KeyCorp

Latest Results (17.12.2024):

Net Loss and Adjusted Income

In the third quarter of 2024, KeyCorp reported a net loss from continuing operations attributable to common shareholders of $(447) million, or $(.47) per diluted common share. However, the adjusted net income was $290 million, or $.30 per diluted common share. This adjustment accounts for significant charges related to the loss on the sale of securities, which impacted the overall earnings for the quarter.

Net Interest Income Growth

KeyCorp's net interest income for the third quarter of 2024 increased by 7% quarter-over-quarter, reaching $964 million. The net interest margin also improved to 2.17%, benefiting from the reinvestment of proceeds from maturing investment securities into higher-yielding investments and a shift in funding mix from higher-cost wholesale borrowings to lower-cost interest-bearing deposits.

Noninterest Income Decline

Noninterest income for KeyCorp in the third quarter of 2024 decreased significantly by $912 million compared to the same period in 2023. This decline was primarily due to a $918 million loss on the sale of securities as part of a strategic portfolio repositioning. Despite this, there were increases in investment banking and debt placement fees, as well as commercial mortgage servicing fees.

Noninterest Expense Management

KeyCorp's noninterest expense in the third quarter of 2024 decreased by $16 million compared to the third quarter of 2023. The reduction was driven by lower marketing expenses and a decrease in the estimated FDIC special assessment. However, there were increases in computer processing and personnel expenses due to technology investments and higher incentive and stock-based compensation.

Strategic Investment and Capital Ratios

During the third quarter of 2024, KeyCorp received an initial $821 million tranche of a strategic minority investment from Scotiabank. This investment contributed to an improvement in KeyCorp's tangible common equity ratio, which increased by 100 basis points quarter-over-quarter to 6.2%. The Common Equity Tier 1 ratio also strengthened to 10.8%, reflecting a solid capital position.