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EX-99.3 - FINANCIAL STATEMENTS - KEYCORP /NEW/ | d286107dex993.htm |
8-K - FORM 8-K - KEYCORP /NEW/ | d286107d8k.htm |
EX-99.2 - SUPPLEMENTAL INFORMATION PACKAGE - KEYCORP /NEW/ | d286107dex992.htm |
Exhibit 99.1
News
KeyCorp 127 Public Square Cleveland, OH 44114 |
CONTACTS: ANALYSTS |
MEDIA | |||
Vernon L. Patterson | David Reavis | |||
216.689.0520 | 216.471.2886 | |||
Vernon_Patterson@KeyBank.com | David_Reavis@KeyBank.com | |||
Kelly L. Lammers | ||||
216.689.3133 | ||||
Kelly_L_Lammers@KeyBank.com |
INVESTOR |
KEY MEDIA | |
RELATIONS: www.key.com/ir |
NEWSROOM: www.key.com/newsroom |
FOR IMMEDIATE RELEASE
KEYCORP REPORTS FOURTH QUARTER 2011
NET INCOME OF $201 MILLION AND
FULL YEAR NET INCOME OF $857 MILLION
| Net income from continuing operations of $201 million, or $.21 per common share, for the fourth quarter of 2011 |
| Full year net income from continuing operations of $857 million, or $.92 per common share |
| Net interest margin of 3.13%, up four basis points from the third quarter of 2011 |
| Average total loans increased $656 million from the third quarter of 2011 |
| Net charge-offs declined to $105 million, or .86% of average loan balances for the fourth quarter of 2011 |
| Nonperforming loans declined to $727 million, or 1.47% of period-end loans, and nonperforming assets decreased to $859 million |
| Loan loss reserve at 2.03% of total period-end loans and 138% of nonperforming loans at December 31, 2011 |
| VISA planned litigation escrow deposit resulted in a $24 million charge during the fourth quarter of 2011 |
| Tier 1 common equity and Tier 1 risk-based capital ratios estimated at 11.28% and 13.01%, respectively, at December 31, 2011 |
CLEVELAND, January 24, 2012 KeyCorp (NYSE: KEY) today announced fourth quarter net income from continuing operations attributable to Key common shareholders of $201 million, or $.21 per common share. Keys fourth quarter 2011 results compare to net income from continuing operations attributable to Key common shareholders of $292 million, or $.33 per common share, for the fourth quarter of 2010. The results for the fourth quarter of 2011 were negatively impacted by a $24 million charge resulting from VISAs late fourth quarter announcement of a planned litigation escrow deposit. In addition, Key recorded a $28
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 2
million gain on the sale of Tuition Management Systems during the fourth quarter of 2010. Fourth quarter 2011 net income attributable to Key common shareholders was $194 million compared to net income attributable to Key common shareholders of $279 million for the same quarter one year ago.
For 2011, net income from continuing operations attributable to Key common shareholders was $857 million, or $.92 per common share, compared to net income from continuing operations attributable to Key common shareholders of $413 million, or $.47 per common share, for 2010. The results for 2011 reflect lower credit costs and an improvement in noninterest expense as compared to 2010. Net income attributable to Key common shareholders for the year ended December 31, 2011, was $813 million compared to net income attributable to Key common shareholders of $390 million for 2010.
During the fourth quarter of 2011, the Company continued to benefit from improved asset quality. 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 declined to $105 million, or .86% of average loan balances for the fourth quarter of 2011, compared to $256 million, or 2.00% of average loan balances for the same period one year ago.
Chairman and Chief Executive Officer Beth Mooney stated, Keys fourth quarter results reflect continued improvement in credit quality and the third consecutive quarter of growth in our commercial, financial and agricultural loan portfolio. 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 2011. This annual amount compares to approximately $29.5 billion in 2010, an increase of 24%.
Mooney continued: We are pleased by the positive survey results that tell us that Keys customer satisfaction, loyalty and retention scores continue to exceed those of other large U.S. banks. This includes the customer satisfaction survey by American Customer Satisfaction Index showing that Key is one of only two large banks that improved its overall customer satisfaction score for two consecutive years. This accomplishment, in the face of an extremely difficult operating environment, demonstrates the success of our client-focused relationship strategy. Key also ranked fifth nationwide in overall customer satisfaction in the J.D. Power and Associates 2011 Small Business Banking Satisfaction Survey.
At December 31, 2011, Keys estimated Tier 1 common equity and Tier 1 risk-based capital ratios were 11.28% and 13.01%, compared to 11.28% and 13.49%, respectively, at September 30, 2011.
On January 12, 2012, Key signed a purchase and assumption agreement to acquire 37 retail banking branches in Buffalo and Rochester, NY. The deposits associated with these branches total approximately $2.4 billion, while loans total approximately $400 million.
Viewed in a broader perspective, this acquisition marks an important milestone for Key, said Mooney. 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
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 3
positioned us so that we can, in a disciplined manner, act on opportunities to strengthen our franchise.
The following table shows Keys continuing and discontinued operating results for the comparative quarters and for the years ended December 31, 2011 and 2010.
Results of Operations
Three months ended | Twelve months ended | |||||||||||||||||||
in millions, except per share amounts |
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | |||||||||||||||
Summary of operations |
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Income (loss) from continuing operations attributable to Key |
$ | 207 | $ | 234 | $ | 333 | $ | 964 | $ | 577 | ||||||||||
Income (loss) from discontinued operations, net of taxes (a) |
(7 | ) | (17 | ) | (13 | ) | (44 | ) | (23 | ) | ||||||||||
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Net income (loss) attributable to Key |
$ | 200 | $ | 217 | $ | 320 | $ | 920 | $ | 554 | ||||||||||
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Income (loss) from continuing operations attributable to Key |
$ | 207 | $ | 234 | $ | 333 | $ | 964 | $ | 577 | ||||||||||
Less: Dividends on Series A Preferred Stock |
6 | 5 | 6 | 23 | 23 | |||||||||||||||
Cash dividends on Series B Preferred Stock (b) |
| | 31 | 31 | 125 | |||||||||||||||
Amortization of discount on Series B Preferred Stock (b) |
| | 4 | 53 | 16 | |||||||||||||||
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Income (loss) from continuing operations attributable to Key common shareholders |
201 | 229 | 292 | 857 | 413 | |||||||||||||||
Income (loss) from discontinued operations, net of taxes (a) |
(7 | ) | (17 | ) | (13 | ) | (44 | ) | (23 | ) | ||||||||||
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Net income (loss) attributable to Key common shareholders |
$ | 194 | $ | 212 | $ | 279 | $ | 813 | $ | 390 | ||||||||||
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Per common share assuming dilution |
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Income (loss) from continuing operations attributable to Key common shareholders |
$ | .21 | $ | .24 | $ | .33 | $ | .92 | $ | .47 | ||||||||||
Income (loss) from discontinued operations, net of taxes (a) |
(.01 | ) | (.02 | ) | (.02 | ) | (.05 | ) | (.03 | ) | ||||||||||
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Net income (loss) attributable to Key common shareholders (c) |
$ | .20 | $ | .22 | $ | .32 | $ | .87 | $ | .44 | ||||||||||
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(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. In April 2009, management decided to wind down the operations of Austin Capital Management, Ltd., a subsidiary that specialized in managing hedge fund investments for institutional customers. As a result of these decisions, Key has accounted for these businesses as discontinued operations. The loss from discontinued operations for the year ended December 31, 2011, was primarily attributable to fair value adjustments related to the education lending securitization trusts. |
(b) | The year ended December 31, 2011, includes a $49 million deemed dividend recorded in the first quarter of 2011 related to the repurchase of the $2.5 billion Series B Preferred Stock. |
(c) | Earnings per share may not foot due to rounding. |
SUMMARY OF CONTINUING OPERATIONS
Taxable-equivalent net interest income was $563 million for the fourth quarter of 2011, and the net interest margin was 3.13%. These results compare to taxable-equivalent net interest income of $635 million and a net interest margin of 3.31% for the fourth quarter of 2010. The decrease in net interest income is attributable to both a decline in earning assets and the net interest margin. The 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.
Compared to the third quarter of 2011, taxable-equivalent net interest income increased by $8 million, and the net interest margin improved by four basis points. The improvement in the net interest income and net interest margin resulted from a decline in Keys cost of funds due to rate reductions on deposits, maturities of higher rate certificates of deposit, and the impact of certain capital securities redemptions during the third and fourth quarters of 2011. In addition to the improved funding mix, a decrease in the balance of lower yielding short-term investments during the fourth quarter of 2011 also contributed to the margin improvement.
Keys noninterest 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 compared to the same period one year ago, which includes a $24 million charge resulting from VISAs late fourth quarter announcement of a planned increase to its litigation escrow deposit. Other income also decreased from the year-ago quarter due to a
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 4
$28 million gain from the sale of Tuition Management Systems in the fourth quarter of 2010. Also contributing to the decline in noninterest income were decreases in operating lease income of $17 million and net securities gains (losses) of $12 million. Electronic banking fees also declined $13 million as a result of new government pricing controls on debit transactions which were effective October 1, 2011.
The major components of Keys noninterest income for the past five quarters are shown in the following table.
Noninterest Income Major Components
in millions |
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | |||||||||||||||
Trust and investment services income |
$ | 104 | $ | 107 | $ | 113 | $ | 110 | $ | 108 | ||||||||||
Service charges on deposit accounts |
70 | 74 | 69 | 68 | 70 | |||||||||||||||
Operating lease income |
25 | 30 | 32 | 35 | 42 | |||||||||||||||
Letter of credit and loan fees |
56 | 55 | 47 | 55 | 51 | |||||||||||||||
Corporate-owned life insurance income |
35 | 31 | 28 | 27 | 42 | |||||||||||||||
Electronic banking fees |
18 | 33 | 33 | 30 | 31 | |||||||||||||||
Insurance income |
11 | 13 | 14 | 15 | 12 | |||||||||||||||
Net gains (losses) from loan sales |
27 | 18 | 11 | 19 | 29 | |||||||||||||||
Net gains (losses) from principal investing |
(8 | ) | 34 | 17 | 35 | (6 | ) | |||||||||||||
Investment banking and capital markets income (loss) |
24 | 25 | 42 | 43 | 63 |
Compared to the third quarter of 2011, noninterest income decreased by $69 million. The decrease was a result of lower net gains (losses) from principal investing (including results attributable to noncontrolling interests) of $42 million and a $10 million loss associated with the redemption of certain capital securities compared to a $13 million gain in the third quarter. Electronic banking fees also declined $15 million as a result of new government pricing controls on debit transactions which were effective October 1, 2011. These declines were partially offset by an increase in net gains (losses) from loan sales of $9 million.
Keys noninterest expense was $717 million for the fourth quarter of 2011, compared to $744 million for the same period last year. The improvement in expense levels resulted from declines of $20 million in FDIC deposit insurance premiums, $10 million in operating lease expense and reductions across several other expense categories. These decreases were partially offset by a $21 million increase in employee benefits expense due to higher medical claims expense compared to the year ago quarter when Key recorded a reduced amount due to favorable experience. In addition, the fourth quarter reflected a credit of $11 million in the provision (credit) for losses on lending-related commitments compared to a credit of $26 million in the same period one year ago.
Compared to the third quarter of 2011, noninterest expense increased by $25 million. Business services and professional fees and miscellaneous expenses both increased by $10 million and personnel expense increased $5 million. Marketing expense also increased $8 million as Key continues to promote, support and advertise relationship-based products, services and capabilities. These increases were partially offset by a decrease of $10 million in the provision (credit) for losses on lending-related commitments.
ASSET QUALITY
Keys provision for loan and lease losses was a credit of $22 million for the fourth quarter of 2011, compared to a credit of $97 million for the year-ago quarter and a charge of $10 million for the third quarter of 2011. Keys allowance for loan and lease losses was $1 billion, or 2.03% of total period-end loans, at December 31, 2011, compared to 2.35% at September 30, 2011, and 3.20% at December 31, 2010.
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 5
Selected asset quality statistics for Key for each of the past five quarters are presented in the following table.
Selected Asset Quality Statistics from Continuing Operations
dollars in millions |
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | |||||||||||||||
Net loan charge-offs |
$ | 105 | $ | 109 | $ | 134 | $ | 193 | $ | 256 | ||||||||||
Net loan charge-offs to average loans |
.86 | % | .90 | % | 1.11 | % | 1.59 | % | 2.00 | % | ||||||||||
Allowance for loan and lease losses |
$ | 1,004 | $ | 1,131 | $ | 1,230 | $ | 1,372 | $ | 1,604 | ||||||||||
Allowance for credit losses (a) |
1,049 | 1,187 | 1,287 | 1,441 | 1,677 | |||||||||||||||
Allowance for loan and lease losses to period-end loans |
2.03 | % | 2.35 | % | 2.57 | % | 2.83 | % | 3.20 | % | ||||||||||
Allowance for credit losses to period-end loans |
2.12 | 2.46 | 2.69 | 2.97 | 3.35 | |||||||||||||||
Allowance for loan and lease losses to nonperforming loans |
138.10 | 143.53 | 146.08 | 155.03 | 150.19 | |||||||||||||||
Allowance for credit losses to nonperforming loans |
144.29 | 150.63 | 152.85 | 162.82 | 157.02 | |||||||||||||||
Nonperforming loans at period end |
$ | 727 | $ | 788 | $ | 842 | $ | 885 | $ | 1,068 | ||||||||||
Nonperforming assets at period end |
859 | 914 | 950 | 1,089 | 1,338 | |||||||||||||||
Nonperforming loans to period-end portfolio loans |
1.47 | % | 1.64 | % | 1.76 | % | 1.82 | % | 2.13 | % | ||||||||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
1.73 | 1.89 | 1.98 | 2.23 | 2.66 |
(a) | Includes the allowance for loan and lease losses plus the liability for credit losses on lending-related commitments. |
Net loan charge-offs for the quarter totaled $105 million, or .86% of average loans. These results compare to $256 million, or 2.00%, for the same period last year and $109 million, or .90%, for the previous quarter. Net loan charge-offs have declined for the last eight consecutive quarters and were less than one percent of average loans for the second consecutive quarter.
Keys net loan charge-offs by loan type for each of the past five quarters are shown in the following table.
Net Loan Charge-offs from Continuing Operations
dollars in millions |
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | |||||||||||||||
Commercial, financial and agricultural |
$ | 28 | $ | 23 | $ | 36 | $ | 32 | $ | 80 | ||||||||||
Real estate commercial mortgage |
23 | 25 | 12 | 43 | 52 | |||||||||||||||
Real estate construction (a) |
(6 | ) | 8 | 24 | 30 | 28 | ||||||||||||||
Commercial lease financing |
| 2 | 4 | 11 | 12 | |||||||||||||||
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Total commercial loans |
45 | 58 | 76 | 116 | 172 | |||||||||||||||
Home equity Key Community Bank |
20 | 18 | 27 | 24 | 26 | |||||||||||||||
Home equity Other |
9 | 8 | 10 | 14 | 13 | |||||||||||||||
Marine |
14 | 11 | 4 | 19 | 17 | |||||||||||||||
Other |
17 | 14 | 17 | 20 | 28 | |||||||||||||||
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Total consumer loans |
60 | 51 | 58 | 77 | 84 | |||||||||||||||
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Total net loan charge-offs |
$ | 105 | $ | 109 | $ | 134 | $ | 193 | $ | 256 | ||||||||||
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Net loan charge-offs to average loans from continuing operations |
.86 | % | .90 | % | 1.11 | % | 1.59 | % | 2.00 | % | ||||||||||
Net loan charge-offs from discontinued operations education lending business |
$ | 25 | $ | 31 | $ | 32 | $ | 35 | $ | 32 |
(a) | Credit amount indicates recoveries exceeded charge-offs. |
Compared to the third quarter of 2011, net loan charge-offs in the commercial loan portfolio decreased by $13 million which was attributable to a decline in the real estate construction category. As shown in the table on page 6, Keys exit loan portfolio accounted for $22 million, or 21%, of Keys total net loan charge-offs for the fourth quarter of 2011. Net charge-offs in the exit loan portfolio decreased by $5 million from the third quarter of 2011, primarily driven by a decrease in net charge-offs in the residential propertieshomebuilder loan portfolio.
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 6
At December 31, 2011, Keys nonperforming loans totaled $727 million and represented 1.47% of period-end portfolio loans, compared to 1.64% at September 30, 2011, and 2.13% at December 31, 2010. Nonperforming assets at December 31, 2011, totaled $859 million and represented 1.73% of portfolio loans and OREO and other nonperforming assets, compared to 1.89% at September 30, 2011, and 2.66% at December 31, 2010. The following table illustrates the trend in Keys nonperforming assets by loan type over the past five quarters.
Nonperforming Assets from Continuing Operations
dollars in millions |
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | |||||||||||||||
Commercial, financial and agricultural |
$ | 188 | $ | 188 | $ | 213 | $ | 221 | $ | 242 | ||||||||||
Real estate commercial mortgage |
218 | 237 | 230 | 245 | 255 | |||||||||||||||
Real estate construction |
54 | 93 | 131 | 146 | 241 | |||||||||||||||
Commercial lease financing |
27 | 31 | 41 | 42 | 64 | |||||||||||||||
Total consumer loans |
240 | 239 | 227 | 231 | 266 | |||||||||||||||
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Total nonperforming loans |
727 | 788 | 842 | 885 | 1,068 | |||||||||||||||
Nonperforming loans held for sale |
46 | 42 | 42 | 86 | 106 | |||||||||||||||
OREO and other nonperforming assets |
86 | 84 | 66 | 118 | 164 | |||||||||||||||
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Total nonperforming assets |
$ | 859 | $ | 914 | $ | 950 | $ | 1,089 | $ | 1,338 | ||||||||||
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Restructured loans accruing and nonaccruing (a) |
$ | 276 | $ | 277 | $ | 252 | $ | 242 | $ | 297 | ||||||||||
Restructured loans included in nonperforming loans (a) |
191 | 178 | 144 | 136 | 202 | |||||||||||||||
Nonperforming assets from discontinued operations education lending business |
23 | 22 | 21 | 22 | 40 | |||||||||||||||
Nonperforming loans to period-end portfolio loans |
1.47 | % | 1.64 | % | 1.76 | % | 1.82 | % | 2.13 | % | ||||||||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
1.73 | 1.89 | 1.98 | 2.23 | 2.66 |
(a) | Restructured loans (i.e. troubled debt restructurings) are those for which Key, for reasons related to a borrowers 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. |
Nonperforming assets continued to decrease during the fourth quarter of 2011, representing the ninth consecutive quarterly decline. As shown in the following table, Keys exit loan portfolio accounted for $119 million, or 13.9%, of Keys total nonperforming assets at December 31, 2011.
The following table shows the composition of Keys exit loan portfolio at December 31, 2011, and September 30, 2011, the net charge-offs recorded on this portfolio for the third and fourth quarters of 2011, and the nonperforming status of these loans at December 31, 2011, and September 30, 2011.
Exit Loan Portfolio from Continuing Operations
Balance | Change | Net Loan | Balance on | |||||||||||||||||||||||||
Outstanding | 12-31-11 vs. | Charge-offs | Nonperforming Status | |||||||||||||||||||||||||
in millions |
12-31-11 | 9-30-11 | 9-30-11 | 4Q11(c) | 3Q11 | 12-31-11 | 9-30-11 | |||||||||||||||||||||
Residential properties homebuilder |
$ | 41 | $ | 48 | $ | (7 | ) | $ | (2 | ) | $ | 4 | $ | 23 | $ | 28 | ||||||||||||
Marine and RV floor plan |
81 | 92 | (11 | ) | 2 | 3 | 45 | 38 | ||||||||||||||||||||
Commercial lease financing (a) |
1,669 | 1,728 | (59 | ) | (2 | ) | | 7 | 9 | |||||||||||||||||||
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Total commercial loans |
1,791 | 1,868 | (77 | ) | (2 | ) | 7 | 75 | 75 | |||||||||||||||||||
Home equity Other |
535 | 565 | (30 | ) | 9 | 8 | 12 | 12 | ||||||||||||||||||||
Marine |
1,766 | 1,871 | (105 | ) | 14 | 11 | 31 | 32 | ||||||||||||||||||||
RV and other consumer |
125 | 131 | (6 | ) | 1 | 1 | 1 | | ||||||||||||||||||||
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Total consumer loans |
2,426 | 2,567 | (141 | ) | 24 | 20 | 44 | 44 | ||||||||||||||||||||
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Total exit loans in loan portfolio |
$ | 4,217 | $ | 4,435 | $ | (218 | ) | $ | 22 | $ | 27 | $ | 119 | $ | 119 | |||||||||||||
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Discontinued operations education lending business (not included in exit loans above) (b) |
$ | 5,812 | $ | 5,984 | $ | (172 | ) | $ | 25 | $ | 31 | $ | 23 | $ | 22 |
(a) | Includes the business aviation, commercial vehicle, office products, construction and industrial leases, and Canadian lease financing portfolios; and all remaining balances related to lease in, lease out; sale in, sale out; service contract leases; and qualified technological equipment leases. |
(b) | Includes loans in Keys consolidated education loan securitization trusts. |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 7
(c) | Credit amounts indicate recoveries exceeded charge-offs. |
CAPITAL
Keys estimated risk-based capital ratios included in the following table continued to exceed all well-capitalized regulatory benchmarks at December 31, 2011.
Capital Ratios
12-31-11 | 9-30-11 | 6-30-11 | 3-31-11 | 12-31-10 | ||||||||||||||||
Tier 1 common equity (a), (b) |
11.28 | % | 11.28 | % | 11.14 | % | 10.74 | % | 9.34 | % | ||||||||||
Tier 1 risk-based capital (a) |
13.01 | 13.49 | 13.93 | 13.48 | 15.16 | |||||||||||||||
Total risk-based capital (a) |
16.53 | 17.05 | 17.88 | 17.38 | 19.12 | |||||||||||||||
Tangible common equity to tangible assets (b) |
9.88 | 9.82 | 9.67 | 9.16 | 8.19 |
(a) | 12-31-11 ratio is estimated. |
(b) | The table entitled GAAP to Non-GAAP Reconciliations presents the computations of certain financial measures related to tangible common equity and Tier 1 common equity. The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. |
As shown in the preceding table, at December 31, 2011, Keys estimated Tier 1 common equity and Tier 1 risk-based capital ratios stood at 11.28% and 13.01%, respectively. In addition, the tangible common equity ratio was 9.88% at December 31, 2011.
The changes in Keys outstanding common shares over the past five quarters are summarized in the following table.
Summary of Changes in Common Shares Outstanding
in thousands |
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | |||||||||||||||
Shares outstanding at beginning of period |
952,808 | 953,822 | 953,926 | 880,608 | 880,328 | |||||||||||||||
Common shares issued |
| | | 70,621 | | |||||||||||||||
Shares reissued (returned) under employee benefit plans |
200 | (1,014 | ) | (104 | ) | 2,697 | 280 | |||||||||||||
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Shares outstanding at end of period |
953,008 | 952,808 | 953,822 | 953,926 | 880,608 | |||||||||||||||
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During the first quarter of 2011, Key successfully completed a $625 million common equity offering and a $1 billion debt offering. The proceeds from these offerings, along with other available funds, were used to repurchase the $2.5 billion of Fixed-Rate Perpetual Preferred Stock, Series B issued to the U.S. Treasury Department as a result of Keys participation in the U.S. Treasurys Capital Purchase Program.
LINE OF BUSINESS RESULTS
The following table shows the contribution made by each major business segment to Keys taxable-equivalent revenue from continuing operations and income (loss) from continuing operations attributable to Key for the periods presented. The specific lines of business that comprise each of the major business segments are described under the heading Line of Business Descriptions. For more detailed financial information pertaining to each business segment and its respective lines of business, see the tables at the end of this release.
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 8
Major Business Segments
Percent change 4Q11 vs. | ||||||||||||||||||||
dollars in millions |
4Q11 | 3Q11 | 4Q10 | 3Q11 | 4Q10 | |||||||||||||||
Revenue from continuing operations (TE) |
||||||||||||||||||||
Key Community Bank |
$ | 546 | $ | 565 | $ | 597 | (3.4 | )% | (8.5 | )% | ||||||||||
Key Corporate Bank |
411 | 368 | 434 | 11.7 | (5.3 | ) | ||||||||||||||
Other Segments |
46 | 105 | 112 | (56.2 | ) | (58.9 | ) | |||||||||||||
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|
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Total Segments |
1,003 | 1,038 | 1,143 | (3.4 | ) | (12.2 | ) | |||||||||||||
Reconciling Items |
(26 | ) | | 18 | N/M | (244.4 | ) | |||||||||||||
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Total |
$ | 977 | $ | 1,038 | $ | 1,161 | (5.9 | )% | (15.8 | )% | ||||||||||
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|
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Income (loss) from continuing operations attributable to Key |
||||||||||||||||||||
Key Community Bank |
$ | 40 | $ | 58 | $ | 58 | (31.0 | )% | (31.0 | )% | ||||||||||
Key Corporate Bank |
156 | 122 | 289 | 27.9 | (46.0 | ) | ||||||||||||||
Other Segments |
24 | 55 | 3 | (56.4 | ) | 700.0 | ||||||||||||||
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|
|
|
|
|||||||||||
Total Segments |
220 | 235 | 350 | (6.4 | ) | (37.1 | ) | |||||||||||||
Reconciling Items |
(13 | ) | (1 | ) | (17 | ) | N/M | N/M | ||||||||||||
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|
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|
|
|
|
|||||||||||
Total |
$ | 207 | $ | 234 | $ | 333 | (11.5 | )% | (37.8 | )% | ||||||||||
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|
|
|
TE = Taxable Equivalent, N/M = Not Meaningful
Key Community Bank
Percent change 4Q11 vs. | ||||||||||||||||||||
dollars in millions |
4Q11 | 3Q11 | 4Q10 | 3Q11 | 4Q10 | |||||||||||||||
Summary of operations |
||||||||||||||||||||
Net interest income (TE) |
$ | 365 | $ | 371 | $ | 394 | (1.6 | )% | (7.4 | )% | ||||||||||
Noninterest income |
181 | 194 | 203 | (6.7 | ) | (10.8 | ) | |||||||||||||
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|
|
|
|
|
|
|
|
|||||||||||
Total revenue (TE) |
546 | 565 | 597 | (3.4 | ) | (8.5 | ) | |||||||||||||
Provision (credit) for loan and lease losses |
30 | 39 | 74 | (23.1 | ) | (59.5 | ) | |||||||||||||
Noninterest expense |
477 | 456 | 457 | 4.6 | 4.4 | |||||||||||||||
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|
|||||||||||
Income (loss) before income taxes (TE) |
39 | 70 | 66 | (44.3 | ) | (40.9 | ) | |||||||||||||
Allocated income taxes and TE adjustments |
(1 | ) | 12 | 8 | (108.3 | ) | (112.5 | ) | ||||||||||||
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|
|||||||||||
Net income (loss) attributable to Key |
$ | 40 | $ | 58 | $ | 58 | (31.0 | )% | (31.0 | )% | ||||||||||
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|
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Average balances |
||||||||||||||||||||
Loans and leases |
$ | 26,406 | $ | 26,270 | $ | 26,436 | .5 | % | (.1 | )% | ||||||||||
Total assets |
29,867 | 29,681 | 29,830 | .6 | .1 | |||||||||||||||
Deposits |
48,076 | 47,672 | 48,124 | .8 | (.1 | ) | ||||||||||||||
Assets under management at period end |
$ | 17,938 | $ | 17,195 | $ | 18,788 | 4.3 | % | (4.5 | )% |
TE = Taxable Equivalent, N/M = Not Meaningful
Additional Key Community Bank Data
Percent change 4Q11 vs. | ||||||||||||||||||||
dollars in millions |
4Q11 | 3Q11 | 4Q10 | 3Q11 | 4Q10 | |||||||||||||||
Average deposit balances |
||||||||||||||||||||
NOW and money market deposit accounts |
$ | 22,524 | $ | 21,967 | $ | 20,513 | 2.5 | % | 9.8 | % | ||||||||||
Savings deposits |
1,959 | 1,971 | 1,863 | (.6 | ) | 5.2 | ||||||||||||||
Certificates of deposit ($100,000 or more) |
3,639 | 3,862 | 4,885 | (5.8 | ) | (25.5 | ) | |||||||||||||
Other time deposits |
6,491 | 6,928 | 8,638 | (6.3 | ) | (24.9 | ) | |||||||||||||
Deposits in foreign office |
393 | 336 | 421 | 17.0 | (6.7 | ) | ||||||||||||||
Noninterest-bearing deposits |
13,070 | 12,608 | 11,804 | 3.7 | 10.7 | |||||||||||||||
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Total deposits |
$ | 48,076 | $ | 47,672 | $ | 48,124 | .8 | % | (.1 | )% | ||||||||||
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Home equity loans |
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Average balance |
$ | 9,280 | $ | 9,388 | $ | 9,582 | ||||||||||||||
Weighted-average loan-to-value ratio (at date of origination) |
70 | % | 70 | % | 70 | % | ||||||||||||||
Percent first lien positions |
53 | 53 | 53 | |||||||||||||||||
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Other data |
||||||||||||||||||||
Branches |
1,058 | 1,063 | 1,033 | |||||||||||||||||
Automated teller machines |
1,579 | 1,584 | 1,531 | |||||||||||||||||
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|
Key Community Bank Summary of Operations
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 9
Key Community Bank recorded net income attributable to Key of $40 million for the fourth quarter of 2011, compared to net income attributable to Key of $58 million for the year-ago quarter.
Taxable-equivalent net interest income declined by $29 million, or 7%, from the fourth quarter of 2010. Average loans and leases and average deposits were essentially even with the level one year ago; however, given the continued low rate environment the value derived from these assets and deposits was less in the current period.
Noninterest income decreased by $22 million, or 11%, from the year-ago quarter. Electronic banking fees declined $13 million as a result of new government pricing controls on debit transactions which were effective October 1, 2011. Investment banking and capital markets income also decreased $5 million from one year ago.
The provision for loan and lease losses declined by $44 million, or 59%, compared to the fourth quarter of 2010 due to lower net charge-offs and nonperforming loans from the same period one year ago. Net charge-offs were $71 million for the fourth quarter of 2011, down $44 million from the $115 million incurred in the same period one year ago. Nonperforming loans declined to $415 million at December 31, 2011, down $82 million from one year ago.
Noninterest expense increased by $20 million, or 4%, from the year-ago quarter. Personnel expense increased $17 million and real estate costs associated with investments in Keys branch network increased $18 million. These increases were partially offset by a reduction in FDIC deposit insurance premiums of $18 million from one year ago.
Key Corporate Bank
Percent change 4Q11 vs. | ||||||||||||||||||||
dollars in millions |
4Q11 | 3Q11 | 4Q10 | 3Q11 | 4Q10 | |||||||||||||||
Summary of operations |
||||||||||||||||||||
Net interest income (TE) |
$ | 175 | $ | 170 | $ | 204 | 2.9 | % | (14.2 | )% | ||||||||||
Noninterest income |
236 | 198 | 230 | 19.2 | 2.6 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total revenue (TE) |
411 | 368 | 434 | 11.7 | (5.3 | ) | ||||||||||||||
Provision (credit) for loan and lease losses |
(61 | ) | (40 | ) | (263 | ) | N/M | N/M | ||||||||||||
Noninterest expense |
227 | 216 | 240 | 5.1 | (5.4 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income (loss) before income taxes (TE) |
245 | 192 | 457 | 27.6 | (46.4 | ) | ||||||||||||||
Allocated income taxes and TE adjustments |
89 | 70 | 168 | 27.1 | (47.0 | ) | ||||||||||||||
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|
|
|
|
|
|
|
|||||||||||
Net income (loss) attributable to Key |
$ | 156 | $ | 122 | $ | 289 | 27.9 | % | (46.0 | )% | ||||||||||
|
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|
|
|
|
|||||||||||||||
Average balances |
||||||||||||||||||||
Loans and leases |
$ | 17,783 | $ | 16,985 | $ | 18,602 | 4.7 | % | (4.4 | )% | ||||||||||
Loans held for sale |
356 | 273 | 253 | 30.4 | 40.7 | |||||||||||||||
Total assets |
21,810 | 21,168 | 22,607 | 3.0 | (3.5 | ) | ||||||||||||||
Deposits |
11,162 | 10,544 | 12,766 | 5.9 | (12.6 | ) | ||||||||||||||
Assets under management at period end |
$ | 31,603 | $ | 34,389 | $ | 41,027 | (8.1 | )% | (23.0 | )% |
TE = Taxable Equivalent, N/M = Not Meaningful
Key Corporate Bank Summary of Operations
Key Corporate Bank recorded net income attributable to Key of $156 million for the fourth quarter of 2011, compared to net income attributable to Key of $289 million for the same period one year ago. This decrease was primarily driven by a $202 million reduction in a credit to the provision for loan and lease losses compared to the same period one year ago.
Taxable-equivalent net interest income decreased by $29 million, or 14%, compared to the fourth quarter of 2010, due to lower average deposits and average earning assets. Average deposits declined by $1.6 billion, or 13%, from one year ago primarily because Key moved $1.5 billion in escrow balances out of the Real Estate Capital line of business to a third party in
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 10
the first quarter of 2011. Average earning assets decreased by $969 million, or 5%, from the year-ago quarter, while lower levels of nonperforming assets and better pricing helped to partially offset volume-related declines.
Noninterest income increased by $6 million, or 3%, from the fourth quarter of 2010. Other income increased $22 million as a result of gains on the disposition of certain investments held by the Real Estate Capital line of business. This increase was partially offset by decreases in operating lease income of $8 million, investment banking and capital markets income of $5 million and trust and investment services income of $4 million.
The provision for loan and lease losses in the fourth quarter of 2011 was a credit of $61 million compared to a credit of $263 million for the same period one year ago. Key Corporate Bank continued to experience improved asset quality for the ninth quarter in a row. Net charge-offs were $12 million for the fourth quarter of 2011, down $49 million from the $61 million incurred in the same period one year ago. Nonperforming loans declined to $294 million at December 31, 2011, down $281 million from one year ago.
Noninterest expense decreased by $13 million, or 5%, from the fourth quarter of 2010. Contributing to the improvement in expense levels were decreases in various miscellaneous expense items of $22 million, operating lease expense of $6 million, and business services and professional fees of $4 million from the year-ago quarter. These improvements were partially offset by an increase in personnel expense of $12 million. In addition, the fourth quarter reflected a credit to the provision for losses on lending-related commitments of $10 million compared to a credit of $18 million for the same period one year ago.
Other Segments
Other Segments consist of Corporate Treasury, Keys Principal Investing unit and various exit portfolios. Other Segments generated net income attributable to Key of $24 million for the fourth quarter of 2011, compared to net income attributable to Key of $3 million for the same period last year. These results were primarily attributable to a decrease in the provision for loan and lease losses of $81 million in the exit portfolio partially offset by decreases in various miscellaneous income items of $41 million and net interest income of $12 million.
Line of Business Descriptions
Key Community Bank
Regional Banking provides individuals with branch-based deposit and investment products, personal finance services and loans, including residential mortgages, home equity and various types of installment loans. This line of business also provides small businesses with deposit, investment and credit products, and business advisory services.
Regional Banking also offers financial, estate and retirement planning, and asset management services to assist high-net-worth clients with their banking, trust, portfolio management, insurance, charitable giving and related needs.
Commercial Banking provides midsize businesses with products and services that include commercial lending, cash management, equipment leasing, investment and employee benefit programs, succession planning, access to capital markets, derivatives and foreign exchange.
Key Corporate Bank
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 11
Real Estate Capital and Corporate Banking Services consists of two business units, Real Estate Capital and Corporate Banking Services.
Real Estate Capital is a national business that provides construction and interim lending, permanent debt placements and servicing, equity and investment banking, and other commercial banking products and services to developers, brokers and owner-investors. This unit deals primarily with nonowner-occupied properties (i.e., generally properties in which at least 50% of the debt service is provided by rental income from nonaffiliated third parties). Real Estate Capital emphasizes providing clients with finance solutions through access to the capital markets.
Corporate Banking Services provides cash management, interest rate derivatives, and foreign exchange products and services to clients served by both the Key Community Bank and Key Corporate Bank groups. Through its Public Sector and Financial Institutions businesses, Corporate Banking Services also provides a full array of commercial banking products and services to government and not-for-profit entities and community banks. A variety of cash management services are provided through the Global Treasury Management unit.
Equipment Finance meets the equipment leasing needs of companies worldwide and provides equipment manufacturers, distributors and resellers with financing options for their clients. Lease financing receivables and related revenues are assigned to other lines of business (primarily Institutional and Capital Markets and Commercial Banking) if those businesses are principally responsible for maintaining the relationship with the client.
Institutional and Capital Markets, through its KeyBanc Capital Markets unit, provides commercial lending, treasury management, investment banking, derivatives, foreign exchange, equity and debt underwriting and trading, and syndicated finance products and services to large corporations and middle-market companies.
Institutional and Capital Markets, through its Victory Capital Management unit, also manages or offers advice regarding investment portfolios for a national client base, including corporations, labor unions, not-for-profit organizations, governments and individuals. These portfolios may be managed in separate accounts, common funds or the Victory family of mutual funds.
Key traces its history back more than 160 years and is headquartered in Cleveland, Ohio. One of the nations largest bank-based financial services companies, Key has assets of approximately $89 billion at December 31, 2011.
Key provides deposit, lending, cash management and investment services to individuals and small businesses in 14 states under the name KeyBank National Association. 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.
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 12
Notes to Editors:
A live Internet broadcast of KeyCorps 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 Tuesday, January 24, 2012. An audio replay of the call will be available through January 31, 2012.
For up-to-date company information, media contacts and facts and figures about Keys lines of business, visit our Media Newsroom at https://www.key.com/newsroom.
This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Keys financial condition, results of operations, earnings outlook, asset quality trends and profitability. Forward-looking statements are not historical facts but instead represent only managements current expectations and forecasts regarding future events, many of which, by their nature, are inherently uncertain and outside of Keys control. Keys actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Factors that could cause Keys actual results to differ materially from those described in the forward-looking statements can be found in KeyCorps Annual Report on Form 10-K for the year ended December 31, 2010, and its Quarterly Reports on Form 10-Q for the periods ended March 31, 2011, June 30, 2011, and September 30, 2011, which have been filed with the Securities and Exchange Commission and are available on Keys website (www.key.com/ir) and on the Securities and Exchange Commissions website (www.sec.gov). Forward-looking statements are not guarantees of future performance and should not be relied upon as representing managements views as of any subsequent date. Key does not undertake any obligation to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.
*****
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 13
Financial Highlights
(dollars in millions, except per share amounts)
Three months ended | ||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | ||||||||||
Summary of operations |
||||||||||||
Net interest income (TE) |
$ | 563 | $ | 555 | $ | 635 | ||||||
Noninterest income |
414 | 483 | 526 | |||||||||
|
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|
|
|
|
|||||||
Total revenue (TE) |
977 | 1,038 | 1,161 | |||||||||
Provision (credit) for loan and lease losses |
(22 | ) | 10 | (97 | ) | |||||||
Noninterest expense |
717 | 692 | 744 | |||||||||
Income (loss) from continuing operations attributable to Key |
207 | 234 | 333 | |||||||||
Income (loss) from discontinued operations, net of taxes (b) |
(7 | ) | (17 | ) | (13 | ) | ||||||
Net income (loss) attributable to Key |
200 | 217 | 320 | |||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | 201 | $ | 229 | $ | 292 | ||||||
Income (loss) from discontinued operations, net of taxes (b) |
(7 | ) | (17 | ) | (13 | ) | ||||||
Net income (loss) attributable to Key common shareholders |
194 | 212 | 279 | |||||||||
Per common share |
||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | .21 | $ | .24 | $ | .33 | ||||||
Income (loss) from discontinued operations, net of taxes (b) |
(.01 | ) | (.02 | ) | (.02 | ) | ||||||
Net income (loss) attributable to Key common shareholders |
.20 | .22 | .32 | |||||||||
Income (loss) from continuing operations attributable to Key common shareholders assuming dilution |
.21 | .24 | .33 | |||||||||
Income (loss) from discontinued operations, net of taxes assuming dilution (b) |
(.01 | ) | (.02 | ) | (.02 | ) | ||||||
Net income (loss) attributable to Key common shareholders assuming dilution |
.20 | .22 | .32 | |||||||||
Cash dividends paid |
.03 | .03 | .01 | |||||||||
Book value at period end |
10.09 | 10.09 | 9.52 | |||||||||
Tangible book value at period end |
9.11 | 9.10 | 8.45 | |||||||||
Market price at period end |
7.69 | 5.93 | 8.85 | |||||||||
Performance ratios |
||||||||||||
From continuing operations: |
||||||||||||
Return on average total assets |
1.01 | % | 1.14 | % | 1.53 | % | ||||||
Return on average common equity |
8.26 | 9.52 | 13.71 | |||||||||
Net interest margin (TE) |
3.13 | 3.09 | 3.31 | |||||||||
From consolidated operations: |
||||||||||||
Return on average total assets |
.91 | % | .98 | % | 1.36 | % | ||||||
Return on average common equity |
7.97 | 8.82 | 13.10 | |||||||||
Net interest margin (TE) |
3.04 | 3.02 | 3.22 | |||||||||
Loan to deposit (d) |
87.00 | 85.71 | 90.30 | |||||||||
Capital ratios at period end |
||||||||||||
Key shareholders equity to assets |
11.16 | % | 11.09 | % | 12.10 | % | ||||||
Tangible Key shareholders equity to tangible assets |
10.21 | 10.15 | 11.20 | |||||||||
Tangible common equity to tangible assets (a) |
9.88 | 9.82 | 8.19 | |||||||||
Tier 1 common equity (a), (c) |
11.28 | 11.28 | 9.34 | |||||||||
Tier 1 risk-based capital (c) |
13.01 | 13.49 | 15.16 | |||||||||
Total risk-based capital (c) |
16.53 | 17.05 | 19.12 | |||||||||
Leverage (c) |
11.70 | 11.93 | 13.02 | |||||||||
Asset quality from continuing operations |
||||||||||||
Net loan charge-offs |
$ | 105 | $ | 109 | $ | 256 | ||||||
Net loan charge-offs to average loans |
.86 | % | .90 | % | 2.00 | % | ||||||
Allowance for loan and lease losses |
$ | 1,004 | $ | 1,131 | $ | 1,604 | ||||||
Allowance for credit losses |
1,049 | 1,187 | 1,677 | |||||||||
Allowance for loan and lease losses to period-end loans |
2.03 | % | 2.35 | % | 3.20 | % | ||||||
Allowance for credit losses to period-end loans |
2.12 | 2.46 | 3.35 | |||||||||
Allowance for loan and lease losses to nonperforming loans |
138.10 | 143.53 | 150.19 | |||||||||
Allowance for credit losses to nonperforming loans |
144.29 | 150.63 | 157.02 | |||||||||
Nonperforming loans at period end |
$ | 727 | $ | 788 | $ | 1,068 | ||||||
Nonperforming assets at period end |
859 | 914 | 1,338 | |||||||||
Nonperforming loans to period-end portfolio loans |
1.47 | % | 1.64 | % | 2.13 | % | ||||||
Nonperforming assets to period-end portfolio loans plus |
||||||||||||
OREO and other nonperforming assets |
1.73 | 1.89 | 2.66 | |||||||||
Trust and brokerage assets |
||||||||||||
Assets under management |
$ | 49,541 | $ | 51,584 | $ | 59,815 | ||||||
Nonmanaged and brokerage assets |
30,639 | 28,007 | 28,069 | |||||||||
Other data |
||||||||||||
Average full-time equivalent employees |
15,381 | 15,490 | 15,424 | |||||||||
Branches |
1,058 | 1,063 | 1,033 | |||||||||
Taxable-equivalent adjustment |
$ | 6 | $ | 6 | $ | 6 |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 14
Financial Highlights (continued)
(dollars in millions, except per share amounts)
Twelve months ended | ||||||||
12-31-11 | 12-31-10 | |||||||
Summary of operations |
||||||||
Net interest income (TE) |
$ | 2,292 | $ | 2,537 | ||||
Noninterest income |
1,808 | 1,954 | ||||||
|
|
|
|
|||||
Total revenue (TE) |
4,100 | 4,491 | ||||||
Provision (credit) for loan and lease losses |
(60 | ) | 638 | |||||
Noninterest expense |
2,790 | 3,034 | ||||||
Income (loss) from continuing operations attributable to Key |
964 | 577 | ||||||
Income (loss) from discontinued operations, net of taxes (b) |
(44 | ) | (23 | ) | ||||
Net income (loss) attributable to Key |
920 | 554 | ||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | 857 | $ | 413 | ||||
Income (loss) from discontinued operations, net of taxes (b) |
(44 | ) | (23 | ) | ||||
Net income (loss) attributable to Key common shareholders |
813 | 390 | ||||||
Per common share |
||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | .92 | $ | .47 | ||||
Income (loss) from discontinued operations, net of taxes (b) |
(.05 | ) | (.03 | ) | ||||
Net income (loss) attributable to Key common shareholders |
.87 | .45 | ||||||
Income (loss) from continuing operations attributable to Key common shareholders assuming dilution |
.92 | .47 | ||||||
Income (loss) from discontinued operations, net of taxes assuming dilution (b) |
(.05 | ) | (.03 | ) | ||||
Net income (loss) attributable to Key common shareholders assuming dilution |
.87 | .44 | ||||||
Cash dividends paid |
.10 | .04 | ||||||
Performance ratios |
||||||||
From continuing operations: |
||||||||
Return on average total assets |
1.17 | % | .66 | % | ||||
Return on average common equity |
9.26 | 5.06 | ||||||
Net interest margin (TE) |
3.16 | 3.26 | ||||||
From consolidated operations: |
||||||||
Return on average total assets |
1.04 | % | .59 | % | ||||
Return on average common equity |
8.79 | 4.78 | ||||||
Net interest margin (TE) |
3.09 | 3.16 | ||||||
Asset quality from continuing operations |
||||||||
Net loan charge-offs |
$ | 541 | $ | 1,570 | ||||
Net loan charge-offs to average loans |
1.11 | % | 2.91 | % | ||||
Other data |
||||||||
Average full-time equivalent employees |
15,381 | 15,610 | ||||||
Taxable-equivalent adjustment |
$ | 25 | $ | 26 |
(a) | The following table entitled GAAP to Non-GAAP Reconciliations presents the computations of certain financial measures related to tangible common equity and Tier 1 common equity. The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons. |
(b) | In September 2009, management decided to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank National Association. In April 2009, management decided to wind down the operations of Austin Capital Management, Ltd., a subsidiary that specialized in managing hedge fund investments for institutional customers. As a result of these decisions, Key has accounted for these businesses as discontinued operations. |
(c) | 12-31-11 ratio is estimated. |
(d) | Represents period-end consolidated total loans and loans held for sale (excluding education loans in the securitization trusts) divided by period-end consolidated total deposits (excluding deposits in foreign office). |
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 15
GAAP to Non-GAAP Reconciliations
(dollars in millions, except per share amounts)
The table below presents the computations of certain financial measures related to tangible common equity, Tier 1 common equity and pre-provision net revenue. The tangible common equity ratio has become a focus of some investors, and management believes that this ratio may assist investors in analyzing Keys capital position absent the effects of intangible assets and preferred stock. Traditionally, the banking regulators have assessed bank and bank holding company capital adequacy based on both the amount and composition of capital, the calculation of which is prescribed in federal banking regulations. As a result of the Supervisory Capital Assessment Program, the Federal Reserve has focused its assessment of capital adequacy on a component of Tier 1 capital, known as Tier 1 common equity. Because the Federal Reserve has long indicated that voting common shareholders equity (essentially Tier 1 capital less preferred stock, qualifying capital securities and noncontrolling interests in subsidiaries) generally should be the dominant element in Tier 1 capital, such a focus is consistent with existing capital adequacy guidelines and does not imply a new or ongoing capital standard. Because Tier 1 common equity is neither formally defined by GAAP nor prescribed in amount by federal banking regulations, this measure is considered to be a non-GAAP financial measure. Since analysts and banking regulators may assess Keys capital adequacy using tangible common equity and Tier 1 common equity, management believes it is useful to provide investors the ability to assess Keys capital adequacy on these same bases. The table also reconciles the GAAP performance measures to the corresponding non-GAAP measures.
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 loan and lease losses makes it easier to analyze the results by presenting them on a more comparable basis.
Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. To mitigate these limitations, Key has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components, and to ensure that Keys performance is properly reflected to facilitate period-to-period comparisons. 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 | ||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | ||||||||||
Tangible common equity to tangible assets at period end |
||||||||||||
Key shareholders equity (GAAP) |
$ | 9,905 | $ | 9,901 | $ | 11,117 | ||||||
Less: Intangible assets |
934 | 935 | 938 | |||||||||
Preferred Stock, Series B |
| | 2,446 | |||||||||
Preferred Stock, Series A |
291 | 291 | 291 | |||||||||
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|
|
|
|
|||||||
Tangible common equity (non-GAAP) |
$ | 8,680 | $ | 8,675 | $ | 7,442 | ||||||
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|
|
|
|
|
|||||||
Total assets (GAAP) |
$ | 88,785 | $ | 89,262 | $ | 91,843 | ||||||
Less: Intangible assets |
934 | 935 | 938 | |||||||||
|
|
|
|
|
|
|||||||
Tangible assets (non-GAAP) |
$ | 87,851 | $ | 88,327 | $ | 90,905 | ||||||
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|
|
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|||||||
Tangible common equity to tangible assets ratio (non-GAAP) |
9.88 | % | 9.82 | % | 8.19 | % | ||||||
Tier 1 common equity at period end |
||||||||||||
Key shareholders equity (GAAP) |
$ | 9,905 | $ | 9,901 | $ | 11,117 | ||||||
Qualifying capital securities |
1,046 | 1,377 | 1,791 | |||||||||
Less: Goodwill |
917 | 917 | 917 | |||||||||
Accumulated other comprehensive income (loss) (a) |
(72 | ) | 88 | (66 | ) | |||||||
Other assets (b) |
72 | 72 | 248 | |||||||||
|
|
|
|
|
|
|||||||
Total Tier 1 capital (regulatory) |
10,034 | 10,201 | 11,809 | |||||||||
Less: Qualifying capital securities |
1,046 | 1,377 | 1,791 | |||||||||
Preferred Stock, Series B |
| | 2,446 | |||||||||
Preferred Stock, Series A |
291 | 291 | 291 | |||||||||
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|
|
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|
|||||||
Total Tier 1 common equity (non-GAAP) |
$ | 8,697 | $ | 8,533 | $ | 7,281 | ||||||
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|
|
|||||||
Net risk-weighted assets (regulatory) (b), (c) |
$ | 77,125 | $ | 75,643 | $ | 77,921 | ||||||
Tier 1 common equity ratio (non-GAAP) (c) |
11.28 | % | 11.28 | % | 9.34 | % | ||||||
Pre-provision net revenue |
||||||||||||
Net interest income (GAAP) |
$ | 557 | $ | 549 | $ | 629 | ||||||
Plus: Taxable-equivalent adjustment |
6 | 6 | 6 | |||||||||
Noninterest income |
414 | 483 | 526 | |||||||||
Less: Noninterest expense |
717 | 692 | 744 | |||||||||
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|
|
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|
|||||||
Pre-provision net revenue from continuing operations (non-GAAP) |
$ | 260 | $ | 346 | $ | 417 | ||||||
|
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(a) | Includes net unrealized gains or losses on securities available for sale (except for net unrealized losses on marketable equity securities), net gains or losses on cash flow hedges, and amounts resulting from the December 31, 2006 adoption and subsequent application of the applicable accounting guidance for defined benefit and other postretirement plans. |
(b) | Other assets deducted from Tier 1 capital and net risk-weighted assets consist of disallowed deferred tax assets of $158 million at December 31, 2010, disallowed intangible assets (excluding goodwill) and deductible portions of nonfinancial equity investments. There were no disallowed deferred tax assets at December 31, 2011 and September 30, 2011. |
(c) | 12-31-11 amount is estimated. |
GAAP = U.S. generally accepted accounting principles
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 16
Consolidated Balance Sheets
(dollars in millions)
12-31-11 | 9-30-11 | 12-31-10 | ||||||||||
Assets |
||||||||||||
Loans |
$ | 49,575 | $ | 48,195 | $ | 50,107 | ||||||
Loans held for sale |
728 | 479 | 467 | |||||||||
Securities available for sale |
16,012 | 17,612 | 21,933 | |||||||||
Held-to-maturity securities |
2,109 | 1,176 | 17 | |||||||||
Trading account assets |
623 | 729 | 985 | |||||||||
Short-term investments |
3,519 | 4,766 | 1,344 | |||||||||
Other investments |
1,163 | 1,210 | 1,358 | |||||||||
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|
|||||||
Total earning assets |
73,729 | 74,167 | 76,211 | |||||||||
Allowance for loan and lease losses |
(1,004 | ) | (1,131 | ) | (1,604 | ) | ||||||
Cash and due from banks |
694 | 828 | 278 | |||||||||
Premises and equipment |
944 | 924 | 908 | |||||||||
Operating lease assets |
350 | 393 | 509 | |||||||||
Goodwill |
917 | 917 | 917 | |||||||||
Other intangible assets |
17 | 18 | 21 | |||||||||
Corporate-owned life insurance |
3,256 | 3,227 | 3,167 | |||||||||
Derivative assets |
945 | 940 | 1,006 | |||||||||
Accrued income and other assets |
3,077 | 2,946 | 3,876 | |||||||||
Discontinued assets |
5,860 | 6,033 | 6,554 | |||||||||
|
|
|
|
|
|
|||||||
Total assets |
$ | 88,785 | $ | 89,262 | $ | 91,843 | ||||||
|
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|
|||||||
Liabilities |
||||||||||||
Deposits in domestic offices: |
||||||||||||
NOW and money market deposit accounts |
$ | 27,954 | $ | 27,548 | $ | 27,066 | ||||||
Savings deposits |
1,962 | 1,968 | 1,879 | |||||||||
Certificates of deposit ($100,000 or more) |
4,111 | 4,457 | 5,862 | |||||||||
Other time deposits |
6,243 | 6,695 | 8,245 | |||||||||
|
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|
|
|
|
|||||||
Total interest-bearing deposits |
40,270 | 40,668 | 43,052 | |||||||||
Noninterest-bearing deposits |
21,098 | 19,803 | 16,653 | |||||||||
Deposits in foreign office interest-bearing |
588 | 561 | 905 | |||||||||
|
|
|
|
|
|
|||||||
Total deposits |
61,956 | 61,032 | 60,610 | |||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,711 | 1,728 | 2,045 | |||||||||
Bank notes and other short-term borrowings |
337 | 519 | 1,151 | |||||||||
Derivative liabilities |
1,026 | 1,141 | 1,142 | |||||||||
Accrued expense and other liabilities |
1,763 | 1,556 | 1,931 | |||||||||
Long-term debt |
9,520 | 10,717 | 10,592 | |||||||||
Discontinued liabilities |
2,550 | 2,651 | 2,998 | |||||||||
|
|
|
|
|
|
|||||||
Total liabilities |
78,863 | 79,344 | 80,469 | |||||||||
Equity |
||||||||||||
Preferred stock, Series A |
291 | 291 | 291 | |||||||||
Preferred stock, Series B |
| | 2,446 | |||||||||
Common shares |
1,017 | 1,017 | 946 | |||||||||
Common stock warrant |
| | 87 | |||||||||
Capital surplus |
4,194 | 4,191 | 3,711 | |||||||||
Retained earnings |
6,246 | 6,079 | 5,557 | |||||||||
Treasury stock, at cost |
(1,815 | ) | (1,820 | ) | (1,904 | ) | ||||||
Accumulated other comprehensive income (loss) |
(28 | ) | 143 | (17 | ) | |||||||
|
|
|
|
|
|
|||||||
Key shareholders equity |
9,905 | 9,901 | 11,117 | |||||||||
Noncontrolling interests |
17 | 17 | 257 | |||||||||
|
|
|
|
|
|
|||||||
Total equity |
9,922 | 9,918 | 11,374 | |||||||||
|
|
|
|
|
|
|||||||
Total liabilities and equity |
$ | 88,785 | $ | 89,262 | $ | 91,843 | ||||||
|
|
|
|
|
|
|||||||
Common shares outstanding (000) |
953,008 | 952,808 | 880,608 |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 17
Consolidated Statements of Income
(dollars in millions, except per share amounts)
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Interest income |
||||||||||||||||||||
Loans |
$ | 542 | $ | 543 | $ | 617 | $ | 2,206 | $ | 2,653 | ||||||||||
Loans held for sale |
4 | 3 | 4 | 14 | 17 | |||||||||||||||
Securities available for sale |
128 | 140 | 170 | 583 | 644 | |||||||||||||||
Held-to-maturity securities |
9 | 2 | | 12 | 2 | |||||||||||||||
Trading account assets |
5 | 5 | 8 | 26 | 37 | |||||||||||||||
Short-term investments |
1 | 3 | 1 | 6 | 6 | |||||||||||||||
Other investments |
9 | 9 | 11 | 42 | 49 | |||||||||||||||
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|
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|
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|
|||||||||||
Total interest income |
698 | 705 | 811 | 2,889 | 3,408 | |||||||||||||||
Interest expense |
||||||||||||||||||||
Deposits |
85 | 95 | 124 | 390 | 671 | |||||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1 | 1 | 2 | 5 | 6 | |||||||||||||||
Bank notes and other short-term borrowings |
2 | 3 | 3 | 11 | 14 | |||||||||||||||
Long-term debt |
53 | 57 | 53 | 216 | 206 | |||||||||||||||
|
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|
|
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|
|
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|
|||||||||||
Total interest expense |
141 | 156 | 182 | 622 | 897 | |||||||||||||||
|
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|
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|
|||||||||||
Net interest income |
557 | 549 | 629 | 2,267 | 2,511 | |||||||||||||||
Provision (credit) for loan and lease losses |
(22 | ) | 10 | (97 | ) | (60 | ) | 638 | ||||||||||||
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|
|
|
|
|
|||||||||||
Net interest income (expense) after provision for loan and lease losses |
579 | 539 | 726 | 2,327 | 1,873 | |||||||||||||||
Noninterest income |
||||||||||||||||||||
Trust and investment services income |
104 | 107 | 108 | 434 | 444 | |||||||||||||||
Service charges on deposit accounts |
70 | 74 | 70 | 281 | 301 | |||||||||||||||
Operating lease income |
25 | 30 | 42 | 122 | 173 | |||||||||||||||
Letter of credit and loan fees |
56 | 55 | 51 | 213 | 194 | |||||||||||||||
Corporate-owned life insurance income |
35 | 31 | 42 | 121 | 137 | |||||||||||||||
Net securities gains (losses) (a) |
| | 12 | 1 | 14 | |||||||||||||||
Electronic banking fees |
18 | 33 | 31 | 114 | 117 | |||||||||||||||
Gains on leased equipment |
9 | 7 | 6 | 25 | 20 | |||||||||||||||
Insurance income |
11 | 13 | 12 | 53 | 64 | |||||||||||||||
Net gains (losses) from loan sales |
27 | 18 | 29 | 75 | 76 | |||||||||||||||
Net gains (losses) from principal investing |
(8 | ) | 34 | (6 | ) | 78 | 66 | |||||||||||||
Investment banking and capital markets income (loss) |
24 | 25 | 63 | 134 | 145 | |||||||||||||||
Other income |
43 | 56 | 66 | 157 | 203 | |||||||||||||||
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|
|||||||||||
Total noninterest income |
414 | 483 | 526 | 1,808 | 1,954 | |||||||||||||||
Noninterest expense |
||||||||||||||||||||
Personnel |
387 | 382 | 365 | 1,520 | 1,471 | |||||||||||||||
Net occupancy |
66 | 65 | 70 | 258 | 270 | |||||||||||||||
Operating lease expense |
18 | 23 | 28 | 94 | 142 | |||||||||||||||
Computer processing |
42 | 40 | 45 | 166 | 185 | |||||||||||||||
Business services and professional fees |
57 | 47 | 56 | 186 | 176 | |||||||||||||||
FDIC assessment |
7 | 7 | 27 | 52 | 124 | |||||||||||||||
OREO expense, net |
5 | 1 | 10 | 13 | 68 | |||||||||||||||
Equipment |
25 | 26 | 26 | 103 | 100 | |||||||||||||||
Marketing |
24 | 16 | 22 | 60 | 72 | |||||||||||||||
Provision (credit) for losses on lending-related commitments |
(11 | ) | (1 | ) | (26 | ) | (28 | ) | (48 | ) | ||||||||||
Other expense |
97 | 86 | 121 | 366 | 474 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest expense |
717 | 692 | 744 | 2,790 | 3,034 | |||||||||||||||
|
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|
|
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|
|
|
|
|||||||||||
Income (loss) from continuing operations before income taxes |
276 | 330 | 508 | 1,345 | 793 | |||||||||||||||
Income taxes |
69 | 95 | 172 | 369 | 186 | |||||||||||||||
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|
|
|||||||||||
Income (loss) from continuing operations |
207 | 235 | 336 | 976 | 607 | |||||||||||||||
Income (loss) from discontinued operations, net of taxes |
(7 | ) | (17 | ) | (13 | ) | (44 | ) | (23 | ) | ||||||||||
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|
|
|
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|
|
|
|||||||||||
Net income (loss) |
200 | 218 | 323 | 932 | 584 | |||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests |
| 1 | 3 | 12 | 30 | |||||||||||||||
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|||||||||||
Net income (loss) attributable to Key |
$ | 200 | $ | 217 | $ | 320 | $ | 920 | $ | 554 | ||||||||||
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|||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | 201 | $ | 229 | $ | 292 | $ | 857 | $ | 413 | ||||||||||
Net income (loss) attributable to Key common shareholders |
194 | 212 | 279 | 813 | 390 | |||||||||||||||
Per common share |
||||||||||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | .21 | $ | .24 | $ | .33 | $ | .92 | $ | .47 | ||||||||||
Income (loss) from discontinued operations, net of taxes |
(.01 | ) | (.02 | ) | (.02 | ) | (.05 | ) | (.03 | ) | ||||||||||
Net income (loss) attributable to Key common shareholders |
.20 | .22 | .32 | .87 | .45 | |||||||||||||||
Per common share assuming dilution |
||||||||||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders |
$ | .21 | $ | .24 | $ | .33 | $ | .92 | $ | .47 | ||||||||||
Income (loss) from discontinued operations, net of taxes |
(.01 | ) | (.02 | ) | (.02 | ) | (.05 | ) | (.03 | ) | ||||||||||
Net income (loss) attributable to Key common shareholders |
.20 | .22 | .32 | .87 | .44 | |||||||||||||||
Cash dividends declared per common share |
$ | .03 | $ | .03 | $ | .01 | $ | .10 | $ | .04 | ||||||||||
Weighted-average common shares outstanding (000) |
948,658 | 948,702 | 875,501 | 931,934 | 874,748 | |||||||||||||||
Weighted-average common shares and potential common shares outstanding (000) (b) |
951,684 | 950,686 | 900,263 | 935,801 | 878,153 |
(a) | For the three months ended December 31, 2011, September 30, 2011, and December 31, 2010, Key did not have any impairment losses related to securities. |
(b) | Assumes conversion of stock options and/or Preferred Series A shares, as applicable. |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 18
Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations
(dollars in millions)
Fourth Quarter 2011 | Third Quarter 2011 | Fourth Quarter 2010 | ||||||||||||||||||||||||||||||||||
Average Balance |
Interest (a) | Yield/Rate (a) | Average Balance |
Interest (a) | Yield/Rate (a) | Average Balance |
Interest (a) | Yield/Rate (a) | ||||||||||||||||||||||||||||
Assets |
||||||||||||||||||||||||||||||||||||
Loans: (b), (c) |
||||||||||||||||||||||||||||||||||||
Commercial, financial and agricultural |
$ | 18,323 | $ | 179 | 3.88 | % | $ | 17,381 | $ | 175 | 3.98 | % | $ | 16,562 | $ | 189 | 4.51 | % | ||||||||||||||||||
Real estate commercial mortgage |
8,090 | 92 | 4.48 | 7,978 | 89 | 4.47 | 9,514 | 117 | 4.89 | |||||||||||||||||||||||||||
Real estate construction |
1,380 | 16 | 4.68 | 1,545 | 18 | 4.46 | 2,531 | 26 | 4.15 | |||||||||||||||||||||||||||
Commercial lease financing |
5,982 | 69 | 4.62 | 6,045 | 72 | 4.80 | 6,484 | 82 | 5.08 | |||||||||||||||||||||||||||
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Total commercial loans |
33,775 | 356 | 4.19 | 32,949 | 354 | 4.27 | 35,091 | 414 | 4.69 | |||||||||||||||||||||||||||
Real estate residential mortgage |
1,918 | 24 | 5.15 | 1,853 | 25 | 5.23 | 1,837 | 25 | 5.43 | |||||||||||||||||||||||||||
Home equity: |
||||||||||||||||||||||||||||||||||||
Key Community Bank |
9,280 | 96 | 4.10 | 9,388 | 97 | 4.12 | 9,583 | 101 | 4.16 | |||||||||||||||||||||||||||
Other |
553 | 11 | 7.68 | 582 | 11 | 7.69 | 686 | 13 | 7.58 | |||||||||||||||||||||||||||
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|||||||||||||||||||
Total home equity loans |
9,833 | 107 | 4.30 | 9,970 | 108 | 4.33 | 10,269 | 114 | 4.39 | |||||||||||||||||||||||||||
Consumer other Key Community Bank |
1,191 | 30 | 9.62 | 1,169 | 28 | 9.60 | 1,170 | 30 | 10.38 | |||||||||||||||||||||||||||
Consumer other: |
||||||||||||||||||||||||||||||||||||
Marine |
1,820 | 29 | 6.35 | 1,928 | 30 | 6.29 | 2,295 | 36 | 6.30 | |||||||||||||||||||||||||||
Other |
127 | 2 | 7.87 | 139 | 3 | 7.89 | 167 | 3 | 7.98 | |||||||||||||||||||||||||||
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|
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Total consumer other |
1,947 | 31 | 6.44 | 2,067 | 33 | 6.40 | 2,462 | 39 | 6.41 | |||||||||||||||||||||||||||
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|
|||||||||||||||||||
Total consumer loans |
14,889 | 192 | 5.12 | 15,059 | 194 | 5.14 | 15,738 | 208 | 5.27 | |||||||||||||||||||||||||||
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|
|||||||||||||||||||
Total loans |
48,664 | 548 | 4.47 | 48,008 | 548 | 4.54 | 50,829 | 622 | 4.87 | |||||||||||||||||||||||||||
Loans held for sale |
440 | 4 | 3.36 | 341 | 3 | 3.75 | 403 | 4 | 3.16 | |||||||||||||||||||||||||||
Securities available for sale (b), (e) |
16,790 | 128 | 3.16 | 18,165 | 141 | 3.16 | 21,257 | 171 | 3.27 | |||||||||||||||||||||||||||
Held-to-maturity securities (b) |
1,648 | 9 | 2.12 | 354 | 2 | 2.59 | 17 | | 11.92 | |||||||||||||||||||||||||||
Trading account assets |
736 | 5 | 2.72 | 869 | 5 | 2.45 | 967 | 8 | 3.22 | |||||||||||||||||||||||||||
Short-term investments |
2,929 | 1 | .26 | 3,348 | 3 | .25 | 2,521 | 1 | .22 | |||||||||||||||||||||||||||
Other investments (e) |
1,181 | 9 | 2.98 | 1,190 | 9 | 2.94 | 1,400 | 11 | 2.86 | |||||||||||||||||||||||||||
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|||||||||||||||||||
Total earning assets |
72,388 | 704 | 3.90 | 72,275 | 711 | 3.93 | 77,394 | 817 | 4.22 | |||||||||||||||||||||||||||
Allowance for loan and lease losses |
(1,057 | ) | (1,176 | ) | (1,789 | ) | ||||||||||||||||||||||||||||||
Accrued income and other assets |
9,942 | 10,360 | 11,025 | |||||||||||||||||||||||||||||||||
Discontinued assets education lending business |
5,912 | 6,079 | 6,674 | |||||||||||||||||||||||||||||||||
|
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|
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|
|
|||||||||||||||||||||||||||||||
Total assets |
$ | 87,185 | $ | 87,538 | $ | 93,304 | ||||||||||||||||||||||||||||||
|
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|
|||||||||||||||||||||||||||||||
Liabilities |
||||||||||||||||||||||||||||||||||||
NOW and money market deposit accounts |
$ | 27,722 | 15 | .22 | $ | 26,917 | 18 | .26 | $ | 27,047 | 21 | .30 | ||||||||||||||||||||||||
Savings deposits |
1,964 | | .06 | 1,980 | | .06 | 1,873 | | .06 | |||||||||||||||||||||||||||
Certificates of deposit ($100,000 or more) (f) |
4,275 | 32 | 2.97 | 4,762 | 36 | 3.03 | 6,341 | 49 | 3.05 | |||||||||||||||||||||||||||
Other time deposits |
6,505 | 37 | 2.24 | 6,942 | 40 | 2.28 | 8,664 | 53 | 2.43 | |||||||||||||||||||||||||||
Deposits in foreign office |
650 | 1 | .25 | 675 | 1 | .28 | 1,228 | 1 | .32 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total interest-bearing deposits |
41,116 | 85 | .82 | 41,276 | 95 | .91 | 45,153 | 124 | 1.09 | |||||||||||||||||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,747 | 1 | .25 | 1,724 | 1 | .28 | 2,236 | 2 | .31 | |||||||||||||||||||||||||||
Bank notes and other short-term borrowings |
471 | 2 | 1.87 | 598 | 3 | 1.85 | 480 | 3 | 2.77 | |||||||||||||||||||||||||||
Long-term debt (f), (g) |
7,020 | 53 | 3.21 | 7,777 | 57 | 3.14 | 7,525 | 53 | 3.02 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total interest-bearing liabilities |
50,354 | 141 | 1.12 | 51,375 | 156 | 1.21 | 55,394 | 182 | 1.31 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Noninterest-bearing deposits |
18,464 | 17,624 | 16,841 | |||||||||||||||||||||||||||||||||
Accrued expense and other liabilities |
2,496 | 2,612 | 2,965 | |||||||||||||||||||||||||||||||||
Discontinued liabilities education lending business (d), (g) |
5,912 | 6,079 | 6,674 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Total liabilities |
77,226 | 77,690 | 81,874 | |||||||||||||||||||||||||||||||||
Equity |
||||||||||||||||||||||||||||||||||||
Key shareholders equity |
9,943 | 9,831 | 11,183 | |||||||||||||||||||||||||||||||||
Noncontrolling interests |
16 | 17 | 247 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Total equity |
9,959 | 9,848 | 11,430 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Total liabilities and equity |
$ | 87,185 | $ | 87,538 | $ | 93,304 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Interest rate spread (TE) |
2.78 | % | 2.72 | % | 2.91 | % | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Net interest income (TE) and net interest margin (TE) |
563 | 3.13 | % | 555 | 3.09 | % | 635 | 3.31 | % | |||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
TE adjustment (b) |
6 | 6 | 6 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
Net interest income, GAAP basis |
$ | 557 | $ | 549 | $ | 629 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
(a) | Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (d) below, calculated using a matched funds transfer pricing methodology. |
(b) | Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%. |
(c) | For purposes of these computations, nonaccrual loans are included in average loan balances. |
(d) | Discontinued liabilities include the liabilities of the education lending business and the dollar amount of any additional liabilities assumed necessary to support the assets associated with this business. |
(e) | Yield is calculated on the basis of amortized cost. |
(f) | Rate calculation excludes basis adjustments related to fair value hedges. |
(g) | A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying our matched funds transfer pricing methodology to discontinued operations. |
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 19
Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations
(dollars in millions)
Twelve months ended December 31, 2011 | Twelve months ended December 31, 2010 | |||||||||||||||||||||||
Average Balance |
Interest(a) | Yield/Rate(a) | Average Balance |
Interest(a) | Yield/Rate(a) | |||||||||||||||||||
Assets |
||||||||||||||||||||||||
Loans: (b), (c) |
||||||||||||||||||||||||
Commercial, financial and agricultural |
$ | 17,240 | $ | 702 | 4.07 | % | $ | 17,500 | $ | 813 | 4.64 | % | ||||||||||||
Real estate commercial mortgage |
8,437 | 380 | 4.50 | 10,027 | 491 | 4.90 | ||||||||||||||||||
Real estate construction |
1,677 | 73 | 4.36 | 3,495 | 149 | 4.26 | ||||||||||||||||||
Commercial lease financing |
6,113 | 296 | 4.85 | 6,754 | 352 | 5.21 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total commercial loans |
33,467 | 1,451 | 4.34 | 37,776 | 1,805 | 4.78 | ||||||||||||||||||
Real estate residential mortgage |
1,850 | 97 | 5.25 | 1,828 | 102 | 5.57 | ||||||||||||||||||
Home equity: |
||||||||||||||||||||||||
Key Community Bank |
9,390 | 387 | 4.12 | 9,773 | 411 | 4.20 | ||||||||||||||||||
Other |
598 | 46 | 7.66 | 751 | 57 | 7.59 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total home equity loans |
9,988 | 433 | 4.34 | 10,524 | 468 | 4.45 | ||||||||||||||||||
Consumer other Key Community Bank |
1,167 | 113 | 9.62 | 1,158 | 132 | 11.44 | ||||||||||||||||||
Consumer other: |
||||||||||||||||||||||||
Marine |
1,992 | 125 | 6.28 | 2,497 | 155 | 6.23 | ||||||||||||||||||
Other |
142 | 11 | 7.87 | 188 | 15 | 7.87 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total consumer other |
2,134 | 136 | 6.38 | 2,685 | 170 | 6.34 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total consumer loans |
15,139 | 779 | 5.14 | 16,195 | 872 | 5.39 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total loans |
48,606 | 2,230 | 4.59 | 53,971 | 2,677 | 4.96 | ||||||||||||||||||
Loans held for sale |
387 | 14 | 3.58 | 453 | 17 | 3.62 | ||||||||||||||||||
Securities available for sale (b), (e) |
18,766 | 584 | 3.20 | 18,800 | 646 | 3.50 | ||||||||||||||||||
Held-to-maturity securities (b) |
514 | 12 | 2.35 | 20 | 2 | 10.56 | ||||||||||||||||||
Trading account assets |
878 | 26 | 2.97 | 1,068 | 37 | 3.47 | ||||||||||||||||||
Short-term investments |
2,543 | 6 | .25 | 2,684 | 6 | .24 | ||||||||||||||||||
Other investments (e) |
1,264 | 42 | 3.14 | 1,442 | 49 | 3.08 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total earning assets |
72,958 | 2,914 | 4.02 | 78,438 | 3,434 | 4.39 | ||||||||||||||||||
Allowance for loan and lease losses |
(1,250 | ) | (2,207 | ) | ||||||||||||||||||||
Accrued income and other assets |
10,385 | 11,243 | ||||||||||||||||||||||
Discontinued assets education lending business |
6,203 | 6,677 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total assets |
$ | 88,296 | $ | 94,151 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Liabilities |
||||||||||||||||||||||||
NOW and money market deposit accounts |
$ | 27,001 | 71 | .26 | $ | 25,712 | 91 | .35 | ||||||||||||||||
Savings deposits |
1,958 | 1 | .06 | 1,867 | 1 | .06 | ||||||||||||||||||
Certificates of deposit ($100,000 or more) (f) |
4,931 | 149 | 3.02 | 8,486 | 275 | 3.24 | ||||||||||||||||||
Other time deposits |
7,185 | 166 | 2.31 | 10,545 | 301 | 2.86 | ||||||||||||||||||
Deposits in foreign office |
807 | 3 | .30 | 926 | 3 | .34 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total interest-bearing deposits |
41,882 | 390 | .93 | 47,536 | 671 | 1.41 | ||||||||||||||||||
Federal funds purchased and securities sold under repurchase agreements |
1,981 | 5 | .27 | 2,044 | 6 | .31 | ||||||||||||||||||
Bank notes and other short-term borrowings |
619 | 11 | 1.84 | 545 | 14 | 2.63 | ||||||||||||||||||
Long-term debt (f), (g) |
7,293 | 216 | 3.18 | 7,211 | 206 | 3.09 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total interest-bearing liabilities |
51,775 | 622 | 1.21 | 57,336 | 897 | 1.58 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Noninterest-bearing deposits |
17,381 | 15,856 | ||||||||||||||||||||||
Accrued expense and other liabilities |
2,687 | 3,131 | ||||||||||||||||||||||
Discontinued liabilities education lending business (d), (g) |
6,203 | 6,677 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total liabilities |
78,046 | 83,000 | ||||||||||||||||||||||
Equity |
||||||||||||||||||||||||
Key shareholders equity |
10,133 | 10,895 | ||||||||||||||||||||||
Noncontrolling interests |
117 | 256 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total equity |
10,250 | 11,151 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Total liabilities and equity |
$ | 88,296 | $ | 94,151 | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Interest rate spread (TE) |
2.81 | % | 2.81 | % | ||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Net interest income (TE) and net interest margin (TE) |
2,292 | 3.16 | % | 2,537 | 3.26 | % | ||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
TE adjustment (b) |
25 | 26 | ||||||||||||||||||||||
|
|
|
|
|||||||||||||||||||||
Net interest income, GAAP basis |
$ | 2,267 | $ | 2,511 | ||||||||||||||||||||
|
|
|
|
(a) | Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (d) below, calculated using a matched funds transfer pricing methodology. |
(b) | Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%. |
(c) | For purposes of these computations, nonaccrual loans are included in average loan balances. |
(d) | Discontinued liabilities include the liabilities of the education lending business and the dollar amount of any additional liabilities assumed necessary to support the assets associated with this business. |
(e) | Yield is calculated on the basis of amortized cost. |
(f) | Rate calculation excludes basis adjustments related to fair value hedges. |
(g) | A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying our matched funds transfer pricing methodology to discontinued operations. |
TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 20
Noninterest Income | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Trust and investment services income (a) |
$ | 104 | $ | 107 | $ | 108 | $ | 434 | $ | 444 | ||||||||||
Service charges on deposit accounts |
70 | 74 | 70 | 281 | 301 | |||||||||||||||
Operating lease income |
25 | 30 | 42 | 122 | 173 | |||||||||||||||
Letter of credit and loan fees |
56 | 55 | 51 | 213 | 194 | |||||||||||||||
Corporate-owned life insurance income |
35 | 31 | 42 | 121 | 137 | |||||||||||||||
Net securities gains (losses) |
| | 12 | 1 | 14 | |||||||||||||||
Electronic banking fees |
18 | 33 | 31 | 114 | 117 | |||||||||||||||
Gains on leased equipment |
9 | 7 | 6 | 25 | 20 | |||||||||||||||
Insurance income |
11 | 13 | 12 | 53 | 64 | |||||||||||||||
Net gains (losses) from loan sales |
27 | 18 | 29 | 75 | 76 | |||||||||||||||
Net gains (losses) from principal investing |
(8 | ) | 34 | (6 | ) | 78 | 66 | |||||||||||||
Investment banking and capital markets income (loss) (a) |
24 | 25 | 63 | 134 | 145 | |||||||||||||||
Other income |
43 | 56 | 66 | 157 | 203 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest income |
$ | 414 | $ | 483 | $ | 526 | $ | 1,808 | $ | 1,954 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
(a) Additional detail provided in tables below. |
||||||||||||||||||||
Trust and Investment Services Income | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Brokerage commissions and fee income |
$ | 33 | $ | 34 | $ | 32 | $ | 132 | $ | 134 | ||||||||||
Personal asset management and custody fees |
38 | 37 | 38 | 153 | 149 | |||||||||||||||
Institutional asset management and custody fees |
33 | 36 | 38 | 149 | 161 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total trust and investment services income |
$ | 104 | $ | 107 | $ | 108 | $ | 434 | $ | 444 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Investment Banking and Capital Markets Income (Loss) | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Investment banking income |
$ | 25 | $ | 16 | $ | 33 | $ | 92 | $ | 112 | ||||||||||
Income (loss) from other investments |
3 | 6 | | 21 | 6 | |||||||||||||||
Dealer trading and derivatives income (loss) |
(15 | ) | (8 | ) | 18 | (22 | ) | (16 | ) | |||||||||||
Foreign exchange income |
11 | 11 | 12 | 43 | 43 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total investment banking and capital markets income (loss) |
$ | 24 | $ | 25 | $ | 63 | $ | 134 | $ | 145 | ||||||||||
|
|
|
|
|
|
|
|
|
|
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 21
Noninterest Expense | ||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Personnel (a) |
$ | 387 | $ | 382 | $ | 365 | $ | 1,520 | $ | 1,471 | ||||||||||
Net occupancy |
66 | 65 | 70 | 258 | 270 | |||||||||||||||
Operating lease expense |
18 | 23 | 28 | 94 | 142 | |||||||||||||||
Computer processing |
42 | 40 | 45 | 166 | 185 | |||||||||||||||
Business services and professional fees |
57 | 47 | 56 | 186 | 176 | |||||||||||||||
FDIC assessment |
7 | 7 | 27 | 52 | 124 | |||||||||||||||
OREO expense, net |
5 | 1 | 10 | 13 | 68 | |||||||||||||||
Equipment |
25 | 26 | 26 | 103 | 100 | |||||||||||||||
Marketing |
24 | 16 | 22 | 60 | 72 | |||||||||||||||
Provision (credit) for losses on lending-related commitments |
(11 | ) | (1 | ) | (26 | ) | (28 | ) | (48 | ) | ||||||||||
Other expense |
97 | 86 | 121 | 366 | 474 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total noninterest expense |
$ | 717 | $ | 692 | $ | 744 | $ | 2,790 | $ | 3,034 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Average full-time equivalent employees (b) |
15,381 | 15,490 | 15,424 | 15,381 | 15,610 | |||||||||||||||
(a) Additional detail provided in table below. |
||||||||||||||||||||
(b) The number of average full-time equivalent employees has not been adjusted for discontinued operations. |
| |||||||||||||||||||
Personnel Expense | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Salaries |
$ | 234 | $ | 233 | $ | 232 | $ | 919 | $ | 913 | ||||||||||
Incentive compensation |
82 | 78 | 85 | 306 | 266 | |||||||||||||||
Employee benefits |
55 | 54 | 34 | 229 | 224 | |||||||||||||||
Stock-based compensation |
13 | 11 | 11 | 45 | 52 | |||||||||||||||
Severance |
3 | 6 | 3 | 21 | 16 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total personnel expense |
$ | 387 | $ | 382 | $ | 365 | $ | 1,520 | $ | 1,471 | ||||||||||
|
|
|
|
|
|
|
|
|
|
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 22
Loan Composition | ||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||
Percent change 12-31-11 vs. | ||||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 9-30-11 | 12-31-10 | ||||||||||||||||
Commercial, financial and agricultural |
$ | 19,378 | $ | 17,848 | $ | 16,441 | 8.6 | % | 17.9 | % | ||||||||||
Commercial real estate: |
||||||||||||||||||||
Commercial mortgage |
8,037 | 7,958 | 9,502 | 1.0 | (15.4 | ) | ||||||||||||||
Construction |
1,312 | 1,456 | 2,106 | (9.9 | ) | (37.7 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total commercial real estate loans |
9,349 | 9,414 | 11,608 | (.7 | ) | (19.5 | ) | |||||||||||||
Commercial lease financing |
6,055 | 5,957 | 6,471 | 1.6 | (6.4 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total commercial loans |
34,782 | 33,219 | 34,520 | 4.7 | .8 | |||||||||||||||
Residential prime loans: |
||||||||||||||||||||
Real estate residential mortgage |
1,946 | 1,875 | 1,844 | 3.8 | 5.5 | |||||||||||||||
Home equity: |
||||||||||||||||||||
Key Community Bank |
9,229 | 9,347 | 9,514 | (1.3 | ) | (3.0 | ) | |||||||||||||
Other |
535 | 565 | 666 | (5.3 | ) | (19.7 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total home equity loans |
9,764 | 9,912 | 10,180 | (1.5 | ) | (4.1 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total residential prime loans |
11,710 | 11,787 | 12,024 | (.7 | ) | (2.6 | ) | |||||||||||||
Consumer other Key Community Bank |
1,192 | 1,187 | 1,167 | .4 | 2.1 | |||||||||||||||
Consumer other: |
||||||||||||||||||||
Marine |
1,766 | 1,871 | 2,234 | (5.6 | ) | (20.9 | ) | |||||||||||||
Other |
125 | 131 | 162 | (4.6 | ) | (22.8 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total consumer indirect loans |
1,891 | 2,002 | 2,396 | (5.5 | ) | (21.1 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total consumer loans |
14,793 | 14,976 | 15,587 | (1.2 | ) | (5.1 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total loans (a) |
$ | 49,575 | $ | 48,195 | $ | 50,107 | 2.9 | % | (1.1 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||||||
Loans Held for Sale Composition | ||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||
Percent change 12-31-11 vs. | ||||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 9-30-11 | 12-31-10 | ||||||||||||||||
Commercial, financial and agricultural |
$ | 19 | $ | 29 | $ | 196 | (34.5 | )% | (90.3 | )% | ||||||||||
Real estate commercial mortgage |
567 | 325 | 118 | 74.5 | 380.5 | |||||||||||||||
Real estate construction |
35 | 20 | 35 | 75.0 | | |||||||||||||||
Commercial lease financing |
12 | 26 | 8 | (53.8 | ) | 50.0 | ||||||||||||||
Real estate residential mortgage |
95 | 79 | 110 | 20.3 | (13.6 | ) | ||||||||||||||
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Total loans held for sale (b) |
$ | 728 | $ | 479 | $ | 467 | 52.0 | % | 55.9 | % | ||||||||||
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Summary of Changes in Loans Held for Sale | ||||||||||||||||||||
(dollars in millions) | ||||||||||||||||||||
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | ||||||||||||||||
Balance at beginning of period |
$ | 479 | $ | 381 | $ | 426 | $ | 467 | $ | 637 | ||||||||||
New originations |
1,235 | 853 | 914 | 980 | 1,053 | |||||||||||||||
Transfers from held to maturity, net |
19 | 23 | 16 | 32 | | |||||||||||||||
Loan sales |
(932 | ) | (759 | ) | (1,039 | ) | (991 | ) | (1,174 | ) | ||||||||||
Loan draws (payments), net |
(72 | ) | 1 | 73 | (62 | ) | (49 | ) | ||||||||||||
Transfers to OREO / valuation adjustments |
(1 | ) | (20 | ) | (9 | ) | | | ||||||||||||
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Balance at end of period |
$ | 728 | $ | 479 | $ | 381 | $ | 426 | $ | 467 | ||||||||||
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(a) | Excluded at December 31, 2011, September 30, 2011, and December 31, 2010, are loans in the amount of $5.8 billion, $6.0 billion, and $6.5 billion, respectively, related to the discontinued operations of the education lending business. |
(b) | Excluded at December 31, 2010, are loans held for sale in the amount of $15 million related to the discontinued operations of the education lending business. There were no loans held for sale in the discontinued operations of the education lending business at December 31, 2011, and September 30, 2011. |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 23
Summary of Loan and Lease Loss Experience from Continuing Operations
(dollars in millions)
Three months ended | Twelve months ended | |||||||||||||||||||
12-31-11 | 9-30-11 | 12-31-10 | 12-31-11 | 12-31-10 | ||||||||||||||||
Average loans outstanding |
$ | 48,664 | $ | 48,008 | $ | 50,829 | $ | 48,606 | $ | 53,971 | ||||||||||
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Allowance for loan and lease losses at beginning of period |
$ | 1,131 | $ | 1,230 | $ | 1,957 | $ | 1,604 | $ | 2,534 | ||||||||||
Loans charged off: |
||||||||||||||||||||
Commercial, financial and agricultural |
45 | 31 | 104 | 169 | 565 | |||||||||||||||
Real estate commercial mortgage |
24 | 27 | 73 | 113 | 360 | |||||||||||||||
Real estate construction |
2 | 19 | 49 | 83 | 380 | |||||||||||||||
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Total commercial real estate loans |
26 | 46 | 122 | 196 | 740 | |||||||||||||||
Commercial lease financing |
6 | 10 | 20 | 42 | 88 | |||||||||||||||
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Total commercial loans |
77 | 87 | 246 | 407 | 1,393 | |||||||||||||||
Real estate residential mortgage |
7 | 5 | 11 | 29 | 36 | |||||||||||||||
Home equity: |
||||||||||||||||||||
Key Community Bank |
22 | 25 | 28 | 100 | 123 | |||||||||||||||
Other |
10 | 9 | 13 | 45 | 62 | |||||||||||||||
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Total home equity loans |
32 | 34 | 41 | 145 | 185 | |||||||||||||||
Consumer other Key Community Bank |
11 | 11 | 16 | 45 | 64 | |||||||||||||||
Consumer other: |
||||||||||||||||||||
Marine |
20 | 18 | 25 | 80 | 129 | |||||||||||||||
Other |
2 | 2 | 4 | 9 | 15 | |||||||||||||||
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Total consumer other |
22 | 20 | 29 | 89 | 144 | |||||||||||||||
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Total consumer loans |
72 | 70 | 97 | 308 | 429 | |||||||||||||||
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Total loans charged off |
149 | 157 | 343 | 715 | 1,822 | |||||||||||||||
Recoveries: |
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Commercial, financial and agricultural |
17 | 8 | 24 | 50 | 87 | |||||||||||||||
Real estate commercial mortgage |
1 | 2 | 21 | 10 | 30 | |||||||||||||||
Real estate construction |
8 | 11 | 21 | 27 | 44 | |||||||||||||||
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Total commercial real estate loans |
9 | 13 | 42 | 37 | 74 | |||||||||||||||
Commercial lease financing |
6 | 8 | 8 | 25 | 25 | |||||||||||||||
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Total commercial loans |
32 | 29 | 74 | 112 | 186 | |||||||||||||||
Real estate residential mortgage |
| 1 | | 3 | 2 | |||||||||||||||
Home equity: |
||||||||||||||||||||
Key Community Bank |
2 | 7 | 2 | 11 | 7 | |||||||||||||||
Other |
1 | 1 | | 4 | 3 | |||||||||||||||
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Total home equity loans |
3 | 8 | 2 | 15 | 10 | |||||||||||||||
Consumer other Key Community Bank |
2 | 2 | 2 | 8 | 7 | |||||||||||||||
Consumer other: |
||||||||||||||||||||
Marine |
6 | 7 | 8 | 32 | 43 | |||||||||||||||
Other |
1 | 1 | 1 | 4 | 4 | |||||||||||||||
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Total consumer other |
7 | 8 | 9 | 36 | 47 | |||||||||||||||
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Total consumer loans |
12 | 19 | 13 | 62 | 66 | |||||||||||||||
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Total recoveries |
44 | 48 | 87 | 174 | 252 | |||||||||||||||
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Net loan charge-offs |
(105 | ) | (109 | ) | (256 | ) | (541 | ) | (1,570 | ) | ||||||||||
Provision (credit) for loan and lease losses |
(22 | ) | 10 | (97 | ) | (60 | ) | 638 | ||||||||||||
Foreign currency translation adjustment |
| | | 1 | 2 | |||||||||||||||
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Allowance for loan and lease losses at end of period |
$ | 1,004 | $ | 1,131 | $ | 1,604 | $ | 1,004 | $ | 1,604 | ||||||||||
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Liability for credit losses on lending-related commitments at beginning of period |
$ | 56 | $ | 57 | $ | 99 | $ | 73 | $ | 121 | ||||||||||
Provision (credit) for losses on lending-related commitments |
(11 | ) | (1 | ) | (26 | ) | (28 | ) | (48 | ) | ||||||||||
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Liability for credit losses on lending-related commitments at end of period (a) |
$ | 45 | $ | 56 | $ | 73 | $ | 45 | $ | 73 | ||||||||||
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Total allowance for credit losses at end of period |
$ | 1,049 | $ | 1,187 | $ | 1,677 | $ | 1,049 | $ | 1,677 | ||||||||||
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Net loan charge-offs to average loans |
.86 | % | .90 | % | 2.00 | % | 1.11 | % | 2.91 | % | ||||||||||
Allowance for loan and lease losses to period-end loans |
2.03 | 2.35 | 3.20 | 2.03 | 3.20 | |||||||||||||||
Allowance for credit losses to period-end loans |
2.12 | 2.46 | 3.35 | 2.12 | 3.35 | |||||||||||||||
Allowance for loan and lease losses to nonperforming loans |
138.10 | 143.53 | 150.19 | 138.10 | 150.19 | |||||||||||||||
Allowance for credit losses to nonperforming loans |
144.29 | 150.63 | 157.02 | 144.29 | 157.02 | |||||||||||||||
Discontinued operations education lending business: |
||||||||||||||||||||
Loans charged off |
$ | 31 | $ | 34 | $ | 34 | $ | 138 | $ | 129 | ||||||||||
Recoveries |
6 | 3 | 2 | 15 | 8 | |||||||||||||||
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|||||||||||
Net loan charge-offs |
$ | (25 | ) | $ | (31 | ) | $ | (32 | ) | $ | (123 | ) | $ | (121 | ) | |||||
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(a) | Included in accrued expense and other liabilities on the balance sheet. |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 24
Summary of Nonperforming Assets and Past Due Loans From Continuing Operations
(dollars in millions)
12-31-11 | 9-30-11 | 6-30-11 | 3-31-11 | 12-31-10 | ||||||||||||||||
Commercial, financial and agricultural |
$ | 188 | $ | 188 | $ | 213 | $ | 221 | $ | 242 | ||||||||||
Real estate commercial mortgage |
218 | 237 | 230 | 245 | 255 | |||||||||||||||
Real estate construction |
54 | 93 | 131 | 146 | 241 | |||||||||||||||
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Total commercial real estate loans |
272 | 330 | 361 | 391 | 496 | |||||||||||||||
Commercial lease financing |
27 | 31 | 41 | 42 | 64 | |||||||||||||||
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Total commercial loans |
487 | 549 | 615 | 654 | 802 | |||||||||||||||
Real estate residential mortgage |
87 | 88 | 79 | 84 | 98 | |||||||||||||||
Home equity: |
||||||||||||||||||||
Key Community Bank |
108 | 102 | 101 | 99 | 102 | |||||||||||||||
Other |
12 | 12 | 11 | 13 | 18 | |||||||||||||||
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Total home equity loans |
120 | 114 | 112 | 112 | 120 | |||||||||||||||
Consumer other Key Community Bank |
1 | 4 | 3 | 3 | 4 | |||||||||||||||
Consumer other: |
||||||||||||||||||||
Marine |
31 | 32 | 32 | 31 | 42 | |||||||||||||||
Other |
1 | 1 | 1 | 1 | 2 | |||||||||||||||
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Total consumer other |
32 | 33 | 33 | 32 | 44 | |||||||||||||||
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Total consumer loans |
240 | 239 | 227 | 231 | 266 | |||||||||||||||
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Total nonperforming loans |
727 | 788 | 842 | 885 | 1,068 | |||||||||||||||
Nonperforming loans held for sale |
46 | 42 | 42 | 86 | 106 | |||||||||||||||
OREO |
65 | 63 | 52 | 97 | 129 | |||||||||||||||
Other nonperforming assets |
21 | 21 | 14 | 21 | 35 | |||||||||||||||
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Total nonperforming assets |
$ | 859 | $ | 914 | $ | 950 | $ | 1,089 | $ | 1,338 | ||||||||||
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Accruing loans past due 90 days or more |
$ | 164 | $ | 118 | $ | 118 | $ | 153 | $ | 239 | ||||||||||
Accruing loans past due 30 through 89 days |
441 | 478 | 465 | 474 | 476 | |||||||||||||||
Restructured loans accruing and nonaccruing (a) |
276 | 277 | 252 | 242 | 297 | |||||||||||||||
Restructured loans included in nonperforming loans (a) |
191 | 178 | 144 | 136 | 202 | |||||||||||||||
Nonperforming assets from discontinued operations education lending business |
23 | 22 | 21 | 22 | 40 | |||||||||||||||
Nonperforming loans to period-end portfolio loans |
1.47 | % | 1.64 | % | 1.76 | % | 1.82 | % | 2.13 | % | ||||||||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets |
1.73 | 1.89 | 1.98 | 2.23 | 2.66 |
(a) | Restructured loans (i.e. troubled debt restructurings) are those for which Key, for reasons related to a borrowers 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. |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 25
Summary of Changes in Nonperforming Loans From Continuing Operations
(in millions)
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | ||||||||||||||||
Balance at beginning of period |
$ | 788 | $ | 842 | $ | 885 | $ | 1,068 | $ | 1,372 | ||||||||||
Loans placed on nonaccrual status |
230 | 292 | 410 | 335 | 544 | |||||||||||||||
Charge-offs |
(149 | ) | (157 | ) | (177 | ) | (232 | ) | (343 | ) | ||||||||||
Loans sold |
(28 | ) | (16 | ) | (11 | ) | (74 | ) | (162 | ) | ||||||||||
Payments |
(70 | ) | (125 | ) | (156 | ) | (114 | ) | (250 | ) | ||||||||||
Transfers to OREO |
(12 | ) | (11 | ) | (6 | ) | (12 | ) | (14 | ) | ||||||||||
Transfers to nonperforming loans held for sale |
(19 | ) | (24 | ) | (15 | ) | (39 | ) | (41 | ) | ||||||||||
Transfers to other nonperforming assets |
(4 | ) | (3 | ) | | (2 | ) | (3 | ) | |||||||||||
Loans returned to accrual status |
(9 | ) | (10 | ) | (88 | ) | (45 | ) | (35 | ) | ||||||||||
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Balance at end of period |
$ | 727 | $ | 788 | $ | 842 | $ | 885 | $ | 1,068 | ||||||||||
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Summary of Changes in Nonperforming Loans Held For Sale From Continuing Operations
(in millions)
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | ||||||||||||||||
Balance at beginning of period |
$ | 42 | $ | 42 | $ | 86 | $ | 106 | $ | 230 | ||||||||||
Transfers in |
19 | 24 | 15 | 39 | 41 | |||||||||||||||
Net advances / (payments) |
(3 | ) | (5 | ) | (13 | ) | (20 | ) | (26 | ) | ||||||||||
Loans sold |
(11 | ) | (5 | ) | (37 | ) | (38 | ) | (139 | ) | ||||||||||
Transfers to OREO |
(1 | ) | (19 | ) | (5 | ) | | | ||||||||||||
Valuation adjustments |
| (1 | ) | (4 | ) | (1 | ) | | ||||||||||||
Loans returned to accrual status / other |
| 6 | | | | |||||||||||||||
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Balance at end of period |
$ | 46 | $ | 42 | $ | 42 | $ | 86 | $ | 106 | ||||||||||
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Summary of Changes in Other Real Estate Owned, Net of Allowance, From Continuing Operations
(in millions)
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | ||||||||||||||||
Balance at beginning of period |
$ | 63 | $ | 52 | $ | 97 | $ | 129 | $ | 163 | ||||||||||
Properties acquired nonperforming loans |
13 | 30 | 11 | 12 | 14 | |||||||||||||||
Valuation adjustments |
(4 | ) | (3 | ) | (7 | ) | (11 | ) | (9 | ) | ||||||||||
Properties sold |
(7 | ) | (16 | ) | (49 | ) | (33 | ) | (39 | ) | ||||||||||
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Balance at end of period |
$ | 65 | $ | 63 | $ | 52 | $ | 97 | $ | 129 | ||||||||||
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KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 26
Line of Business Results
(dollars in millions)
Key Community Bank
Percent change 4Q11 vs. | ||||||||||||||||||||||||||||
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | 3Q11 | 4Q10 | ||||||||||||||||||||||
Summary of operations |
||||||||||||||||||||||||||||
Total revenue (TE) |
$ | 546 | $ | 565 | $ | 559 | $ | 565 | $ | 597 | (3.4 | )% | (8.5 | )% | ||||||||||||||
Provision (credit) for loan and lease losses |
30 | 39 | 79 | 11 | 74 | (23.1 | ) | (59.5 | ) | |||||||||||||||||||
Noninterest expense |
477 | 456 | 447 | 446 | 457 | 4.6 | 4.4 | |||||||||||||||||||||
Net income (loss) attributable to Key |
40 | 58 | 34 | 81 | 58 | (31.0 | ) | (31.0 | ) | |||||||||||||||||||
Average loans and leases |
26,406 | 26,270 | 26,242 | 26,312 | 26,436 | .5 | (.1 | ) | ||||||||||||||||||||
Average deposits |
48,076 | 47,672 | 47,719 | 48,108 | 48,124 | .8 | (.1 | ) | ||||||||||||||||||||
Net loan charge-offs |
71 | 60 | 79 | 76 | 115 | 18.3 | (38.3 | ) | ||||||||||||||||||||
Net loan charge-offs to average loans |
1.07 | % | .91 | % | 1.21 | % | 1.17 | % | 1.73 | % | N/A | N/A | ||||||||||||||||
Nonperforming assets at period end |
$ | 415 | $ | 439 | $ | 455 | $ | 475 | $ | 497 | (5.5 | ) | (16.5 | ) | ||||||||||||||
Return on average allocated equity |
5.14 | % | 7.37 | % | 4.28 | % | 10.07 | % | 6.83 | % | N/A | N/A | ||||||||||||||||
Average full-time equivalent employees |
8,633 | 8,641 | 8,504 | 8,378 | 8,291 | (.1 | ) | 4.1 | ||||||||||||||||||||
Supplementary information (lines of business) |
||||||||||||||||||||||||||||
Regional Banking |
||||||||||||||||||||||||||||
Total revenue (TE) |
$ | 430 | $ | 448 | $ | 449 | $ | 448 | $ | 470 | (4.0 | )% | (8.5 | )% | ||||||||||||||
Provision (credit) for loan and lease losses |
54 | 48 | 63 | 17 | 77 | 12.5 | (29.9 | ) | ||||||||||||||||||||
Noninterest expense |
429 | 407 | 398 | 400 | 413 | 5.4 | 3.9 | |||||||||||||||||||||
Net income (loss) attributable to Key |
(18 | ) | 10 | 6 | 33 | 4 | (280.0 | ) | (550.0 | ) | ||||||||||||||||||
Average loans and leases |
17,360 | 17,407 | 17,495 | 17,597 | 17,810 | (.3 | ) | (2.5 | ) | |||||||||||||||||||
Average deposits |
41,226 | 41,204 | 41,710 | 42,189 | 42,371 | .1 | (2.7 | ) | ||||||||||||||||||||
Net loan charge-offs |
59 | 53 | 65 | 62 | 77 | 11.3 | (23.4 | ) | ||||||||||||||||||||
Net loan charge-offs to average loans |
1.35 | % | 1.21 | % | 1.49 | % | 1.43 | % | 1.72 | % | N/A | N/A | ||||||||||||||||
Nonperforming assets at period end |
$ | 287 | $ | 292 | $ | 302 | $ | 294 | $ | 326 | (1.7 | ) | (12.0 | ) | ||||||||||||||
Return on average allocated equity |
(3.27 | )% | 1.80 | % | 1.08 | % | 5.96 | % | .69 | % | N/A | N/A | ||||||||||||||||
Average full-time equivalent employees |
8,258 | 8,275 | 8,138 | 8,009 | 7,930 | (.2 | ) | 4.1 | ||||||||||||||||||||
Commercial Banking |
||||||||||||||||||||||||||||
Total revenue (TE) |
$ | 116 | $ | 117 | $ | 110 | $ | 117 | $ | 127 | (.9 | )% | (8.7 | )% | ||||||||||||||
Provision (credit) for loan and lease losses |
(24 | ) | (9 | ) | 16 | (6 | ) | (3 | ) | N/M | N/M | |||||||||||||||||
Noninterest expense |
48 | 49 | 49 | 46 | 44 | (2.0 | ) | 9.1 | ||||||||||||||||||||
Net income (loss) attributable to Key |
58 | 48 | 28 | 48 | 54 | 20.8 | 7.4 | |||||||||||||||||||||
Average loans and leases |
9,046 | 8,863 | 8,747 | 8,715 | 8,626 | 2.1 | 4.9 | |||||||||||||||||||||
Average deposits |
6,850 | 6,468 | 6,009 | 5,919 | 5,753 | 5.9 | 19.1 | |||||||||||||||||||||
Net loan charge-offs |
12 | 7 | 14 | 14 | 38 | 71.4 | (68.4 | ) | ||||||||||||||||||||
Net loan charge-offs to average loans |
.53 | % | .31 | % | .64 | % | .65 | % | 1.75 | % | N/A | N/A | ||||||||||||||||
Nonperforming assets at period end |
$ | 128 | $ | 147 | $ | 153 | $ | 181 | $ | 171 | (12.9 | ) | (25.1 | ) | ||||||||||||||
Return on average allocated equity |
25.51 | % | 20.59 | % | 11.72 | % | 19.20 | % | 19.86 | % | N/A | N/A | ||||||||||||||||
Average full-time equivalent employees |
375 | 366 | 366 | 369 | 361 | 2.5 | 3.9 |
KeyCorp Reports Fourth Quarter and Full Year 2011
January 24, 2012
Page 27
Line of Business Results (continued) (dollars in millions)
Key Corporate Bank
|
||||||||||||||||||||||||||||||
Percent change 4Q11 vs. |
||||||||||||||||||||||||||||||
4Q11 | 3Q11 | 2Q11 | 1Q11 | 4Q10 | 3Q11 | 4Q10 | ||||||||||||||||||||||||
Summary of operations |
||||||||||||||||||||||||||||||
Total revenue (TE) |
$ | 411 | $ | 368 | $ | 388 | $ | 403 | $ | 434 | 11.7 | % | (5.3 | )% | ||||||||||||||||
Provision (credit) for loan and lease losses |
(61 | ) | (40 | ) | (76 | ) | (21 | ) | (263 | ) | N/M | N/M | ||||||||||||||||||
Noninterest expense |
227 | 216 | 206 | 228 | 240 | 5.1 | (5.4 | ) | ||||||||||||||||||||||
Net income (loss) attributable to Key |
156 | 122 | 163 | 125 | 289 | 27.9 | (46.0 | ) | ||||||||||||||||||||||
Average loans and leases |
17,783 | 16,985 | 17,168 | 17,677 | 18,602 | 4.7 | (4.4 | ) | ||||||||||||||||||||||
Average loans held for sale |
356 | 273 | 302 | 275 | 253 | 30.4 | 40.7 | |||||||||||||||||||||||
Average deposits |
11,162 | 10,544 | 10,195 | 11,282 | 12,766 | 5.9 | (12.6 | ) | ||||||||||||||||||||||
Net loan charge-offs |
12 | 22 | 29 | 75 | 61 | (45.5 | ) | (80.3 | ) | |||||||||||||||||||||
Net loan charge-offs to average loans |
.27 | % | .51 | % | .68 | % | 1.72 | % | 1.30 | % | N/A | N/A | ||||||||||||||||||
Nonperforming assets at period end |
$ | 294 | $ | 326 | $ | 339 | $ | 427 | $ | 575 | (9.8 | ) | (48.9 | ) | ||||||||||||||||
Return on average allocated equity |
30.43 | % | 22.54 | % | 28.61 | % | 19.82 | % | 41.07 | % | N/A | N/A | ||||||||||||||||||
Average full-time equivalent employees |
2,286 | 2,288 | 2,191 | 2,155 | 2,169 | (.1 | ) | 5.4 | ||||||||||||||||||||||
Supplementary information (lines of business) |
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Real Estate Capital and Corporate Banking Services |
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Total revenue (TE) |
$ | 175 | $ | 144 | $ | 154 | $ | 165 | $ | 177 | 21.5 | % | (1.1 | )% | ||||||||||||||||
Provision (credit) for loan and lease losses |
(31 | ) | (38 | ) | (49 | ) | 9 | (211 | ) | N/M | N/M | |||||||||||||||||||
Noninterest expense |
63 | 65 | 49 | 69 | 83 | (3.1 | ) | (24.1 | ) | |||||||||||||||||||||
Net income (loss) attributable to Key |
90 | 74 | 96 | 56 | 192 | 21.6 | (53.1 | ) | ||||||||||||||||||||||
Average loans and leases |
7,445 | 7,088 | 7,713 | 8,583 | 9,381 | 5.0 | (20.6 | ) | ||||||||||||||||||||||
Average loans held for sale |
216 | 173 | 229 | 140 | 199 | 24.9 | 8.5 | |||||||||||||||||||||||
Average deposits |
7,643 | 7,286 | 7,371 | 8,611 | 10,409 | 4.9 | (26.6 | ) | ||||||||||||||||||||||
Net loan charge-offs |
10 | 19 | 26 | 65 | 57 | (47.4 | ) | (82.5 | ) | |||||||||||||||||||||
Net loan charge-offs to average loans |
.53 | % | 1.06 | % | 1.35 | % | 3.07 | % | 2.41 | % | N/A | N/A | ||||||||||||||||||
Nonperforming assets at period end |
$ | 209 | $ | 240 | $ | 245 | $ | 334 | $ | 442 | (12.9 | ) | (52.7 | ) | ||||||||||||||||
Return on average allocated equity |
35.04 | % | 26.47 | % | 31.36 | % | 15.42 | % | 46.14 | % | N/A | N/A | ||||||||||||||||||
Average full-time equivalent employees |
953 | 942 | 902 | 882 | 889 | 1.2 | 7.2 | |||||||||||||||||||||||
Equipment Finance |
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Total revenue (TE) |
$ | 62 | $ | 68 | $ | 63 | $ | 63 | $ | 66 | (8.8 | )% | (6.1 | )% | ||||||||||||||||
Provision (credit) for loan and lease losses |
(15 | ) | (8 | ) | (30 | ) | (26 | ) | (16 | ) | N/M | N/M | ||||||||||||||||||
Noninterest expense |
48 | 45 | 45 | 52 | 52 | 6.7 | (7.7 | ) | ||||||||||||||||||||||
Net income (loss) attributable to Key |
18 | 20 | 30 | 23 | 19 | (10.0 | ) | (5.3 | ) | |||||||||||||||||||||
Average loans and leases |
4,680 | 4,619 | 4,545 | 4,621 | 4,656 | 1.3 | .5 | |||||||||||||||||||||||
Average loans held for sale |
10 | 7 | | 4 | | 42.9 | N/M | |||||||||||||||||||||||
Average deposits |
9 | 11 | 12 | 6 | 2 | (18.2 | ) | 350.0 | ||||||||||||||||||||||
Net loan charge-offs |
(1 | ) | (1 | ) | 2 | 10 | 7 | | (114.3 | ) | ||||||||||||||||||||
Net loan charge-offs to average loans |
(.08 | )% | (.09 | )% | .18 | % | .88 | % | .60 | % | N/A | N/A | ||||||||||||||||||
Nonperforming assets at period end |
$ | 41 | $ | 31 | $ | 39 | $ | 44 | $ | 68 | 32.3 | (39.7 | ) | |||||||||||||||||
Return on average allocated equity |
24.80 | % | 25.76 | % | 37.96 | % | 28.53 | % | 22.04 | % | N/A | N/A | ||||||||||||||||||
Average full-time equivalent employees |
517 | 511 | 511 | 521 | 529 | 1.2 | (2.3 | ) | ||||||||||||||||||||||
Institutional and Capital Markets |
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Total revenue (TE) |
$ | 174 | $ | 156 | $ | 171 | $ | 175 | $ | 191 | 11.5 | % | (8.9 | )% | ||||||||||||||||
Provision (credit) for loan and lease losses |
(15 | ) | 6 | 3 | (4 | ) | (36 | ) | (350.0 | ) | N/M | |||||||||||||||||||
Noninterest expense |
116 | 106 | 112 | 107 | 105 | 9.4 | 10.5 | |||||||||||||||||||||||
Net income (loss) attributable to Key |
48 | 28 | 37 | 46 | 78 | 71.4 | (38.5 | ) | ||||||||||||||||||||||
Average loans and leases |
5,658 | 5,278 | 4,910 | 4,473 | 4,565 | 7.2 | 23.9 | |||||||||||||||||||||||
Average loans held for sale |
130 | 93 | 73 | 131 | 54 | 39.8 | 140.7 | |||||||||||||||||||||||
Average deposits |
3,510 | 3,247 | 2,812 | 2,665 | 2,355 | 8.1 | 49.0 | |||||||||||||||||||||||
Net loan charge-offs |
3 | 4 | 1 | | (3 | ) | (25.0 | ) | N/M | |||||||||||||||||||||
Net loan charge-offs to average loans |
.21 | % | .30 | % | .08 | % | | (.26 | )% | N/A | N/A | |||||||||||||||||||
Nonperforming assets at period end |
$ | 44 | $ | 55 | $ | 55 | $ | 49 | $ | 65 | (20.0 | ) | (32.3 | ) | ||||||||||||||||
Return on average allocated equity |
26.19 | % | 15.22 | % | 20.05 | % | 24.61 | % | 38.73 | % | N/A | N/A | ||||||||||||||||||
Average full-time equivalent employees |
816 | 835 | 778 | 752 | 751 | (2.3 | ) | 8.7 |
TE = Taxable Equivalent, N/A = Not Applicable, N/M = Not Meaningful