01—Abstract
Summary
Summary of the 10-Q filed May 6, 2025. Cited figures are marked; the original filing is the authoritative source.
KeyCorp reported net income from continuing operations attributable to Key common shareholders of $370 milliona, or diluted EPS of $0.33, for the first quarter of 2025, compared with $183 million in the first quarter of 2024.
Net interest income (TE) was $1.1 billionb and the net interest margin was 2.58%, up from 2.02% a year earlier, reflecting lower deposit costs, reinvestment of securities cash flows, and a shift toward lower-cost deposits as wholesale borrowings declined. Average loans were $104.4 billion, down $6.7 billion year over year, reflecting tepid client loan demand, while average deposits rose $5.7 billion to $148.5 billion. Noninterest income was $668 million and noninterest expense was $1.1 billion.
Asset quality was stable. Net loan charge-offs were 0.43% of average loans, the low end of the company's 40 to 60 basis point long-term target range, and nonperforming loans fell to $686 millionc from $758 million at year-end 2024. The provision for credit losses rose to $118 million from $101 million, citing higher net charge-offs and economic uncertainty.
Common Equity Tier 1 was an estimated 11.8% at March 31, 2025. The Board authorized a $1.0 billiond share repurchase program, with purchases expected to begin in the second half of 2025, and the company did not repurchase open-market shares in the first quarter.
Management's 2025 business outlook calls for ending loans flat versus year-end 2024, net interest income (TE) up roughly 20% for full year 2025, adjusted noninterest income up 5% or more, and adjusted noninterest expense up 3% to 5%. The filing also highlights a $4.9 billion parent-company cash and short-term investment balance, uninsured deposits of $65.2 billion (43% of total deposits), and ongoing regulatory developments affecting the CFPB and CRA rules.
02—Key points
Key Highlights
- Net income from continuing operations attributable to Key common shareholders of $370 million; diluted EPS of $0.33, versus $0.20 in the first quarter of 2024.
- Net interest margin of 2.58%, up 56 basis points year over year; net interest income (TE) increased $219 million to about $1.1 billion.
- Average loans fell $6.7 billion to $104.4 billion, while average deposits rose $5.7 billion to $148.5 billion.
- Net loan charge-offs of 0.43% of average loans; nonperforming loans declined to $686 million from $758 million at December 31, 2024.
- Common Equity Tier 1 ratio of an estimated 11.8% at March 31, 2025, with all capital ratios above regulatory requirements.
- Board authorized a $1.0 billion share repurchase program; no open-market repurchases in the first quarter, with purchases expected to begin in the second half of 2025.
- 2025 guidance: ending loans flat versus year-end 2024, net interest income (TE) up about 20% for full year 2025, and adjusted noninterest expense up 3% to 5%.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed May 6, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $1.77B$1.53B | +15.7% |
| Operating Income | $406.00M$219.00M | +85.4% |
| Net Income | $405.00M$219.00M | +84.9% |
| EPS (Basic) | $0.34$0.20 | +70.0% |
| EPS (Diluted) | $0.33$0.20 | +65.0% |
| Shares Outstanding (Basic) | 1.10B929.69M | +18.0% |
| Shares Outstanding (Diluted) | 1.11B937.01M | +18.0% |
05—Questions
Frequently Asked Questions
How did KeyCorp's net interest margin change in the first quarter of 2025?
The net interest margin was 2.58% in the first quarter of 2025, up 56 basis points from 2.02% in the first quarter of 2024. The filing attributes the increase mainly to lower deposit costs, reinvestment of maturing low-yielding securities and fixed-rate loans into higher-yielding assets, the repositioning of the available-for-sale portfolio in late 2024, and a funding mix shift toward lower-cost deposits as wholesale borrowings declined.
Is KeyCorp's loan book growing?
Not on an average basis. Average loans were $104.4 billion in the first quarter of 2025, down $6.7 billion from a year earlier, reflecting tepid client loan demand and declines in both commercial and consumer loans. Period-end loans were $104.8 billion at March 31, 2025, up from $104.3 billion at December 31, 2024, and management's 2025 outlook calls for ending loans to be flat versus year-end 2024.
What is the status of KeyCorp's credit quality?
Credit metrics were stable to improving. Net loan charge-offs were 0.43% of average loans, at the low end of the 40 to 60 basis point long-term target range, and nonperforming loans fell to $686 million from $758 million at year-end 2024. The provision for credit losses increased to $118 million from $101 million, driven by higher net charge-offs and uncertainty in the economic outlook.
What capital return plans does KeyCorp have?
The Board authorized a share repurchase program of up to $1.0 billion of common shares in March 2025. No open-market repurchases were completed in the first quarter, and the company intends to begin repurchasing under the program in the second half of 2025, depending on market conditions, stock price, and regulatory and liquidity requirements. KeyCorp also paid a quarterly common dividend of $.205 per share in the first quarter.
06—Continue