Received initial $821
million tranche of strategic minority investment from
Scotiabank; Common Equity Tier 1 ratio of 10.8% and Tangible
Common Equity ratio of 6.2%(b)
Net interest income up 7%
quarter-over-quarter, with average deposits up 2.5%; Client
deposits were up 4% year-over-year
Continued strong fee momentum across
investment banking, commercial mortgage servicing, commercial
payments, and wealth management
Nonperforming assets and provision for credit
losses were stable to improved quarter-over-quarter
CLEVELAND, Oct. 17,
2024 /PRNewswire/ -- KeyCorp (NYSE: KEY) today
announced net loss from continuing operations attributable to Key
common shareholders of $(447)
million, or $(.47) per diluted
common share, or adjusted net income of $290
million or $.30 per diluted
common share(a), for the third quarter of 2024. Included
in the third quarter of 2024 are $(737)
million, or $(.77) per diluted
common share, after-tax, of charges related to the loss on the sale
of securities(c). Net income from continuing operations
attributable to Key common shareholders was $237 million, or $.25
per diluted common share, for the second quarter of 2024 and $266
million, or $.29 per diluted common share, for the third quarter of
2023.
Comments from Chairman and CEO, Chris
Gorman
"Key performed well in the third quarter. EPS was impacted by
a previously communicated securities portfolio repositioning that
will enhance future earnings, capital, and liquidity starting in
the fourth quarter. Underlying results were solid as relationship
clients, deposits, and business-related fees all demonstrated
continued momentum. As anticipated, we saw a meaningful increase
in net interest income, up 7% quarter-over-quarter, as substantial
portions of low-yielding securities and swaps matured.
Concurrently, both our credit risk profile and expenses remained
stable.
We continue to make progress regarding our $2.8 billion capital raise from Scotiabank,
completing the initial $821 million
investment tranche this quarter. As a result of this initial
investment and the meaningful decline in interest rates in the
third quarter, our tangible common equity ratio improved by 100
basis points quarter-over-quarter, and our reported CET1 ratio
further strengthened to 10.8%. We continue to expect to complete
the final tranche of the equity financing in the first quarter of
2025, subject to Fed approval.
Our fee-based pipelines continue to build. Investment banking
and debt placement pipelines remain near record levels. Wealth
management and commercial payments continue to demonstrate
momentum.
Given the combination of our strong pipelines, further
expected net interest income tailwinds in the quarters ahead, and a
stable-to-improved credit outlook, I remain optimistic with respect
to the trajectory of our business and our ability to drive value
for all of our stakeholders."
|
(a) The table entitled
"GAAP to Non-GAAP Reconciliations" in the attached financial
supplement presents the computations of certain financial measures
related to "adjusted earnings per share" and "adjusted net income."
The table reconciles the GAAP performance measures to the
corresponding non-GAAP measures, which provides a basis for
period-to-period comparisons.
|
|
(b) September 30,
2024 ratio is estimated and reflects Key's election to adopt the
CECL optional transition provision.
|
|
(c) See table on page
25 for more information on Selected Items Impact on
Earnings.
|
|
Selected Financial
Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in millions,
except per share data
|
|
|
|
|
Change 3Q24
vs.
|
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(447)
|
$ 237
|
$ 266
|
|
(288.6) %
|
(268.0) %
|
|
Income (loss) from
continuing operations attributable to Key common shareholders
per
common share — assuming dilution
|
(.47)
|
.25
|
.29
|
|
(288.0)
|
(262.1)
|
|
Return on average
tangible common equity from continuing operations
(a)
|
(16.98) %
|
10.39 %
|
12.40 %
|
|
N/A
|
N/A
|
|
Return on average total
assets from continuing operations
|
(.87)
|
.59
|
.62
|
|
N/A
|
N/A
|
|
Common Equity Tier 1
ratio (b)
|
10.8
|
10.5
|
9.8
|
|
N/A
|
N/A
|
|
Book value at period
end
|
$
14.53
|
$
13.09
|
$
11.65
|
|
11.0
|
24.7
|
|
Net interest margin
(TE) from continuing operations
|
2.17 %
|
2.04 %
|
2.01 %
|
|
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 "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.
|
|
(b)
|
September 30, 2024
ratio is estimated.
|
|
TE = Taxable
Equivalent, N/A = Not Applicable
|
|
INCOME STATEMENT
HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Net interest income
(TE)
|
$
964
|
$
899
|
$
923
|
|
7.2 %
|
4.4 %
|
|
Noninterest
income
|
(269)
|
627
|
643
|
|
(142.9)
|
(141.8)
|
|
Total revenue
(TE)
|
$
695
|
$ 1,526
|
$ 1,566
|
|
(54.5) %
|
(55.6) %
|
|
|
|
|
|
|
|
|
TE = Taxable
Equivalent
|
Taxable-equivalent net interest income was $964 million for the third quarter of 2024 and
the net interest margin was 2.17%. Compared to the third quarter of
2023, net interest income increased by $41 million, and the
net interest margin increased by 16 basis points. Both net interest
income and the net interest margin benefited from the reinvestment
of proceeds from maturing investment securities into higher
yielding investments, the maturity of lower-yielding interest rate
swaps with negative carry, and a shift in funding mix from
higher-cost wholesale borrowings to lower-cost interest-bearing
deposits. In addition, during the third quarter of 2024, Key began
the repositioning of the available-for-sale portfolio, which
involved the sale of approximately $7.0
billion of lower-yielding mortgaged-backed securities and
reinvestment of the proceeds into higher-yielding investments.
These benefits were partially offset by a decline in loan balances
and higher deposit costs relative to a year ago.
Compared to the second quarter of 2024, taxable-equivalent net
interest income increased by $65
million, and the net interest margin increased by 13 basis
points. Both net interest income and the net interest margin
benefited from the reinvestment of proceeds from maturing
investment securities into higher yielding investments, continued
amortization of low-yielding interest rate swaps that had been
terminated in 2023, the repositioning of the available-for-sale
portfolio, and an improved funding mix. Lower loan balances and
higher interest-bearing deposit costs somewhat offset the
increase.
|
Noninterest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Trust and investment
services income
|
$
140
|
$
139
|
$
130
|
|
.7 %
|
7.7 %
|
|
Investment banking and
debt placement fees
|
171
|
126
|
141
|
|
35.7
|
21.3
|
|
Cards and payments
income
|
84
|
85
|
90
|
|
(1.2)
|
(6.7)
|
|
Service charges on
deposit accounts
|
67
|
66
|
69
|
|
1.5
|
(2.9)
|
|
Corporate services
income
|
69
|
68
|
73
|
|
1.5
|
(5.5)
|
|
Commercial mortgage
servicing fees
|
73
|
61
|
46
|
|
19.7
|
58.7
|
|
Corporate-owned life
insurance income
|
36
|
34
|
35
|
|
5.9
|
2.9
|
|
Consumer mortgage
income
|
12
|
16
|
15
|
|
(25.0)
|
(20.0)
|
|
Operating lease income
and other leasing gains
|
16
|
21
|
22
|
|
(23.8)
|
(27.3)
|
|
Other income
|
(937)
|
11
|
22
|
|
N/M
|
N/M
|
|
Total noninterest
income
|
$
(269)
|
$
627
|
$
643
|
|
(142.9) %
|
(141.8) %
|
|
|
|
|
|
|
|
|
N/M = Not
Meaningful
|
Compared to the third quarter of 2023, noninterest
income decreased by $912
million. The decrease was driven primarily by a $918 million loss on the sale of securities as
part of a strategic repositioning of the portfolio in the third
quarter of 2024. See the Selected Items Impact on Earnings table on
page 25 for more information. The decline was partly offset by a
$30 million increase in investment
banking and debt placement fees, reflective of stronger
syndication, debt, and equity underwriting fees, as well as a
$27 million increase in commercial
mortgage servicing fees reflecting higher active special servicing
balances and overall growth of the servicing portfolio.
Compared to the second quarter of 2024, noninterest income
decreased by $896 million. The
decrease was driven primarily by the loss on the sale of securities
referenced above. The decline was partly offset by a $45 million increase in investment banking and
debt placement fees, reflective of stronger syndication and equity
underwriting fees, as well as a $12
million increase in commercial mortgage servicing fees.
|
Noninterest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Personnel
expense
|
$
670
|
$
636
|
$
663
|
|
5.3 %
|
1.1 %
|
|
Net
occupancy
|
66
|
66
|
67
|
|
—
|
(1.5)
|
|
Computer
processing
|
104
|
101
|
89
|
|
3.0
|
16.9
|
|
Business services and
professional fees
|
41
|
37
|
38
|
|
10.8
|
7.9
|
|
Equipment
|
20
|
20
|
20
|
|
—
|
—
|
|
Operating lease
expense
|
14
|
17
|
18
|
|
(17.6)
|
(22.2)
|
|
Marketing
|
21
|
21
|
28
|
|
—
|
(25.0)
|
|
Other
expense
|
158
|
181
|
187
|
|
(12.7)
|
(15.5)
|
|
Total noninterest
expense
|
$
1,094
|
$ 1,079
|
$ 1,110
|
|
1.4 %
|
(1.4) %
|
|
|
|
|
|
|
|
Compared to the third quarter of 2023, noninterest expense
decreased $16 million. The decline in
noninterest expense was driven by a $7
million decrease in marketing expense, and a reduction in
the estimated FDIC special assessment in the third quarter of 2024.
See the Selected Items Impact on Earnings table on page 25 for more
information. Partly offsetting the decline was an increase in
computer processing expense of $15
million, due to technology investments, and a $7 million increase in personnel expense due to
an increase in incentive and stock-based compensation related to
strong capital markets activity and a higher stock price compared
to the year-ago period.
Compared to the second quarter of 2024, noninterest expense
increased by $15 million. The
increase was driven by a $34 million
increase in personnel expense, primarily from incentive and
stock-based compensation, reflecting stronger capital markets
activity. The increase was partly offset by a decline in other
expense of $23 million, related to a
reduction of the estimated FDIC special assessment charge
recognized in the third quarter of 2024 when compared to the second
quarter of 2024. See the Selected Items Impact on Earnings table on
page 25 for more information.
|
BALANCE SHEET
HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Commercial and
industrial (a)
|
$
53,121
|
$
54,599
|
$
59,187
|
|
(2.7) %
|
(10.2) %
|
|
Other commercial
loans
|
19,929
|
20,500
|
22,371
|
|
(2.8)
|
(10.9)
|
|
Total consumer
loans
|
33,194
|
33,862
|
36,069
|
|
(2.0)
|
(8.0)
|
|
Total loans
|
$
106,244
|
$
108,961
|
$
117,627
|
|
(2.5) %
|
(9.7) %
|
|
|
|
|
|
|
|
|
(a)
|
Commercial and
industrial average loan balances include $215 million, $218
million, and $202 million of assets from commercial credit cards at
September 30, 2024, June 30, 2024, and September 30, 2023,
respectively.
|
Average loans were $106.2 billion
for the third quarter of 2024, a decrease of $11.4 billion compared to the third quarter of
2023, reflective of Key's planned balance sheet optimization
efforts in 2023, and continued tepid client loan demand. The
decline in average loans was mostly driven by a $8.5 billion decline in average commercial
loans, due to lower commercial and industrial loans and commercial
mortgage real estate loans. Additionally, average consumer loans
declined by $2.9 billion,
reflective of broad-based declines across all consumer loan
categories.
Compared to the second quarter of 2024, average loans decreased
by $2.7 billion. Average commercial
loans declined by $2.0 billion,
primarily driven by a decrease in commercial and industrial loans
and commercial mortgage real estate loans. Average consumer loans
declined $668 million, driven by
broad-based declines across all consumer loan categories.
|
Average
Deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Non-time
deposits
|
$
129,901
|
$
128,161
|
$
129,743
|
|
1.4 %
|
0.1 %
|
|
Time
deposits
|
17,870
|
16,019
|
15,082
|
|
11.6
|
18.5
|
|
Total
deposits
|
$
147,771
|
$
144,180
|
$
144,825
|
|
2.5 %
|
2.0 %
|
|
|
|
|
|
|
|
|
Cost of total
deposits
|
2.39 %
|
2.28 %
|
1.88 %
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
N/A = Not
Applicable
|
Average deposits totaled $147.8
billion for the third quarter of 2024, an increase of
$2.9 billion compared to the year-ago
quarter, reflecting growth in both consumer and commercial
deposits.
Compared to the second quarter of 2024, average deposits
increased by $3.6 billion, driven by
an increase in both consumer and commercial deposit balances.
|
ASSET
QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Net loan
charge-offs
|
$ 154
|
$ 91
|
$ 71
|
|
69.2 %
|
116.9 %
|
|
Net loan charge-offs to
average total loans
|
.58 %
|
.34 %
|
.24 %
|
|
N/A
|
N/A
|
|
Nonperforming loans at
period end
|
$ 728
|
$ 710
|
$ 455
|
|
2.5
|
60.0
|
|
Nonperforming assets at
period end
|
741
|
727
|
471
|
|
1.9
|
57.3
|
|
Allowance for loan and
lease losses
|
1,494
|
1,547
|
1,488
|
|
(3.4)
|
0.4
|
|
Allowance for credit
losses
|
1,774
|
1,833
|
1,778
|
|
(3.2)
|
(0.2)
|
|
Provision for credit
losses
|
95
|
100
|
81
|
|
(5.0)
|
17.3
|
|
|
|
|
|
|
|
|
Allowance for loan and
lease losses to nonperforming loans
|
205 %
|
218 %
|
327 %
|
|
N/A
|
N/A
|
|
Allowance for credit
losses to nonperforming loans
|
244
|
258
|
391
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
N/A = Not
Applicable
|
Key's provision for credit losses was $95
million, compared to $81
million in the third quarter of 2023 and $100 million in the second quarter of 2024. The
increase from the year-ago period reflects continued, but slowing,
credit portfolio migration, higher net charge-offs, and changes in
the economic outlook, partly offset by balance sheet optimization
efforts.
Net loan charge-offs for the third quarter of 2024 totaled
$154 million, or 0.58% of average
total loans. These results compare to $71
million, or 0.24%, for the third quarter of 2023 and
$91 million, or 0.34%, for the second
quarter of 2024. Key's allowance for credit losses was $1.8 billion, or 1.68% of total period-end loans
at September 30, 2024, compared to
1.54% at September 30, 2023, and
1.71% at June 30, 2024.
At September 30, 2024, Key's
nonperforming loans totaled $728
million, which represented 0.69% of period-end portfolio
loans. These results compare to 0.39% at September 30, 2023, and 0.66% at June 30, 2024. Nonperforming assets at
September 30, 2024, totaled
$741 million, and represented 0.70%
of period-end portfolio loans and OREO and other nonperforming
assets. These results compare to 0.41% at September 30, 2023, and 0.68% at June 30, 2024.
CAPITAL
Key's estimated risk-based capital ratios, included in the
following table, continued to exceed all "well-capitalized"
regulatory benchmarks at September 30,
2024.
|
Capital
Ratios
|
|
|
|
|
|
|
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
Common Equity Tier 1
(a)
|
10.8 %
|
10.5 %
|
9.8 %
|
|
Tier 1 risk-based
capital (a)
|
12.6
|
12.2
|
11.4
|
|
Total risk-based
capital (a)
|
15.1
|
14.7
|
13.8
|
|
Tangible common equity
to tangible assets (b)
|
6.2
|
5.2
|
4.4
|
|
Leverage
(a)
|
9.2
|
9.1
|
8.9
|
|
|
|
|
|
(a)
|
September 30, 2024
ratio is estimated and reflects Key's election to adopt the CECL
optional transition provision.
|
|
(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.
|
Key's regulatory capital position remained strong in the third
quarter of 2024. As shown in the preceding table, at September 30, 2024, Key's estimated Common Equity
Tier 1 and Tier 1 risk-based capital ratios stood at 10.8% and
12.6%, respectively. Key's tangible common equity ratio was 6.2% at
September 30, 2024.
Key elected the CECL phase-in option provided by regulatory
guidance which delayed for two years the estimated impact of CECL
on regulatory capital and phases it in over three years beginning
in 2022. Effective for the first quarter 2022, Key is now in the
three-year transition period. On a fully phased-in basis, Key's
Common Equity Tier 1 ratio would be reduced by five basis
points.
|
Summary of Changes
in Common Shares Outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In
thousands
|
|
|
|
|
Change 3Q24
vs.
|
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Shares outstanding at
beginning of period
|
943,200
|
942,776
|
935,733
|
|
— %
|
.8 %
|
|
Shares issued under
employee compensation plans (net of cancellations and
returns)
|
222
|
424
|
428
|
|
(47.6)
|
(48.1)
|
|
Shares issued under
Scotiabank investment agreement
|
47,829
|
—
|
—
|
|
N/M
|
N/M
|
|
Shares outstanding at
end of period
|
991,251
|
943,200
|
936,161
|
|
5.1 %
|
5.9 %
|
|
|
|
|
|
|
|
|
N/M = Not
Meaningful
|
Key declared a dividend of $.205
per common share for the third quarter of 2024.
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 3Q24
vs.
|
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Revenue from
continuing operations (TE)
|
|
|
|
|
|
|
|
Consumer
Bank
|
$
814
|
$
769
|
$
775
|
|
5.9 %
|
5.0 %
|
|
Commercial
Bank
|
868
|
770
|
809
|
|
12.7
|
7.3
|
|
Other
(a)
|
(987)
|
(13)
|
(18)
|
|
N/M
|
N/M
|
|
Total
|
$
695
|
$
1,526
|
$
1,566
|
|
(54.5) %
|
(55.6) %
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key
|
|
|
|
|
|
|
|
Consumer
Bank
|
$
86
|
$
67
|
$
65
|
|
28.4 %
|
32.3 %
|
|
Commercial
Bank
|
300
|
207
|
240
|
|
44.9
|
25.0
|
|
Other
(a)
|
(797)
|
(1)
|
(3)
|
|
N/M
|
N/M
|
|
Total
|
$
(411)
|
$
273
|
$
302
|
|
(250.5) %
|
(236.1) %
|
|
|
|
|
|
|
|
|
|
(a)
|
Other includes other
segments that consists of corporate treasury, our principal
investing unit, and various exit portfolios as well as reconciling
items which primarily represents the unallocated portion of
nonearning assets of corporate support functions. Charges related
to the funding of these assets are part of net interest income and
are allocated to the business segments through noninterest expense.
Corporate treasury includes realized gains and losses from
transactions associated with Key's investment securities portfolio.
Reconciling items also includes intercompany eliminations and
certain items that are not allocated to the business segments
because they do not reflect their normal operations.
|
|
TE = Taxable
Equivalent
|
|
N/M = Not
Meaningful
|
|
Consumer
Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Summary of
operations
|
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
584
|
$
535
|
$
534
|
|
9.2 %
|
9.4 %
|
|
Noninterest
income
|
230
|
234
|
241
|
|
(1.7)
|
(4.6)
|
|
Total revenue
(TE)
|
814
|
769
|
775
|
|
5.9
|
5.0
|
|
Provision for credit
losses
|
52
|
33
|
14
|
|
57.6
|
271.4
|
|
Noninterest
expense
|
649
|
648
|
676
|
|
.2
|
(4.0)
|
|
Income (loss) before
income taxes (TE)
|
113
|
88
|
85
|
|
28.4
|
32.9
|
|
Allocated income taxes
(benefit) and TE adjustments
|
27
|
21
|
20
|
|
28.6
|
35.0
|
|
Net income (loss)
attributable to Key
|
$
86
|
$
67
|
$
65
|
|
28.4 %
|
32.3 %
|
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
|
Loans and
leases
|
$ 38,332
|
$ 39,174
|
$ 41,610
|
|
(2.1) %
|
(7.9) %
|
|
Total assets
|
41,188
|
42,008
|
44,429
|
|
(2.0)
|
(7.3)
|
|
Deposits
|
86,431
|
85,397
|
82,683
|
|
1.2
|
4.5
|
|
|
|
|
|
|
|
|
Assets under
management at period end
|
$ 61,122
|
$ 57,602
|
$ 52,516
|
|
6.1 %
|
16.4 %
|
|
|
|
|
|
|
|
|
TE = Taxable
Equivalent
|
|
Additional Consumer
Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Noninterest
income
|
|
|
|
|
|
|
|
Trust and investment
services income
|
$
114
|
$ 112
|
$ 105
|
|
1.8 %
|
8.6 %
|
|
Service charges on
deposit accounts
|
34
|
34
|
39
|
|
—
|
(12.8)
|
|
Cards and payments
income
|
60
|
61
|
65
|
|
(1.6)
|
(7.7)
|
|
Consumer mortgage
income
|
12
|
16
|
15
|
|
(25.0)
|
(20.0)
|
|
Other noninterest
income
|
10
|
11
|
17
|
|
(9.1)
|
(41.2)
|
|
Total noninterest
income
|
$
230
|
$ 234
|
$ 241
|
|
(1.7) %
|
(4.6) %
|
|
|
|
|
|
|
|
|
Average deposit
balances
|
|
|
|
|
|
|
|
Money market
deposits
|
$
30,805
|
$
30,229
|
$
28,638
|
|
1.9 %
|
7.6 %
|
|
Demand
deposits
|
22,310
|
22,292
|
22,526
|
|
.1
|
(1.0)
|
|
Savings
deposits
|
4,553
|
4,791
|
5,676
|
|
(5.0)
|
(19.8)
|
|
Time
deposits
|
13,927
|
13,038
|
8,752
|
|
6.8
|
59.1
|
|
Noninterest-bearing
deposits
|
14,836
|
15,047
|
17,091
|
|
(1.4)
|
(13.2)
|
|
Total
deposits
|
$
86,431
|
$
85,397
|
$
82,683
|
|
1.2 %
|
4.5 %
|
|
|
|
|
|
|
|
|
Other
data
|
|
|
|
|
|
|
|
Branches
|
944
|
946
|
959
|
|
|
|
|
Automated teller
machines
|
1,194
|
1,199
|
1,249
|
|
|
|
|
|
|
|
|
|
|
Consumer Bank Summary of Operations (3Q24 vs. 3Q23)
- Key's Consumer Bank recorded net income attributable to Key of
$86 million for the third quarter of
2024, compared to $65 million for the
year-ago quarter
- Taxable-equivalent net interest income increased by
$50 million, or 9.4%, compared to the
third quarter of 2023
- Average loans and leases decreased $3.3
billion, or 7.9%, from the third quarter of 2023, driven by
broad-based declines across all loan categories
- Average deposits increased $3.7
billion, or 4.5%, from the third quarter of 2023, driven by
growth in retail deposits
- Provision for credit losses increased $38 million compared to the third quarter of
2023, driven by changes in economic outlook and higher net
charge-offs, partly offset by planned balance sheet optimization
efforts
- Noninterest income decreased $11
million from the year-ago quarter, driven by declines in
service charges on deposit accounts and cards and payments
income
- Noninterest expense decreased $27
million from the year-ago quarter, reflective of lower
marketing expense
|
Commercial
Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Summary of
operations
|
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
460
|
$
411
|
$
446
|
|
11.9 %
|
3.1 %
|
|
Noninterest
income
|
408
|
359
|
363
|
|
13.6
|
12.4
|
|
Total revenue
(TE)
|
868
|
770
|
809
|
|
12.7
|
7.3
|
|
Provision for credit
losses
|
41
|
87
|
68
|
|
(52.9)
|
(39.7)
|
|
Noninterest
expense
|
445
|
432
|
433
|
|
3.0
|
2.8
|
|
Income (loss) before
income taxes (TE)
|
382
|
251
|
308
|
|
52.2
|
24.0
|
|
Allocated income taxes
and TE adjustments
|
82
|
44
|
68
|
|
86.4
|
20.6
|
|
Net income (loss)
attributable to Key
|
$
300
|
$
207
|
$
240
|
|
44.9 %
|
25.0 %
|
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
|
Loans and
leases
|
$ 67,452
|
$ 69,248
|
$ 75,598
|
|
(2.6) %
|
(10.8) %
|
|
Loans held for
sale
|
998
|
522
|
1,268
|
|
91.2
|
(21.3)
|
|
Total assets
|
76,395
|
78,328
|
85,930
|
|
(2.5)
|
(11.1)
|
|
Deposits
|
58,696
|
57,360
|
56,078
|
|
2.3 %
|
4.7 %
|
|
|
|
|
|
|
|
|
TE = Taxable
Equivalent
|
|
Additional
Commercial Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in
millions
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
3Q23
|
|
2Q24
|
3Q23
|
|
Noninterest
income
|
|
|
|
|
|
|
|
Trust and investment
services income
|
$
26
|
$
26
|
$
25
|
|
— %
|
4.0 %
|
|
Investment banking and
debt placement fees
|
171
|
126
|
141
|
|
35.7
|
21.3
|
|
Cards and payments
income
|
22
|
21
|
18
|
|
4.8
|
22.2
|
|
Service charges on
deposit accounts
|
32
|
31
|
29
|
|
3.2
|
10.3
|
|
Corporate services
income
|
62
|
61
|
64
|
|
1.6
|
(3.1)
|
|
Commercial mortgage
servicing fees
|
73
|
61
|
45
|
|
19.7
|
62.2
|
|
Operating lease income
and other leasing gains
|
16
|
21
|
22
|
|
(23.8)
|
(27.3)
|
|
Other noninterest
income
|
6
|
12
|
19
|
|
(50.0)
|
(68.4)
|
|
Total noninterest
income
|
$
408
|
$
359
|
$
363
|
|
13.6 %
|
12.4 %
|
|
|
|
|
|
|
|
Commercial Bank Summary of Operations (3Q24 vs. 3Q23)
- Key's Commercial Bank recorded net income attributable to Key
of $300 million for the third quarter
of 2024 compared to $240 million for
the year-ago quarter
- Taxable-equivalent net interest income increased by
$14 million, or 3.1%, compared to the
third quarter of 2023
- Average loan and lease balances decreased $8.1 billion, or 10.8%, compared to the third
quarter of 2023, driven by a decline in commercial and industrial
loans
- Average deposit balances increased $2.6
billion compared to the third quarter of 2023, driven by our
focus on growing deposits across our commercial businesses
- Provision for credit losses decreased $27 million compared to the third quarter of
2023, driven by the impact of balance sheet optimization efforts,
partly offset by slowing credit portfolio migration, changes in
economic outlook, and higher net charge-offs
- Noninterest income increased $45
million compared to the third quarter of 2023, primarily
driven by an increase in investment banking and debt placement fees
and commercial mortgage servicing fees
- Noninterest expense increased $12
million compared to the third quarter of 2023, driven by
higher incentive compensation related to stronger investment
banking and debt placement fees
*******************************************
KeyCorp's roots trace back nearly 200 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 $190 billion
at September 30, 2024.
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 approximately
1,000 branches and approximately 1,200 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, 2023 and in KeyCorp's subsequent
SEC filings, all of which have been or will be filed with the
Securities and Exchange Commission (the "SEC") and are or will be
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
worsening of the U.S. economy due to financial, political, or other
shocks, the extensive regulation of the U.S. financial services
industry, the soundness of other financial institutions and the
impact of changes in the interest rate environment. 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 October 17, 2024. A
replay of the call will be available on our website through
October 17, 2025.
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.
*****
KeyCorp
Third Quarter
2024
Financial Supplement
|
Page
|
|
|
12
|
Basis of
Presentation
|
|
13
|
Financial
Highlights
|
|
15
|
GAAP to Non-GAAP
Reconciliation
|
|
17
|
Consolidated Balance
Sheets
|
|
18
|
Consolidated Statements
of Income
|
|
19
|
Consolidated Average
Balance Sheets, and Net Interest Income and Yields/Rates From
Continuing Operations
|
|
21
|
Noninterest
Expense
|
|
21
|
Personnel
Expense
|
|
22
|
Loan
Composition
|
|
22
|
Loans Held for Sale
Composition
|
|
22
|
Summary of Changes in
Loans Held for Sale
|
|
22
|
Summary of Loan and
Lease Loss Experience From Continuing Operations
|
|
24
|
Asset Quality
Statistics From Continuing Operations
|
|
24
|
Summary of
Nonperforming Assets and Past Due Loans From Continuing
Operations
|
|
24
|
Summary of Changes in
Nonperforming Loans From Continuing Operations
|
|
25
|
Line of Business
Results
|
|
25
|
Selected Items Impact
on Earnings
|
Basis of Presentation
Use of Non-GAAP Financial Measures
This document
contains GAAP financial measures and non-GAAP financial measures
where management believes it to be helpful in understanding
Key's results of operations or financial position. Where non-GAAP
financial measures are used, the comparable GAAP financial measure,
as well as the reconciliation to the comparable GAAP financial
measure, can be found in this document, the financial supplement,
or conference call slides related to this document, all of which
can be found on Key's website (www.key.com/ir).
Annualized Data
Certain returns, yields, performance
ratios, or quarterly growth rates are presented on an "annualized"
basis. This is done for analytical and decision-making purposes to
better discern underlying performance trends when compared to
full-year or year-over-year amounts.
Taxable Equivalent
Income from tax-exempt earning
assets is increased by an amount equivalent to the taxes that would
have been paid if this income had been taxable at the federal
statutory rate. This adjustment puts all earning assets, most
notably tax-exempt municipal securities, and certain lease assets,
on a common basis that facilitates comparison of results to results
of peers.
Earnings Per Share Equivalent
Certain income or
expense items may be expressed on a per common share basis. This is
done for analytical and decision-making purposes to better discern
underlying trends in total consolidated earnings per share
performance excluding the impact of such items. When the impact of
certain income or expense items is disclosed separately, the
after-tax amount is computed using the marginal tax rate, unless
otherwise specified, with this then being the amount used to
calculate the earnings per share equivalent.
|
Financial
Highlights
|
|
(Dollars in millions,
except per share amounts)
|
|
|
|
Three months
ended
|
|
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
Summary of
operations
|
|
|
|
|
Net interest income
(TE)
|
$
964
|
$
899
|
$
923
|
|
Noninterest
income
|
(269)
|
627
|
643
|
|
|
Total revenue
(TE)
|
695
|
1,526
|
1,566
|
|
Provision for credit
losses
|
95
|
100
|
81
|
|
Noninterest
expense
|
1,094
|
1,079
|
1,110
|
|
Income (loss) from
continuing operations attributable to Key
|
(411)
|
273
|
302
|
|
Income (loss) from
discontinued operations, net of taxes
|
1
|
1
|
1
|
|
Net income (loss)
attributable to Key
|
(410)
|
274
|
303
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
(447)
|
237
|
266
|
|
Income (loss) from
discontinued operations, net of taxes
|
1
|
1
|
1
|
|
Net income (loss)
attributable to Key common shareholders
|
(446)
|
238
|
267
|
|
|
|
|
|
|
|
Per common
share
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(.47)
|
$
.25
|
$
.29
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
—
|
—
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
(.47)
|
.25
|
.29
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders —
assuming dilution
|
(.47)
|
.25
|
.29
|
|
Income (loss) from
discontinued operations, net of taxes — assuming
dilution
|
—
|
—
|
—
|
|
Net income (loss)
attributable to Key common shareholders — assuming dilution
(a)
|
(.47)
|
.25
|
.29
|
|
|
|
|
|
|
|
Cash dividends
declared
|
.205
|
.205
|
.205
|
|
Book value at period
end
|
14.53
|
13.09
|
11.65
|
|
Tangible book value at
period end
|
11.72
|
10.13
|
8.65
|
|
Market price at period
end
|
16.75
|
14.21
|
10.76
|
|
|
|
|
|
|
|
Performance
ratios
|
|
|
|
|
From continuing
operations:
|
|
|
|
|
Return on average total
assets
|
(.87) %
|
.59 %
|
.62 %
|
|
Return on average
common equity
|
(13.41)
|
7.96
|
9.31
|
|
Return on average
tangible common equity (b)
|
(16.98)
|
10.39
|
12.40
|
|
Net interest margin
(TE)
|
2.17
|
2.04
|
2.01
|
|
Cash efficiency ratio
(b)
|
156.4
|
70.2
|
70.3
|
|
|
|
|
|
|
|
From consolidated
operations:
|
|
|
|
|
Return on average total
assets
|
(.87) %
|
.59 %
|
.62 %
|
|
Return on average
common equity
|
(13.38)
|
7.99
|
9.35
|
|
Return on average
tangible common equity (b)
|
(16.95)
|
10.43
|
12.45
|
|
Net interest margin
(TE)
|
2.17
|
2.04
|
2.01
|
|
Loan to deposit
(c)
|
71.0
|
74.0
|
80.8
|
|
|
|
|
|
|
|
Capital ratios at
period end
|
|
|
|
|
Key shareholders'
equity to assets
|
8.9 %
|
7.9 %
|
7.1 %
|
|
Key common
shareholders' equity to assets
|
7.6
|
6.6
|
5.8
|
|
Tangible common equity
to tangible assets (b)
|
6.2
|
5.2
|
4.4
|
|
Common Equity Tier 1
(d)
|
10.8
|
10.5
|
9.8
|
|
Tier 1 risk-based
capital (d)
|
12.6
|
12.2
|
11.4
|
|
Total risk-based
capital (d)
|
15.1
|
14.7
|
13.8
|
|
Leverage
(d)
|
9.2
|
9.1
|
8.9
|
|
|
|
|
|
|
|
Asset quality — from
continuing operations
|
|
|
|
|
Net loan
charge-offs
|
$
154
|
$
91
|
$
71
|
|
Net loan charge-offs to
average loans
|
.58 %
|
.34 %
|
.24 %
|
|
Allowance for loan and
lease losses
|
$
1,494
|
$
1,547
|
$
1,488
|
|
Allowance for credit
losses
|
1,774
|
1,833
|
1,778
|
|
Allowance for loan and
lease losses to period-end loans
|
1.42 %
|
1.44 %
|
1.29 %
|
|
Allowance for credit
losses to period-end loans
|
1.68
|
1.71
|
1.54
|
|
Allowance for loan and
lease losses to nonperforming loans
|
205
|
218
|
327
|
|
Allowance for credit
losses to nonperforming loans
|
244
|
258
|
391
|
|
Nonperforming loans at
period-end
|
$
728
|
$
710
|
$
455
|
|
Nonperforming assets at
period-end
|
741
|
727
|
471
|
|
Nonperforming loans to
period-end portfolio loans
|
.69 %
|
.66 %
|
.39 %
|
|
Nonperforming assets to
period-end portfolio loans plus OREO and other nonperforming
assets
|
.70
|
.68
|
.41
|
|
|
|
|
|
|
|
Trust
assets
|
|
|
|
|
Assets under
management
|
$
61,122
|
$
57,602
|
$
52,516
|
|
Other
data
|
|
|
|
|
Average full-time
equivalent employees
|
16,805
|
16,646
|
17,666
|
|
Branches
|
944
|
946
|
959
|
|
Taxable-equivalent
adjustment
|
$
12
|
$
12
|
$
8
|
|
|
|
|
|
Financial Highlights
(continued)
|
|
(Dollars in millions,
except per share amounts)
|
|
|
Nine months
ended
|
|
|
9/30/2024
|
9/30/2023
|
|
Summary of
operations
|
|
|
|
Net interest income
(TE)
|
$
2,749
|
$
3,015
|
|
Noninterest
income
|
1,005
|
1,860
|
|
Total revenue
(TE)
|
3,754
|
4,875
|
|
Provision for credit
losses
|
296
|
387
|
|
Noninterest
expense
|
3,316
|
3,362
|
|
Income (loss) from
continuing operations attributable to Key
|
81
|
899
|
|
Income (loss) from
discontinued operations, net of taxes
|
2
|
3
|
|
Net income (loss)
attributable to Key
|
83
|
902
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
(27)
|
791
|
|
Income (loss) from
discontinued operations, net of taxes
|
2
|
3
|
|
Net income (loss)
attributable to Key common shareholders
|
(25)
|
794
|
|
|
|
|
|
Per common
share
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(.03)
|
$
.85
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
—
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
(.03)
|
.86
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders —
assuming dilution
|
(.03)
|
.85
|
|
Income (loss) from
discontinued operations, net of taxes — assuming
dilution
|
—
|
—
|
|
Net income (loss)
attributable to Key common shareholders — assuming dilution
(a)
|
(.03)
|
.85
|
|
|
|
|
|
Cash dividends
paid
|
.62
|
.62
|
|
|
|
|
|
Performance
ratios
|
|
|
|
From continuing
operations:
|
|
|
|
Return on average total
assets
|
.06 %
|
.62 %
|
|
Return on average
common equity
|
(.29)
|
9.18
|
|
Return on average
tangible common equity (b)
|
(.37)
|
12.17
|
|
Net interest margin
(TE)
|
2.08
|
2.20
|
|
Cash efficiency ratio
(b)
|
87.7
|
68.4
|
|
|
|
|
|
From consolidated
operations:
|
|
|
|
Return on average total
assets
|
.06 %
|
.62 %
|
|
Return on average
common equity
|
(0.27)
|
9.22
|
|
Return on average
tangible common equity (b)
|
(0.35)
|
12.22
|
|
Net interest margin
(TE)
|
2.08
|
2.20
|
|
|
|
|
|
Asset quality — from
continuing operations
|
|
|
|
Net loan
charge-offs
|
$
326
|
$
168
|
|
Net loan charge-offs to
average total loans
|
.40 %
|
.19 %
|
|
|
|
|
|
Other
data
|
|
|
|
Average full-time
equivalent employees
|
16,734
|
17,880
|
|
|
|
|
|
Taxable-equivalent
adjustment
|
35
|
23
|
|
(a)
|
Earnings per share may
not foot due to rounding.
|
|
(b)
|
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.
|
|
(c)
|
Represents period-end
consolidated total loans and loans held for sale divided by
period-end consolidated total deposits.
|
|
(d)
|
September 30, 2024,
ratio is estimated and reflects Key's election to adopt the CECL
optional transition provision.
|
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," "pre-provision net revenue," "cash efficiency
ratio," "adjusted income (loss) available from continuing
operations attributable to Key common shareholders," and "diluted
earnings per share - adjusted."
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.
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 provides 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.
Adjusted income (loss) available from continuing operations
attributable to Key common shareholders (or "adjusted net income")
and diluted earnings per share - adjusted (or "adjusted earnings
per share") are non-GAAP in that these measures exclude securities
portfolio repositioning, net of tax, that occurred in the third
quarter of 2024. Management believes these measures provide
investors with useful information to gain a better understanding of
ongoing operations and enhance comparability of results with prior
periods, as well as demonstrate the effects of the significant
losses related to the securities repositioning.
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
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Tangible common
equity to tangible assets at period-end
|
|
|
|
|
|
|
|
Key shareholders'
equity (GAAP)
|
$
16,852
|
$
14,789
|
$
13,356
|
|
|
|
|
Less: Intangible
assets (a)
|
2,786
|
2,793
|
2,816
|
|
|
|
|
Preferred
Stock (b)
|
2,446
|
2,446
|
2,446
|
|
|
|
|
Tangible common equity
(non-GAAP)
|
$
11,620
|
$ 9,550
|
$ 8,094
|
|
|
|
|
Total assets
(GAAP)
|
$
189,763
|
$ 187,450
|
$ 187,851
|
|
|
|
|
Less: Intangible
assets (a)
|
2,786
|
2,793
|
2,816
|
|
|
|
|
Tangible assets
(non-GAAP)
|
$
186,977
|
$ 184,657
|
$ 185,035
|
|
|
|
|
Tangible common equity
to tangible assets ratio (non-GAAP)
|
6.21 %
|
5.17 %
|
4.37 %
|
|
|
|
|
Pre-provision net
revenue
|
|
|
|
|
|
|
|
Net interest income
(GAAP)
|
$
952
|
$
887
|
$
915
|
|
$
2,714
|
$
2,992
|
|
Plus:
Taxable-equivalent adjustment
|
12
|
12
|
8
|
|
35
|
23
|
|
Noninterest
income
|
(269)
|
627
|
643
|
|
1,005
|
1,860
|
|
Less: Noninterest
expense
|
1,094
|
1,079
|
1,110
|
|
3,316
|
3,362
|
|
Pre-provision net
revenue from continuing operations (non-GAAP)
|
$
(399)
|
$
447
|
$
456
|
|
$
438
|
$
1,513
|
|
Average tangible
common equity
|
|
|
|
|
|
|
|
Average Key
shareholders' equity (GAAP)
|
$
15,759
|
$
14,474
|
$
13,831
|
|
$
14,963
|
$
14,020
|
|
Less: Intangible
assets (average) (c)
|
2,789
|
2,796
|
2,821
|
|
2,796
|
2,831
|
|
Preferred stock
(average)
|
2,500
|
2,500
|
2,500
|
|
2,500
|
2,500
|
|
Average tangible
common equity (non-GAAP)
|
$
10,470
|
$ 9,178
|
$ 8,510
|
|
$
9,667
|
$
8,689
|
|
Return on average
tangible common equity from continuing operations
|
|
|
|
|
|
|
|
Net income (loss) from
continuing operations attributable to Key common shareholders
(GAAP)
|
$
(447)
|
$
237
|
$
266
|
|
$
(27)
|
$ 791
|
|
Average tangible
common equity (non-GAAP)
|
10,470
|
9,178
|
8,510
|
|
9,667
|
8,689
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity from continuing operations
(non-GAAP)
|
(16.98) %
|
10.39 %
|
12.40 %
|
|
(0.37) %
|
12.17 %
|
|
Return on average
tangible common equity consolidated
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Key common shareholders (GAAP)
|
$
(446)
|
$
238
|
$
267
|
|
$
(25)
|
$ 794
|
|
Average tangible
common equity (non-GAAP)
|
10,470
|
9,178
|
8,510
|
|
9,667
|
8,689
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity consolidated (non-GAAP)
|
(16.95) %
|
10.43 %
|
12.45 %
|
|
(0.35) %
|
12.22 %
|
|
GAAP to Non-GAAP
Reconciliations (continued)
|
|
(Dollars in
millions)
|
|
Three months
ended
|
|
Nine months
ended
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Cash efficiency
ratio
|
|
|
|
|
|
|
|
Noninterest expense
(GAAP)
|
$ 1,094
|
$ 1,079
|
$ 1,110
|
|
$
3,316
|
$
3,362
|
|
Less: Intangible asset
amortization
|
7
|
7
|
9
|
|
22
|
29
|
|
Adjusted noninterest
expense (non-GAAP)
|
$ 1,087
|
$ 1,072
|
$ 1,101
|
|
$
3,294
|
$
3,333
|
|
|
|
|
|
|
|
|
Net interest income
(GAAP)
|
$
952
|
$ 887
|
$ 915
|
|
$
2,714
|
$
2,992
|
|
Plus:
Taxable-equivalent adjustment
|
12
|
12
|
8
|
|
35
|
23
|
|
Net interest income TE
(non-GAAP)
|
964
|
899
|
923
|
|
2,749
|
3,015
|
|
Noninterest income
(GAAP)
|
(269)
|
627
|
643
|
|
1,005
|
1,860
|
|
Total
taxable-equivalent revenue (non-GAAP)
|
$
695
|
$ 1,526
|
$ 1,566
|
|
$
3,754
|
$
4,875
|
|
|
|
|
|
|
|
|
Cash efficiency ratio
(non-GAAP)
|
156.4 %
|
70.2 %
|
70.3 %
|
|
87.7 %
|
68.4 %
|
|
|
|
|
|
|
|
|
Adjusted income
(loss) available from continuing operations attributable to Key
common shareholders
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders
(GAAP)
|
$
(447)
|
$ 237
|
$ 266
|
|
|
|
|
Plus: Loss on sale of
securities (net of tax)
|
737
|
—
|
—
|
|
|
|
|
Adjusted income (loss)
available from continuing operations attributable to Key common
shareholders (non-GAAP)
|
$
290
|
$ 237
|
$ 266
|
|
|
|
|
Diluted earnings per
common share (EPS) - adjusted
|
|
|
|
|
|
|
|
Diluted EPS from
continuing operations attributable to Key common shareholders
(GAAP)
|
$
(.47)
|
$
.25
|
$
.29
|
|
|
|
|
Plus: EPS impact of
loss on sale of securities
|
.77
|
—
|
—
|
|
|
|
|
Diluted EPS from
continuing operations attributable to Key common shareholders -
adjusted (non-GAAP)
|
$
.30
|
$
.25
|
$
.29
|
|
|
|
|
(a)
|
For the three months
ended September 30, 2024, June 30, 2024, and September 30, 2023,
intangible assets exclude less than $1 million, less than $1
million, and $1 million, respectively, of period-end purchased
credit card receivables.
|
|
(b)
|
Net of capital
surplus.
|
|
(c)
|
For the three months
ended September 30, 2024, June 30, 2024, and September 30, 2023,
average intangible assets exclude less than $1 million, less than
$1 million, and $1 million, respectively, of average purchased
credit card receivables.
|
|
GAAP = U.S. generally
accepted accounting principles
|
|
Consolidated Balance
Sheets
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
Assets
|
|
|
|
|
Loans
|
$
105,346
|
$
107,078
|
$
115,544
|
|
Loans held for
sale
|
1,058
|
517
|
730
|
|
Securities available
for sale
|
34,169
|
37,460
|
35,839
|
|
Held-to-maturity
securities
|
7,702
|
7,968
|
8,853
|
|
Trading account
assets
|
1,404
|
1,219
|
1,325
|
|
Short-term
investments
|
22,796
|
15,536
|
7,871
|
|
Other
investments
|
1,117
|
1,259
|
1,356
|
|
|
Total earning
assets
|
173,592
|
171,037
|
171,518
|
|
Allowance for loan and
lease losses
|
(1,494)
|
(1,547)
|
(1,488)
|
|
Cash and due from
banks
|
1,276
|
1,326
|
766
|
|
Premises and
equipment
|
624
|
631
|
649
|
|
Goodwill
|
2,752
|
2,752
|
2,752
|
|
Other intangible
assets
|
34
|
41
|
65
|
|
Corporate-owned life
insurance
|
4,379
|
4,382
|
4,381
|
|
Accrued income and
other assets
|
8,323
|
8,532
|
8,843
|
|
Discontinued
assets
|
277
|
296
|
365
|
|
|
Total
assets
|
$
189,763
|
$
187,450
|
$
187,851
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Deposits in domestic
offices:
|
|
|
|
|
|
Interest-bearing
deposits
|
$
119,995
|
$
117,570
|
$
112,581
|
|
|
Noninterest-bearing
deposits
|
30,358
|
28,150
|
31,710
|
|
|
Total
deposits
|
150,353
|
145,720
|
144,291
|
|
Federal funds purchased
and securities sold under repurchase agreements
|
44
|
25
|
43
|
|
Bank notes and other
short-term borrowings
|
2,359
|
5,292
|
3,470
|
|
Accrued expense and
other liabilities
|
4,478
|
4,755
|
5,388
|
|
Long-term
debt
|
15,677
|
16,869
|
21,303
|
|
|
Total
liabilities
|
172,911
|
172,661
|
174,495
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
Preferred
stock
|
2,500
|
2,500
|
2,500
|
|
Common
shares
|
1,257
|
1,257
|
1,257
|
|
Capital
surplus
|
6,149
|
6,185
|
6,254
|
|
Retained
earnings
|
15,066
|
15,706
|
15,835
|
|
Treasury stock, at
cost
|
(4,839)
|
(5,715)
|
(5,851)
|
|
Accumulated other
comprehensive income (loss)
|
(3,281)
|
(5,144)
|
(6,639)
|
|
|
Key shareholders'
equity
|
16,852
|
14,789
|
13,356
|
|
Total liabilities
and equity
|
$
189,763
|
$
187,450
|
$
187,851
|
|
|
|
|
|
|
|
Common shares
outstanding (000)
|
991,251
|
943,200
|
936,161
|
|
Consolidated
Statements of Income
|
|
(Dollars in millions,
except per share amounts)
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Interest
income
|
|
|
|
|
|
|
|
Loans
|
$
1,516
|
$
1,524
|
$
1,593
|
|
$
4,578
|
$
4,645
|
|
Loans held for
sale
|
18
|
8
|
19
|
|
40
|
49
|
|
Securities available
for sale
|
298
|
259
|
192
|
|
789
|
580
|
|
Held-to-maturity
securities
|
70
|
73
|
79
|
|
218
|
234
|
|
Trading account
assets
|
15
|
16
|
15
|
|
45
|
42
|
|
Short-term
investments
|
244
|
192
|
123
|
|
578
|
276
|
|
Other
investments
|
14
|
16
|
22
|
|
47
|
51
|
|
|
Total interest
income
|
2,175
|
2,088
|
2,043
|
|
6,295
|
5,877
|
|
Interest
expense
|
|
|
|
|
|
|
|
Deposits
|
887
|
817
|
687
|
|
2,486
|
1,568
|
|
Federal funds purchased
and securities sold under repurchase agreements
|
1
|
1
|
9
|
|
3
|
79
|
|
Bank notes and other
short-term borrowings
|
43
|
51
|
81
|
|
140
|
263
|
|
Long-term
debt
|
292
|
332
|
351
|
|
952
|
975
|
|
|
Total interest
expense
|
1,223
|
1,201
|
1,128
|
|
3,581
|
2,885
|
|
Net interest
income
|
952
|
887
|
915
|
|
2,714
|
2,992
|
|
Provision for credit
losses
|
95
|
100
|
81
|
|
296
|
387
|
|
Net interest income
after provision for credit losses
|
857
|
787
|
834
|
|
2,418
|
2,605
|
|
Noninterest
income
|
|
|
|
|
|
|
|
Trust and investment
services income
|
140
|
139
|
130
|
|
415
|
384
|
|
Investment banking and
debt placement fees
|
171
|
126
|
141
|
|
467
|
406
|
|
Cards and payments
income
|
84
|
85
|
90
|
|
246
|
256
|
|
Service charges on
deposit accounts
|
67
|
66
|
69
|
|
196
|
205
|
|
Corporate services
income
|
69
|
68
|
73
|
|
206
|
235
|
|
Commercial mortgage
servicing fees
|
73
|
61
|
46
|
|
190
|
142
|
|
Corporate-owned life
insurance income
|
36
|
34
|
35
|
|
102
|
96
|
|
Consumer mortgage
income
|
12
|
16
|
15
|
|
42
|
40
|
|
Operating lease income
and other leasing gains
|
16
|
21
|
22
|
|
61
|
70
|
|
Other
income(c)
|
(937)
|
11
|
22
|
|
(920)
|
26
|
|
|
Total noninterest
income
|
(269)
|
627
|
643
|
|
1,005
|
1,860
|
|
Noninterest
expense
|
|
|
|
|
|
|
|
Personnel
|
670
|
636
|
663
|
|
1,980
|
1,986
|
|
Net
occupancy
|
66
|
66
|
67
|
|
199
|
202
|
|
Computer
processing
|
104
|
101
|
89
|
|
307
|
276
|
|
Business services and
professional fees
|
41
|
37
|
38
|
|
119
|
124
|
|
Equipment
|
20
|
20
|
20
|
|
60
|
64
|
|
Operating lease
expense
|
14
|
17
|
18
|
|
48
|
59
|
|
Marketing
|
21
|
21
|
28
|
|
61
|
78
|
|
Other
expense
|
158
|
181
|
187
|
|
542
|
573
|
|
|
Total noninterest
expense
|
1,094
|
1,079
|
1,110
|
|
3,316
|
3,362
|
|
Income (loss) from
continuing operations before income taxes
|
(506)
|
335
|
367
|
|
107
|
1,103
|
|
Income taxes
(benefit)
|
(95)
|
62
|
65
|
|
26
|
204
|
|
Income (loss) from
continuing operations
|
(411)
|
273
|
302
|
|
81
|
899
|
|
Income (loss) from
discontinued operations, net of taxes
|
1
|
1
|
1
|
|
2
|
3
|
|
Net income
(loss)
|
(410)
|
274
|
303
|
|
83
|
902
|
|
Net income (loss)
attributable to Key
|
$
(410)
|
$
274
|
$
303
|
|
$
83
|
$
902
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(447)
|
$
237
|
$
266
|
|
$
(27)
|
$
791
|
|
Net income (loss)
attributable to Key common shareholders
|
(446)
|
238
|
267
|
|
(25)
|
794
|
|
Per common
share
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(.47)
|
$
.25
|
$
.29
|
|
$
(.03)
|
$
.85
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
—
|
—
|
|
—
|
—
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
(.47)
|
.25
|
.29
|
|
(.03)
|
.86
|
|
Per common share —
assuming dilution
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
(.47)
|
$
.25
|
$
.29
|
|
$
(.03)
|
$
.85
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
—
|
—
|
|
—
|
—
|
|
Net income (loss)
attributable to Key common
shareholders (a)
|
(.47)
|
.25
|
.29
|
|
(.03)
|
.85
|
|
|
|
|
|
|
|
|
|
|
Cash dividends declared
per common share
|
$
.205
|
$
.205
|
$
.205
|
|
$
.615
|
$
.615
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding (000)
|
948,979
|
931,726
|
927,131
|
|
936,962
|
927,019
|
|
Effect of common share
options and other stock awards
|
8,951
|
6,761
|
4,613
|
|
7,678
|
5,213
|
|
Weighted-average common
shares and potential common shares outstanding
(000) (b)
|
957,929
|
938,487
|
931,744
|
|
944,640
|
932,232
|
|
(a)
|
Earnings per share may
not foot due to rounding.
|
|
(b)
|
Assumes conversion of
common share options and other stock awards, as
applicable.
|
|
(c)
|
For the three months
ended September 30, 2024, and June 30, 2024, we had $935 million
and $13 million in net securities losses, respectively. For the
three months ended September 30, 2023, we had no net securities
gains or losses. For the nine months ended September 30, 2024, and
September 30, 2023, we had $948 million and $7 million in net
securities losses, respectively.
|
|
Consolidated Average
Balance Sheets, and Net Interest Income and Yields/Rates From
Continuing Operations
|
|
(Dollars in
millions)
|
|
|
Third Quarter
2024
|
|
Second Quarter
2024
|
|
Third Quarter
2023
|
|
|
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)
|
$
53,121
|
$
847
|
6.34 %
|
|
$
54,599
|
$
860
|
6.34 %
|
|
$
59,187
|
$
886
|
5.94 %
|
|
Real estate —
commercial mortgage
|
13,864
|
225
|
6.46
|
|
14,287
|
217
|
6.10
|
|
15,844
|
238
|
5.97
|
|
Real estate —
construction
|
3,077
|
59
|
7.65
|
|
3,020
|
56
|
7.51
|
|
2,820
|
48
|
6.77
|
|
Commercial lease
financing
|
2,988
|
26
|
3.46
|
|
3,193
|
28
|
3.46
|
|
3,707
|
30
|
3.25
|
|
Total commercial
loans
|
73,050
|
1,157
|
6.30
|
|
75,099
|
1,161
|
6.22
|
|
81,558
|
1,202
|
5.85
|
|
Real estate —
residential mortgage
|
20,215
|
167
|
3.30
|
|
20,515
|
169
|
3.30
|
|
21,459
|
176
|
3.28
|
|
Home equity
loans
|
6,634
|
100
|
5.98
|
|
6,817
|
102
|
5.98
|
|
7,418
|
110
|
5.87
|
|
Other consumer
loans
|
5,426
|
69
|
5.08
|
|
5,597
|
70
|
5.00
|
|
6,201
|
78
|
4.96
|
|
Credit cards
|
919
|
35
|
15.22
|
|
933
|
34
|
14.63
|
|
991
|
35
|
14.16
|
|
Total consumer
loans
|
33,194
|
371
|
4.46
|
|
33,862
|
375
|
4.44
|
|
36,069
|
399
|
4.40
|
|
Total loans
|
106,244
|
1,528
|
5.73
|
|
108,961
|
1,536
|
5.66
|
|
117,627
|
1,601
|
5.41
|
|
Loans held for
sale
|
1,098
|
18
|
6.54
|
|
599
|
8
|
5.42
|
|
1,356
|
19
|
5.73
|
|
Securities available
for sale (b), (e)
|
36,700
|
298
|
2.87
|
|
36,764
|
259
|
2.42
|
|
37,271
|
192
|
1.76
|
|
Held-to-maturity
securities (b)
|
7,838
|
70
|
3.58
|
|
8,123
|
73
|
3.59
|
|
9,020
|
79
|
3.50
|
|
Trading account
assets
|
1,142
|
15
|
5.08
|
|
1,231
|
16
|
5.38
|
|
1,203
|
15
|
4.97
|
|
Short-term
investments
|
17,773
|
244
|
5.47
|
|
13,729
|
192
|
5.62
|
|
8,416
|
123
|
5.79
|
|
Other investments
(e)
|
1,193
|
14
|
4.77
|
|
1,234
|
16
|
5.19
|
|
1,395
|
22
|
6.35
|
|
Total earning
assets
|
171,988
|
2,187
|
4.93
|
|
170,641
|
2,100
|
4.77
|
|
176,288
|
2,051
|
4.47
|
|
Allowance for loan and
lease losses
|
(1,533)
|
|
|
|
(1,534)
|
|
|
|
(1,477)
|
|
|
|
Accrued income and
other assets
|
17,154
|
|
|
|
17,476
|
|
|
|
17,530
|
|
|
|
Discontinued
assets
|
284
|
|
|
|
305
|
|
|
|
374
|
|
|
|
Total
assets
|
$
187,893
|
|
|
|
$
186,888
|
|
|
|
$
192,715
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Money market
deposits
|
$
40,379
|
$
309
|
3.04 %
|
|
$
39,364
|
$
290
|
2.97 %
|
|
$
35,243
|
$
213
|
2.40 %
|
|
Demand
deposits
|
56,087
|
365
|
2.59
|
|
54,629
|
340
|
2.50
|
|
55,837
|
315
|
2.24
|
|
Savings
deposits
|
4,967
|
3
|
.22
|
|
5,189
|
2
|
.19
|
|
5,966
|
1
|
.05
|
|
Time
deposits
|
17,870
|
210
|
4.68
|
|
16,019
|
185
|
4.64
|
|
15,082
|
158
|
4.16
|
|
Total interest-bearing
deposits
|
119,303
|
887
|
2.96
|
|
115,201
|
817
|
2.85
|
|
112,128
|
687
|
2.43
|
|
Federal funds purchased
and securities sold
under repurchase agreements
|
98
|
1
|
4.48
|
|
124
|
1
|
4.76
|
|
710
|
9
|
5.04
|
|
Bank notes and other
short-term borrowings
|
3,172
|
43
|
5.44
|
|
3,617
|
51
|
5.57
|
|
5,819
|
81
|
5.54
|
|
Long-term debt
(f)
|
16,422
|
292
|
7.09
|
|
19,219
|
332
|
6.91
|
|
21,584
|
351
|
6.50
|
|
Total interest-bearing
liabilities
|
138,995
|
1,223
|
3.50
|
|
138,161
|
1,201
|
3.49
|
|
140,241
|
1,128
|
3.20
|
|
Noninterest-bearing
deposits
|
28,468
|
|
|
|
28,979
|
|
|
|
32,697
|
|
|
|
Accrued expense and
other liabilities
|
4,387
|
|
|
|
4,969
|
|
|
|
5,572
|
|
|
|
Discontinued
liabilities (f)
|
284
|
|
|
|
305
|
|
|
|
374
|
|
|
|
Total
liabilities
|
$
172,134
|
|
|
|
$
172,414
|
|
|
|
$
178,884
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Key shareholders'
equity
|
$
15,759
|
|
|
|
$
14,474
|
|
|
|
$
13,831
|
|
|
|
Noncontrolling
interests
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Total
equity
|
15,759
|
|
|
|
14,474
|
|
|
|
13,831
|
|
|
|
Total liabilities
and equity
|
$
187,893
|
|
|
|
$
186,888
|
|
|
|
$
192,715
|
|
|
|
Interest rate spread
(TE)
|
|
|
1.43 %
|
|
|
|
1.28 %
|
|
|
|
1.27 %
|
|
Net interest income
(TE) and net interest margin (TE)
|
|
$
964
|
2.17 %
|
|
|
$
899
|
2.04 %
|
|
|
$
923
|
2.01 %
|
|
TE adjustment
(b)
|
|
12
|
|
|
|
12
|
|
|
|
8
|
|
|
Net interest income,
GAAP basis
|
|
$
952
|
|
|
|
$
887
|
|
|
|
$
915
|
|
|
(a)
|
Results are from
continuing operations. Interest excludes the interest associated
with the liabilities referred to in (f) 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, 2024, June 30,
2024, and September 30, 2023.
|
|
(c)
|
For purposes of these
computations, nonaccrual loans are included in average loan
balances.
|
|
(d)
|
Commercial and
industrial average balances include $215 million, $218 million, and
$202 million of assets from commercial credit cards for the three
months ended September 30, 2024, June 30, 2024, and September 30,
2023, respectively.
|
|
(e)
|
Yield presented is
calculated on the basis of amortized cost. The average amortized
cost for securities available for sale was $41.6 billion, $42.8
billion, and $43.6 billion for the three months ended September 30,
2024, June 30, 2024, and September 30, 2023, respectively. Yield
based on the fair value of securities available for sale was 3.25%,
2.82%, and 2.06% for the three months ended September 30, 2024,
June 30, 2024, and September 30, 2023, respectively.
|
|
(f)
|
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, 2024
|
|
Nine months ended
September 30, 2023
|
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
|
|
Balance
|
Interest
(a)
|
Rate (a)
|
|
Balance
|
Interest
(a)
|
Rate (a)
|
|
Assets
|
|
|
|
|
|
|
|
|
Loans: (b),
(c)
|
|
|
|
|
|
|
|
|
Commercial and
industrial (d)
|
$
54,309
|
$
2,561
|
6.30 %
|
|
$
60,294
|
$
2,574
|
5.71 %
|
|
Real estate —
commercial mortgage
|
14,328
|
671
|
6.25
|
|
16,178
|
697
|
5.76
|
|
Real estate —
construction
|
3,046
|
172
|
7.56
|
|
2,663
|
131
|
6.58
|
|
Commercial lease
financing
|
3,175
|
81
|
3.38
|
|
3,749
|
86
|
3.06
|
|
Total commercial
loans
|
74,858
|
3,485
|
6.22
|
|
82,884
|
3,488
|
5.63
|
|
Real estate —
residential mortgage
|
20,514
|
508
|
3.30
|
|
21,534
|
524
|
3.25
|
|
Home equity
loans
|
6,824
|
305
|
5.98
|
|
7,621
|
325
|
5.71
|
|
Other consumer
loans
|
5,607
|
211
|
5.02
|
|
6,346
|
230
|
4.84
|
|
Credit cards
|
935
|
104
|
14.92
|
|
986
|
101
|
13.68
|
|
Total consumer
loans
|
33,880
|
1,128
|
4.44
|
|
36,487
|
1,180
|
4.32
|
|
Total
loans
|
108,738
|
4,613
|
5.67
|
|
119,371
|
4,668
|
5.23
|
|
Loans held for
sale
|
862
|
40
|
6.14
|
|
1,118
|
49
|
5.90
|
|
Securities available
for sale (b), (e)
|
36,850
|
789
|
2.48
|
|
38,440
|
580
|
1.74
|
|
Held-to-maturity
securities (b)
|
8,127
|
218
|
3.58
|
|
9,108
|
234
|
3.43
|
|
Trading account
assets
|
1,161
|
45
|
5.23
|
|
1,150
|
42
|
4.82
|
|
Short-term
investments
|
13,929
|
578
|
5.55
|
|
6,600
|
276
|
5.59
|
|
Other investments
(e)
|
1,221
|
47
|
5.12
|
|
1,423
|
51
|
4.78
|
|
Total earning
assets
|
170,888
|
6,330
|
4.79
|
|
177,210
|
5,900
|
4.30
|
|
Allowance for loan and
lease losses
|
(1,524)
|
|
|
|
(1,398)
|
|
|
|
Accrued income and
other assets
|
17,327
|
|
|
|
17,411
|
|
|
|
Discontinued
assets
|
306
|
|
|
|
395
|
|
|
|
Total
assets
|
$
186,997
|
|
|
|
$
193,618
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Money market
deposits
|
$
39,139
|
$
863
|
2.94 %
|
|
$
33,829
|
$
414
|
1.64 %
|
|
Other demand
deposits
|
55,619
|
1,062
|
2.55
|
|
53,951
|
754
|
1.87
|
|
Savings
deposits
|
5,136
|
6
|
.16
|
|
6,630
|
2
|
.04
|
|
Time
deposits
|
16,113
|
555
|
4.60
|
|
13,615
|
398
|
3.90
|
|
Total interest-bearing
deposits
|
116,007
|
2,486
|
2.86
|
|
108,025
|
1,568
|
1.94
|
|
Federal funds purchased
and securities sold under repurchase agreements
|
109
|
3
|
4.44
|
|
2,183
|
79
|
4.84
|
|
Bank notes and other
short-term borrowings
|
3,371
|
140
|
5.55
|
|
6,797
|
263
|
5.17
|
|
Long-term debt
(f)
|
18,386
|
952
|
6.90
|
|
21,341
|
975
|
6.09
|
|
Total interest-bearing
liabilities
|
137,873
|
3,581
|
3.47
|
|
138,346
|
2,885
|
2.79
|
|
Noninterest-bearing
deposits
|
28,947
|
|
|
|
35,691
|
|
|
|
Accrued expense and
other liabilities
|
4,908
|
|
|
|
5,166
|
|
|
|
Discontinued
liabilities (f)
|
306
|
|
|
|
395
|
|
|
|
Total
liabilities
|
$
172,034
|
|
|
|
$
179,598
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Key shareholders'
equity
|
$
14,963
|
|
|
|
$
14,020
|
|
|
|
Noncontrolling
interests
|
—
|
|
|
|
—
|
|
|
|
Total
equity
|
14,963
|
|
|
|
14,020
|
|
|
|
Total liabilities
and equity
|
$
186,997
|
|
|
|
$
193,618
|
|
|
|
Interest rate spread
(TE)
|
|
|
1.32 %
|
|
|
|
1.52 %
|
|
Net interest income
(TE) and net interest margin (TE)
|
|
$
2,749
|
2.08 %
|
|
|
$
3,015
|
2.20 %
|
|
TE adjustment
(b)
|
|
35
|
|
|
|
23
|
|
|
Net interest income,
GAAP basis
|
|
$
2,714
|
|
|
|
$
2,992
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Results are from
continuing operations. Interest excludes the interest
associated with the liabilities referred to in (f) 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 nine months ended September 30, 2024, and
September 30, 2023, respectively.
|
|
(c)
|
For purposes of these
computations, nonaccrual loans are included in average loan
balances.
|
|
(d)
|
Commercial and
industrial average balances include $215 million and $192 million
of assets from commercial credit cards for the nine months ended
September 30, 2024, and September 30, 2023,
respectively.
|
|
(e)
|
Yield presented is
calculated on the basis of amortized cost. The average amortized
cost for securities available for sale was $42.4 billion and $44.5
billion for the nine months ended September 30, 2024, and September
30, 2023, respectively. Yield based on the fair value of securities
available for sale was 2.85% and 2.01% for the nine months ended
September 30, 2024, and September 30, 2023,
respectively.
|
|
(f)
|
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
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Personnel
(a)
|
$
670
|
$
636
|
$
663
|
|
$
1,980
|
$
1,986
|
|
Net
occupancy
|
66
|
66
|
67
|
|
199
|
202
|
|
Computer
processing
|
104
|
101
|
89
|
|
307
|
276
|
|
Business services and
professional fees
|
41
|
37
|
38
|
|
119
|
124
|
|
Equipment
|
20
|
20
|
20
|
|
60
|
64
|
|
Operating lease
expense
|
14
|
17
|
18
|
|
48
|
59
|
|
Marketing
|
21
|
21
|
28
|
|
61
|
78
|
|
Other
expense
|
158
|
181
|
187
|
|
542
|
573
|
|
Total noninterest
expense
|
$
1,094
|
$
1,079
|
$
1,110
|
|
$
3,316
|
$
3,362
|
|
Average full-time
equivalent employees (b)
|
16,805
|
16,646
|
17,666
|
|
16,734
|
17,880
|
|
(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
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Salaries and contract
labor
|
$
408
|
$
394
|
$
415
|
|
$
1,191
|
$
1,250
|
|
Incentive and
stock-based compensation
|
162
|
143
|
141
|
|
464
|
386
|
|
Employee
benefits
|
99
|
98
|
106
|
|
323
|
308
|
|
Severance
|
1
|
1
|
1
|
|
2
|
42
|
|
Total personnel
expense
|
$
670
|
$
636
|
$
663
|
|
$
1,980
|
$
1,986
|
|
Loan
Composition
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
Change 9/30/2024
vs.
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
6/30/2024
|
9/30/2023
|
|
Commercial and
industrial (a)(b)
|
$
52,774
|
$
53,129
|
$
57,606
|
|
(.7) %
|
(8.4) %
|
|
Commercial real
estate:
|
|
|
|
|
|
|
|
Commercial
mortgage
|
13,637
|
14,218
|
15,549
|
|
(4.1)
|
(12.3)
|
|
Construction
|
3,093
|
3,077
|
2,982
|
|
.5
|
3.7
|
|
Total
commercial real estate loans
|
16,730
|
17,295
|
18,531
|
|
(3.3)
|
(9.7)
|
|
Commercial lease
financing (b)
|
2,913
|
3,101
|
3,681
|
|
(6.1)
|
(20.9)
|
|
Total
commercial loans
|
72,417
|
73,525
|
79,818
|
|
(1.5)
|
(9.3)
|
|
Residential — prime
loans:
|
|
|
|
|
|
|
|
Real estate —
residential mortgage
|
20,122
|
20,380
|
21,309
|
|
(1.3)
|
(5.6)
|
|
Home equity
loans
|
6,555
|
6,729
|
7,324
|
|
(2.6)
|
(10.5)
|
|
Total
residential — prime loans
|
26,677
|
27,109
|
28,633
|
|
(1.6)
|
(6.8)
|
|
Other consumer
loans
|
5,338
|
5,514
|
6,105
|
|
(3.2)
|
(12.6)
|
|
Credit cards
|
914
|
930
|
988
|
|
(1.7)
|
(7.5)
|
|
Total consumer
loans
|
32,929
|
33,553
|
35,726
|
|
(1.9)
|
(7.8)
|
|
Total loans (c),
(d)
|
$
105,346
|
$ 107,078
|
$ 115,544
|
|
(1.6) %
|
(8.8) %
|
|
(a)
|
Loan balances include
$219 million, $217 million, and $207 million of commercial credit
card balances at September 30, 2024, June 30, 2024, and September
30, 2023, respectively.
|
|
(b)
|
Commercial and
industrial includes receivables held as collateral for a secured
borrowing of $261 million at September 30, 2024, $285 million at
June 30, 2024 and no amounts held as collateral for a secured
borrowing at September 30, 2023. Commercial lease financing
includes receivables held as collateral for a secured borrowing of
$3 million, $5 million, and $4 million at September 30, 2024, June
30, 2024, and September 30, 2023, respectively. Principal
reductions are based on the cash payments received from these
related receivables.
|
|
(c)
|
Total loans exclude
loans of $272 million at September 30, 2024, $291 million at June
30, 2024, and $360 million at September 30, 2023, related to the
discontinued operations of the education lending
business.
|
|
(d)
|
Accrued interest of
$480 million, $487 million, and $522 million at September 30, 2024,
June 30, 2024, and September 30, 2023, respectively, presented in
"other assets" on the Consolidated Balance Sheets is excluded from
the amortized cost basis disclosed in this table.
|
|
Loans Held for Sale
Composition
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Change 9/30/2024
vs.
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
6/30/2024
|
9/30/2023
|
|
Commercial and
industrial
|
$
250
|
$
72
|
$
47
|
|
247.2 %
|
431.9 %
|
|
Real estate —
commercial mortgage
|
747
|
354
|
571
|
|
111.0
|
30.8
|
|
Real estate —
residential mortgage
|
61
|
91
|
112
|
|
(33.0)
|
(45.5)
|
|
Total loans held for
sale
|
$
1,058
|
$
517
|
$
730
|
|
104.6 %
|
44.9 %
|
|
Summary of Changes
in Loans Held for Sale
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
3Q24
|
2Q24
|
1Q24
|
4Q23
|
3Q23
|
|
Balance at beginning of
period
|
$
517
|
$
228
|
$
483
|
$
730
|
$
1,130
|
|
New
originations
|
2,473
|
1,532
|
1,738
|
1,879
|
3,035
|
|
Transfers from (to)
held to maturity, net
|
(16)
|
(1)
|
(105)
|
(31)
|
(94)
|
|
Loan sales
|
(1,889)
|
(1,234)
|
(1,893)
|
(2,095)
|
(3,312)
|
|
Loan draws (payments),
net
|
(28)
|
(7)
|
4
|
—
|
(29)
|
|
Valuation and other
adjustments
|
1
|
(1)
|
1
|
—
|
—
|
|
Balance at end of
period
|
$
1,058
|
$
517
|
$
228
|
$
483
|
$
730
|
|
Summary of Loan and
Lease Loss Experience From Continuing Operations
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
9/30/2024
|
6/30/2024
|
9/30/2023
|
|
9/30/2024
|
9/30/2023
|
|
Average loans
outstanding
|
$
106,244
|
$ 108,961
|
$ 117,627
|
|
$
108,738
|
$ 119,371
|
|
Allowance for loan and
lease losses at the beginning of the period
|
$ 1,547
|
$ 1,542
|
$ 1,480
|
|
$
1,508
|
$
1,337
|
|
Loans charged
off:
|
|
|
|
|
|
|
|
Commercial and
industrial
|
131
|
86
|
62
|
|
279
|
139
|
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
7
|
10
|
1
|
|
22
|
15
|
|
Real estate —
construction
|
—
|
—
|
—
|
|
—
|
—
|
|
Total
commercial real estate loans
|
7
|
10
|
1
|
|
22
|
15
|
|
Commercial lease
financing
|
—
|
6
|
—
|
|
6
|
—
|
|
Total
commercial loans
|
138
|
102
|
63
|
|
307
|
154
|
|
Real estate —
residential mortgage
|
—
|
1
|
—
|
|
2
|
1
|
|
Home equity
loans
|
1
|
—
|
1
|
|
2
|
4
|
|
Other consumer
loans
|
17
|
16
|
14
|
|
49
|
37
|
|
Credit
cards
|
11
|
12
|
9
|
|
35
|
27
|
|
Total consumer
loans
|
29
|
29
|
24
|
|
88
|
69
|
|
Total loans
charged off
|
167
|
131
|
87
|
|
395
|
223
|
|
Recoveries:
|
|
|
|
|
|
|
|
Commercial and
industrial
|
7
|
31
|
10
|
|
46
|
33
|
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
1
|
1
|
—
|
|
2
|
1
|
|
Real estate —
construction
|
—
|
—
|
—
|
|
—
|
—
|
|
Total
commercial real estate loans
|
1
|
1
|
—
|
|
2
|
1
|
|
Commercial lease
financing
|
—
|
3
|
1
|
|
5
|
4
|
|
Total
commercial loans
|
8
|
35
|
11
|
|
53
|
38
|
|
Real estate —
residential mortgage
|
1
|
1
|
1
|
|
4
|
3
|
|
Home equity
loans
|
1
|
—
|
1
|
|
2
|
3
|
|
Other consumer
loans
|
2
|
2
|
2
|
|
6
|
7
|
|
Credit
cards
|
1
|
2
|
1
|
|
4
|
4
|
|
Total consumer
loans
|
5
|
5
|
5
|
|
16
|
17
|
|
Total
recoveries
|
13
|
40
|
16
|
|
69
|
55
|
|
Net loan
charge-offs
|
(154)
|
(91)
|
(71)
|
|
(326)
|
(168)
|
|
Provision (credit) for
loan and lease losses
|
101
|
96
|
79
|
|
312
|
319
|
|
Allowance for loan and
lease losses at end of period
|
$ 1,494
|
$ 1,547
|
$ 1,488
|
|
$
1,494
|
$
1,488
|
|
|
|
|
|
|
|
|
Liability for credit
losses on lending-related commitments at beginning of
period
|
$
286
|
$ 281
|
$ 291
|
|
$
296
|
$ 225
|
|
Provision (credit) for
losses on lending-related commitments
|
(6)
|
4
|
2
|
|
(16)
|
68
|
|
Other
|
—
|
1
|
(3)
|
|
—
|
(3)
|
|
Liability for credit
losses on lending-related commitments at end of period
(a)
|
$
280
|
$ 286
|
$ 290
|
|
$
280
|
$ 290
|
|
|
|
|
|
|
|
|
Total allowance for
credit losses at end of period
|
$ 1,774
|
$ 1,833
|
$ 1,778
|
|
$
1,774
|
$
1,778
|
|
|
|
|
|
|
|
|
Net loan charge-offs to
average total loans
|
.58 %
|
.34 %
|
.24 %
|
|
.40 %
|
.19 %
|
|
Allowance for loan and
lease losses to period-end loans
|
1.42
|
1.44
|
1.29
|
|
1.42
|
1.29
|
|
Allowance for credit
losses to period-end loans
|
1.68
|
1.71
|
1.54
|
|
1.68
|
1.54
|
|
Allowance for loan and
lease losses to nonperforming loans
|
205
|
218
|
327
|
|
205
|
327
|
|
Allowance for credit
losses to nonperforming loans
|
244
|
258
|
391
|
|
244
|
391
|
|
|
|
|
|
|
|
|
Discontinued operations
— education lending business:
|
|
|
|
|
|
|
|
Loans charged
off
|
$
1
|
$
1
|
$
—
|
|
$
3
|
$
3
|
|
Recoveries
|
—
|
1
|
—
|
|
1
|
1
|
|
Net loan
charge-offs
|
$
(1)
|
$
—
|
$
—
|
|
$
(2)
|
$
(2)
|
|
(a) Included in "Accrued
expense and other liabilities" on the balance sheet.
|
|
Asset Quality
Statistics From Continuing Operations
|
|
(Dollars in
millions)
|
|
3Q24
|
2Q24
|
1Q24
|
4Q23
|
3Q23
|
|
Net loan
charge-offs
|
$
154
|
$
91
|
$
81
|
$
76
|
$
71
|
|
Net loan charge-offs to
average total loans
|
.58 %
|
.34 %
|
.29 %
|
.26 %
|
.24 %
|
|
Allowance for loan and
lease losses
|
$
1,494
|
$
1,547
|
$
1,542
|
$
1,508
|
$
1,488
|
|
Allowance for credit
losses (a)
|
1,774
|
1,833
|
1,823
|
1,804
|
1,778
|
|
Allowance for loan and
lease losses to period-end loans
|
1.42 %
|
1.44 %
|
1.40 %
|
1.34 %
|
1.29 %
|
|
Allowance for credit
losses to period-end loans
|
1.68
|
1.71
|
1.66
|
1.60
|
1.54
|
|
Allowance for loan and
lease losses to nonperforming loans
|
205
|
218
|
234
|
263
|
327
|
|
Allowance for credit
losses to nonperforming loans
|
244
|
258
|
277
|
314
|
391
|
|
Nonperforming loans at
period end
|
$
728
|
$ 710
|
$ 658
|
$ 574
|
$ 455
|
|
Nonperforming assets at
period end
|
741
|
727
|
674
|
591
|
471
|
|
Nonperforming loans to
period-end portfolio loans
|
.69 %
|
.66 %
|
.60 %
|
.51 %
|
.39 %
|
|
Nonperforming assets to
period-end portfolio loans plus OREO and other nonperforming
assets
|
.70
|
.68
|
.61
|
.52
|
.41
|
|
|
(a) Includes the allowance
for loan and lease losses plus the liability for credit losses on
lending-related commitments.
|
|
Summary of
Nonperforming Assets and Past Due Loans From Continuing
Operations
|
|
(Dollars in
millions)
|
|
9/30/2024
|
6/30/2024
|
3/31/2024
|
12/31/2023
|
9/30/2023
|
|
Commercial and
industrial
|
$
365
|
$ 358
|
$ 360
|
$ 297
|
$ 214
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
176
|
173
|
113
|
100
|
63
|
|
Real estate —
construction
|
—
|
—
|
—
|
—
|
—
|
|
Total commercial real
estate loans
|
176
|
173
|
113
|
100
|
63
|
|
Commercial lease
financing
|
—
|
1
|
1
|
—
|
1
|
|
Total commercial
loans
|
541
|
532
|
474
|
397
|
278
|
|
Real estate —
residential mortgage
|
87
|
77
|
79
|
71
|
72
|
|
Home equity
loans
|
90
|
91
|
95
|
97
|
97
|
|
Other Consumer
loans
|
4
|
4
|
4
|
4
|
4
|
|
Credit cards
|
6
|
6
|
6
|
5
|
4
|
|
Total consumer
loans
|
187
|
178
|
184
|
177
|
177
|
|
Total
nonperforming loans (a)
|
728
|
710
|
658
|
574
|
455
|
|
OREO
|
13
|
17
|
16
|
17
|
16
|
|
Nonperforming loans
held for sale
|
—
|
—
|
—
|
—
|
—
|
|
Other nonperforming
assets
|
—
|
—
|
—
|
—
|
—
|
|
Total nonperforming
assets
|
$
741
|
$ 727
|
$ 674
|
$ 591
|
$ 471
|
|
Accruing loans past due
90 days or more
|
$
166
|
$ 137
|
$ 119
|
$ 107
|
$
52
|
|
Accruing loans past due
30 through 89 days
|
184
|
282
|
242
|
222
|
178
|
|
Nonperforming assets
from discontinued operations — education lending
business
|
2
|
3
|
2
|
3
|
2
|
|
Nonperforming loans to
period-end portfolio loans
|
.69 %
|
.66 %
|
.60 %
|
.51 %
|
.39 %
|
|
Nonperforming assets to
period-end portfolio loans plus OREO and other
nonperforming assets
|
.70
|
.68
|
.61
|
.52
|
.41
|
|
Summary of Changes
in Nonperforming Loans From Continuing Operations
|
|
(Dollars in
millions)
|
|
3Q24
|
2Q24
|
1Q24
|
4Q23
|
3Q23
|
|
Balance at beginning of
period
|
$
710
|
$
658
|
$
574
|
$
455
|
$
431
|
|
Loans placed on
nonaccrual status
|
271
|
317
|
243
|
297
|
159
|
|
Charge-offs
|
(167)
|
(131)
|
(97)
|
(95)
|
(87)
|
|
Loans sold
|
(32)
|
(22)
|
(5)
|
(9)
|
(4)
|
|
Payments
|
(37)
|
(76)
|
(35)
|
(56)
|
(25)
|
|
Transfers to
OREO
|
(1)
|
(1)
|
(2)
|
(2)
|
(3)
|
|
Loans returned to
accrual status
|
(16)
|
(35)
|
(20)
|
(16)
|
(16)
|
|
Balance at end of
period
|
$
728
|
$
710
|
$
658
|
$
574
|
$
455
|
|
Line of Business
Results
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change 3Q24
vs.
|
|
3Q24
|
2Q24
|
1Q24
|
4Q23
|
3Q23
|
|
2Q24
|
3Q23
|
|
Consumer
Bank
|
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
814
|
$
769
|
$
757
|
$
770
|
$
775
|
|
5.9 %
|
5.0 %
|
|
Provision for credit
losses
|
52
|
33
|
(2)
|
5
|
14
|
|
57.6
|
271.4
|
|
Noninterest
expense
|
649
|
648
|
704
|
779
|
676
|
|
.2
|
(4.0)
|
|
Net income (loss)
attributable to Key
|
86
|
67
|
41
|
(11)
|
65
|
|
28.4
|
32.3
|
|
Average loans and
leases
|
38,332
|
39,174
|
39,919
|
40,763
|
41,610
|
|
(2.1)
|
(7.9)
|
|
Average
deposits
|
86,431
|
85,397
|
84,075
|
83,557
|
82,683
|
|
1.2
|
4.5
|
|
Net loan
charge-offs
|
54
|
45
|
44
|
40
|
36
|
|
20.0
|
50.0
|
|
Net loan charge-offs to
average total loans
|
.56 %
|
.46 %
|
.44 %
|
.39 %
|
.34 %
|
|
21.7
|
64.7
|
|
Nonperforming assets at
period end
|
$
195
|
$
190
|
$
196
|
$
190
|
$
190
|
|
2.6
|
2.6
|
|
Return on average
allocated equity
|
10.34 %
|
7.93 %
|
4.69 %
|
(1.28) %
|
7.42 %
|
|
30.4
|
39.4
|
|
|
|
|
|
|
|
|
|
|
Commercial
Bank
|
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
868
|
$
770
|
$
798
|
$
804
|
$
809
|
|
12.7 %
|
7.3 %
|
|
Provision for credit
losses
|
41
|
87
|
102
|
96
|
68
|
|
(52.9)
|
(39.7)
|
|
Noninterest
expense
|
445
|
432
|
442
|
526
|
433
|
|
3.0
|
2.8
|
|
Net income (loss)
attributable to Key
|
300
|
207
|
205
|
150
|
240
|
|
44.9
|
25.0
|
|
Average loans and
leases
|
67,452
|
69,248
|
70,633
|
72,713
|
75,598
|
|
(2.6)
|
(10.8)
|
|
Average loans held for
sale
|
998
|
522
|
840
|
635
|
1,268
|
|
91.2
|
(21.3)
|
|
Average
deposits
|
58,696
|
57,360
|
56,331
|
58,196
|
56,078
|
|
2.3
|
4.7
|
|
Net loan
charge-offs
|
99
|
64
|
37
|
35
|
35
|
|
54.7
|
182.9
|
|
Net loan charge-offs to
average total loans
|
.58 %
|
.37 %
|
.21 %
|
.19 %
|
.18 %
|
|
56.8
|
222.2
|
|
Nonperforming assets at
period end
|
$
546
|
$
537
|
$
478
|
$
401
|
$
281
|
|
1.7
|
94.3
|
|
Return on average
allocated equity
|
11.98 %
|
8.31 %
|
8.24 %
|
5.88 %
|
9.11 %
|
|
44.2
|
31.5
|
|
TE = Taxable
Equivalent
|
|
Selected Items
Impact on Earnings(a)
|
|
(Dollars in millions,
except per share amounts)
|
|
Pretax(b)
|
|
After-tax at
marginal rate(b)(c)
|
|
Quarter to date
results
|
Amount
|
|
Net
Income
|
EPS(d)
|
|
Three months ended
September 30, 2024
|
|
|
|
|
|
Loss on sale of
securities (other income)
|
$
(918)
|
|
$
(737)
|
$
(0.77)
|
|
FDIC special assessment
(other expense)(d)
|
6
|
|
5
|
—
|
|
Three months ended
June 30, 2024
|
|
|
|
|
|
FDIC special assessment
(other expense)(e)
|
(5)
|
|
(4)
|
—
|
|
Three months ended
March 31, 2024
|
|
|
|
|
|
FDIC special assessment
(other expense)(e)
|
(29)
|
|
(22)
|
(0.02)
|
|
Three months ended
December 31, 2023
|
|
|
|
|
|
Efficiency related
expenses(f)
|
(67)
|
|
(51)
|
(0.05)
|
|
Pension settlement
(other expense)
|
(18)
|
|
(14)
|
(0.02)
|
|
FDIC special assessment
(other expense)(e)
|
(190)
|
|
(144)
|
(0.15)
|
|
Three months ended
September 30, 2023
|
|
|
|
|
|
No items
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Includes items
impacting results or trends during the period but are not
considered non-GAAP adjustments.
|
|
(b)
|
Favorable (unfavorable)
impact.
|
|
(c)
|
After-tax loss on sale
of securities adjusted to reflect impact of GAAP accounting for
income taxes in interim periods, with related adjustments to be
required in the fourth quarter of 2024.
|
|
(d)
|
Impact to EPS reflected
on a fully diluted basis.
|
|
(e)
|
In November 2023, the
FDIC issued a final rule implementing a special assessment on
insured depository institutions to recover the loss to the FDIC's
deposit insurance fund (DIF) associated with protecting uninsured
depositors following the 2023 closures of Silicon Valley Bank and
Signature Bank. KeyCorp recorded the initial loss estimate related
to the special assessment during the fourth quarter of 2023. In
late February 2024, the FDIC provided updated estimates on the
uninsured deposit losses and recoverable assets related to the 2023
closures of Silicon Valley Bank and Signature Bank. KeyCorp
recorded the additional expense related to the revised special
assessment during the first quarter of 2024. Amounts reflected for
both the three-months ended June 30, 2024, and September 30, 2024,
represent adjustments from initial estimates based on quarterly
invoices received from the FDIC.
|
|
(f)
|
Efficiency related
expenses for the three-months ended December 31, 2023, consist
primarily of $39 million of severance recorded in personnel expense
and $24 million of corporate real estate related rationalization
and other contract termination or renegotiation costs recorded in
other expense.
|
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SOURCE KeyCorp
