash efficiency ratio is a ratio of two non-GAAP performance measures. As such, there is no directly comparable GAAP performance measure. The cash efficiency ratio performance measure removes the impact of Key's intangible asset amortization from the calculation. Management believes this ratio provide greater consistency and comparability between Key's results and those of its peer banks. Additionally, this ratio is used by analysts and investors as they develop earnings forecasts and peer bank analysis.
Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. Although these non-GAAP financial measures are frequently used by investors to evaluate 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 |
Nine months ended |
|||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
||||||||||||
Tangible common equity to tangible assets at period-end |
||||||||||||||||
Key shareholders' equity (GAAP) |
$ |
15,208 |
$ |
15,100 |
$ |
15,249 |
||||||||||
Less: Intangible assets (a) |
2,838 |
2,858 |
2,870 |
|||||||||||||
Preferred Stock (b) |
1,421 |
1,009 |
1,009 |
|||||||||||||
Tangible common equity (non-GAAP) |
$ |
10,949 |
$ |
11,233 |
$ |
11,370 |
||||||||||
Total assets (GAAP) |
$ |
138,805 |
$ |
137,792 |
$ |
136,733 |
||||||||||
Less: Intangible assets (a) |
2,838 |
2,858 |
2,870 |
|||||||||||||
Tangible assets (non-GAAP) |
$ |
135,967 |
$ |
134,934 |
$ |
133,863 |
||||||||||
Tangible common equity to tangible assets ratio (non-GAAP) |
8.05 |
% |
8.32 |
% |
8.49 |
% |
||||||||||
Pre-provision net revenue |
||||||||||||||||
Net interest income (GAAP) |
$ |
986 |
$ |
979 |
$ |
948 |
$ |
2,909 |
$ |
2,839 |
||||||
Plus: Taxable-equivalent adjustment |
7 |
8 |
14 |
23 |
39 |
|||||||||||
Noninterest income |
609 |
660 |
592 |
1,870 |
1,822 |
|||||||||||
Less: Noninterest expense |
964 |
993 |
992 |
2,963 |
3,000 |
|||||||||||
Pre-provision new revenue from continuing operations (non-GAAP) |
$ |
638 |
$ |
654 |
$ |
562 |
$ |
1,839 |
$ |
1,700 |
||||||
Average tangible common equity |
||||||||||||||||
Average Key shareholders' equity (GAAP) |
$ |
15,210 |
$ |
15,032 |
$ |
15,241 |
$ |
15,045 |
$ |
15,208 |
||||||
Less: Intangible assets (average) (c) |
2,848 |
2,883 |
2,878 |
2,882 |
2,802 |
|||||||||||
Preferred stock (average) |
1,316 |
1,025 |
1,025 |
1,123 |
1,175 |
|||||||||||
Average tangible common equity (non-GAAP) |
$ |
11,046 |
$ |
11,124 |
$ |
11,338 |
$ |
11,040 |
$ |
11,231 |
||||||
Return on average tangible common equity from continuing operations |
||||||||||||||||
Net income (loss) from continuing operations attributable to Key common |
$ |
468 |
$ |
464 |
$ |
349 |
$ |
1,334 |
$ |
1,038 |
||||||
Average tangible common equity (non-GAAP) |
11,046 |
11,124 |
11,338 |
11,040 |
11,231 |
|||||||||||
Return on average tangible common equity from continuing operations |
16.81 |
% |
16.73 |
% |
12.21 |
% |
16.16 |
% |
12.36 |
% |
||||||
Return on average tangible common equity consolidated |
||||||||||||||||
Net income (loss) attributable to Key common shareholders (GAAP) |
$ |
468 |
$ |
467 |
$ |
350 |
$ |
1,339 |
$ |
1,044 |
||||||
Average tangible common equity (non-GAAP) |
11,046 |
11,124 |
11,338 |
11,040 |
11,231 |
|||||||||||
Return on average tangible common equity consolidated (non-GAAP) |
16.81 |
% |
16.84 |
% |
12.25 |
% |
16.22 |
% |
12.43 |
% |
||||||
Cash efficiency ratio |
||||||||||||||||
Noninterest expense (GAAP) |
$ |
964 |
$ |
993 |
$ |
992 |
$ |
2,963 |
$ |
3,000 |
||||||
Less: Intangible asset amortization |
23 |
25 |
25 |
77 |
69 |
|||||||||||
Adjusted noninterest expense (non-GAAP) |
$ |
941 |
$ |
968 |
$ |
967 |
$ |
2,886 |
$ |
2,931 |
||||||
Net interest income (GAAP) |
$ |
986 |
$ |
979 |
$ |
948 |
$ |
2,909 |
$ |
2,839 |
||||||
Plus: Taxable-equivalent adjustment |
7 |
8 |
14 |
23 |
39 |
|||||||||||
Noninterest income |
609 |
660 |
592 |
1,870 |
1,822 |
|||||||||||
Total taxable-equivalent revenue (non-GAAP) |
$ |
1,602 |
$ |
1,647 |
$ |
1,554 |
$ |
4,802 |
$ |
4,700 |
||||||
Cash efficiency ratio (non-GAAP) |
58.7 |
% |
58.8 |
% |
62.2 |
% |
60.1 |
% |
62.4 |
% |
GAAP to Non-GAAP Reconciliations (continued) |
|||||
(dollars in millions) |
|||||
Three |
|||||
9/30/2018 |
|||||
Common Equity Tier 1 under the Regulatory Capital Rules ("RCR") (estimates) |
|||||
Common Equity Tier 1 under current RCR |
$ |
12,197 |
|||
Adjustments from current RCR to the fully phased-in RCR: |
|||||
Deferred tax assets and other intangible assets (d) |
— |
||||
Common Equity Tier 1 anticipated under the fully phased-in RCR (e) |
$ |
12,197 |
|||
Net risk-weighted assets under current RCR |
$ |
122,781 |
|||
Adjustments from current RCR to the fully phased-in RCR: |
|||||
Mortgage servicing assets (f) |
755 |
||||
Deferred tax assets |
345 |
||||
All other assets |
— |
||||
Total risk-weighted assets anticipated under the fully phased-in RCR (e) |
$ |
123,881 |
|||
Common Equity Tier 1 ratio under the fully phased-in RCR (e) |
9.85 |
% |
(a) |
For the three months ended September 30, 2018, June 30, 2018, and September 30, 2017, intangible assets exclude $17 million, $20 million, and $30 million, respectively, of period-end purchased credit card receivables. |
(b) |
Net of capital surplus. |
(c) |
For the three months ended September 30, 2018, June 30, 2018, and September 30, 2017, average intangible assets exclude $18 million, $21 million, and $32 million, respectively, of average purchased credit card receivables. For the nine months ended September 30, 2018, and September 30, 2017, average intangible assets exclude $21 million and $36 million, respectively, of average purchased credit card receivables. |
(d) |
Includes the deferred tax assets subject to future taxable income for realization, primarily tax credit carryforwards, as well as intangible assets (other than goodwill and mortgage servicing assets) subject to the transition provisions of the final rule. |
(e) |
The anticipated amount of regulatory capital and risk-weighted assets is based upon the federal banking agencies' Regulatory Capital Rules (as fully phased-in on January 1, 2019); Key is subject to the Regulatory Capital Rules under the "standardized approach." |
(f) |
Item is included in the 10%/15% exceptions bucket calculation and is risk-weighted at 250%. |
GAAP = U.S. generally accepted accounting principles |
Consolidated Balance Sheets |
|||||||||||
(dollars in millions) |
|||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
|||||||||
Assets |
|||||||||||
Loans |
$ |
89,268 |
$ |
88,222 |
$ |
86,492 |
|||||
Loans held for sale |
1,618 |
1,418 |
1,341 |
||||||||
Securities available for sale |
18,341 |
17,367 |
19,012 |
||||||||
Held-to-maturity securities |
11,869 |
12,277 |
10,276 |
||||||||
Trading account assets |
958 |
833 |
783 |
||||||||
Short-term investments |
2,272 |
2,646 |
3,993 |
||||||||
Other investments |
681 |
709 |
728 |
||||||||
Total earning assets |
125,007 |
123,472 |
122,625 |
||||||||
Allowance for loan and lease losses |
(887) |
(887) |
(880) |
||||||||
Cash and due from banks |
319 |
784 |
562 |
||||||||
Premises and equipment |
891 |
892 |
916 |
||||||||
Operating lease assets |
930 |
903 |
736 |
||||||||
Goodwill |
2,516 |
2,516 |
2,487 |
||||||||
Other intangible assets |
338 |
361 |
412 |
||||||||
Corporate-owned life insurance |
4,156 |
4,147 |
4,113 |
||||||||
Accrued income and other assets |
4,378 |
4,382 |
4,366 |
||||||||
Discontinued assets |
1,157 |
1,222 |
1,396 |
||||||||
Total assets |
$ |
138,805 |
$ |
137,792 |
$ |
136,733 |
|||||
Liabilities |
|||||||||||
Deposits in domestic offices: |
|||||||||||
NOW and money market deposit accounts |
$ |
57,219 |
$ |
55,059 |
$ |
53,734 |
|||||
Savings deposits |
4,948 |
6,199 |
6,366 |
||||||||
Certificates of deposit ($100,000 or more) |
8,453 |
7,547 |
6,519 |
||||||||
Other time deposits |
5,130 |
4,943 |
4,720 |
||||||||
Total interest-bearing deposits |
75,750 |
73,748 |
71,339 |
||||||||
Noninterest-bearing deposits |
30,030 |
30,800 |
32,107 |
||||||||
Total deposits |
105,780 |
104,548 |
103,446 |
||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,285 |
1,667 |
372 |
||||||||
Bank notes and other short-term borrowings |
637 |
639 |
616 |
||||||||
Accrued expense and other liabilities |
2,044 |
1,983 |
1,949 |
||||||||
Long-term debt |
13,849 |
13,853 |
15,100 |
||||||||
Total liabilities |
123,595 |
122,690 |
121,483 |
||||||||
Equity |
|||||||||||
Preferred stock |
1,450 |
1,025 |
1,025 |
||||||||
Common shares |
1,257 |
1,257 |
1,257 |
||||||||
Capital surplus |
6,315 |
6,315 |
6,310 |
||||||||
Retained earnings |
11,262 |
10,970 |
10,125 |
||||||||
Treasury stock, at cost |
(3,910) |
(3,382) |
(2,962) |
||||||||
Accumulated other comprehensive income (loss) |
(1,166) |
(1,085) |
(506) |
||||||||
Key shareholders' equity |
15,208 |
15,100 |
15,249 |
||||||||
Noncontrolling interests |
2 |
2 |
1 |
||||||||
Total equity |
15,210 |
15,102 |
15,250 |
||||||||
Total liabilities and equity |
$ |
138,805 |
$ |
137,792 |
$ |
136,733 |
|||||
Common shares outstanding (000) |
1,034,287 |
1,058,944 |
1,079,039 |
Consolidated Statements of Income |
||||||||||||||||||
(dollars in millions, except per share amounts) |
||||||||||||||||||
Three months ended |
Nine months ended |
|||||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
||||||||||||||
Interest income |
||||||||||||||||||
Loans |
$ |
1,025 |
$ |
1,000 |
$ |
928 |
$ |
2,965 |
$ |
2,753 |
||||||||
Loans held for sale |
12 |
16 |
17 |
40 |
39 |
|||||||||||||
Securities available for sale |
102 |
97 |
91 |
294 |
276 |
|||||||||||||
Held-to-maturity securities |
72 |
72 |
55 |
213 |
161 |
|||||||||||||
Trading account assets |
7 |
7 |
7 |
21 |
21 |
|||||||||||||
Short-term investments |
15 |
8 |
6 |
31 |
14 |
|||||||||||||
Other investments |
6 |
5 |
5 |
17 |
12 |
|||||||||||||
Total interest income |
1,239 |
1,205 |
1,109 |
3,581 |
3,276 |
|||||||||||||
Interest expense |
||||||||||||||||||
Deposits |
140 |
112 |
72 |
343 |
196 |
|||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1 |
5 |
— |
10 |
1 |
|||||||||||||
Bank notes and other short-term borrowings |
4 |
7 |
3 |
17 |
12 |
|||||||||||||
Long-term debt |
108 |
102 |
86 |
302 |
228 |
|||||||||||||
Total interest expense |
253 |
226 |
161 |
672 |
437 |
|||||||||||||
Net interest income |
986 |
979 |
948 |
2,909 |
2,839 |
|||||||||||||
Provision for credit losses |
62 |
64 |
51 |
187 |
180 |
|||||||||||||
Net interest income after provision for credit losses |
924 |
915 |
897 |
2,722 |
2,659 |
|||||||||||||
Noninterest income |
||||||||||||||||||
Trust and investment services income |
117 |
128 |
135 |
378 |
404 |
|||||||||||||
Investment banking and debt placement fees |
166 |
155 |
141 |
464 |
403 |
|||||||||||||
Service charges on deposit accounts |
85 |
91 |
91 |
265 |
268 |
|||||||||||||
Operating lease income and other leasing gains |
35 |
(6) |
16 |
61 |
69 |
|||||||||||||
Corporate services income |
52 |
61 |
54 |
175 |
163 |
|||||||||||||
Cards and payments income |
69 |
71 |
75 |
202 |
210 |
|||||||||||||
Corporate-owned life insurance income |
34 |
32 |
31 |
98 |
94 |
|||||||||||||
Consumer mortgage income |
9 |
7 |
7 |
23 |
19 |
|||||||||||||
Mortgage servicing fees |
19 |
22 |
21 |
61 |
54 |
|||||||||||||
Other income (a) |
23 |
99 |
21 |
143 |
138 |
|||||||||||||
Total noninterest income |
609 |
660 |
592 |
1,870 |
1,822 |
|||||||||||||
Noninterest expense |
||||||||||||||||||
Personnel |
553 |
586 |
559 |
1,733 |
1,669 |
|||||||||||||
Net occupancy |
76 |
79 |
74 |
233 |
239 |
|||||||||||||
Computer processing |
52 |
51 |
56 |
155 |
171 |
|||||||||||||
Business services and professional fees |
43 |
51 |
49 |
135 |
140 |
|||||||||||||
Equipment |
27 |
26 |
29 |
79 |
83 |
|||||||||||||
Operating lease expense |
31 |
30 |
24 |
88 |
64 |
|||||||||||||
Marketing |
26 |
26 |
34 |
77 |
85 |
|||||||||||||
FDIC assessment |
21 |
21 |
21 |
63 |
62 |
|||||||||||||
Intangible asset amortization |
23 |
25 |
25 |
77 |
69 |
|||||||||||||
OREO expense, net |
3 |
— |
3 |
5 |
8 |
|||||||||||||
Other expense |
109 |
98 |
118 |
318 |
410 |
|||||||||||||
Total noninterest expense |
964 |
993 |
992 |
2,963 |
3,000 |
|||||||||||||
Income (loss) from continuing operations before income taxes |
569 |
582 |
497 |
1,629 |
1,481 |
|||||||||||||
Income taxes |
87 |
103 |
134 |
252 |
386 |
|||||||||||||
Income (loss) from continuing operations |
482 |
479 |
363 |
1,377 |
1,095 |
|||||||||||||
Income (loss) from discontinued operations, net of taxes |
— |
3 |
1 |
5 |
6 |
|||||||||||||
Net income (loss) |
482 |
482 |
364 |
1,382 |
1,101 |
|||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
— |
— |
— |
— |
1 |
|||||||||||||
Net income (loss) attributable to Key |
$ |
482 |
$ |
482 |
$ |
364 |
$ |
1,382 |
$ |
1,100 |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
468 |
$ |
464 |
$ |
349 |
$ |
1,334 |
$ |
1,038 |
||||||||
Net income (loss) attributable to Key common shareholders |
468 |
467 |
350 |
1,339 |
1,044 |
|||||||||||||
Per common share |
||||||||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
.45 |
$ |
.44 |
$ |
.32 |
$ |
1.28 |
$ |
.96 |
||||||||
Income (loss) from discontinued operations, net of taxes |
— |
— |
— |
.01 |
.01 |
|||||||||||||
Net income (loss) attributable to Key common shareholders (b) |
.45 |
.44 |
.32 |
1.27 |
.97 |
|||||||||||||
Per common share — assuming dilution |
||||||||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ |
.45 |
$ |
.44 |
$ |
.32 |
$ |
1.26 |
$ |
.95 |
||||||||
Income (loss) from discontinued operations, net of taxes |
— |
— |
— |
.01 |
.01 |
|||||||||||||
Net income (loss) attributable to Key common shareholders (b) |
.45 |
.44 |
.32 |
1.26 |
.96 |
|||||||||||||
Cash dividends declared per common share |
$ |
.17 |
$ |
.12 |
$ |
.095 |
$ |
.395 |
$ |
.275 |
||||||||
Weighted-average common shares outstanding (000) |
1,036,479 |
1,052,652 |
1,073,390 |
1,048,397 |
1,075,296 |
|||||||||||||
Effect of common share options and other stock awards |
13,497 |
13,141 |
15,451 |
14,419 |
16,359 |
|||||||||||||
Weighted-average common shares and potential common shares outstanding (000) (c) |
1,049,976 |
1,065,793 |
1,088,841 |
1,062,816 |
1,091,655 |
|||||||||||||
(a) |
For the three months ended September 30, 2018, June 30, 2018, and September 30, 2017, net securities gains (losses) totaled less than $1 million. For the three months ended September 30, 2018, June 30, 2018, and September 30, 2017, Key did not have any impairment losses related to securities. |
(b) |
Earnings per share may not foot due to rounding. |
(c) |
Assumes conversion of common share options and other stock awards, as applicable. |
Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations |
|||||||||||||||||||||||||||
(dollars in millions) |
|||||||||||||||||||||||||||
Third Quarter 2018 |
Second Quarter 2018 |
Third Quarter 2017 |
|||||||||||||||||||||||||
Average |
Yield/ |
Average |
Yield/ |
Average |
Yield/ |
||||||||||||||||||||||
Balance |
Interest (a) |
Rate (a) |
Balance |
Interest (a) |
Rate (a) |
Balance |
Interest (a) |
Rate (a) |
|||||||||||||||||||
Assets |
|||||||||||||||||||||||||||
Loans: (b), (c) |
|||||||||||||||||||||||||||
Commercial and industrial (d) |
$ |
44,749 |
$ |
495 |
4.39 |
% |
$ |
45,030 |
$ |
485 |
4.32 |
% |
$ |
41,416 |
$ |
414 |
3.97 |
% |
|||||||||
Real estate — commercial mortgage |
14,268 |
176 |
4.89 |
14,055 |
172 |
4.89 |
14,850 |
169 |
4.51 |
||||||||||||||||||
Real estate — construction |
1,759 |
22 |
5.05 |
1,789 |
23 |
4.97 |
2,054 |
23 |
4.51 |
||||||||||||||||||
Commercial lease financing |
4,444 |
43 |
3.88 |
4,550 |
41 |
3.61 |
4,694 |
46 |
3.89 |
||||||||||||||||||
Total commercial loans |
65,220 |
736 |
4.49 |
65,424 |
721 |
4.41 |
63,014 |
652 |
4.11 |
||||||||||||||||||
Real estate — residential mortgage |
5,466 |
55 |
3.99 |
5,451 |
54 |
3.97 |
5,493 |
54 |
3.92 |
||||||||||||||||||
Home equity loans |
11,415 |
137 |
4.80 |
11,601 |
135 |
4.67 |
12,314 |
136 |
4.41 |
||||||||||||||||||
Consumer direct loans |
1,789 |
35 |
7.71 |
1,768 |
33 |
7.54 |
1,774 |
33 |
7.26 |
||||||||||||||||||
Credit cards |
1,095 |
32 |
11.43 |
1,080 |
30 |
11.21 |
1,049 |
30 |
11.34 |
||||||||||||||||||
Consumer indirect loans |
3,482 |
37 |
4.25 |
3,320 |
35 |
4.26 |
3,170 |
37 |
4.64 |
||||||||||||||||||
Total consumer loans |
23,247 |
296 |
5.06 |
23,220 |
287 |
4.97 |
23,800 |
290 |
4.85 |
||||||||||||||||||
Total loans |
88,467 |
1,032 |
4.64 |
88,644 |
1,008 |
4.56 |
86,814 |
942 |
4.31 |
||||||||||||||||||
Loans held for sale |
1,117 |
12 |
4.59 |
1,375 |
16 |
4.50 |
1,607 |
17 |
4.13 |
||||||||||||||||||
Securities available for sale (b), (e) |
17,631 |
102 |
2.22 |
17,443 |
97 |
2.13 |
18,574 |
91 |
1.96 |
||||||||||||||||||
Held-to-maturity securities (b) |
12,065 |
72 |
2.40 |
12,226 |
72 |
2.36 |
10,469 |
55 |
2.12 |
||||||||||||||||||
Trading account assets |
787 |
7 |
3.37 |
943 |
7 |
3.21 |
889 |
7 |
2.74 |
||||||||||||||||||
Short-term investments |
2,928 |
15 |
1.93 |
2,015 |
8 |
1.76 |
2,166 |
6 |
1.21 |
||||||||||||||||||
Other investments (e) |
685 |
6 |
3.27 |
710 |
5 |
3.08 |
728 |
5 |
2.46 |
||||||||||||||||||
Total earning assets |
123,680 |
1,246 |
3.98 |
123,356 |
1,213 |
3.92 |
121,247 |
1,123 |
3.68 |
||||||||||||||||||
Allowance for loan and lease losses |
(886) |
(875) |
(868) |
||||||||||||||||||||||||
Accrued income and other assets |
13,935 |
13,897 |
13,977 |
||||||||||||||||||||||||
Discontinued assets |
1,186 |
1,241 |
1,417 |
||||||||||||||||||||||||
Total assets |
$ |
137,915 |
$ |
137,619 |
$ |
135,773 |
|||||||||||||||||||||
Liabilities |
|||||||||||||||||||||||||||
NOW and money market deposit accounts |
$ |
56,391 |
82 |
.58 |
$ |
54,749 |
59 |
.44 |
$ |
53,826 |
37 |
.27 |
|||||||||||||||
Savings deposits |
5,413 |
3 |
.20 |
6,276 |
5 |
.35 |
6,697 |
5 |
.25 |
||||||||||||||||||
Certificates of deposit ($100,000 or more) |
8,186 |
38 |
1.86 |
7,516 |
32 |
1.70 |
6,402 |
21 |
1.31 |
||||||||||||||||||
Other time deposits |
5,026 |
17 |
1.40 |
4,949 |
16 |
1.22 |
4,664 |
9 |
.81 |
||||||||||||||||||
Total interest-bearing deposits |
75,016 |
140 |
.74 |
73,490 |
112 |
.61 |
71,589 |
72 |
.40 |
||||||||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
552 |
1 |
1.00 |
1,475 |
5 |
1.41 |
456 |
— |
.23 |
||||||||||||||||||
Bank notes and other short-term borrowings |
596 |
4 |
2.76 |
1,116 |
7 |
2.27 |
865 |
3 |
1.49 |
||||||||||||||||||
Long-term debt (f), (g) |
12,678 |
108 |
3.34 |
12,748 |
102 |
3.20 |
12,631 |
86 |
2.75 |
||||||||||||||||||
Total interest-bearing liabilities |
88,842 |
253 |
1.13 |
88,829 |
226 |
1.02 |
85,541 |
161 |
.75 |
||||||||||||||||||
Noninterest-bearing deposits |
30,610 |
30,513 |
31,516 |
||||||||||||||||||||||||
Accrued expense and other liabilities |
2,065 |
2,002 |
2,057 |
||||||||||||||||||||||||
Discontinued liabilities (g) |
1,186 |
1,241 |
1,417 |
||||||||||||||||||||||||
Total liabilities |
122,703 |
122,585 |
120,531 |
||||||||||||||||||||||||
Equity |
|||||||||||||||||||||||||||
Key shareholders' equity |
15,210 |
15,032 |
15,241 |
||||||||||||||||||||||||
Noncontrolling interests |
2 |
2 |
1 |
||||||||||||||||||||||||
Total equity |
15,212 |
15,034 |
15,242 |
||||||||||||||||||||||||
Total liabilities and equity |
$ |
137,915 |
$ |
137,619 |
$ |
135,773 |
|||||||||||||||||||||
Interest rate spread (TE) |
2.85 |
% |
2.90 |
% |
2.93 |
% |
|||||||||||||||||||||
Net interest income (TE) and net interest margin (TE) |
993 |
3.18 |
% |
987 |
3.19 |
% |
962 |
3.15 |
% |
||||||||||||||||||
TE adjustment (b) |
7 |
8 |
14 |
||||||||||||||||||||||||
Net interest income, GAAP basis |
$ |
986 |
$ |
979 |
$ |
948 |
(a) |
Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (g) 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 21% for the three months ended September 30, 2018, and June 30, 2018, and 35% for the three months ended September 30, 2017. |
(c) |
For purposes of these computations, nonaccrual loans are included in average loan balances. |
(d) |
Commercial and industrial average balances include $128 million, $126 million, and $117 million of assets from commercial credit cards for the three months ended September 30, 2018, June 30, 2018, and September 30, 2017, respectively. |
(e) |
Yield is calculated on the basis of amortized cost. |
(f) |
Rate calculation excludes basis adjustments related to fair value hedges. |
(g) |
A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying Key's matched funds transfer pricing methodology to discontinued operations. |
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles |
Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations |
||||||||||||||||||
(dollars in millions) |
||||||||||||||||||
Nine months ended September 30, 2018 |
Nine months ended September 30, 2017 |
|||||||||||||||||
Average |
Average |
|||||||||||||||||
Balance |
Interest (a) |
Yield/Rate (a) |
Balance |
Interest (a) |
Yield/ Rate (a) |
|||||||||||||
Assets |
||||||||||||||||||
Loans: (b), (c) |
||||||||||||||||||
Commercial and industrial (d) |
$ |
44,178 |
$ |
1,414 |
4.28 |
% |
$ |
40,700 |
$ |
1,196 |
3.93 |
% |
||||||
Real estate — commercial mortgage |
14,137 |
513 |
4.85 |
15,043 |
520 |
4.62 |
||||||||||||
Real estate — construction |
1,834 |
67 |
4.88 |
2,203 |
80 |
4.86 |
||||||||||||
Commercial lease financing |
4,552 |
125 |
3.67 |
4,673 |
140 |
3.99 |
||||||||||||
Total commercial loans |
64,701 |
2,119 |
4.38 |
62,619 |
1,936 |
4.13 |
||||||||||||
Real estate — residential mortgage |
5,466 |
163 |
3.97 |
5,507 |
160 |
3.88 |
||||||||||||
Home equity loans |
11,629 |
406 |
4.67 |
12,465 |
402 |
4.32 |
||||||||||||
Consumer direct loans |
1,774 |
101 |
7.59 |
1,760 |
94 |
7.10 |
||||||||||||
Credit cards |
1,085 |
92 |
11.32 |
1,053 |
88 |
11.15 |
||||||||||||
Consumer indirect loans |
3,363 |
107 |
4.27 |
3,081 |
112 |
4.85 |
||||||||||||
Total consumer loans |
23,317 |
869 |
4.98 |
23,866 |
856 |
4.79 |
||||||||||||
Total loans |
88,018 |
2,988 |
4.54 |
86,485 |
2,792 |
4.31 |
||||||||||||
Loans held for sale |
1,226 |
40 |
4.40 |
1,293 |
39 |
4.01 |
||||||||||||
Securities available for sale (b), (e) |
17,653 |
294 |
2.14 |
18,582 |
276 |
1.96 |
||||||||||||
Held-to-maturity securities (b) |
12,111 |
213 |
2.35 |
10,311 |
161 |
2.08 |
||||||||||||
Trading account assets |
879 |
21 |
3.19 |
966 |
21 |
2.84 |
||||||||||||
Short-term investments |
2,334 |
31 |
1.76 |
1,918 |
14 |
1.00 |
||||||||||||
Other investments (e) |
706 |
17 |
3.10 |
708 |
12 |
2.20 |
||||||||||||
Total earning assets |
122,927 |
3,604 |
3.90 |
120,263 |
3,315 |
3.68 |
||||||||||||
Allowance for loan and lease losses |
(879) |
(862) |
||||||||||||||||
Accrued income and other assets |
13,966 |
13,801 |
||||||||||||||||
Discontinued assets |
1,243 |
1,477 |
||||||||||||||||
Total assets |
$ |
137,257 |
$ |
134,679 |
||||||||||||||
Liabilities |
||||||||||||||||||
NOW and money market deposit accounts |
$ |
54,891 |
187 |
.46 |
$ |
54,178 |
103 |
.25 |
||||||||||
Savings deposits |
5,971 |
13 |
.28 |
6,635 |
10 |
.19 |
||||||||||||
Certificates of deposit ($100,000 or more) |
7,563 |
97 |
1.72 |
6,050 |
56 |
1.24 |
||||||||||||
Other time deposits |
4,947 |
46 |
1.25 |
4,673 |
27 |
.78 |
||||||||||||
Total interest-bearing deposits |
73,372 |
343 |
.63 |
71,536 |
196 |
.37 |
||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,146 |
10 |
1.22 |
570 |
1 |
.27 |
||||||||||||
Bank notes and other short-term borrowings |
1,015 |
17 |
2.19 |
1,291 |
12 |
1.27 |
||||||||||||
Long-term debt (f), (g) |
12,631 |
302 |
3.17 |
11,510 |
228 |
2.66 |
||||||||||||
Total interest-bearing liabilities |
88,164 |
672 |
1.02 |
84,907 |
437 |
.69 |
||||||||||||
Noninterest-bearing deposits |
30,701 |
31,123 |
||||||||||||||||
Accrued expense and other liabilities |
2,102 |
1,962 |
||||||||||||||||
Discontinued liabilities (g) |
1,243 |
1,478 |
||||||||||||||||
Total liabilities |
122,210 |
119,470 |
||||||||||||||||
Equity |
||||||||||||||||||
Key shareholders' equity |
15,045 |
15,208 |
||||||||||||||||
Noncontrolling interests |
2 |
1 |
||||||||||||||||
Total equity |
15,047 |
15,209 |
||||||||||||||||
Total liabilities and equity |
$ |
137,257 |
$ |
134,679 |
||||||||||||||
Interest rate spread (TE) |
2.88 |
% |
2.99 |
% |
||||||||||||||
Net interest income (TE) and net interest margin (TE) |
2,932 |
3.17 |
% |
2,878 |
3.19 |
% |
||||||||||||
TE adjustment (b) |
23 |
39 |
||||||||||||||||
Net interest income, GAAP basis |
$ |
2,909 |
$ |
2,839 |
(a) |
Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (g) 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 21% and 35% for the nine months ended September 30, 2018, and September 30, 2017, respectively. |
(c) |
For purposes of these computations, nonaccrual loans are included in average loan balances. |
(d) |
Commercial and industrial average balances include $125 million and $116 million of assets from commercial credit cards for the nine months ended September 30, 2018, and September 30, 2017, respectively. |
(e) |
Yield is calculated on the basis of amortized cost. |
(f) |
Rate calculation excludes basis adjustments related to fair value hedges. |
(g) |
A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying Key's matched funds transfer pricing methodology to discontinued operations. |
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles |
Noninterest Expense |
||||||||||||||||
(dollars in millions) |
||||||||||||||||
Three months ended |
Nine months ended |
|||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
||||||||||||
Personnel (a) |
$ |
553 |
$ |
586 |
$ |
559 |
$ |
1,733 |
$ |
1,669 |
||||||
Net occupancy |
76 |
79 |
74 |
233 |
239 |
|||||||||||
Computer processing |
52 |
51 |
56 |
155 |
171 |
|||||||||||
Business services and professional fees |
43 |
51 |
49 |
135 |
140 |
|||||||||||
Equipment |
27 |
26 |
29 |
79 |
83 |
|||||||||||
Operating lease expense |
31 |
30 |
24 |
88 |
64 |
|||||||||||
Marketing |
26 |
26 |
34 |
77 |
85 |
|||||||||||
FDIC assessment |
21 |
21 |
21 |
63 |
62 |
|||||||||||
Intangible asset amortization |
23 |
25 |
25 |
77 |
69 |
|||||||||||
OREO expense, net |
3 |
— |
3 |
5 |
8 |
|||||||||||
Other expense |
109 |
98 |
118 |
318 |
410 |
|||||||||||
Total noninterest expense |
$ |
964 |
$ |
993 |
$ |
992 |
$ |
2,963 |
$ |
3,000 |
||||||
Average full-time equivalent employees (b) |
18,150 |
18,376 |
18,548 |
18,354 |
18,427 |
(a) |
Additional detail provided in Personnel Expense 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 |
Nine months ended |
|||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
||||||||||||
Salaries and contract labor |
$ |
335 |
$ |
341 |
$ |
339 |
$ |
1,015 |
$ |
995 |
||||||
Incentive and stock-based compensation |
138 |
147 |
134 |
430 |
398 |
|||||||||||
Employee benefits |
79 |
82 |
81 |
266 |
256 |
|||||||||||
Severance |
1 |
16 |
5 |
22 |
20 |
|||||||||||
Total personnel expense |
$ |
553 |
$ |
586 |
$ |
559 |
$ |
1,733 |
$ |
1,669 |
Merger-Related Charges |
|||||||||||||
(in millions) |
|||||||||||||
Three months ended |
Nine months ended |
||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
|||||||||
Personnel |
— |
— |
$ |
25 |
— |
$ |
86 |
||||||
Net occupancy |
— |
— |
(2) |
— |
2 |
||||||||
Business services and professional fees |
— |
— |
2 |
— |
13 |
||||||||
Computer processing |
— |
— |
4 |
— |
11 |
||||||||
Marketing |
— |
— |
5 |
— |
17 |
||||||||
Other nonpersonnel expense |
— |
— |
2 |
— |
32 |
||||||||
Total merger-related charges |
— |
— |
$ |
36 |
— |
$ |
161 |
Loan Composition |
||||||||||||||
(dollars in millions) |
||||||||||||||
Percent change 9/30/2018 vs. |
||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
6/30/2018 |
9/30/2017 |
||||||||||
Commercial and industrial (a) |
$ |
45,023 |
$ |
44,569 |
$ |
41,147 |
1.0 |
% |
9.4 |
% |
||||
Commercial real estate: |
||||||||||||||
Commercial mortgage |
14,716 |
14,162 |
14,929 |
3.9 |
(1.4) |
|||||||||
Construction |
1,763 |
1,736 |
1,954 |
1.6 |
(9.8) |
|||||||||
Total commercial real estate loans |
16,479 |
15,898 |
16,883 |
3.7 |
(2.4) |
|||||||||
Commercial lease financing (b) |
4,470 |
4,509 |
4,716 |
(.9) |
(5.2) |
|||||||||
Total commercial loans |
65,972 |
64,976 |
62,746 |
1.5 |
5.1 |
|||||||||
Residential — prime loans: |
||||||||||||||
Real estate — residential mortgage |
5,497 |
5,452 |
5,476 |
.8 |
.4 |
|||||||||
Home equity loans |
11,339 |
11,519 |
12,238 |
(1.6) |
(7.3) |
|||||||||
Total residential — prime loans |
16,836 |
16,971 |
17,714 |
(.8) |
(5.0) |
|||||||||
Consumer direct loans |
1,807 |
1,785 |
1,789 |
1.2 |
1.0 |
|||||||||
Credit cards |
1,098 |
1,094 |
1,045 |
.4 |
5.1 |
|||||||||
Consumer indirect loans |
3,555 |
3,396 |
3,198 |
4.7 |
11.2 |
|||||||||
Total consumer loans |
23,296 |
23,246 |
23,746 |
.2 |
(1.9) |
|||||||||
Total loans (c) |
$ |
89,268 |
$ |
88,222 |
$ |
86,492 |
1.2 |
% |
3.2 |
% |
(a) |
Loan balances include $129 million, $128 million, and $118 million of commercial credit card balances at September 30, 2018, June 30, 2018, and September 30, 2017, respectively. |
(b) |
Commercial lease financing includes receivables held as collateral for a secured borrowing of $12 million, $16 million, and $31 million at September 30, 2018, June 30, 2018, and September 30, 2017, respectively. Principal reductions are based on the cash payments received from these related receivables. |
(c) |
Total loans exclude loans of $1.1 billion at September 30, 2018, $1.2 billion at June 30, 2018, and $1.4 billion at September 30, 2017, related to the discontinued operations of the education lending business. |
Loans Held for Sale Composition |
||||||||||||||
(dollars in millions) |
||||||||||||||
Percent change 9/30/2018 vs. |
||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
6/30/2018 |
9/30/2017 |
||||||||||
Commercial and industrial |
$ |
97 |
$ |
217 |
$ |
34 |
(55.3) |
% |
185.3 |
% |
||||
Real estate — commercial mortgage |
1,433 |
1,139 |
1,246 |
25.8 |
15.0 |
|||||||||
Commercial lease financing |
1 |
4 |
1 |
(75.0) |
— |
|||||||||
Real estate — residential mortgage |
87 |
58 |
60 |
50.0 |
45.0 |
|||||||||
Total loans held for sale (a) |
$ |
1,618 |
$ |
1,418 |
$ |
1,341 |
14.1 |
% |
20.7 |
% |
(a) |
Total loans held for sale include Real estate — residential mortgage loans held for sale at fair value of $87 million at September 30, 2018, $58 million at June 30, 2018, and $60 million at September 30, 2017. |
N/M = Not Meaningful |
Summary of Changes in Loans Held for Sale |
|||||||||||||||
(in millions) |
|||||||||||||||
3Q18 |
2Q18 |
1Q18 |
4Q17 |
3Q17 |
|||||||||||
Balance at beginning of period |
$ |
1,418 |
$ |
1,667 |
$ |
1,107 |
$ |
1,341 |
$ |
1,743 |
|||||
New originations |
2,976 |
2,665 |
3,280 |
3,566 |
2,855 |
||||||||||
Transfers from (to) held to maturity, net |
4 |
(4) |
(14) |
(10) |
(63) |
||||||||||
Loan sales |
(2,491) |
(2,909) |
(2,705) |
(3,783) |
(3,191) |
||||||||||
Loan draws (payments), net |
(289) |
(1) |
(1) |
(7) |
(3) |
||||||||||
Balance at end of period (a) |
$ |
1,618 |
$ |
1,418 |
$ |
1,667 |
$ |
1,107 |
$ |
1,341 |
(a) |
Total loans held for sale include Real estate — residential mortgage loans held for sale at fair value of $87 million at September 30, 2018, $58 million at June 30, 2018, $47 million at March 31, 2018, $71 million at December 31, 2017, and $60 million at September 30, 2017. |
Summary of Loan and Lease Loss Experience From Continuing Operations |
||||||||||||||||
(dollars in millions) |
||||||||||||||||
Three months ended |
Nine months ended |
|||||||||||||||
9/30/2018 |
6/30/2018 |
9/30/2017 |
9/30/2018 |
9/30/2017 |
||||||||||||
Average loans outstanding |
$ |
88,467 |
$ |
88,644 |
$ |
86,814 |
$ |
88,018 |
$ |
86,485 |
||||||
Allowance for loan and lease losses at beginning of period |
$ |
887 |
$ |
881 |
$ |
870 |
$ |
877 |
$ |
858 |
||||||
Loans charged off: |
||||||||||||||||
Commercial and industrial |
38 |
39 |
29 |
114 |
101 |
|||||||||||
Real estate — commercial mortgage |
6 |
2 |
6 |
9 |
9 |
|||||||||||
Real estate — construction |
— |
— |
2 |
— |
2 |
|||||||||||
Total commercial real estate loans |
6 |
2 |
8 |
9 |
11 |
|||||||||||
Commercial lease financing |
4 |
4 |
1 |
9 |
9 |
|||||||||||
Total commercial loans |
48 |
45 |
38 |
132 |
121 |
|||||||||||
Real estate — residential mortgage |
2 |
— |
— |
3 |
2 |
|||||||||||
Home equity loans |
4 |
6 |
6 |
14 |
23 |
|||||||||||
Consumer direct loans |
10 |
9 |
8 |
27 |
26 |
|||||||||||
Credit cards |
10 |
12 |
11 |
34 |
34 |
|||||||||||
Consumer indirect loans |
7 |
7 |
8 |
22 |
24 |
|||||||||||
Total consumer loans |
33 |
34 |
33 |
100 |
109 |
|||||||||||
Total loans charged off |
81 |
79 |
71 |
232 |
230 |
|||||||||||
Recoveries: |
||||||||||||||||
Commercial and industrial |
5 |
7 |
25 |
18 |
32 |
|||||||||||
Real estate — commercial mortgage |
1 |
1 |
1 |
2 |
1 |
|||||||||||
Real estate — construction |
— |
— |
— |
1 |
1 |
|||||||||||
Total commercial real estate loans |
1 |
1 |
1 |
3 |
2 |
|||||||||||
Commercial lease financing |
3 |
— |
3 |
4 |
5 |
|||||||||||
Total commercial loans |
9 |
8 |
29 |
25 |
39 |
|||||||||||
Real estate — residential mortgage |
2 |
— |
1 |
2 |
4 |
|||||||||||
Home equity loans |
3 |
3 |
4 |
9 |
12 |
|||||||||||
Consumer direct loans |
1 |
2 |
1 |
5 |
4 |
|||||||||||
Credit cards |
2 |
2 |
1 |
5 |
4 |
|||||||||||
Consumer indirect loans |
4 |
4 |
3 |
12 |
11 |
|||||||||||
Total consumer loans |
12 |
11 |
10 |
33 |
35 |
|||||||||||
Total recoveries |
21 |
19 |
39 |
58 |
74 |
|||||||||||
Net loan charge-offs |
(60) |
(60) |
(32) |
(174) |
(156) |
|||||||||||
Provision (credit) for loan and lease losses |
60 |
66 |
42 |
184 |
178 |
|||||||||||
Allowance for loan and lease losses at end of period |
$ |
887 |
$ |
887 |
$ |
880 |
$ |
887 |
$ |
880 |
||||||
Liability for credit losses on lending-related commitments at beginning of period |
$ |
58 |
$ |
60 |
$ |
48 |
$ |
57 |
$ |
55 |
||||||
Provision (credit) for losses on lending-related commitments |
2 |
(2) |
9 |
3 |
2 |
|||||||||||
Liability for credit losses on lending-related commitments at end of period (a) |
$ |
60 |
$ |
58 |
$ |
57 |
$ |
60 |
$ |
57 |
||||||
Total allowance for credit losses at end of period |
$ |
947 |
$ |
945 |
$ |
937 |
$ |
947 |
$ |
937 |
||||||
Net loan charge-offs to average total loans |
.27 |
% |
.27 |
% |
.15 |
% |
.26 |
% |
.24 |
% |
||||||
Allowance for loan and lease losses to period-end loans |
.99 |
1.01 |
1.02 |
.99 |
1.02 |
|||||||||||
Allowance for credit losses to period-end loans |
1.06 |
1.07 |
1.08 |
1.06 |
1.08 |
|||||||||||
Allowance for loan and lease losses to nonperforming loans |
137.5 |
162.8 |
170.2 |
137.5 |
170.2 |
|||||||||||
Allowance for credit losses to nonperforming loans |
146.8 |
173.4 |
181.2 |
146.8 |
181.2 |
|||||||||||
Discontinued operations — education lending business: |
||||||||||||||||
Loans charged off |
$ |
4 |
$ |
3 |
$ |
10 |
$ |
11 |
$ |
20 |
||||||
Recoveries |
1 |
1 |
2 |
4 |
6 |
|||||||||||
Net loan charge-offs |
$ |
(3) |
$ |
(2) |
$ |
(8) |
$ |
(7) |
$ |
(14) |
(a) Included in "Accrued expense and other liabilities" on the balance sheet. |
Asset Quality Statistics From Continuing Operations |
|||||||||||||||
(dollars in millions) |
|||||||||||||||
3Q18 |
2Q18 |
1Q18 |
4Q17 |
3Q17 |
|||||||||||
Net loan charge-offs |
$ |
60 |
$ |
60 |
$ |
54 |
$ |
52 |
$ |
32 |
|||||
Net loan charge-offs to average total loans |
.27 |
% |
.27 |
% |
.25 |
% |
.24 |
% |
.15 |
% |
|||||
Allowance for loan and lease losses |
$ |
887 |
$ |
887 |
$ |
881 |
$ |
877 |
$ |
880 |
|||||
Allowance for credit losses (a) |
947 |
945 |
941 |
934 |
937 |
||||||||||
Allowance for loan and lease losses to period-end loans |
.99 |
% |
1.01 |
% |
1.00 |
% |
1.01 |
% |
1.02 |
% |
|||||
Allowance for credit losses to period-end loans |
1.06 |
1.07 |
1.07 |
1.08 |
1.08 |
||||||||||
Allowance for loan and lease losses to nonperforming loans (b) |
137.5 |
162.8 |
162.8 |
174.4 |
170.2 |
||||||||||
Allowance for credit losses to nonperforming loans (b) |
146.8 |
173.4 |
173.9 |
185.7 |
181.2 |
||||||||||
Nonperforming loans at period end (b) |
$ |
645 |
$ |
545 |
$ |
541 |
$ |
503 |
$ |
517 |
|||||
Nonperforming assets at period end (b) |
674 |
571 |
569 |
534 |
556 |
||||||||||
Nonperforming loans to period-end portfolio loans (b) |
.72 |
% |
.62 |
% |
.61 |
% |
.58 |
% |
.60 |
% |
|||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming |
.75 |
.65 |
.65 |
.62 |
.64 |
(a) |
Includes the allowance for loan and lease losses plus the liability for credit losses on lending-related unfunded commitments. |
(b) |
Nonperforming loan balances exclude $606 million, $629 million, $690 million, $738 million, and $783 million of purchased credit impaired loans at September 30, 2018, June 30, 2018, March 31, 2018, December 31, 2017, and September 30, 2017, respectively. |
Summary of Nonperforming Assets and Past Due Loans From Continuing Operations |
|||||||||||||||
(dollars in millions) |
|||||||||||||||
9/30/2018 |
6/30/2018 |
3/31/2018 |
12/31/2017 |
9/30/2017 |
|||||||||||
Commercial and industrial |
$ |
227 |
$ |
178 |
$ |
189 |
$ |
153 |
$ |
169 |
|||||
Real estate — commercial mortgage |
98 |
42 |
33 |
30 |
30 |
||||||||||
Real estate — construction |
2 |
2 |
2 |
2 |
2 |
||||||||||
Total commercial real estate loans |
100 |
44 |
35 |
32 |
32 |
||||||||||
Commercial lease financing |
10 |
21 |
5 |
6 |
11 |
||||||||||
Total commercial loans |
337 |
243 |
229 |
191 |
212 |
||||||||||
Real estate — residential mortgage |
62 |
55 |
59 |
58 |
57 |
||||||||||
Home equity loans |
221 |
222 |
229 |
229 |
227 |
||||||||||
Consumer direct loans |
4 |
4 |
4 |
4 |
3 |
||||||||||
Credit cards |
2 |
2 |
2 |
2 |
2 |
||||||||||
Consumer indirect loans |
19 |
19 |
18 |
19 |
16 |
||||||||||
Total consumer loans |
308 |
302 |
312 |
312 |
305 |
||||||||||
Total nonperforming loans (a) |
645 |
545 |
541 |
503 |
517 |
||||||||||
OREO |
28 |
26 |
28 |
31 |
39 |
||||||||||
Other nonperforming assets |
1 |
— |
— |
— |
— |
||||||||||
Total nonperforming assets (a) |
$ |
674 |
$ |
571 |
$ |
569 |
$ |
534 |
$ |
556 |
|||||
Accruing loans past due 90 days or more |
$ |
87 |
$ |
103 |
$ |
82 |
$ |
89 |
$ |
86 |
|||||
Accruing loans past due 30 through 89 days |
368 |
429 |
305 |
359 |
329 |
||||||||||
Restructured loans — accruing and nonaccruing (b) |
366 |
347 |
317 |
317 |
315 |
||||||||||
Restructured loans included in nonperforming loans (b) |
211 |
184 |
179 |
189 |
187 |
||||||||||
Nonperforming assets from discontinued operations — education lending business |
6 |
6 |
6 |
7 |
8 |
||||||||||
Nonperforming loans to period-end portfolio loans (a) |
.72 |
% |
.62 |
% |
.61 |
% |
.58 |
% |
.60 |
% |
|||||
Nonperforming assets to period-end portfolio loans plus OREO and other |
.75 |
.65 |
.65 |
.62 |
.64 |
(a) |
Nonperforming loan balances exclude $606 million, $629 million, $690 million, $738 million, and $783 million of purchased credit impaired loans at September 30, 2018, June 30, 2018, March 31, 2018, December 31, 2017, and September 30, 2017, respectively. |
(b) |
Restructured loans (i.e., troubled debt restructuring) 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) |
|||||||||||||||
3Q18 |
2Q18 |
1Q18 |
4Q17 |
3Q17 |
|||||||||||
Balance at beginning of period |
$ |
545 |
$ |
541 |
$ |
503 |
$ |
517 |
$ |
507 |
|||||
Loans placed on nonaccrual status |
263 |
175 |
182 |
137 |
181 |
||||||||||
Charge-offs |
(81) |
(78) |
(70) |
(67) |
(71) |
||||||||||
Loans sold |
— |
(1) |
— |
— |
(1) |
||||||||||
Payments |
(57) |
(33) |
(29) |
(52) |
(32) |
||||||||||
Transfers to OREO |
(5) |
(5) |
(4) |
(8) |
(10) |
||||||||||
Loans returned to accrual status |
(20) |
(54) |
(41) |
(24) |
(57) |
||||||||||
Balance at end of period (a) |
$ |
645 |
$ |
545 |
$ |
541 |
$ |
503 |
$ |
517 |
(a) |
Nonperforming loan balances exclude $606 million, $629 million, $690 million, $738 million, and $783 million of purchased credit impaired loans at September 30, 2018, June 30, 2018, March 31, 2018, December 31, 2017, and September 30, 2017, respectively. |
Line of Business Results |
||||||||||||||||||||
(dollars in millions) |
||||||||||||||||||||
Percent change 3Q18 vs. |
||||||||||||||||||||
3Q18 |
2Q18 |
1Q18 |
4Q17 |
3Q17 |
2Q18 |
3Q17 |
||||||||||||||
Key Community Bank |
||||||||||||||||||||
Summary of operations |
||||||||||||||||||||
Total revenue (TE) |
$ |
994 |
$ |
997 |
$ |
959 |
$ |
961 |
$ |
945 |
(.3) |
% |
5.2 |
% |
||||||
Provision for credit losses |
43 |
38 |
48 |
57 |
59 |
13.2 |
(27.1) |
|||||||||||||
Noninterest expense |
635 |
640 |
653 |
665 |
626 |
(.8) |
1.4 |
|||||||||||||
Net income (loss) attributable to Key |
241 |
243 |
197 |
152 |
163 |
(.8) |
47.9 |
|||||||||||||
Average loans and leases |
47,862 |
47,985 |
47,683 |
47,408 |
47,614 |
(.3) |
.5 |
|||||||||||||
Average deposits |
82,259 |
80,930 |
79,945 |
80,352 |
79,563 |
1.6 |
3.4 |
|||||||||||||
Net loan charge-offs |
43 |
34 |
42 |
35 |
41 |
26.5 |
4.9 |
|||||||||||||
Net loan charge-offs to average total loans |
.36 |
% |
.28 |
% |
.36 |
% |
.29 |
% |
.34 |
% |
N/A |
N/A |
||||||||
Nonperforming assets at period end |
$ |
467 |
$ |
468 |
$ |
425 |
$ |
405 |
$ |
427 |
(.2) |
9.4 |
||||||||
Return on average allocated equity |
19.80 |
% |
20.05 |
% |
16.51 |
% |
12.46 |
% |
13.39 |
% |
N/A |
N/A |
||||||||
Average full-time equivalent employees |
10,529 |
10,619 |
10,666 |
10,629 |
10,696 |
(.8) |
(1.6) |
|||||||||||||
Key Corporate Bank |
||||||||||||||||||||
Summary of operations |
||||||||||||||||||||
Total revenue (TE) |
$ |
574 |
$ |
542 |
$ |
558 |
$ |
605 |
$ |
561 |
5.9 |
% |
2.3 |
% |
||||||
Provision for credit losses |
20 |
28 |
14 |
(6) |
(11) |
(28.6) |
N/M |
|||||||||||||
Noninterest expense |
316 |
325 |
312 |
352 |
303 |
(2.8) |
4.3 |
|||||||||||||
Net income (loss) attributable to Key |
199 |
167 |
208 |
223 |
190 |
19.2 |
4.7 |
|||||||||||||
Average loans and leases |
39,714 |
39,709 |
38,257 |
37,457 |
38,021 |
— |
4.5 |
|||||||||||||
Average loans held for sale |
1,042 |
1,299 |
1,118 |
1,345 |
1,521 |
(19.8) |
(31.5) |
|||||||||||||
Average deposits |
21,056 |
21,057 |
20,815 |
21,558 |
21,559 |
— |
(2.3) |
|||||||||||||
Net loan charge-offs |
19 |
26 |
11 |
16 |
(9) |
(26.9) |
N/M |
|||||||||||||
Net loan charge-offs to average total loans |
.19 |
% |
.26 |
% |
.12 |
% |
.17 |
% |
(.09) |
% |
N/A |
N/A |
||||||||
Nonperforming assets at period end |
$ |
196 |
$ |
91 |
$ |
127 |
$ |
109 |
$ |
106 |
115.4 |
84.9 |
||||||||
Return on average allocated equity |
26.91 |
% |
22.80 |
% |
29.49 |
% |
31.51 |
% |
27.08 |
% |
N/A |
N/A |
||||||||
Average full-time equivalent employees |
2,546 |
2,537 |
2,543 |
2,418 |
2,460 |
.4 |
3.5 |
|||||||||||||
TE = Taxable Equivalent, N/A = Not Applicable, N/M = Not Meaningful |
SOURCE KeyCorp
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