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KEY · KeyCorp

30 filings

10-K

KEY 10-K Annual Reports

KeyCorp - 30 annual reports

Filing record · 2016–202610-K1110-Q348-K141

2025
KeyCorp Annual Report, Year Ended Dec 31, 2025
KeyCorp reported record full-year 2025 revenue, with net interest income and fee revenue both growing faster than projected, as stated in its 10-K filed February 23, 2026. Net income attributable to Key common shareholders was $1.69 billion ($1.53 per common share), compared with a loss of $304 million in 2024, which had included an $1.8 billion securities repositioning loss. Total noninterest income rose to $2.84 billion from $809 million, and net interest income (taxable-equivalent) reached $4.67 billion, up $861 million, with the net interest margin at 2.69%, up 53 basis points. Credit quality remained stable: net charge-offs were 41 basis points for the year, and nonperforming loans fell to $615 million from $758 million. The provision for credit losses rose to $471 million from $335 million, driven by reserve builds tied to economic uncertainty and loan growth. Average loans declined to $105.7 billion as consumer loans ran off, while commercial loans grew 6.4% at year end to $76.5 billion. Total assets were $184.4 billion at December 31, 2025. Capital ratios were strong, with a Common Equity Tier 1 ratio of 11.78% and a Tier 1 risk-based ratio of 13.46%. The board authorized a $1.0 billion share repurchase program in March 2025, and repurchases began in the fourth quarter, totaling $200 million. Quarterly dividends were held at $0.205 per share. Scotiabank holds approximately 14.9% of common shares and may designate up to two directors. Management's 2026 outlook calls for revenue up about 7% and net interest income up 8 to 10%.
Feb 23, 2026
2024
KeyCorp Annual Report, Year Ended Dec 31, 2024
KeyCorp reported a 2024 net loss of $161 million, or a loss of $0.32 per common share from continuing operations attributable to common shareholders, driven primarily by a $1.8 billion pre-tax loss on the sale of securities available for sale as part of a strategic repositioning of its securities portfolio. Excluding that repositioning, the filing presents adjusted noninterest income of $2.645 billion and adjusted noninterest expense of $4.520 billion. Net interest income (TE) was $3.81 billion, down $133 million from 2023, with the net interest margin at 2.16%. Average loans declined to $107.7 billion from $118.0 billion, and total loans at year-end were $104.3 billion, while deposits rose to $149.8 billion. The balance sheet was strengthened by Scotiabank's strategic minority investment of approximately $2.8 billion, completed in two closings in August and December 2024, which gave Scotiabank about 14.9% of common shares outstanding. Total assets were $187.2 billion at year-end. The Common Equity Tier 1 ratio rose to 11.92% from 10.02%, tangible book value per common share increased to $11.70 from $10.02, and the tangible common equity ratio rose to 7.0% from 5.1%. KeyCorp did not repurchase shares in the open market in 2024 and has no Board-approved repurchase authorizations outstanding; the quarterly dividend remained $0.205 per share. The filing also outlines 2025 guidance on an operating basis: average loans down 2% to 5%, ending loans flat versus year-end 2024, net interest income (TE) up about 20%, adjusted noninterest income up 5% or more, and adjusted noninterest expense up 3% to 5%. Net charge-offs were 0.41% of average loans in 2024, and nonperforming loans rose to $758 million from $574 million.
Feb 21, 2025
2023
KeyCorp Annual Report, Year Ended Dec 31, 2023
KeyCorp reported consolidated total assets of approximately $188.3 billion at December 31, 2023, and net income attributable to Key of $967 million for 2023, down from $1.917 billion in 2022. Net interest income (TE) was $3.9 billion, with a net interest margin of 2.17%, down 47 basis points from the prior year, driven by higher interest-bearing deposit costs and a shift in funding mix to higher-cost deposits and borrowings. Noninterest income was $2.5 billion, down from $2.7 billion, while noninterest expense rose to $4.7 billion from $4.4 billion, including a $190 million FDIC special assessment tied to the 2023 bank failures. The provision for credit losses was $489 million versus $502 million in 2022, and net loan charge-offs rose to 0.21% of average loans from 0.14%. Total loans declined to $112.6 billion from $119.4 billion, reflecting planned balance sheet optimization, while deposits grew to $145.6 billion. Common Equity Tier 1 and Tier 1 risk-based capital ratios were 10.02% and 11.67%, respectively, and all capital ratios exceeded regulatory requirements. Moody's, S&P, and Fitch each downgraded KeyCorp's and KeyBank's long-term debt ratings during 2023. For 2024, management guides to average loans down 5% to 7%, net interest income (TE) down 2% to 5%, and noninterest income up 5% or more, with noninterest expense relatively stable. The filing also discloses a $10 million SEC settlement over off-channel communications record-keeping, a pending Gurevitch securities class action filed in August 2023, and related shareholder derivative suits. Annual dividends were $0.82 per common share for 2023, and the share repurchase authorization expired September 30, 2023 without open-market repurchases in the fourth quarter.
Feb 22, 2024
2022
KeyCorp Annual Report, Year Ended Dec 31, 2022
KeyCorp reported consolidated total assets of approximately $189.8 billion at December 31, 2022, and operates through KeyBank National Association across two business segments, Consumer Bank and Commercial Bank, with 972 full-service retail branches in 15 states. For 2022, the company reported net income attributable to Key of $1.917 billion, compared with $2.625 billion in 2021, and income from continuing operations of $1.911 billion. Net interest income was $4.527 billion on a GAAP basis, and noninterest income was $2.718 billion, down from $3.194 billion, with investment banking and debt placement fees falling by $299 million, or 31.9%, as capital markets activity slowed. The provision for credit losses was a net charge of $502 million, compared with a net benefit of $418 million in 2021, driven mainly by reserve increases tied to the economic outlook and loan growth. Loan growth was the main driver of the balance sheet. Total loans from continuing operations reached $119.4 billion, up from $101.9 billion, while deposits declined by $10.0 billion to $142.6 billion. Wholesale funding rose to $28.8 billion from $12.8 billion. Shareholders' equity fell to $13.454 billion from $17.423 billion, largely due to a $5.709 billion decline in other comprehensive income from unrealized losses on securities and derivatives. Common Equity Tier 1 and Tier 1 risk-based capital ratios were 9.10% and 10.60%, respectively, and all regulatory capital ratios exceeded requirements. Management stated it expects positive operating leverage in 2023, expects noninterest expense to be relatively stable, and expects noninterest income to decline 1% to 3%. The annual dividend increased to $.79 per common share for 2022, reflecting a quarterly rate of $.205 in the fourth quarter. No common shares were repurchased during 2022 under the existing authorization, and approximately $790 million remained available under the authorization through the third quarter of 2023. The filing also notes that net loan charge-offs fell to 0.14% of average loans, with 2023 guidance of 25 to 30 basis points.
Feb 22, 2023
2021
KeyCorp Annual Report, Year Ended Dec 31, 2021
KeyCorp (KEY), a bank holding company headquartered in Cleveland, Ohio, reported consolidated total assets of approximately $186.3 billion at December 31, 2021. Its principal subsidiary, KeyBank, operates 999 full-service retail banking branches and 1,317 ATMs across 15 states, and the company runs two business segments, Consumer Bank and Commercial Bank. Net income attributable to Key was $2.63 billion in 2021 (diluted EPS of $2.63), up from $1.34 billion in 2020. The provision for credit losses was a net benefit of $418.0 million in 2021, compared with a $1.0 billion expense in 2020, driven by a $602 million reserve release, improved economic outlook, and lower net charge-offs. Net interest income rose to $4.07 billion (GAAP), with the TE net interest margin declining to 2.50% from 2.77%, reflecting elevated liquidity and lower reinvestment yields. Noninterest income rose to $3.2 billion from $2.7 billion, with investment banking and debt placement fees increasing 41.8% to $937 million, and noninterest expense was $4.4 billion versus $4.1 billion. Average deposits grew $17.7 billion to $145.0 billion, and total deposits reached $152.6 billion at year-end. Management guided for 2022 TE net interest income and average loans to be relatively stable or up 1% to 3%, noninterest income and noninterest expense each to be down 1% to 3%, and an effective tax rate of approximately 20%. Capital and shareholder returns remained strong: Common Equity Tier 1 ratio was 9.48% under the Regulatory Capital Rules, and the company returned 75% of 2021 net income to shareholders through dividends and repurchases, including $1.2 billion of gross common share repurchases. The full-year dividend was $0.75 per share, and the company has authorization to repurchase up to $1.5 billion under its 2021 capital plan. Credit quality improved, with net loan charge-offs of 0.18% of average loans and nonperforming loans at 0.45% of period-end portfolio loans.
Feb 22, 2022
2020
KeyCorp Annual Report, Year Ended Dec 31, 2020
KeyCorp reported consolidated total assets of approximately $170.3 billion at December 31, 2020, and operates through two business segments, Consumer Bank and Commercial Bank, with 1,073 full-service KeyBank branches across 15 states. Net income attributable to Key was $1.343 billion in 2020, down from $1.717 billion in 2019. Net interest income was $4.034 billion, while the provision for credit losses rose to $1.021 billion from $445 million, reflecting the COVID-19 pandemic and the January 1, 2020 adoption of CECL. Noninterest income increased to $2.652 billion from $2.459 billion, and noninterest expense rose to $4.109 billion from $3.901 billion. Net interest margin (TE) declined to 2.77% from 3.04%. Capital remained above regulatory requirements at year-end, with a Common Equity Tier 1 ratio of 9.73% and a Tier 1 risk-based capital ratio of 11.11%. KeyCorp repurchased $170 million of common shares in 2020 and then suspended repurchases from March 17, 2020 in response to the pandemic. The Federal Reserve restricted capital distributions for the third and fourth quarters of 2020 and extended those limits into the first quarter of 2021. In January 2021, the Board authorized up to $900 million in share repurchases, effective through the third quarter of 2021. The full-year dividend was $.74 per share, up from $.71 in 2019. Management guided for 2021 with expectations of relatively stable TE net interest income, average loans relatively stable, average deposits up 1% to 3%, noninterest income up 1% to 3%, and noninterest expense down 1% to 3%. Net loan charge-offs are expected to be in the range of 50 to 60 basis points, and the GAAP tax rate is expected to be approximately 19%.
Feb 22, 2021
2019
KeyCorp Annual Report, Year Ended Dec 31, 2019
KeyCorp reported consolidated total assets of approximately $145.0 billion at December 31, 2019, and operates as a bank holding company through KeyBank National Association, with two business segments, Consumer Bank and Commercial Bank. For 2019, net income attributable to Key was $1.717 billion, compared with $1.866 billion in 2018, and income from continuing operations attributable to Key was $1.708 billion. Net interest income was flat at $3.909 billion, while noninterest income fell to $2.459 billion from $2.515 billion. Noninterest expense declined to $3.901 billion from $3.975 billion, with the company citing completion of a $200 million cost reduction program. The provision for credit losses rose to $445 million from $246 million, primarily reflecting a $139 million loss from a previously disclosed fraud incident. Capital and shareholder returns remained central to the filing. The Common Equity Tier 1 ratio was 9.44% at year end, and the company repurchased $868 million of common shares during 2019. The full-year dividend was $0.71 per share, compared with $0.565 in 2018. Book value per common share rose to $15.54 from $13.90. Management guided for 2020 tax-equivalent net interest income to rise 1% to 3%, and disclosed that Christopher Gorman will succeed Beth Mooney as Chairman and Chief Executive Officer effective May 1, 2020. The company also disclosed that it expects to adopt the CECL accounting standard on January 1, 2020, with its allowance for loan and lease losses expected to increase by approximately 20% to 25%. The filing also highlights the company's exposure to commercial real estate and commercial and industrial loans, which together represent a large share of the loan book, and the ongoing transition from LIBOR to alternative reference rates. Key's regulatory position as a Category IV firm under the Tailoring Rules reduces some compliance requirements. Investors should weigh the year's flat revenue and the higher credit provision against the company's continued capital return and efficiency gains.
Feb 26, 2020
2018
KeyCorp Annual Report, Year Ended Dec 31, 2018
KeyCorp (KEY) reported consolidated total assets of approximately $139.6 billion at December 31, 2018, operating through two business segments, Key Community Bank and Key Corporate Bank, with 1,159 branches and 1,505 ATMs across 15 states. For 2018, net income attributable to Key was $1.866 billion, compared with $1.296 billion in 2017, and income from continuing operations attributable to Key common shareholders was $1.793 billion. Diluted EPS from continuing operations was $1.70, up from $1.12. The filing attributes the earnings improvement largely to the Tax Cuts and Jobs Act, which lowered the effective tax rate to 15.6% from 33.0%, alongside a record $6.4 billion in total revenue and a cash efficiency ratio of 60.0%, down from 63.5%. Capital position and shareholder returns were central to 2018. The Common Equity Tier 1 ratio was 9.93% and Tier 1 risk-based capital was 11.08%, both above regulatory requirements. KeyCorp repurchased $1.145 billion of common shares during 2018 under its capital plans, and the full-year dividend rose to $.565 per common share from $.38. Management's 2019 outlook calls for TE net interest income of $4.0 billion to $4.1 billion, noninterest expense of $3.85 billion to $3.95 billion, and a GAAP tax rate of 18% to 19%. Key risks flagged in the filing include pending adoption of ASU 2016-13 (current expected credit losses), which management says will generally increase the allowance for credit losses, though the quantitative impact cannot yet be reasonably estimated. Commercial and industrial loans rose to $45.8 billion, and commercial loans make up 74% of the portfolio. Net loan charge-offs were .26% of average loans, below the company's 40% to 60 basis point target range, and nonperforming loans were $542 million.
Feb 25, 2019
2017
KeyCorp Annual Report, Year Ended Dec 31, 2017
KeyCorp, organized in 1958 under Ohio law and headquartered in Cleveland, is a bank holding company and one of the nation's largest bank-based financial services companies, with consolidated total assets of $137.7 billion at December 31, 2017. Its principal subsidiary, KeyBank, operates through two segments, Key Community Bank and Key Corporate Bank, with 1,197 full-service retail branches and 1,572 ATMs in 15 states. Net income attributable to Key for 2017 was $1.30 billion, up from $791 million in 2016, though the filing notes that the Tax Cuts and Jobs Act increased the tax provision by $147 million, and that the 2017 year reflects the full-year impact of the First Niagara acquisition completed August 1, 2016. Key's 2017 results show growth in net interest income to $3.78 billion from $2.92 billion, with net interest margin (TE) of 3.17% versus 2.92% in 2016, and noninterest income of $2.48 billion versus $2.07 billion. Noninterest expense rose to $4.10 billion, including $217 million of merger-related charges. Return on average tangible common equity was 10.84% (13.14% excluding notable items), and the cash efficiency ratio was 63.5% (60.2% excluding notable items). Net loan charge-offs were .24% of average loans, and nonperforming loans declined to $503 million from $625 million. Common Equity Tier 1 was 10.16% at year end, and the company repurchased $730 million of common shares during 2017. Looking ahead, management's 2018 guidance calls for net interest income of $3.9 billion to $4.0 billion, noninterest income of $2.5 billion to $2.6 billion, and noninterest expense of $3.85 billion to $3.95 billion, with a GAAP tax rate of 18% to 19%. Management also revised its long-term targets beginning in 2018 to a cash efficiency ratio of 54% to 56%, net loan charge-offs of .40% to .60% of average loans, and a return on tangible common equity of 15% to 18%.
Feb 26, 2018
2016
KeyCorp Annual Report, Year Ended Dec 31, 2016
KeyCorp, organized in 1958 under Ohio law and headquartered in Cleveland, reported consolidated total assets of $136.5 billion at December 31, 2016. Its results for 2016 were shaped by the August 1, 2016 merger with First Niagara, which contributed approximately $23 billion of period-end loans and $27.3 billion of period-end deposits, and by merger-related charges. Income from continuing operations attributable to Key common shareholders was $753 million, or $.80 per common share (assuming dilution), compared with $892 million, or $1.05, in 2015. Noninterest expense rose to $3.76 billion, including $465 million of merger-related charges, and the cash efficiency ratio was 73.7%, compared with a long-term target below 60%. Revenue grew: net interest income was $2.919 billion, up from $2.348 billion, and noninterest income was $2.071 billion, up 10.2%. Credit quality remained solid, with net loan charge-offs of .29% of average loans and nonperforming loans of $625 million, or .73% of period-end loans, up from $387 million. Capital ratios stayed above requirements, with a Common Equity Tier 1 ratio of 9.54% and a pro forma fully phased-in ratio of 9.43%. The Board declared a $.085 quarterly dividend for the second through fourth quarters of 2016, and management said it will consider raising the dividend to up to $.095 in the second quarter of 2017. For 2017, management expects net interest income of $3.6 billion to $3.7 billion, noninterest income of $2.3 billion to $2.4 billion, and noninterest expense of $3.65 billion to $3.75 billion, excluding merger-related charges. It also anticipates mid-single-digit average loan and deposit growth of 4% to 6%.
Feb 28, 2017
2015
KeyCorp Annual Report, Year Ended Dec 31, 2015
KeyCorp (KEY), headquartered in Cleveland, Ohio, reported total assets of $95.1 billion at December 31, 2015, operating through two major segments, Key Community Bank and Key Corporate Bank, with 966 full-service retail branches across 12 states. For 2015, income from continuing operations attributable to Key common shareholders was $892 million, or $1.05 per diluted common share, compared with $917 million, or $1.04, in 2014. Net interest income was $2.348 billion and noninterest income rose 4.6% to $1.88 billion, while noninterest expense increased 2.9% to $2.84 billion. The provision for credit losses rose to $166 million from $57 million, reflecting loan growth and lower recoveries, though net loan charge-offs remained at .24% of average loans. Capital ratios remained strong, with an estimated Common Equity Tier 1 ratio of 10.94% under the current rules and a Tier 1 risk-based capital ratio of 11.35%. KeyCorp repurchased $460 million of common shares during 2015, but suspended its 2015 capital plan repurchase program in the fourth quarter due to the pending acquisition of First Niagara. The quarterly common dividend increased to $.075 per share during 2015, with an additional potential increase to $.085 per share under consideration for 2016. The dominant event for investors is the October 30, 2015 agreement to acquire First Niagara Financial Group, Inc., in which each First Niagara common share converts into 0.680 of a KeyCorp share plus $2.30 in cash; the filing values the consideration at approximately $4.1 billion and expects closing in the third quarter of 2016, subject to regulatory and shareholder approvals. S&P and Fitch affirmed KeyCorp's ratings but revised the outlook to negative, and Moody's placed the ratings under review for downgrade.
Feb 24, 2016
2014
KeyCorp Annual Report, Year Ended Dec 31, 2014
KeyCorp reported net income attributable to Key of $900 million for 2014, or $.99 per common share on a diluted basis, with income from continuing operations attributable to Key common shareholders of $917 million, or $1.04 per diluted share. Taxable-equivalent net interest income was $2.3 billion and the net interest margin was 2.97%, down from 3.12% in 2013 due to lower earning asset yields. Noninterest income rose to $1.8 billion, led by a record year for investment banking and debt placement fees of $397 million, while noninterest expense fell to $2.8 billion. Consolidated total assets were $93.8 billion at December 31, 2014, and the company is a bank holding company whose principal subsidiary is KeyBank National Association. Asset quality improved through 2014. The provision for loan and lease losses declined to $59 million from $130 million, net loan charge-offs fell to .20% of average loans, and nonperforming assets decreased. The allowance for loan and lease losses was $794 million, or 1.38% of period-end loans. The Common Equity Tier 1 ratio under the Regulatory Capital Rules was estimated at 10.7%, and the Tier 1 common equity ratio was 11.17%. Capital return remained a priority. Key repurchased $496 million of common shares during 2014 and increased its quarterly dividend 18% to $.065 per share, bringing the 2014 annual dividend to $.25. The filing states that the Federal Reserve is still reviewing the 2015 capital plan under CCAR, and that Key cannot implement capital actions beyond the first quarter of 2015 until the review is complete. Management expects 2015 net interest income growth in the low- to mid-single-digit percentage range and mid-single-digit average loan growth.
Mar 2, 2015
2013
KeyCorp Annual Report, Year Ended Dec 31, 2013
KeyCorp (KEY) reported its 2013 results in this Form 10-K, filed February 26, 2014. The company is a bank holding company headquartered in Cleveland, Ohio, with consolidated total assets of $92.9 billion at December 31, 2013, operating 1,028 full-service retail branches across 12 states through its principal subsidiary, KeyBank National Association. Its two business segments are Key Community Bank and Key Corporate Bank. For 2013, income from continuing operations attributable to Key common shareholders was $847 million, or $.93 per common share, compared with $813 million, or $.86 per share, in 2012. Net income attributable to Key was $910 million. Credit quality and capital were central to the year. Net loan charge-offs fell to $168 million, or .32% of average loans, from $345 million, or .69%, in 2012. Nonperforming loans declined to $508 million, or .93% of period-end loans. The allowance for loan and lease losses was $848 million, or 1.56% of period-end loans. The Tier 1 common equity ratio was 11.22%, and the company estimated a Common Equity Tier 1 ratio of 10.7% under the Basel III Regulatory Capital Rules. Key returned approximately 76% of 2013 net income to shareholders through buybacks and dividends, and it completed $474 million of open market common share repurchases during 2013. The filing also reports a net interest margin of 3.12%, down nine basis points from 2012, which management attributes to lower asset yields and elevated liquidity. Noninterest income was $1.8 billion, down 4.8%, and noninterest expense was $2.8 billion, roughly flat. Management reported annualized run-rate savings of $241 million from its efficiency initiative. The Federal Reserve's 2014 CCAR review was pending at the time of filing, and Key stated it could not implement its capital plan beyond the first quarter of 2014 until the review was complete.
Feb 26, 2014
2012
KeyCorp Annual Report, Year Ended Dec 31, 2012
KeyCorp (KEY) reported its 2012 annual results on Form 10-K filed February 26, 2013. The company, a bank holding company headquartered in Cleveland with consolidated total assets of $89.2 billion at December 31, 2012, earned net income attributable to Key of $858 million for 2012, or $.89 per common share, compared to $920 million in 2011. Income from continuing operations attributable to Key common shareholders was $827 million, or $.88 per share. Net interest income was flat at $2.26 billion, while noninterest income rose 8.8% to $1.97 billion, and noninterest expense rose 4.2% to $2.91 billion. The company's provision for loan and lease losses was $229 million, compared with a credit of $60 million in 2011, but net loan charge-offs fell to $345 million (.69% of average loans) from $541 million. Asset quality continued to improve, with nonperforming loans declining to $674 million (1.28% of period-end loans) and the allowance for loan and lease losses at $888 million (1.68% of loans). Capital ratios remained strong, with a Tier 1 common equity ratio of 11.36% and a Tier 1 risk-based capital ratio of 12.15%. The company returned approximately 50% of net income to shareholders through dividends and share repurchases, and it used its capital to acquire 37 branches in Western New York and Elan Financial's Key-branded credit card assets in 2012. Key also noted that the Federal Reserve's 2013 CCAR review and the phase-in of Basel III and Dodd-Frank capital rules are key near-term uncertainties, and it disclosed an agreement announced February 21, 2013 to sell its Victory Capital Management business for $246 million.
Feb 26, 2013
2011
KeyCorp Annual Report, Year Ended Dec 31, 2011
KeyCorp, organized in 1958 under Ohio law and headquartered in Cleveland, is a bank holding company with consolidated total assets of $89 billion at December 31, 2011. Its principal subsidiary, KeyBank, operates through two segments, Key Community Bank and Key Corporate Bank, with 1,058 full-service branches in 14 states and 15,381 average full-time equivalent employees for 2011. The filing reports that KeyCorp returned to profitability in 2010 and remained profitable throughout 2011, with net income attributable to Key of $920 million for 2011 and net income attributable to Key common shareholders of $813 million, or $.87 per diluted common share. Income from continuing operations attributable to Key common shareholders was $857 million, or $.92 per common share, compared with $413 million, or $.47, in 2010. The improvement was attributed mainly to lower credit costs, with a negative provision for loan and lease losses of $60 million in 2011 versus a $638 million provision in 2010. Asset quality improved during 2011. Net loan charge-offs fell to $541 million, or 1.11% of average loans, from $1.6 billion, or 2.91%, in 2010. Nonperforming loans declined to $727 million, and nonperforming assets to $859 million. The allowance for loan and lease losses was $1.0 billion, or 2.03% of period-end loans. Capital ratios were strong, with a Tier 1 common equity ratio of 11.26% and a tangible common equity ratio of 9.88%. Management reported a net interest margin of 3.16% for 2011, down ten basis points, and an efficiency ratio of 68%, while the company remains focused on the long-term goals it lists, including a return on average assets of 1.00% to 1.25%. Key risks flagged in the filing include the Dodd-Frank Act and Basel III capital and liquidity rules, which will phase out trust preferred securities as Tier 1 capital starting January 1, 2013. Other risks include the European sovereign debt crisis, a slow U.S. economic recovery, commercial real estate exposure, and pending litigation tied to Austin Capital Management (Madoff-related claims of up to approximately $186 million in investment losses). The company also announced a January 2012 agreement to acquire 37 retail branches in Buffalo and Rochester, New York, with approximately $2.4 billion in deposits and $400 million in loans, and it has submitted a 2012-2013 capital plan that is still under Federal Reserve review.
Feb 27, 2012
2010
KeyCorp Annual Report, Year Ended Dec 31, 2010
KeyCorp (KEY), headquartered in Cleveland, Ohio, reported a return to profitability in 2010 after a large loss in 2009. Net income attributable to Key was $554 million for 2010, compared with a net loss of $1.335 billion in 2009. Net income attributable to Key common shareholders was $390 million, or $.44 per diluted common share, compared with a loss of $2.34 per share in 2009. The company cites three consecutive profitable quarters, higher pre-provision net revenue, and a lower provision for loan and lease losses ($638 million in 2010 versus $3.159 billion in 2009). Total assets were $91.8 billion at December 31, 2010. Nonperforming assets fell to $1.338 billion from $2.510 billion, and the allowance for loan and lease losses declined to $1.604 billion from $2.534 billion. Capital and liquidity improved during the year. The Tier 1 common equity ratio rose to 9.34% from 7.50%, and the Tier 1 risk-based capital ratio reached 15.16%. The company also cites a net interest margin of 3.26% for 2010, up 43 basis points, driven mainly by lower funding costs and a shift toward lower-cost deposits. The filing flags continuing risks, including a Moody's downgrade of KeyBank's ratings on November 1, 2010, the phase-out of trust preferred securities as Tier 1 capital starting January 1, 2013, the U.S. Treasury's $2.5 billion Series B Preferred Stock and warrant, and the possibility of further commercial real estate deterioration. The company also reports a planned leadership transition, with Beth E. Mooney set to become Chairman and CEO on May 1, 2011, and a multi-year cost program (Keyvolution) targeting $300 million to $375 million of run-rate savings by the end of 2012, with $228 million achieved as of December 31, 2010. Pending litigation includes shareholder derivative suits and an ERISA case, which the company says it intends to defend vigorously.
Feb 24, 2011
2009-A
KeyCorp Annual Report (Amendment), Year Ended Dec 31, 2009
This KeyCorp amendment to its 2009 Form 10-K corrects specific items and is limited solely to those corrections. It amends Item 8 (Financial Statements and Supplementary Data) and Item 9A (Controls and Procedures), and it updates Part IV, Item 15, with currently dated Sarbanes-Oxley certifications. The consolidated financial statements themselves are not reproduced here. They are incorporated by reference from the Financial Review section of KeyCorp's 2009 Annual Report to Shareholders, filed as Exhibit 13. Management concluded that KeyCorp's disclosure controls and procedures were effective, in all material respects, as of the end of the period covered by the report. The filing states that no changes were made to internal control over financial reporting during the last fiscal quarter that materially affected, or were reasonably likely to materially affect, those controls. Management's Annual Report on Internal Control Over Financial Reporting, along with the Ernst & Young LLP report on it, is incorporated by reference from the Annual Report and is also reproduced in Exhibit 99.4. Ernst & Young's report in Exhibit 99.3 states that the 2009 consolidated financial statements present fairly, in all material respects, KeyCorp's financial position and results, and that the company maintained effective internal control over financial reporting as of December 31, 2009. The exhibit index lists management compensation and benefit plans, including executive and director compensation arrangements, along with the certifications under Sections 302 and 906 and the Ernst & Young consent. Most of these exhibits are incorporated by reference from KeyCorp's Form 10-K filed March 1, 2010. The report is signed by Robert L. Morris, Executive Vice President and Chief Accounting Officer, on August 6, 2010.
Aug 9, 2010
2009
KeyCorp Annual Report, Year Ended Dec 31, 2009
KeyCorp, organized in Ohio and headquartered in Cleveland, is a bank holding company with consolidated total assets of $93.3 billion at December 31, 2009, operating through KeyBank National Association with 1,007 full-service retail branches in fourteen states and 1,495 ATMs in sixteen states. The company reported a net loss attributable to Key of $1.335 billion, or $2.34 per common share, for 2009, compared with a net loss of $1.468 billion, or $3.36 per share, in 2008. The loss was driven mainly by a provision for loan losses of $3.159 billion (up from $1.537 billion), noncash intangible asset impairment charges of $241 million, and commercial real estate write-downs. Net interest income was $2.380 billion and noninterest income was $2.035 billion, while noninterest expense rose to $3.554 billion. Capital and liquidity were strengthened during 2009 in response to the Supervisory Capital Assessment Program, which required $1.8 billion of additional Tier 1 common equity. Through an at-the-market common stock offering, preferred stock and capital securities exchanges, and other actions, the company reported Tier 1 common equity in excess of $2.4 billion and a Tier 1 common equity ratio of 7.50% at year end, compared with 5.62% a year earlier. The Tier 1 risk-based capital ratio was 12.75% and the total risk-based capital ratio was 16.95%. Nonperforming assets rose to $2.5 billion, or 4.25% of portfolio loans plus OREO and other nonperforming assets, and net loan charge-offs were $2.257 billion, or 3.40% of average loans. Investors should note that the company's ability to return capital is constrained. The common dividend was reduced to $.01 per quarter in 2009, the U.S. Treasury holds $2.5 billion of Series B Preferred Stock with a warrant for 35,244,361 common shares, and KeyBank could not pay dividends to the parent without regulatory approval because of its net losses. The company also disclosed that its long-term debt is rated investment grade, with Moody's downgrading certain KeyCorp capital securities and Series A Preferred Stock on February 17, 2010.
Mar 1, 2010
2008
KeyCorp Annual Report, Year Ended Dec 31, 2008
KeyCorp, headquartered in Cleveland, Ohio, reported a 2008 net loss of $1.468 billion, or $3.36 per common share, compared with net income of $919 million, or $2.32 per diluted common share, in 2007. Three primary factors drove the decline: a $1.011 billion after-tax charge in the second quarter from an adverse federal tax court ruling on leveraged lease financing transactions, a $1.306 billion increase in the provision for loan losses, and a $420 million after-tax noncash goodwill impairment charge tied to the National Banking unit. Total assets reached $104.531 billion at year-end, while total shareholders' equity rose to $10.480 billion, supported by $4.242 billion of new capital raised during 2008, including $2.5 billion of Series B Preferred Stock sold to the U.S. Treasury under the Capital Purchase Program. Tier 1 and total risk-based capital ratios were 10.92% and 14.82%, respectively. Asset quality deteriorated sharply. Net loan charge-offs were $1.260 billion, or 1.67% of average loans, and nonperforming assets rose to $1.464 billion, or 1.91% of portfolio loans, OREO and other nonperforming assets. Management expects nonperforming loans to keep rising in 2009. The company's exit loan portfolio, which includes residential homebuilder loans and marine and RV floor-plan lending, accounted for 44% of net charge-offs in the second half of 2008. The net interest margin fell 130 basis points to 2.16%, largely due to the leveraged lease tax charges. Common dividends were cut twice during 2008, and the CPP terms restrict dividend increases and share repurchases for three years. Looking ahead, the filing flags several risks: the Treasury's Capital Assistance Program requires stress testing for banks with more than $100 billion in assets, which could force capital raises that dilute common shareholders; the Series B Preferred dividend rises from 5% to 9% after five years; and KeyBank cannot pay dividends to the parent without regulatory approval because of its 2008 net loss of $1.161 billion. The parent held $4.756 billion in short-term investments at year-end, and the company reported that Moody's and Standard & Poor's ratings for KeyCorp were under review, with S&P lowering its senior debt rating to BB on February 24, 2009.
Feb 27, 2009
2007
KeyCorp Annual Report, Year Ended Dec 31, 2007
KeyCorp (KEY), headquartered in Cleveland, Ohio, is one of the nation's largest bank-based financial services companies, with consolidated total assets of $100.0 billion at December 31, 2007. It operates through KeyBank National Association across two business groups, Community Banking and National Banking, with 955 full-service retail branches in thirteen states at year end. KeyCorp reported 2007 income from continuing operations of $941 million, or $2.38 per diluted share, and net income of $919 million, or $2.32 per diluted share, compared with $1.193 billion ($2.91 per share) from continuing operations in 2006. Results were affected by a $254 million provision for loan losses in excess of net charge-offs, a $64 million charge for its potential liability to Visa Inc., a $49 million securities repositioning loss, and a $171 million gain from the sale of the McDonald Investments branch network. Net interest margin declined to 3.46% from 3.67%, and nonperforming assets rose to $764 million. The filing highlights growing stress in the commercial real estate portfolio, particularly residential construction lending in Florida and southern California, and volatility in fixed income markets since July 2007. Management expects a 2008 net interest margin of around 3.30%, net loan charge-offs of .60% to .70% of average loans, and an effective tax rate of around 32%. The company completed the acquisition of U.S.B. Holding Co., Inc. (Union State Bank) on January 1, 2008, and KeyCorp's Tier 1 risk-based capital ratio was 7.44% at year end, with total risk-based capital at 11.38%. The quarterly dividend was increased to $.375 per share effective with the March 2008 payment. Investors should note the pending IRS litigation over lease financing transactions, which management says could carry an after-tax interest cost of up to $420 million if resolved adversely.
Feb 28, 2008
2006
KeyCorp Annual Report, Year Ended Dec 31, 2006
KeyCorp, headquartered in Cleveland, Ohio, reported total assets of $92.3 billion at December 31, 2006, and describes itself as one of the nation's largest bank-based financial services companies. It operates through two business groups, Community Banking and National Banking, with 950 KeyCenters across sixteen states and an average of 20,006 full-time equivalent employees in 2006. Income from continuing operations before the cumulative effect of an accounting change was $1.193 billion, or $2.91 per diluted share, which the filing describes as the highest level of earnings in the company's history. Net income was $1.055 billion, or $2.57 per diluted share, after a $143 million loss from discontinued operations tied to the Champion Mortgage divestiture, which included a $170 million goodwill write-off. The balance sheet and capital position were stable. Total deposits were $59.1 billion, and the Tier 1 risk-based capital ratio was 8.24%, the total risk-based capital ratio 12.43%, and the leverage ratio 8.98%. The filing reports net loan charge-offs of .26% of average loans from continuing operations, the lowest since 1995, and nonperforming assets of $273 million. Management repurchased 17.5 million common shares during 2006, and in January 2007 the Board authorized repurchase of 25.0 million additional shares and raised the quarterly dividend 5.8% to $.365. The company also disclosed a regulatory consent order from the OCC and a memorandum of understanding with the Federal Reserve Bank of Cleveland related to Bank Secrecy Act compliance, with no fine or civil money penalty imposed. Recent portfolio actions shaped 2006 results. Key sold the $2.5 billion nonprime Champion Mortgage loan portfolio in November 2006 and agreed to sell its origination platform, and on February 9, 2007 it sold the McDonald Investments branch network to UBS Financial Services for cash proceeds of approximately $219 million. The filing also notes a pending settlement with Swiss Reinsurance America Corporation, under which Swiss Re will pay Key $279 million in 2007, producing a one-time gain of approximately $26 million.
Feb 28, 2007
2005
KeyCorp Annual Report, Year Ended Dec 31, 2005
KeyCorp (KEY) reported record 2005 net income of $1.129 billion, or $2.73 per diluted common share, up from $954 million, or $2.30 per share, in 2004. Return on average equity was 15.42% for 2005, compared with 13.75% for 2004. Total revenue rose by $334 million, or 7%, driven by growth in net interest income, fee-based businesses and higher net gains from loan sales. Average commercial loans grew 19%, and the net interest margin improved 6 basis points to 3.69%. Total assets were $93.1 billion at December 31, 2005, and the company operated 947 KeyCenters across sixteen states. Asset quality improved during the year. Nonperforming loans and nonperforming assets each fell to their lowest level in eleven years, and net loan charge-offs were $315 million, or .49% of average loans. Noninterest expense grew 6% to $3.137 billion, reflecting expanded business activity, compliance spending and a $30 million lease accounting charge. Tier 1 risk-based capital was 7.59% and total risk-based capital was 11.47% at year end, and KeyBank National Association qualified as well capitalized. The filing also discloses regulatory and compliance matters. In October 2005, KBNA entered a consent order with the OCC, and KeyCorp entered a memorandum of understanding with the Federal Reserve Bank of Cleveland, both concerning Bank Secrecy Act compliance. Neither regulator imposed a fine or civil money penalty. The filing also describes an ongoing residual value insurance litigation against Swiss Re and an IRS challenge to lease financing deductions for tax years 1995 through 2000.
Feb 28, 2006
2004
KeyCorp Annual Report, Year Ended Dec 31, 2004
KeyCorp, headquartered in Cleveland, Ohio, reported consolidated total assets of $90.7 billion at December 31, 2004, and described itself as one of the nation's largest bank-based financial services companies. It operated 935 KeyCenters and 2,194 ATMs in seventeen states, with an average of 19,576 full-time equivalent employees in 2004. Net income for 2004 was $954 million, or $2.30 per diluted common share, compared with $903 million, or $2.12 per share, in 2003. Return on average equity was 13.75%, compared with 13.08% in 2003. Net interest income fell to $2.64 billion, reflecting a 16 basis point decline in the net interest margin to 3.64%. Noninterest income was $1.75 billion, roughly flat year over year. Results were affected by a fourth-quarter 2004 loss of $46 million on the sale of the broker-originated home equity loan portfolio and the reclassification of the indirect automobile loan portfolio to held-for-sale status, and by a $55 million goodwill write-off tied to the decision to exit the nonprime indirect automobile business. Those actions reduced 2004 results by $78 million ($77 million after tax), or $.19 per common share. Asset quality improved, with nonperforming loans at their lowest level since September 30, 1995, and net loan charge-offs of $431 million, or .67% of average loans. The company repurchased 16.5 million common shares in 2004 and raised its quarterly dividend to $.325 in January 2005. Acquisitions completed in 2004 included American Express Business Finance Corporation, EverTrust Financial Group and ten branch offices of Sterling Bank & Trust FSB. Tier 1 risk-based capital was 7.22% and total risk-based capital was 11.47% at year end, and KeyBank National Association was classified as well capitalized. Management also disclosed an ongoing residual value insurance lawsuit against Swiss Re, in which total claims filed were approximately $379 million.
Feb 28, 2005
2003
KeyCorp Annual Report, Year Ended Dec 31, 2003
KeyCorp, organized in 1958 under Ohio law and headquartered in Cleveland, reported consolidated total assets of $84.5 billion at December 31, 2003, and described itself as one of the nation's largest bank-based financial services companies. Its three major business groups are Consumer Banking, Corporate and Investment Banking, and Investment Management Services, served through 906 KeyCenters, a telephone banking call center group and 2,167 ATMs in 17 states. Net income for 2003 was $903 million, or $2.12 per diluted common share, compared with $976 million, or $2.27 per share, in 2002. Return on average equity was 13.08% for 2003, versus 14.96% for 2002. The filing shows improving asset quality alongside weak revenue growth. Nonperforming loans were at their lowest level since March 31, 2001, and net loan charge-offs were $548 million, or .87% of average loans, down from $780 million, or 1.23%, in 2002. Taxable-equivalent net interest income fell $73 million, or 3%, as the net interest margin contracted 17 basis points to 3.80%, while noninterest income was essentially unchanged at $1.76 billion. Management cited weak commercial loan demand and the June 2003 Federal Reserve rate cut. Average core deposits grew more than 10% over the past twelve months. Capital remained strong, with a Tier 1 risk-based capital ratio of 8.35%, a total risk-based capital ratio of 12.57%, and a leverage ratio of 8.55% at year-end. Tangible equity to tangible assets was 6.94%. The quarterly dividend was raised to $.31 in January 2004, the thirty-ninth consecutive annual increase, and 11.5 million common shares were repurchased during 2003 at an average price of $26.33.
Mar 12, 2004
2002
KeyCorp Annual Report, Year Ended Dec 31, 2002
KeyCorp, headquartered in Cleveland, Ohio, is a bank holding company that reported consolidated total assets of $85.2 billion at December 31, 2002, operating through three major business groups: Key Consumer Banking, Key Corporate Finance and Key Capital Partners, with 910 full-service KeyCenters and 2,165 ATMs in 17 states. Net income for 2002 was $976 million, or $2.27 per diluted common share, compared with $132 million, or $.31 per share, in 2001, when results were burdened by $1.1 billion of pre-tax charges. Net interest margin rose to 3.97% from 3.81%, while average earning assets fell 4% to $72.3 billion, and noninterest expense declined 10% to $2.7 billion, the lowest since 1998, following completion of the competitiveness initiative. Credit quality remained a key focus. Net loan charge-offs were $780 million, or 1.23% of average loans, and nonperforming assets totaled $993 million, or 1.59% of loans, OREO and other nonperforming assets, up from $947 million, or 1.49%, a year earlier. The allowance for loan losses was $1.5 billion, or 2.32% of loans. Capital ratios remained above well-capitalized thresholds, with a Tier 1 risk-based capital ratio of 8.09%, a total risk-based capital ratio of 12.51% and a leverage ratio of 8.15% at year-end. Assets under management declined to $61.7 billion from $72.7 billion, reflecting market declines and net outflows of approximately $4.1 billion. The filing also flags risks for investors, including an ongoing Internal Revenue Service challenge to certain leveraged lease investments, litigation over residual value insurance with Reliance Insurance Company, and the expected adoption of FIN 46 on variable interest entities, which management says will most significantly affect the balance sheet. Dividends were raised to $.305 per quarter from $.30 in early 2003.
Mar 21, 2003
2001
KeyCorp Annual Report, Year Ended Dec 31, 2001
KeyCorp, headquartered in Cleveland, Ohio, reported a sharp decline in 2001 earnings driven by significant core charges. Net income for 2001 was $132 million, or $.31 per diluted common share, compared with $1.002 billion, or $2.30 per share, in 2000. Core net income was $320 million, or $.74 per share, against $1.009 billion, or $2.32 per share, in 2000. The decline reflected a provision for loan losses of $1.350 billion for the year, a $150 million goodwill write-down tied to downsizing the automobile finance business, and weaker capital markets-sensitive businesses. Total assets were $80.9 billion at December 31, 2001, and total shareholders' equity was $6.2 billion, down $468 million from 2000. Nonperforming assets rose to $947 million, and the allowance for loan losses reached $1.677 billion, or 2.65% of loans. Management described strategic actions taken in May and December 2001, including exiting automobile leasing, de-emphasizing indirect prime auto lending, and eliminating nonrelationship leveraged and syndicated lending. The competitiveness initiative is expected to reach an annual savings rate of approximately $360 million by the end of 2002, and the workforce is expected to shrink by about 4,000 positions by the end of the first quarter of 2002. Capital ratios remained above regulatory well-capitalized thresholds, with a Tier 1 risk-based capital ratio of 7.43% and a total risk-based capital ratio of 11.41% at year end. The quarterly dividend was increased to $.30 per share, effective with the March 2002 payment. The filing also discloses material legal matters, including the Reliance Insurance residual value litigation, where KeyBank has filed claims of about $89 million through December 31, 2001, and the NSM securities litigation, where a January 2002 insurance settlement was disputed by the carriers. Management believes the settlement is valid.
Mar 28, 2002
2000
KeyCorp Annual Report, Year Ended Dec 31, 2000
KeyCorp, headquartered in Cleveland, Ohio, reported consolidated total assets of $87 billion at December 31, 2000, operating 922 full-service branches in 13 states and 22,142 full-time equivalent employees. Net income was $1.002 billion, or $2.30 per diluted common share, compared with $1.107 billion, or $2.45, in 1999. Core net income was $1.009 billion, or $2.32 per common share, and management estimates that excluding divested businesses and securitization gains, core earnings per diluted share rose 10% to $2.30 from $2.10. The results include a $332 million gain from the January 2000 sale of the credit card portfolio, $127 million of restructuring and other special charges tied to a three-year competitiveness initiative, and a $490 million provision for loan losses, up from $348 million in 1999. Net charge-offs were $414 million, or .63% of average loans, and nonperforming assets rose to $672 million from $473 million. The company's capital position is described as strong, with a Tier 1 risk-adjusted capital ratio of 7.72% and a total risk-adjusted capital ratio of 11.48% at year end. Key repurchased 22,652,800 common shares during 2000 and increased its quarterly dividend 5.4% to $.295 in January 2001. Management says the 2001 business climate is more challenging than 2000, citing industry-wide credit quality issues tied to a slowing U.S. economy. The Form 10-K incorporates most financial detail by reference to the 2000 Annual Report to Shareholders, which is included as Exhibit 13. Leadership transitioned in February 2001 when Robert W. Gillespie retired as chief executive officer and Henry L. Meyer III succeeded him. The filing also discloses a pending legal matter in which McDonald Investments Inc. is defending eight lawsuits by purchasers of Nakornthai Strip Mill Public Company securities, with at least $257 million of securities alleged to have been purchased.
Mar 22, 2001
1999
KeyCorp Annual Report, Year Ended Dec 31, 1999
KeyCorp, organized in Ohio and headquartered in Cleveland, reported in its 1999 Form 10-K that it was one of the nation's largest integrated multi-line financial services companies, with consolidated total assets of $83 billion at December 31, 1999. Net income for 1999 was $1.107 billion, or $2.45 per diluted common share, up 11% from $996 million in 1998. Return on average total assets was 1.37% and return on average total equity was 17.68%. Excluding significant nonrecurring items, core net income was $1.051 billion, or $2.33 per diluted share. Results were driven by fee-generating businesses, particularly investment banking, dealer trading, asset management and brokerage, and core noninterest income rose 31% to represent 41% of total core revenue. Management announced a three-year initiative in the fourth quarter of 1999 expected to improve pre-tax earnings by more than $370 million per year when fully implemented, including a planned reduction of about 3,000 positions, or 11%, by year-end 2000. Key also sold its Long Island business (28 KeyCenters with $1.3 billion of deposits) and completed the sale of its $1.3 billion credit card portfolio in January 2000, which the filing says will generate a $332 million pre-tax gain. The company expects its shift away from securitizing home equity loans to reduce 2000 diluted earnings per share by approximately $.08. The filing also discloses litigation against McDonald Investments Inc., a subsidiary acquired in 1998, relating to Nakornthai Strip Mill securities. Eight lawsuits seek at least $257 million in securities purchases, and management says it is vigorously defending the actions. Capital ratios remained above the well-capitalized thresholds, with a Tier 1 risk-adjusted capital ratio of 7.68% and a total risk-adjusted capital ratio of 11.66% at December 31, 1999.
Mar 22, 2000
1995
KeyCorp Annual Report, Year Ended Dec 31, 1995
KeyCorp (KEY), a Cleveland, Ohio bank holding company with consolidated total assets of approximately $66.3 billion at December 31, 1995, reported 1995 net income of $825.0 million, or $3.45 per Common Share, essentially flat with $853.5 million, or $3.45 per share, in 1994. The return on average common equity was 17.35% in 1995 versus 18.87% in 1994, and the return on average total assets was 1.24% versus 1.36%. Management described 1995 as a transition year: net interest income fell $58.1 million, or 2%, as the net interest margin declined to 4.47% from 4.83%, while noninterest income rose $50.4 million, or 6%, and noninterest expense rose $144.4 million, or 7%. Results included an extraordinary net gain of $35.8 million after tax from the sale of the residential mortgage servicing business, and net securities losses of $40.6 million for the year, largely tied to a balance sheet reconfiguration. The filing describes a strategic plan launched in 1994 organized around four lines of business: Corporate Banking, National Consumer Finance, Community Banking and Key PrivateBank. During 1995 the company acquired AutoFinance Group, Inc. and Spears, Benzak, Salomon & Farrell, Inc., completed three bank acquisitions, and agreed to sell Society First Federal Savings Bank, expected to close in the second quarter of 1996. Capital remained above regulatory minimums, with a Tier I risk-adjusted capital ratio of 7.53%, a total risk-adjusted ratio of 10.85%, and a leverage ratio of 6.20% at December 31, 1995. The board approved a new repurchase program of up to 12 million Common Shares in January 1996, and the quarterly dividend was raised 5.6% to $.38 per share. Credit quality was stable, with net loan charge-offs of $99.2 million in 1995 (0.21% of average loans) versus $109.2 million in 1994, and a provision for loan losses of $100.5 million, down from $125.2 million. Nonperforming assets totaled $378.6 million, or 0.79% of loans, OREO and other nonperforming assets, compared with $339.8 million, or 0.73%, a year earlier. The filing states that management does not believe pending legal actions will have a material adverse effect on consolidated financial condition.
Mar 28, 1996
1993
KeyCorp Annual Report, Year Ended Dec 31, 1993
Society Corporation (filed as Society Corporation; the merged company assumed the name KeyCorp, now KeyCorp) reported record 1993 net income of $347.2 million, or $2.93 per Common Share, up from $301.2 million, or $2.51, in 1992. Results were absorbed after $53.9 million in fourth-quarter merger and integration charges tied to the March 1, 1994 merger with old KeyCorp of Albany, New York, which had about $33 billion in assets. Society itself had about $27 billion in assets at December 31, 1993, and reported a return on average common equity of 17.87% and a net interest margin of 5.26%. Because the merger was accounted for as a pooling of interests and occurred after year-end, the core financial statements reflect Society alone, while supplemental statements on pages 65 through 94 present the combined company, which had net income of $709.9 million for 1993 and total assets of $59.6 billion at year-end. Credit quality improved substantially during 1993. The provision for loan losses fell to $72.2 million from $147.4 million, and nonperforming assets dropped to $224.4 million from $496.9 million, a decline the filing describes as 55%. Net interest income rose 5% to $1.2 billion, helped by a larger earning asset base that included the January 1993 acquisition of Society First Federal. Noninterest expense rose 5% to $1.1 billion, largely reflecting merger charges. Management expects roughly $100 million in annual cost savings from the old KeyCorp merger by the end of the first quarter of 1995, with about 50% achieved in 1994. Capital remained strong, with a Tier I risk-adjusted capital ratio of 8.65%, a total risk-adjusted capital ratio of 12.88%, and a leverage ratio of 7.18%, all of which the filing says place Society well capitalized. The company paid cash dividends of $1.12 per share in 1993, and the quarterly dividend was raised to $.32 per share in January 1994. Shareholders' equity reached $2.04 billion at Society and $4.39 billion on a combined basis.
Mar 31, 1994