KeyCorp Fourth-Quarter Results Top Expectations
January 19 2017 - 7:49AM
Dow Jones News
By Joshua Jamerson
Regional lender KeyCorp on Wednesday said revenue climbed again
in the fourth quarter, thanks in part to its recent acquisition of
First Niagara Financial Group Inc., as a key measure of lending
profitability expanded.
The Cleveland-based bank reported net income of $229 million, or
19 cents a share, for the quarter, compared with $226 million, or
26 cents a share, a year earlier. Excluding merger-related costs,
KeyCorp earned 31 cents a share.
Revenue rose 43% to $1.57 billion. Analysts polled by Thomson
Reuters expected earnings of 29 cents a share on $1.45 billion in
revenue.
KeyCorp, which last year acquired First Niagara for about $4.1
billion, said net interest income rose 55% to $948 million,
reflecting the benefit from the acquisition and ongoing business
activity.
Noninterest income rose 27% to $618 million, helped by
investment banking and debt placement fees, as well as service
charges on deposit accounts.
Like many other lenders, KeyCorp has moved to cut costs and has
closed some branches. Deal-related costs added up to $207 million
in the quarter. Excluding merger-related charges, noninterest
expenses rose 39% from a year ago, reflecting the impact of adding
in First Niagara.
KeyCorp's net interest margin -- a gauge of lending
profitability that measures how much a bank earns from the
difference between what it pays on deposits and what it takes in on
loans and investments -- was 3.09% in the fourth quarter, up from
2.83% in the prior quarter and from 2.84% a year ago.
KeyCorp shares, which have risen 40% in the past three months,
were inactive premarket.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
January 19, 2017 07:34 ET (12:34 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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