Proactiveinvestors United Kingdom KeyCorp Proactiveinvestors United Kingdom KeyCorp RSS feed en Tue, 23 Jul 2019 00:08:42 +0100 Genera CMS (Proactiveinvestors) (Proactiveinvestors) <![CDATA[News - KeyCorp Q3 profits beat expectations as loan losses spike ]]>

KeyCorp's (NYSE:KEY) fiscal third-quarter earnings topped analysts' expectations thanks to an increase in revenue spurred by acquisitions, though loan loss provisions spiked.

The Cleveland, Ohio-based company offers retail and commercial banking, leasing, consumer financing and investment banking services to corporations, institutions and people.

Earnings slipped to $214 million or 23 cents per share, when compared to a year-ago earnings of $229 million or 24 cents per share. 

Analysts expected a 21 cent per share profit for the period ended September 30.

Sales came in at $1.12 billion, up from $1.03 billion a year-ago. Results beat analysts' views of $1 billion in revenue for the period ended September 30.

Shares gained 5.47 per cent to hit $8.87 each on the New York Stock Exchange, as investors reacted positively to the news.

The company announced a number of actions to boost its product offerings and profitability during the third quarter.

"We re-entered the credit card business, repositioned our merchant services and debit card processing, and improved market share with a 37-branch acquisition in Western New York," KeyCorp's chief executive Beth E. Mooney said.

"Our third quarter results reflect the impact of these actions and underscore the company's sustained drive to increase revenue and reduce costs," Mooney added.

In July, the regional bank acquired 37 retail banking branches owned by HSBC Holdings PLC (HKG:0005) for $110 million.

Net interest income, a measure of the bank's ability to profit from lending, rose four per cent, to $578 million.

Noninterest income jumped 12.6 per cent to $544 million from $483 million. 

Net charge-offs – debt written off due to debt delinquency – fell to 0.86 per cent of average loans on a continuing-operations basis, compared with 0.9 per cent a year earlier.

Provision for loan and lease losses spiked to $109 million, when compared to just $10 million a year prior, primarily due to acquisitions and the application of the recently updated regulatory guidance.

Total loans rose nearly six per cent to $50.6 billion from $48 billion. Meanwhile, total deposits rose to $62.7 billion from 58.9 billion.

Thu, 18 Oct 2012 12:38:00 +0100
<![CDATA[News - KeyCorp reports drop in Q4 profit, but asset quality improves ]]> US bank KeyCorp (NYSE:KEY) said Tuesday that fourth quarter profits declined on a one-time charge and gains from an acquisition seen a year ago, but the company continued to benefit from improving asset quality.

For the fourth quarter of 2011, the holding company for KeyBank National Association said net income attributable to Key common shareholders was $194 million, or 20 cents per share, versus $279 million, or 32 cents per share, for the same quarter a year ago.

Net income from continuing operations was $201 million, or 21 cents per share, compared to $292 million, or 33 cents per share, in the year-ago period.

KeyCorp said the results in the latest quarter were negatively impacted by a $24 million charge resulting from Visa's "late fourth quarter announcement" of a planned litigation escrow deposit.

In addition, Key recorded a $28 million gain on the sale of Tuition Management Systems during the fourth quarter a year earlier.

Net interest income, or the difference between the revenue that is generated from a bank's assets and the expenses associated with paying out its liabilities, was $563 million in the most recent quarter, down from $635 million in the fourth quarter of 2010.

This was due to a decline in earning assets and the net interest margin, which dropped to 3.13 percent from 3.31 percent a year earlier.

Net interest margin has been under pressure as a result of the continuation of the low rate environment contracting the spread between lending rates and funding costs.

Key's non-interest income was $414 million for the fourth quarter of 2011, compared to $526 million for the year-ago quarter. Investment banking and capital markets income decreased $39 million, including the Visa charge.

The company said though that nonperforming loans decreased by $341 million and nonperforming assets declined by $479 million from the year-ago quarter to $727 million and $859 million, respectively.

Net charge-offs, which refers to debt owed to a company that is unlikely to be recovered, declined to $105 million, or 0.86 percent of average loan balances for the fourth quarter of 2011, compared to $256 million, or 2.00 percent of average loan balances for the same period one year ago.

Key's provision for loan and lease losses was a credit of $22 million for the fourth quarter, versus a credit of $97 million in the same quarter a year earlier.

"Key's fourth quarter results reflect continued improvement in credit quality and the third consecutive quarter of growth in our commercial, financial and agricultural loan portfolio," said chairman and CEO, Beth Mooney.

"We are encouraged by this growth and believe it demonstrates our ability to leverage the alignment of our franchise across business lines to support the needs of our clients. Further, these results confirm our belief that the inflection point for loan growth was reached in the third quarter of 2011."

The company originated new or renewed lending commitments to consumers and businesses of approximately $10.5 billion during the quarter and $36.6 billion for the full year 2011, up 24 percent from 2010.

Average total loans increased $656 million from the third quarter of 2011, the bank said.

For the full year 2011, net income from continuing operations attributable to Key common shareholders was $857 million, or 92 cents per common share, compared to $413 million, or 47 cents per common share, for the previous year, reflecting lower credit costs and an improvement in non-interest expense, KeyCorp said.

At December 31, 2011, Key's estimated Tier 1 common equity ratio was 11.28 percent. This is a measurement of a bank's core equity capital compared with its total risk-weighted assets, and the measure of a bank's financial strength.

Earlier this month, KeyCorp said it signed a deal to acquire 37 retail banking branches in Buffalo and Rochester, New York. The deposits associated with these branches total roughly $2.4 billion, while loans total about $400 million.

"During the challenging last few years, we have focused on taking actions to strengthen our balance sheet, fortify our capital, effectively manage risk and expenses, and focus on our core relationship business. Those actions, while sometimes difficult, have now positioned us so that we can, in a disciplined manner, act on opportunities to strengthen our franchise," concluded Mooney.

Shares of KeyCorp were down 0.75 percent in premarket trade Tuesday, to $8.05. Its banking services are provided across the US through its 1,033 retail banking branches in 14 states, and a network of 1,531 automated teller machines (ATMs) in fifteen states.

Tue, 24 Jan 2012 09:31:00 +0000