CLEVELAND, July 20, 2021 /PRNewswire/ -- KeyCorp (NYSE: KEY)
today announced net income from continuing operations attributable
to Key common shareholders of $698
million, or $.72 per diluted
common share for the second quarter of 2021. This compared to
$591 million, or $.61 per diluted common share, for the first
quarter of 2021 and $159 million, or
$.16 per diluted common share, for
the second quarter of 2020.
Our results this quarter reflect the success of our
productive, client-centric team, strong risk management practices,
and momentum from recent investments in both our teammates and
digital capabilities.
We generated record second quarter revenue, driven by growth
in both our commercial and consumer businesses, as we acquired and
deepened relationships across our franchise. Our fee-based
businesses reported another strong quarter, with noninterest income
up 8% year-over-year. Our investment banking business generated
record fees for the second quarter. Furthermore, our investment
banking revenue in the second quarter represents the second-highest
quarter in our history. With broad-based growth across our targeted
industry verticals and continued investments in our teammates, our
investment banking business has delivered a decade of consistent
growth.
Credit quality remained strong this quarter, with lower
nonperforming loans and net charge-offs as a percent of loans of 9
basis points. Our positive credit trends reflect our strong risk
culture and disciplined underwriting practices. Our capital
position also continues to be one of our strengths, with a Common
Equity Tier 1 ratio of 9.9% at the end of the quarter. Earlier this
month, our Board of Directors approved a new share repurchase
authorization of up to $1.5 billion
and will evaluate an increase to the common stock dividend in the
fourth quarter 2021.
- Chris
Gorman, Chairman and CEO
Selected Financial
Highlights
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dollars in
millions, except per share data
|
|
|
|
|
Change 2Q21
vs.
|
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
698
|
|
$
|
591
|
|
$
|
159
|
|
|
18.1
|
%
|
339.0
|
%
|
Income (loss) from
continuing operations attributable to Key common shareholders
per
common share — assuming
dilution
|
.72
|
|
.61
|
|
.16
|
|
|
18.0
|
|
350.0
|
|
Return on average
tangible common equity from continuing operations
(a)
|
22.34
|
%
|
18.25
|
%
|
4.96
|
%
|
|
N/A
|
N/A
|
Return on average
total assets from continuing operations
|
1.63
|
|
1.44
|
|
.45
|
|
|
N/A
|
N/A
|
Common Equity Tier 1
ratio (b)
|
9.9
|
|
9.9
|
|
9.1
|
|
|
N/A
|
N/A
|
Book value at period
end
|
$
|
16.75
|
|
$
|
16.22
|
|
$
|
16.07
|
|
|
3.3
|
%
|
4.2
|
%
|
Net interest margin
(TE) from continuing operations
|
2.52
|
%
|
2.61
|
%
|
2.76
|
%
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
(a)
|
The table entitled
"GAAP to Non-GAAP Reconciliations" in the attached financial
supplement presents the computations of certain financial measures
related to "Return on average tangible common equity from
continuing operations." The table reconciles the GAAP performance
measures to the corresponding non-GAAP measures, which provides a
basis for period-to-period comparisons.
|
(b)
|
June 30, 2021
ratio is estimated.
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TE = Taxable
Equivalent, N/A = Not Applicable
|
INCOME STATEMENT
HIGHLIGHTS
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Revenue
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dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Net interest income
(TE)
|
$
|
1,023
|
|
$
|
1,012
|
|
$
|
1,025
|
|
|
1.1
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%
|
(.2)
|
%
|
Noninterest
income
|
750
|
|
738
|
|
692
|
|
|
1.6
|
|
8.4
|
|
Total
revenue
|
$
|
1,773
|
|
$
|
1,750
|
|
$
|
1,717
|
|
|
1.3
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%
|
3.3
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%
|
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|
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|
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|
Taxable-equivalent net interest income was $1.0 billion for the second quarter of 2021, a
decrease of $2 million from the
second quarter of 2020. The decrease in net interest income
reflects a decrease in the net interest margin, largely offset by
higher earning asset balances. The net interest margin was impacted
by lower interest rates and a change in balance sheet mix,
including elevated levels of liquidity.
Compared to the first quarter of 2021, taxable-equivalent net
interest income increased by $11
million, and the net interest margin decreased by 9 basis
points. Both net interest income and the net interest margin were
impacted by higher earning asset balances, including elevated
levels of liquidity, lower interest-bearing deposit costs, and
higher loan fees from the Paycheck Protection Program ("PPP")
forgiveness, partially offset by lower earning asset yields. Net
interest income also benefited from one additional day in the
second quarter of 2021.
Noninterest
Income
|
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dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Trust and investment
services income
|
$
|
133
|
|
$
|
133
|
|
$
|
123
|
|
|
—
|
%
|
8.1
|
%
|
Investment banking
and debt placement fees
|
217
|
|
162
|
|
156
|
|
|
34.0
|
|
39.1
|
|
Service charges on
deposit accounts
|
83
|
|
73
|
|
68
|
|
|
13.7
|
|
22.1
|
|
Operating lease
income and other leasing gains
|
36
|
|
38
|
|
60
|
|
|
(5.3)
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|
(40.0)
|
|
Corporate services
income
|
55
|
|
64
|
|
52
|
|
|
(14.1)
|
|
5.8
|
|
Cards and payments
income
|
113
|
|
105
|
|
91
|
|
|
7.6
|
|
24.2
|
|
Corporate-owned life
insurance income
|
30
|
|
31
|
|
35
|
|
|
(3.2)
|
|
(14.3)
|
|
Consumer mortgage
income
|
26
|
|
47
|
|
62
|
|
|
(44.7)
|
|
(58.1)
|
|
Commercial mortgage
servicing fees
|
44
|
|
34
|
|
12
|
|
|
29.4
|
|
266.7
|
|
Other
income
|
13
|
|
51
|
|
33
|
|
|
(74.5)
|
|
(60.6)
|
|
Total noninterest
income
|
$
|
750
|
|
$
|
738
|
|
$
|
692
|
|
|
1.6
|
%
|
8.4
|
%
|
|
|
|
|
|
|
|
Compared to the second quarter of 2020, noninterest income
increased by $58 million, primarily
driven by a $61 million increase in
investment banking and debt placement fees. Commercial mortgage
servicing fees increased $32 million.
Additionally, cards and payments income increased $22 million, reflecting broad-based growth across
credit, debit, and merchant product categories. Partially
offsetting these increases were consumer mortgage income and other
income, which decreased $36 million
and $20 million, respectively.
Compared to the first quarter of 2021, noninterest income
increased by $12 million. The largest
driver of the quarter-over-quarter increase was a $55 million increase in investment banking and
debt placement fees, reflecting broad-based growth in all areas.
Commercial mortgage servicing fees and service charges on deposit
accounts both increased $10 million.
Partially offsetting these increases were a $38 million decrease in other income, reflecting
market-related valuation adjustments, and a $21 million decrease in consumer mortgage
income.
Noninterest
Expense
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dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Personnel
expense
|
$
|
623
|
|
$
|
624
|
|
$
|
572
|
|
|
(.2)
|
%
|
8.9
|
%
|
Nonpersonnel
expense
|
453
|
|
447
|
|
441
|
|
|
1.3
|
|
2.7
|
|
Total noninterest
expense
|
$
|
1,076
|
|
$
|
1,071
|
|
$
|
1,013
|
|
|
.5
|
%
|
6.2
|
%
|
|
|
|
|
|
|
|
Key's noninterest expense was $1.1
billion for the second quarter of 2021, an increase of
$63 million from the year-ago period.
The increase is primarily related to higher personnel costs of
$51 million, reflecting higher
incentive and stock-based compensation, attributed to an increase
in revenue and stock performance and an increase in employee
benefits. Additionally, other drivers for the year-over-year
increase include higher computer processing expense and marketing
expense.
Compared to the first quarter of 2021, noninterest expense
increased $5 million. Incentive and
stock-based compensation increased $14
million, reflecting Key's strong investment banking
performance, offset by a $15 million
decrease in employee benefits.
BALANCE SHEET
HIGHLIGHTS
|
|
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Average
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Commercial and
industrial (a)
|
$
|
51,808
|
|
$
|
52,581
|
|
$
|
60,480
|
|
|
(1.5)
|
%
|
(14.3)
|
%
|
Other commercial
loans
|
19,034
|
|
18,848
|
|
19,850
|
|
|
1.0
|
|
(4.1)
|
|
Total consumer
loans
|
29,972
|
|
29,299
|
|
27,611
|
|
|
2.3
|
|
8.6
|
|
Total loans
|
$
|
100,814
|
|
$
|
100,728
|
|
$
|
107,941
|
|
|
.1
|
%
|
(6.6)
|
%
|
|
|
|
|
|
|
|
(a)
|
Commercial and
industrial average loan balances include $132 million, $126
million, and $135 million of assets from commercial credit cards at
June 30, 2021, March 31, 2021, and June 30, 2020,
respectively.
|
Average loans were $100.8 billion
for the second quarter of 2021, a decrease of $7.1 billion compared to the second quarter of
2020. Commercial loans decreased $9.5
billion, reflecting decreased utilization versus the
year-ago period, partly offset by growth in PPP loans. Consumer
loans increased $2.4 billion,
reflecting strength from Laurel Road and Key's consumer mortgage
business, partly offset by Key's exit from the indirect auto
lending business.
Compared to the first quarter of 2021, average loans increased
by $86 million. Commercial loans
declined due to lower commercial utilization rates, partly offset
by growth in PPP loans. Consumer loans continue to reflect strength
from Key's consumer mortgage business, partly offset by Key's exit
from the indirect auto lending business.
Average
Deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Non-time
deposits
|
$
|
139,480
|
|
$
|
132,267
|
|
$
|
118,694
|
|
|
5.5
|
%
|
17.5
|
%
|
Certificates of
deposit ($100,000 or more)
|
2,212
|
|
2,571
|
|
4,950
|
|
|
(14.0)
|
|
(55.3)
|
|
Other time
deposits
|
2,630
|
|
2,902
|
|
4,333
|
|
|
(9.4)
|
|
(39.3)
|
|
Total
deposits
|
$
|
144,322
|
|
$
|
137,740
|
|
$
|
127,977
|
|
|
4.8
|
%
|
12.8
|
%
|
|
|
|
|
|
|
|
Cost of total
deposits
|
.05
|
%
|
.06
|
%
|
.30
|
%
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
Average deposits totaled $144.3
billion for the second quarter of 2021, an increase of
$16.3 billion compared to the
year-ago quarter, reflecting growth from consumer and commercial
relationships, partially offset by a decline in time deposits.
Compared to the first quarter of 2021, average deposits
increased by $6.6 billion, primarily
driven by broad-based commercial growth and higher consumer
balances.
ASSET
QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Net loan
charge-offs
|
$
|
22
|
|
$
|
114
|
|
$
|
96
|
|
|
(80.7)
|
%
|
(77.1)
|
%
|
Net loan charge-offs
to average total loans
|
.09
|
%
|
.46
|
%
|
.36
|
%
|
|
N/A
|
N/A
|
Nonperforming loans
at period end
|
$
|
694
|
|
$
|
728
|
|
$
|
760
|
|
|
(4.7)
|
|
(8.7)
|
|
Nonperforming assets
at period end
|
738
|
|
790
|
|
951
|
|
|
(6.6)
|
|
(22.4)
|
|
Allowance for loan
and lease losses
|
1,220
|
|
1,438
|
|
1,708
|
|
|
(15.2)
|
|
(28.6)
|
|
Allowance for credit
losses
|
1,372
|
|
1,616
|
|
1,906
|
|
|
(15.1)
|
|
(28.0)
|
|
Allowance for loan
and lease losses to nonperforming loans
|
175.8
|
%
|
197.5
|
%
|
224.7
|
%
|
|
N/A
|
N/A
|
Allowance for credit
losses to nonperforming loans
|
197.7
|
|
222.0
|
|
250.8
|
|
|
N/A
|
N/A
|
Provision for credit
losses
|
$
|
(222)
|
|
$
|
(93)
|
|
$
|
482
|
|
|
138.7
|
%
|
(146.1)
|
%
|
|
|
|
|
|
|
|
Key's provision for credit losses was a net benefit of
$222 million, including a
$244 million reserve release for the second quarter of 2021,
compared to an expense of $482
million in the second quarter of 2020 and a net benefit of
$93 million in the first quarter of
2021. The reserve release was largely driven by a continued
improvement in the economic outlook.
Net loan charge-offs for the second quarter of 2021 totaled
$22 million, or .09% of average total
loans. These results compare to $96
million, or .36%, for the second quarter of 2020 and
$114 million, or .46%, for the first
quarter of 2021. Key's allowance for credit losses was $1.4 billion, or 1.36% of total period-end loans
at June 30, 2021, compared to 1.80% at June 30, 2020, and
1.60% at March 31, 2021.
At June 30, 2021, Key's nonperforming loans totaled
$694 million, which represented .69%
of period-end portfolio loans. These results compare to .72% at
June 30, 2020, and .72% at March 31, 2021. Nonperforming
assets at June 30, 2021, totaled $738
million, and represented .73% of period-end portfolio loans
and OREO and other nonperforming assets. These results compare to
.89% at June 30, 2020, and .78% at March 31, 2021.
CAPITAL
Key's estimated risk-based capital ratios included in the
following table continued to exceed all "well-capitalized"
regulatory benchmarks at June 30, 2021.
Capital
Ratios
|
|
|
|
|
|
|
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
Common Equity Tier 1
(a)
|
9.9
|
%
|
9.9
|
%
|
9.1
|
%
|
Tier 1 risk-based
capital (a)
|
11.3
|
|
11.3
|
|
10.5
|
|
Total risk based
capital (a)
|
13.2
|
|
13.4
|
|
12.8
|
|
Tangible common
equity to tangible assets (b)
|
7.4
|
|
7.5
|
|
7.6
|
|
Leverage
(a)
|
8.7
|
|
8.9
|
|
8.8
|
|
|
|
|
|
(a)
|
June 30, 2021
ratio is estimated and reflects Key's election to adopt the CECL
optional transition provision.
|
(b)
|
The table entitled
"GAAP to Non-GAAP Reconciliations" in the attached financial
supplement presents the computations of certain financial measures
related to "tangible common equity." The table reconciles the GAAP
performance measures to the corresponding non-GAAP measures, which
provides a basis for period-to-period comparisons.
|
Key's capital position remained strong in the second quarter of
2021. As shown in the preceding table, at June 30, 2021, Key's
estimated Common Equity Tier 1 and Tier 1 risk-based capital ratios
stood at 9.9% and 11.3%, respectively. Key's tangible common equity
ratio was 7.4% at June 30, 2021.
Key has elected the CECL phase-in option provided by regulatory
guidance which delays for two years the estimated impact of CECL on
regulatory capital and phases it in over three years beginning in
2022. On a fully phased-in basis, Key's Common Equity Tier 1 ratio
would be reduced by 20 basis points.
Summary of Changes
in Common Shares Outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
in
thousands
|
|
|
|
|
Change 2Q21
vs.
|
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Shares outstanding at
beginning of period
|
972,587
|
|
975,773
|
|
975,319
|
|
|
(.3)
|
%
|
(.3)
|
%
|
Open market
repurchases and return of shares under employee compensation
plans
|
(13,304)
|
|
(9,277)
|
|
(19)
|
|
|
43.4
|
|
N/M
|
|
Shares issued under
employee compensation plans (net of cancellations)
|
993
|
|
6,091
|
|
647
|
|
|
(83.7)
|
|
53.5
|
|
|
Shares outstanding at
end of period
|
960,276
|
|
972,587
|
|
975,947
|
|
|
(1.3)
|
%
|
(1.6)
|
%
|
|
|
|
|
|
|
|
|
During the second quarter of 2021, Key declared a dividend of
$.185 per common share and completed
$300 million of common share
repurchases. Capital distributions for the quarter were consistent
with the regulatory capital distribution guidelines. In July of
2021, Key's Board of Directors approved a new share repurchase
authorization program of up to $1.5
billion, applicable for the third quarter of 2021 through
the third quarter of 2022, that supersedes the remaining capacity
under the previous authorization. Additionally, Key will evaluate
an increase to the per share common dividend in the fourth quarter
of 2021, subject to Board approval.
LINE OF BUSINESS RESULTS
The following table shows the contribution made by each major
business segment to Key's taxable-equivalent revenue from
continuing operations and income (loss) from continuing operations
attributable to Key for the periods presented. For more detailed
financial information pertaining to each business segment, see the
tables at the end of this release.
Major Business
Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Revenue from
continuing operations (TE)
|
|
|
|
|
|
|
Consumer
Bank
|
$
|
854
|
|
$
|
867
|
|
$
|
835
|
|
|
(1.5)
|
%
|
2.3
|
%
|
Commercial
Bank
|
874
|
|
859
|
|
879
|
|
|
1.7
|
|
(.6)
|
|
Other
(a)
|
45
|
|
24
|
|
3
|
|
|
87.5
|
|
1,400.0
|
|
|
Total
|
$
|
1,773
|
|
$
|
1,750
|
|
$
|
1,717
|
|
|
1.3
|
%
|
3.3
|
%
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key
|
|
|
|
|
|
|
Consumer
Bank
|
$
|
259
|
|
$
|
220
|
|
$
|
98
|
|
|
17.7
|
%
|
164.3
|
%
|
Commercial
Bank
|
434
|
|
384
|
|
106
|
|
|
13.0
|
|
309.4
|
|
Other
(a)
|
31
|
|
14
|
|
(19)
|
|
|
121.4
|
|
N/M
|
|
Total
|
$
|
724
|
|
$
|
618
|
|
$
|
185
|
|
|
17.2
|
%
|
291.4
|
%
|
|
|
|
|
|
|
|
|
(a)
|
Other includes other
segments that consists of corporate treasury, our principal
investing unit, and various exit portfolios as well as reconciling
items which primarily represents the unallocated portion of
nonearning assets of corporate support functions. Charges related
to the funding of these assets are part of net interest income and
are allocated to the business segments through noninterest expense.
Reconciling items also includes intercompany eliminations and
certain items that are not allocated to the business segments
because they do not reflect their normal operations.
|
TE = Taxable
Equivalent, N/M = Not Meaningful
|
Consumer
Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Summary of
operations
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
|
600
|
|
$
|
610
|
|
$
|
589
|
|
|
(1.6)
|
%
|
1.9
|
%
|
Noninterest
income
|
254
|
|
257
|
|
246
|
|
|
(1.2)
|
|
3.3
|
|
Total revenue
(TE)
|
854
|
|
867
|
|
835
|
|
|
(1.5)
|
|
2.3
|
|
Provision for credit
losses
|
(70)
|
|
(23)
|
|
155
|
|
|
(204.3)
|
|
(145.2)
|
|
Noninterest
expense
|
584
|
|
601
|
|
552
|
|
|
(2.8)
|
|
5.8
|
|
Income (loss) before
income taxes (TE)
|
340
|
|
289
|
|
128
|
|
|
17.6
|
|
165.6
|
|
Allocated income
taxes (benefit) and TE adjustments
|
81
|
|
69
|
|
30
|
|
|
17.4
|
|
170.0
|
|
Net income (loss)
attributable to Key
|
$
|
259
|
|
$
|
220
|
|
$
|
98
|
|
|
17.7
|
%
|
164.3
|
%
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
Loans and
leases
|
$
|
40,598
|
|
$
|
39,249
|
|
$
|
37,300
|
|
|
3.4
|
%
|
8.8
|
%
|
Total
assets
|
43,991
|
|
42,476
|
|
42,194
|
|
|
3.6
|
|
4.3
|
|
Deposits
|
88,412
|
|
85,033
|
|
79,235
|
|
|
4.0
|
|
11.6
|
|
|
|
|
|
|
|
|
Assets under
management at period end
|
$
|
47,737
|
|
$
|
45,218
|
|
$
|
39,722
|
|
|
5.6
|
%
|
20.2
|
%
|
|
|
|
|
|
|
|
Additional
Consumer Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Noninterest
income
|
|
|
|
|
|
|
Trust and investment
services income
|
$
|
104
|
|
$
|
101
|
|
$
|
87
|
|
|
3.0
|
%
|
19.5
|
%
|
Service charges on
deposit accounts
|
47
|
|
38
|
|
36
|
|
|
23.7
|
|
30.6
|
|
Cards and payments
income
|
62
|
|
54
|
|
47
|
|
|
14.8
|
|
31.9
|
|
Consumer mortgage
income
|
26
|
|
47
|
|
61
|
|
|
(44.7)
|
|
(57.4)
|
|
Other noninterest
income
|
15
|
|
17
|
|
15
|
|
|
(11.8)
|
|
.0
|
|
Total noninterest
income
|
$
|
254
|
|
$
|
257
|
|
$
|
246
|
|
|
(1.2)
|
%
|
3.3
|
%
|
|
|
|
|
|
|
|
Average deposit
balances
|
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
56,038
|
|
$
|
54,685
|
|
$
|
49,143
|
|
|
2.5
|
%
|
14.0
|
%
|
Savings
deposits
|
6,523
|
|
5,878
|
|
4,816
|
|
|
11.0
|
|
35.4
|
|
Certificates of
deposit ($100,000 or more)
|
2,083
|
|
2,424
|
|
4,520
|
|
|
(14.1)
|
|
(53.9)
|
|
Other time
deposits
|
2,615
|
|
2,888
|
|
4,296
|
|
|
(9.5)
|
|
(39.1)
|
|
Noninterest-bearing
deposits
|
21,153
|
|
19,159
|
|
16,460
|
|
|
10.4
|
|
28.5
|
|
Total
deposits
|
$
|
88,412
|
|
$
|
85,033
|
|
$
|
79,235
|
|
|
4.0
|
|
11.6
|
%
|
|
|
|
|
|
|
|
Home equity
loans
|
|
|
|
|
|
|
Average
balance
|
$
|
9,081
|
|
$
|
9,234
|
|
$
|
9,893
|
|
|
|
|
Combined
weighted-average loan-to-value ratio (at date of
origination)
|
68
|
%
|
69
|
%
|
70
|
%
|
|
|
|
Percent first lien
positions
|
70
|
|
68
|
|
63
|
|
|
|
|
|
|
|
|
|
|
|
Other
data
|
|
|
|
|
|
|
Branches
|
1,014
|
|
1,068
|
|
1,077
|
|
|
|
|
Automated teller
machines
|
1,329
|
|
1,368
|
|
1,394
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Bank Summary of Operations (2Q21 vs. 2Q20)
- Net income attributable to Key of $259
million for the second quarter of 2021, compared to
$98 million for the year-ago
quarter
- Taxable-equivalent net interest income increased by
$11 million, or 1.9%, compared to the
second quarter of 2020, driven by strong consumer mortgage balance
sheet growth and fees related to PPP loans, partially offset by the
lower interest rate environment
- Average loans and leases increased $3.3
billion, or 8.8%, driven by growth in consumer mortgage and
benefit from the PPP
- Average deposits increased $9.2
billion, or 11.6%, from the second quarter of 2020, driven
by retention of consumer stimulus payments and relationship
growth
- Provision for credit losses decreased $225 million, compared to the second quarter of
2020. The provision for credit losses was a net benefit and was
driven by expected improvements in economic conditions and
continued strength in client credit quality
- Noninterest income increased $8
million, or 3.3%, from the year ago quarter, driven by
higher trust and investment services income and client spend
activity, partially offset by lower consumer mortgage income, due
to lower gain on sale volume
- Noninterest expense increased $32
million, or 5.8%, from the year ago quarter, driven by
higher variable compensation and support expenses related to higher
loan volumes
Commercial
Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Summary of
operations
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
|
419
|
|
$
|
413
|
|
$
|
458
|
|
|
1.5
|
%
|
(8.5)
|
%
|
Noninterest
income
|
455
|
|
446
|
|
421
|
|
|
2.0
|
|
8.1
|
|
Total revenue
(TE)
|
874
|
|
859
|
|
879
|
|
|
1.7
|
|
(.6)
|
|
Provision for credit
losses
|
(131)
|
|
(67)
|
|
326
|
|
|
95.5
|
|
(140.2)
|
|
Noninterest
expense
|
451
|
|
443
|
|
441
|
|
|
1.8
|
|
2.3
|
|
Income (loss) before
income taxes (TE)
|
554
|
|
483
|
|
112
|
|
|
14.7
|
|
394.6
|
|
Allocated income
taxes and TE adjustments
|
120
|
|
99
|
|
6
|
|
|
21.2
|
|
N/M
|
Net income (loss)
attributable to Key
|
$
|
434
|
|
$
|
384
|
|
$
|
106
|
|
|
13.0
|
%
|
309.4
|
%
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
Loans and
leases
|
$
|
59,953
|
|
$
|
61,221
|
|
$
|
70,336
|
|
|
(2.1)
|
%
|
(14.8)
|
%
|
Loans held for
sale
|
1,341
|
|
1,237
|
|
2,012
|
|
|
8.4
|
|
(33.3)
|
|
Total
assets
|
69,101
|
|
70,448
|
|
79,267
|
|
|
(1.9)
|
|
(12.8)
|
|
Deposits
|
54,814
|
|
51,894
|
|
47,954
|
|
|
5.6
|
%
|
14.3
|
%
|
|
|
|
|
|
|
|
TE = Taxable
Equivalent, N/M = Not Meaningful
|
Additional
Commercial Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 2Q21
vs.
|
|
2Q21
|
1Q21
|
2Q20
|
|
1Q21
|
2Q20
|
Noninterest
income
|
|
|
|
|
|
|
Trust and investment
services income
|
$
|
27
|
|
$
|
32
|
|
$
|
37
|
|
|
(15.6)
|
%
|
(27.0)
|
|
Investment banking
and debt placement fees
|
215
|
|
162
|
|
156
|
|
|
32.7
|
|
37.8
|
%
|
Operating lease
income and other leasing gains
|
35
|
|
38
|
|
59
|
|
|
(7.9)
|
|
(40.7)
|
|
|
|
|
|
|
|
|
Corporate services
income
|
47
|
|
56
|
|
45
|
|
|
(16.1)
|
|
4.4
|
|
Service charges on
deposit accounts
|
34
|
|
33
|
|
30
|
|
|
3.0
|
|
13.3
|
|
Cards and payments
income
|
49
|
|
52
|
|
45
|
|
|
(5.8)
|
|
8.9
|
|
Payments and services
income
|
130
|
|
141
|
|
120
|
|
|
(7.8)
|
|
8.3
|
|
|
|
|
|
|
|
|
Commercial mortgage
servicing fees
|
44
|
|
34
|
|
12
|
|
|
29.4
|
|
266.7
|
|
Other noninterest
income
|
4
|
|
39
|
|
37
|
|
|
(89.7)
|
|
(89.2)
|
|
Total noninterest
income
|
$
|
455
|
|
$
|
446
|
|
$
|
421
|
|
|
2.0
|
%
|
8.1
|
%
|
|
|
|
|
|
|
|
Commercial Bank Summary of Operations (2Q21 vs. 2Q20)
- Net income attributable to Key of $434
million for the second quarter of 2021, compared to
$106 million for the year-ago
quarter
- Taxable-equivalent net interest income decreased by
$39 million, compared to the second
quarter of 2020, as lower average loan balances offset fees related
to PPP loans
- Average loan and lease balances decreased $10.4 billion, compared to the second quarter of
2020, driven by lower commercial and industrial line draws
- Average deposit balances increased $6.9
billion, or 14.3%, compared to the second quarter of 2020,
driven by growth in targeted relationships and the impact of
government programs
- Provision for credit losses decreased $457 million, compared to the second quarter of
2020. The provision for credit losses was a net benefit and was
driven by expected improvements in economic conditions
- Noninterest income increased $34
million, from the year-ago quarter, driven by elevated
investment banking client activity and commercial mortgage
servicing fees, partially offset by favorable market-related
adjustments to customer derivatives in the year-ago period
- Noninterest expense increased by $10
million, or 2.3%, from the second quarter of 2020, driven by
higher personnel-related costs
*******************************************
KeyCorp's roots trace back nearly 200 years to Albany, New York. Headquartered in
Cleveland, Ohio, Key is one of the
nation's largest bank-based financial services companies, with
assets of approximately $181.1
billion at June 30, 2021.
Key provides deposit, lending, cash management, and investment
services to individuals and businesses in 15 states under the name
KeyBank National Association through a network of more than 1,000
branches and approximately 1,300 ATMs. 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.
|
|
INVESTOR
RELATIONS:
|
KEY MEDIA
NEWSROOM:
|
www.key.com/ir
|
www.key.com/newsroom
|
This earnings
release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements do not relate strictly to historical or current
facts. Forward-looking statements usually can be identified
by the use of words such as "goal," "objective," "plan," "expect,"
"assume," "anticipate," "intend," "project," "believe," "estimate,"
or other words of similar meaning. Forward-looking statements
provide our current expectations or forecasts of future events,
circumstances, results, or aspirations. Forward-looking statements,
by their nature, are subject to assumptions, risks and
uncertainties, many of which are outside of our control. Our actual
results may differ materially from those set forth in our
forward-looking statements. There is no assurance that any list of
risks and uncertainties or risk factors is complete. Factors that
could cause Key's actual results to differ from those described in
the forward-looking statements can be found in KeyCorp's Form 10-K
for the year ended December 31, 2020, as well as in KeyCorp's
subsequent SEC filings, all of which have been or will be filed
with the Securities and Exchange Commission (the "SEC") and are or
will be available on Key's website (www.key.com/ir) and on the
SEC's website (www.sec.gov). These factors may include, among
others, deterioration of commercial real estate market
fundamentals, adverse changes in credit quality trends, declining
asset prices, a worsening of the U.S. economy due to financial,
political, or other shocks, the extensive regulation of the U.S.
financial services industry, and the impact of the COVID-19 global
pandemic on us, our clients, our third-party service providers, and
the markets. Any forward-looking statements made by us or on our
behalf speak only as of the date they are made and we do not
undertake any obligation to update any forward-looking statement to
reflect the impact of subsequent events or
circumstances.
|
Notes to Editors:
A live Internet broadcast of
KeyCorp's 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 10:00 a.m.
ET, on July 20, 2021. A replay
of the call will be available through July
29, 2021.
*****
KeyCorp
|
Second Quarter
2021
|
Financial
Supplement
|
|
Page
|
|
12
|
Financial
Highlights
|
14
|
GAAP to Non-GAAP
Reconciliation
|
16
|
Consolidated Balance
Sheets
|
17
|
Consolidated
Statements of Income
|
18
|
Consolidated Average
Balance Sheets, and Net Interest Income and Yields/Rates From
Continuing Operations
|
20
|
Noninterest
Expense
|
20
|
Personnel
Expense
|
21
|
Loan
Composition
|
21
|
Loans Held for Sale
Composition
|
21
|
Summary of Changes in
Loans Held for Sale
|
22
|
Summary of Loan and
Lease Loss Experience From Continuing Operations
|
23
|
Asset Quality
Statistics From Continuing Operations
|
23
|
Summary of
Nonperforming Assets and Past Due Loans From Continuing
Operations
|
23
|
Summary of Changes in
Nonperforming Loans From Continuing Operations
|
24
|
Line of Business
Results
|
Financial
Highlights
|
(dollars in millions,
except per share amounts)
|
|
|
|
Three months
ended
|
|
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
Summary of
operations
|
|
|
|
|
Net interest income
(TE)
|
$
|
1,023
|
|
$
|
1,012
|
|
$
|
1,025
|
|
|
Noninterest
income
|
750
|
|
738
|
|
692
|
|
|
|
Total revenue
(TE)
|
1,773
|
|
1,750
|
|
1,717
|
|
|
Provision for credit
losses
|
(222)
|
|
(93)
|
|
482
|
|
|
Noninterest
expense
|
1,076
|
|
1,071
|
|
1,013
|
|
|
Income (loss) from
continuing operations attributable to Key
|
724
|
|
618
|
|
185
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
5
|
|
4
|
|
2
|
|
|
Net income (loss)
attributable to Key
|
729
|
|
622
|
|
187
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
698
|
|
591
|
|
159
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
5
|
|
4
|
|
2
|
|
|
Net income (loss)
attributable to Key common shareholders
|
703
|
|
595
|
|
161
|
|
|
|
|
|
|
|
Per common
share
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.73
|
|
$
|
.61
|
|
$
|
.16
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
—
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
.73
|
|
.62
|
|
.17
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders —
assuming dilution
|
.72
|
|
.61
|
|
.16
|
|
|
Income (loss) from
discontinued operations, net of taxes — assuming
dilution
|
—
|
|
—
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders — assuming dilution
(a)
|
.73
|
|
.61
|
|
.17
|
|
|
|
|
|
|
|
|
Cash dividends
declared
|
.185
|
|
.185
|
|
.185
|
|
|
Book value at period
end
|
16.75
|
|
16.22
|
|
16.07
|
|
|
Tangible book value
at period end
|
13.81
|
|
13.30
|
|
13.12
|
|
|
Market price at
period end
|
20.65
|
|
19.98
|
|
12.18
|
|
|
|
|
|
|
|
Performance
ratios
|
|
|
|
|
From continuing
operations:
|
|
|
|
|
Return on average
total assets
|
1.63
|
%
|
1.44
|
%
|
.45
|
%
|
|
Return on average
common equity
|
18.21
|
|
14.98
|
|
4.05
|
|
|
Return on average
tangible common equity (b)
|
22.34
|
|
18.25
|
|
4.96
|
|
|
Net interest margin
(TE)
|
2.52
|
|
2.61
|
|
2.76
|
|
|
Cash efficiency ratio
(b)
|
59.9
|
|
60.3
|
|
57.9
|
|
|
|
|
|
|
|
|
From consolidated
operations:
|
|
|
|
|
Return on average
total assets
|
1.64
|
%
|
1.45
|
%
|
.46
|
%
|
|
Return on average
common equity
|
18.34
|
|
15.08
|
|
4.10
|
|
|
Return on average
tangible common equity (b)
|
22.50
|
|
18.37
|
|
5.02
|
|
|
Net interest margin
(TE)
|
2.55
|
|
2.60
|
|
2.76
|
|
|
Loan to deposit
(c)
|
70.4
|
|
73.1
|
|
80.4
|
|
|
|
|
|
|
|
Capital ratios at
period end
|
|
|
|
|
Key shareholders'
equity to assets
|
9.9
|
%
|
10.0
|
%
|
10.2
|
%
|
|
Key common
shareholders' equity to assets
|
8.9
|
|
9.0
|
|
9.2
|
|
|
Tangible common
equity to tangible assets (b)
|
7.4
|
|
7.5
|
|
7.6
|
|
|
Common Equity Tier
1 (d)
|
9.9
|
|
9.9
|
|
9.1
|
|
|
Tier 1 risk-based
capital (d)
|
11.3
|
|
11.3
|
|
10.5
|
|
|
Total risk-based
capital (d)
|
13.2
|
|
13.4
|
|
12.8
|
|
|
Leverage
(d)
|
8.7
|
|
8.9
|
|
8.8
|
|
|
|
|
|
|
|
Asset quality —
from continuing operations
|
|
|
|
|
Net loan
charge-offs
|
$
|
22
|
|
$
|
114
|
|
$
|
96
|
|
|
Net loan charge-offs
to average loans
|
.09
|
%
|
.46
|
%
|
.36
|
%
|
|
Allowance for loan
and lease losses
|
$
|
1,220
|
|
$
|
1,438
|
|
$
|
1,708
|
|
|
Allowance for credit
losses
|
1,372
|
|
1,616
|
|
1,906
|
|
|
Allowance for loan
and lease losses to period-end loans
|
1.21
|
%
|
1.42
|
%
|
1.61
|
%
|
|
Allowance for credit
losses to period-end loans
|
1.36
|
|
1.60
|
|
1.80
|
|
|
Allowance for loan
and lease losses to nonperforming loans
|
175.8
|
|
197.5
|
|
224.7
|
|
|
Allowance for credit
losses to nonperforming loans
|
197.7
|
|
222.0
|
|
250.8
|
|
|
Nonperforming loans
at period-end
|
$
|
694
|
|
$
|
728
|
|
$
|
760
|
|
|
Nonperforming assets
at period-end
|
738
|
|
790
|
|
951
|
|
|
Nonperforming loans
to period-end portfolio loans
|
.69
|
%
|
.72
|
%
|
.72
|
%
|
|
Nonperforming assets
to period-end portfolio loans plus OREO and other nonperforming
assets
|
.73
|
|
.78
|
|
.89
|
|
|
|
|
|
|
|
Trust
assets
|
|
|
|
|
Assets under
management
|
$
|
47,737
|
|
$
|
45,218
|
|
$
|
39,722
|
|
|
|
|
|
|
|
Other
data
|
|
|
|
|
Average full-time
equivalent employees
|
17,157
|
|
17,086
|
|
16,646
|
|
|
Branches
|
1,014
|
|
1,068
|
|
1,077
|
|
|
Taxable-equivalent
adjustment
|
$
|
6
|
|
$
|
7
|
|
$
|
7
|
|
|
|
|
|
Financial
Highlights (continued)
|
(dollars in millions,
except per share amounts)
|
|
|
Six months
ended
|
|
|
6/30/2021
|
6/30/2020
|
Summary of
operations
|
|
|
|
Net interest income
(TE)
|
$
|
2,035
|
|
$
|
2,014
|
|
|
Noninterest
income
|
1,488
|
|
1,169
|
|
|
Total revenue
(TE)
|
3,523
|
|
3,183
|
|
|
Provision for credit
losses
|
(315)
|
|
841
|
|
|
Noninterest
expense
|
2,147
|
|
1,944
|
|
|
Income (loss) from
continuing operations attributable to Key
|
1,342
|
|
330
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
9
|
|
3
|
|
|
Net income (loss)
attributable to Key
|
1,351
|
|
333
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
1,289
|
|
277
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
9
|
|
3
|
|
|
Net income (loss)
attributable to Key common shareholders
|
1,298
|
|
280
|
|
|
|
|
|
Per common
share
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
1.34
|
|
$
|
.29
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
.01
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
1.35
|
|
.29
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders —
assuming dilution
|
1.33
|
|
.28
|
|
|
Income (loss) from
discontinued operations, net of taxes — assuming
dilution
|
.01
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders — assuming dilution
(a)
|
1.34
|
|
.29
|
|
|
|
|
|
|
Cash dividends
paid
|
.37
|
|
.37
|
|
|
|
|
|
Performance
ratios
|
|
|
|
From continuing
operations:
|
|
|
|
Return on average
total assets
|
1.55
|
%
|
.43
|
%
|
|
Return on average
common equity
|
16.64
|
|
3.58
|
|
|
Return on average
tangible common equity (b)
|
20.34
|
|
4.40
|
|
|
Net interest margin
(TE)
|
2.56
|
|
2.88
|
|
|
Cash efficiency ratio
(b)
|
60.1
|
|
60.0
|
|
|
|
|
|
|
From consolidated
operations:
|
|
|
|
Return on average
total assets
|
1.55
|
%
|
.43
|
%
|
|
Return on average
common equity
|
16.76
|
|
3.62
|
|
|
Return on average
tangible common equity (b)
|
20.48
|
|
4.45
|
|
|
Net interest margin
(TE)
|
2.57
|
|
2.87
|
|
|
|
|
|
Asset quality —
from continuing operations
|
|
|
|
Net loan
charge-offs
|
$
|
136
|
|
$
|
180
|
|
|
Net loan charge-offs
to average total loans
|
.27
|
%
|
.35
|
%
|
|
|
|
|
Other
data
|
|
|
|
Average full-time
equivalent employees
|
17,122
|
|
16,587
|
|
|
|
|
|
Taxable-equivalent
adjustment
|
13
|
|
15
|
|
(a)
|
Earnings per share
may not foot due to rounding.
|
(b)
|
The following table
entitled "GAAP to Non-GAAP Reconciliations" presents the
computations of certain financial measures related to "tangible
common equity" and "cash efficiency." The table reconciles the GAAP
performance measures to the corresponding non-GAAP measures, which
provides a basis for period-to-period comparisons.
|
(c)
|
Represents period-end
consolidated total loans and loans held for sale divided by
period-end consolidated total deposits.
|
(d)
|
June 30, 2021,
ratio is estimated and reflects Key's election to adopt the CECL
optional transition provision.
|
GAAP to Non-GAAP
Reconciliations
|
(dollars in
millions)
|
The table below
presents certain non-GAAP financial measures related to "tangible
common equity," "return on average tangible common equity,"
"pre-provision net revenue," and "cash efficiency
ratio."
|
|
The tangible common
equity ratio and the return on average tangible common equity ratio
have been a focus for some investors, and management believes these
ratios may assist investors in analyzing Key's capital position
without regard to the effects of intangible assets and preferred
stock.
|
|
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 credit losses makes it easier to
analyze the results by presenting them on a more comparable
basis.
|
|
The cash efficiency
ratio is a ratio of two non-GAAP performance measures. As such,
there is no directly comparable GAAP performance measure. The cash
efficiency ratio performance measure removes the impact of Key's
intangible asset amortization from the calculation. Management
believes this ratio provide greater consistency and comparability
between Key's results and those of its peer banks. Additionally,
this ratio is used by analysts and investors as they develop
earnings forecasts and peer bank analysis.
|
|
Non-GAAP financial
measures have inherent limitations, are not required to be
uniformly applied, and are not audited. 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
|
|
Six months
ended
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Tangible common
equity to tangible assets at period-end
|
|
|
|
|
|
|
Key shareholders'
equity (GAAP)
|
$
|
17,941
|
|
$
|
17,634
|
|
$
|
17,542
|
|
|
|
|
Less: Intangible
assets (a)
|
2,828
|
|
2,842
|
|
2,877
|
|
|
|
|
Preferred
Stock (b)
|
1,856
|
|
1,856
|
|
1,856
|
|
|
|
|
Tangible common equity
(non-GAAP)
|
$
|
13,257
|
|
$
|
12,936
|
|
$
|
12,809
|
|
|
|
|
Total assets
(GAAP)
|
$
|
181,115
|
|
$
|
176,203
|
|
$
|
171,192
|
|
|
|
|
Less: Intangible
assets (a)
|
2,828
|
|
2,842
|
|
2,877
|
|
|
|
|
Tangible assets
(non-GAAP)
|
$
|
178,287
|
|
$
|
173,361
|
|
$
|
168,315
|
|
|
|
|
Tangible common equity
to tangible assets ratio (non-GAAP)
|
7.44
|
%
|
7.46
|
%
|
7.61
|
%
|
|
|
|
Pre-provision net
revenue
|
|
|
|
|
|
|
Net interest income
(GAAP)
|
$
|
1,017
|
|
$
|
1,005
|
|
$
|
1,018
|
|
|
$
|
2,022
|
|
$
|
1,999
|
|
Plus:
Taxable-equivalent adjustment
|
6
|
|
7
|
|
7
|
|
|
13
|
|
15
|
|
Noninterest
income
|
750
|
|
738
|
|
692
|
|
|
1,488
|
|
1,169
|
|
Less: Noninterest
expense
|
1,076
|
|
1,071
|
|
1,013
|
|
|
2,147
|
|
1,944
|
|
Pre-provision net
revenue from continuing operations (non-GAAP)
|
$
|
697
|
|
$
|
679
|
|
$
|
704
|
|
|
$
|
1,376
|
|
$
|
1,239
|
|
Average tangible
common equity
|
|
|
|
|
|
|
Average Key
shareholders' equity (GAAP)
|
$
|
17,271
|
|
$
|
17,769
|
|
$
|
17,688
|
|
|
$
|
17,519
|
|
$
|
17,452
|
|
Less: Intangible
assets (average) (c)
|
2,840
|
|
2,844
|
|
2,886
|
|
|
2,840
|
|
2,894
|
|
Preferred stock
(average)
|
1,900
|
|
1,900
|
|
1,900
|
|
|
1,900
|
|
1,900
|
|
Average tangible
common equity (non-GAAP)
|
$
|
12,531
|
|
$
|
13,025
|
|
$
|
12,902
|
|
|
$
|
12,779
|
|
$
|
12,658
|
|
Return on average
tangible common equity from continuing operations
|
|
|
|
|
|
|
Net income (loss) from
continuing operations attributable to Key common
shareholders (GAAP)
|
$
|
698
|
|
$
|
591
|
|
$
|
159
|
|
|
$
|
1,289
|
|
$
|
277
|
|
Average tangible
common equity (non-GAAP)
|
12,531
|
|
13,025
|
|
12,902
|
|
|
12,779
|
|
12,658
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity from continuing operations
(non- GAAP)
|
22.34
|
%
|
18.25
|
%
|
4.96
|
%
|
|
20.34
|
%
|
4.40
|
%
|
Return on average
tangible common equity consolidated
|
|
|
|
|
|
|
Net income (loss)
attributable to Key common shareholders (GAAP)
|
$
|
703
|
|
$
|
595
|
|
$
|
161
|
|
|
$
|
1,298
|
|
$
|
280
|
|
Average tangible
common equity (non-GAAP)
|
12,531
|
|
13,025
|
|
12,902
|
|
|
12,779
|
|
12,658
|
|
|
|
|
|
|
|
|
Return on average
tangible common equity consolidated (non-GAAP)
|
22.50
|
%
|
18.37
|
%
|
5.02
|
%
|
|
20.48
|
%
|
4.45
|
%
|
GAAP to Non-GAAP
Reconciliations (continued)
|
(dollars in
millions)
|
|
Three months
ended
|
|
Six months
ended
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Cash efficiency
ratio
|
|
|
|
|
|
|
Noninterest expense
(GAAP)
|
$
|
1,076
|
|
$
|
1,071
|
|
$
|
1,013
|
|
|
$
|
2,147
|
|
$
|
1,944
|
|
Less: Intangible asset
amortization
|
14
|
|
15
|
|
18
|
|
|
29
|
|
35
|
|
Adjusted noninterest
expense (non-GAAP)
|
$
|
1,062
|
|
$
|
1,056
|
|
$
|
995
|
|
|
$
|
2,118
|
|
$
|
1,909
|
|
|
|
|
|
|
|
|
Net interest income
(GAAP)
|
$
|
1,017
|
|
$
|
1,005
|
|
$
|
1,018
|
|
|
$
|
2,022
|
|
$
|
1,999
|
|
Plus:
Taxable-equivalent adjustment
|
6
|
|
7
|
|
7
|
|
|
13
|
|
15
|
|
Noninterest
income
|
750
|
|
738
|
|
692
|
|
|
1,488
|
|
1,169
|
|
Total
taxable-equivalent revenue (non-GAAP)
|
$
|
1,773
|
|
$
|
1,750
|
|
$
|
1,717
|
|
|
$
|
3,523
|
|
$
|
3,183
|
|
|
|
|
|
|
|
|
Cash efficiency ratio
(non-GAAP)
|
59.9
|
%
|
60.3
|
%
|
57.9
|
%
|
|
60.1
|
%
|
60.0
|
%
|
|
|
|
|
|
|
|
(a)
|
For the three months
ended June 30, 2021, March 31, 2021, and June 30,
2020, intangible assets exclude $4 million, $4 million, and $5
million, respectively, of period-end purchased credit card
receivables.
|
(b)
|
Net of capital
surplus.
|
(c)
|
For the three months
ended June 30, 2021, March 31, 2021, and June 30,
2020, average intangible assets exclude $4 million, $4 million, and
$6 million, respectively, of average purchased credit card
receivables. For the six months ended June 30, 2021, and
June 30, 2020, average intangible assets exclude $4 million
and $6 million, respectively, of average purchased credit card
receivables
|
GAAP = U.S.
generally accepted accounting principles
|
Consolidated
Balance Sheets
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
Assets
|
|
|
|
|
Loans
|
$
|
100,730
|
|
$
|
100,926
|
|
$
|
106,159
|
|
|
Loans held for
sale
|
1,537
|
|
2,296
|
|
2,007
|
|
|
Securities available
for sale
|
34,638
|
|
33,923
|
|
23,600
|
|
|
Held-to-maturity
securities
|
6,175
|
|
6,857
|
|
9,075
|
|
|
Trading account
assets
|
851
|
|
811
|
|
645
|
|
|
Short-term
investments
|
20,460
|
|
15,376
|
|
14,036
|
|
|
Other
investments
|
635
|
|
621
|
|
655
|
|
|
|
Total earning
assets
|
165,026
|
|
160,810
|
|
156,177
|
|
|
Allowance for loan
and lease losses
|
(1,220)
|
|
(1,438)
|
|
(1,708)
|
|
|
Cash and due from
banks
|
792
|
|
938
|
|
1,059
|
|
|
Premises and
equipment
|
785
|
|
737
|
|
776
|
|
|
Goodwill
|
2,673
|
|
2,673
|
|
2,664
|
|
|
Other intangible
assets
|
159
|
|
173
|
|
218
|
|
|
Corporate-owned life
insurance
|
4,304
|
|
4,296
|
|
4,251
|
|
|
Accrued income and
other assets
|
7,966
|
|
7,347
|
|
6,976
|
|
|
Discontinued
assets
|
630
|
|
667
|
|
779
|
|
|
|
Total
assets
|
$
|
181,115
|
|
176,203
|
|
171,192
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Deposits in domestic
offices:
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
85,242
|
|
$
|
82,777
|
|
$
|
78,853
|
|
|
|
Savings
deposits
|
6,993
|
|
6,655
|
|
5,371
|
|
|
|
Certificates of
deposit ($100,000 or more)
|
2,064
|
|
2,437
|
|
4,476
|
|
|
|
Other time
deposits
|
2,493
|
|
2,782
|
|
4,011
|
|
|
|
Total
interest-bearing deposits
|
96,792
|
|
94,651
|
|
92,711
|
|
|
|
Noninterest-bearing
deposits
|
49,280
|
|
47,532
|
|
42,802
|
|
|
|
Total
deposits
|
146,072
|
|
142,183
|
|
135,513
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
211
|
|
281
|
|
267
|
|
|
Bank notes and other
short-term borrowings
|
723
|
|
744
|
|
1,716
|
|
|
Accrued expense and
other liabilities
|
2,957
|
|
2,862
|
|
2,420
|
|
|
Long-term
debt
|
13,211
|
|
12,499
|
|
13,734
|
|
|
|
Total
liabilities
|
163,174
|
|
158,569
|
|
153,650
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
Preferred
stock
|
1,900
|
|
1,900
|
|
1,900
|
|
|
Common
shares
|
1,257
|
|
1,257
|
|
1,257
|
|
|
Capital
surplus
|
6,232
|
|
6,213
|
|
6,240
|
|
|
Retained
earnings
|
13,689
|
|
13,166
|
|
12,154
|
|
|
Treasury stock, at
cost
|
(5,287)
|
|
(5,005)
|
|
(4,945)
|
|
|
Accumulated other
comprehensive income (loss)
|
150
|
|
103
|
|
936
|
|
|
|
Key shareholders'
equity
|
17,941
|
|
17,634
|
|
17,542
|
|
|
Noncontrolling
interests
|
—
|
|
—
|
|
—
|
|
|
|
Total
equity
|
17,941
|
|
17,634
|
|
17,542
|
|
Total liabilities
and equity
|
$
|
181,115
|
|
$
|
176,203
|
|
$
|
171,192
|
|
|
|
|
|
|
|
Common shares
outstanding (000)
|
960,276
|
|
972,587
|
|
975,947
|
|
Consolidated
Statements of Income
|
(dollars in millions,
except per share amounts)
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Interest
income
|
|
|
|
|
|
|
|
Loans
|
$
|
888
|
|
$
|
889
|
|
$
|
980
|
|
|
$
|
1,777
|
|
$
|
2,006
|
|
|
Loans held for
sale
|
11
|
|
11
|
|
21
|
|
|
22
|
|
40
|
|
|
Securities available
for sale
|
133
|
|
130
|
|
121
|
|
|
263
|
|
250
|
|
|
Held-to-maturity
securities
|
45
|
|
45
|
|
56
|
|
|
90
|
|
118
|
|
|
Trading account
assets
|
5
|
|
5
|
|
5
|
|
|
10
|
|
13
|
|
|
Short-term
investments
|
6
|
|
5
|
|
7
|
|
|
11
|
|
13
|
|
|
Other
investments
|
2
|
|
2
|
|
—
|
|
|
4
|
|
1
|
|
|
|
Total interest
income
|
1,090
|
|
1,087
|
|
1,190
|
|
|
2,177
|
|
2,441
|
|
Interest
expense
|
|
|
|
|
|
|
|
Deposits
|
16
|
|
21
|
|
96
|
|
|
37
|
|
265
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
—
|
|
—
|
|
—
|
|
|
—
|
|
6
|
|
|
Bank notes and other
short-term borrowings
|
3
|
|
1
|
|
5
|
|
|
4
|
|
10
|
|
|
Long-term
debt
|
54
|
|
60
|
|
71
|
|
|
114
|
|
161
|
|
|
|
Total interest
expense
|
73
|
|
82
|
|
172
|
|
|
155
|
|
442
|
|
Net interest
income
|
1,017
|
|
1,005
|
|
1,018
|
|
|
2,022
|
|
1,999
|
|
Provision for credit
losses
|
(222)
|
|
(93)
|
|
482
|
|
|
(315)
|
|
841
|
|
Net interest income
after provision for credit losses
|
1,239
|
|
1,098
|
|
536
|
|
|
2,337
|
|
1,158
|
|
Noninterest
income
|
|
|
|
|
|
|
|
Trust and investment
services income
|
133
|
|
133
|
|
123
|
|
|
266
|
|
256
|
|
|
Investment banking
and debt placement fees
|
217
|
|
162
|
|
156
|
|
|
379
|
|
272
|
|
|
Service charges on
deposit accounts
|
83
|
|
73
|
|
68
|
|
|
156
|
|
152
|
|
|
Operating lease
income and other leasing gains
|
36
|
|
38
|
|
60
|
|
|
74
|
|
90
|
|
|
Corporate services
income
|
55
|
|
64
|
|
52
|
|
|
119
|
|
114
|
|
|
Cards and payments
income
|
113
|
|
105
|
|
91
|
|
|
218
|
|
157
|
|
|
Corporate-owned life
insurance income
|
30
|
|
31
|
|
35
|
|
|
61
|
|
71
|
|
|
Consumer mortgage
income
|
26
|
|
47
|
|
62
|
|
|
73
|
|
82
|
|
|
Commercial mortgage
servicing fees
|
44
|
|
34
|
|
12
|
|
|
78
|
|
30
|
|
|
Other
income
|
13
|
|
51
|
|
33
|
|
|
64
|
|
(55)
|
|
|
|
Total noninterest
income
|
750
|
|
738
|
|
692
|
|
|
1,488
|
|
1,169
|
|
Noninterest
expense
|
|
|
|
|
|
|
|
Personnel
|
623
|
|
624
|
|
572
|
|
|
1,247
|
|
1,087
|
|
|
Net
occupancy
|
75
|
|
76
|
|
71
|
|
|
151
|
|
147
|
|
|
Computer
processing
|
71
|
|
73
|
|
56
|
|
|
144
|
|
111
|
|
|
Business services and
professional fees
|
51
|
|
50
|
|
49
|
|
|
101
|
|
93
|
|
|
Equipment
|
25
|
|
25
|
|
25
|
|
|
50
|
|
49
|
|
|
Operating lease
expense
|
31
|
|
34
|
|
34
|
|
|
65
|
|
70
|
|
|
Marketing
|
31
|
|
26
|
|
24
|
|
|
57
|
|
45
|
|
|
Intangible asset
amortization
|
14
|
|
15
|
|
18
|
|
|
29
|
|
35
|
|
|
Other
expense
|
155
|
|
148
|
|
164
|
|
|
303
|
|
307
|
|
|
|
Total noninterest
expense
|
1,076
|
|
1,071
|
|
1,013
|
|
|
2,147
|
|
1,944
|
|
Income (loss) from
continuing operations before income taxes
|
913
|
|
765
|
|
215
|
|
|
1,678
|
|
383
|
|
|
Income
taxes
|
189
|
|
147
|
|
30
|
|
|
336
|
|
53
|
|
Income (loss) from
continuing operations
|
724
|
|
618
|
|
185
|
|
|
1,342
|
|
330
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
5
|
|
4
|
|
2
|
|
|
9
|
|
3
|
|
Net income
(loss)
|
729
|
|
622
|
|
187
|
|
|
1,351
|
|
333
|
|
|
Less: Net
income (loss) attributable to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Net income (loss)
attributable to Key
|
$
|
729
|
|
$
|
622
|
|
$
|
187
|
|
|
$
|
1,351
|
|
$
|
333
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
698
|
|
$
|
591
|
|
$
|
159
|
|
|
$
|
1,289
|
|
$
|
277
|
|
Net income (loss)
attributable to Key common shareholders
|
703
|
|
595
|
|
161
|
|
|
1,298
|
|
280
|
|
Per common
share
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.73
|
|
$
|
.61
|
|
$
|
.16
|
|
|
$
|
1.34
|
|
$
|
.29
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
—
|
|
—
|
|
|
.01
|
|
—
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
.73
|
|
.62
|
|
.17
|
|
|
1.35
|
|
.29
|
|
Per common share —
assuming dilution
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.72
|
|
$
|
.61
|
|
$
|
.16
|
|
|
$
|
1.33
|
|
$
|
.28
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
—
|
|
—
|
|
|
.01
|
|
—
|
|
Net income (loss)
attributable to Key common
shareholders (a)
|
.73
|
|
.61
|
|
.17
|
|
|
1.34
|
|
.29
|
|
|
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
$
|
.185
|
|
$
|
.185
|
|
$
|
.185
|
|
|
$
|
.370
|
|
$
|
.370
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding (000)
|
961,292
|
|
964,878
|
|
967,147
|
|
|
957,423
|
|
967,380
|
|
|
Effect of common
share options and other stock awards
|
9,514
|
|
9,419
|
|
4,994
|
|
|
9,740
|
|
6,892
|
|
Weighted-average
common shares and potential common shares outstanding
(000) (b)
|
970,806
|
|
974,297
|
|
972,141
|
|
|
967,163
|
|
974,272
|
|
(a)
|
Earnings per share
may not foot due to rounding.
|
(b)
|
Assumes conversion of
common share options and other stock awards, as
applicable.
|
Consolidated
Average Balance Sheets, and Net Interest Income and Yields/Rates
From Continuing Operations
|
(dollars in
millions)
|
|
|
Second Quarter
2021
|
|
First Quarter
2021
|
|
Second Quarter
2020
|
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
|
Average
|
|
Yield/
|
|
|
Balance
|
Interest
(a)
|
Rate
(a)
|
|
Balance
|
Interest
(a)
|
Rate
(a)
|
|
Balance
|
Interest
(a)
|
Rate
(a)
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans: (b),
(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial (d)
|
$
|
51,808
|
|
$
|
450
|
|
3.52
|
|
|
$
|
52,581
|
|
$
|
453
|
|
3.48
|
|
|
$
|
60,480
|
|
$
|
518
|
|
3.44
|
|
|
Real estate —
commercial mortgage
|
12,825
|
|
117
|
|
3.67
|
|
|
12,658
|
|
114
|
|
3.67
|
|
|
13,510
|
|
128
|
|
3.80
|
|
|
Real estate —
construction
|
$
|
2,149
|
|
$
|
20
|
|
3.68
|
|
|
$
|
2,048
|
|
$
|
19
|
|
3.75
|
|
|
$
|
1,756
|
|
$
|
17
|
|
3.97
|
|
|
Commercial lease
financing
|
4,060
|
|
30
|
|
2.98
|
|
|
4,142
|
|
31
|
|
2.99
|
|
|
4,584
|
|
33
|
|
2.96
|
|
|
Total commercial
loans
|
$
|
70,842
|
|
$
|
617
|
|
3.53
|
|
|
$
|
71,429
|
|
$
|
617
|
|
3.50
|
|
|
$
|
80,330
|
|
$
|
696
|
|
3.49
|
|
|
Real estate —
residential mortgage
|
11,055
|
|
81
|
|
2.92
|
|
|
9,699
|
|
76
|
|
3.12
|
|
|
7,783
|
|
69
|
|
3.57
|
|
|
Home equity
loans
|
$
|
9,089
|
|
$
|
85
|
|
3.76
|
|
|
$
|
9,282
|
|
$
|
85
|
|
3.73
|
|
|
$
|
9,949
|
|
$
|
97
|
|
3.89
|
|
|
Consumer direct
loans
|
4,910
|
|
57
|
|
4.69
|
|
|
4,817
|
|
56
|
|
4.72
|
|
|
4,152
|
|
55
|
|
5.24
|
|
|
Credit
cards
|
$
|
908
|
|
$
|
22
|
|
9.79
|
|
|
$
|
933
|
|
$
|
24
|
|
10.45
|
|
|
$
|
983
|
|
$
|
25
|
|
10.22
|
|
|
Consumer indirect
loans
|
4,010
|
|
32
|
|
3.23
|
|
|
4,568
|
|
37
|
|
3.30
|
|
|
4,744
|
|
45
|
|
3.82
|
|
|
Total consumer
loans
|
$
|
29,972
|
|
$
|
277
|
|
3.74
|
|
|
$
|
29,299
|
|
$
|
278
|
|
3.84
|
|
|
$
|
27,611
|
|
$
|
291
|
|
4.22
|
|
|
Total loans
|
100,814
|
|
894
|
|
3.59
|
|
|
100,728
|
|
895
|
|
3.60
|
|
|
107,941
|
|
987
|
|
3.67
|
|
|
Loans held for
sale
|
$
|
1,616
|
|
$
|
11
|
|
2.60
|
|
|
$
|
1,531
|
|
$
|
11
|
|
2.89
|
|
|
$
|
2,463
|
|
$
|
21
|
|
3.50
|
|
|
Securities available
for sale (b), (e)
|
33,623
|
|
133
|
|
3.13
|
|
|
30,039
|
|
130
|
|
1.76
|
|
|
20,749
|
|
121
|
|
2.43
|
|
|
Held-to-maturity
securities (b)
|
$
|
6,452
|
|
$
|
45
|
|
2.75
|
|
|
$
|
7,188
|
|
$
|
46
|
|
2.53
|
|
|
$
|
9,331
|
|
$
|
56
|
|
2.43
|
|
|
Trading account
assets
|
837
|
|
5
|
|
2.56
|
|
|
848
|
|
5
|
|
2.15
|
|
|
760
|
|
5
|
|
2.43
|
|
|
Short-term
investments
|
$
|
18,817
|
|
$
|
6
|
|
0.13
|
|
|
$
|
16,510
|
|
$
|
5
|
|
0.13
|
|
|
$
|
7,892
|
|
$
|
7
|
|
0.31
|
|
|
Other investments
(e)
|
622
|
|
2
|
|
1.02
|
|
|
614
|
|
2
|
|
1.40
|
|
|
672
|
|
—
|
|
0.29
|
|
|
Total earning
assets
|
$
|
162,781
|
|
$
|
1,096
|
|
2.72
|
|
|
$
|
157,458
|
|
$
|
1,094
|
|
2.81
|
|
|
$
|
149,808
|
|
$
|
1,197
|
|
3.22
|
|
|
Allowance for loan
and lease losses
|
(1,442)
|
|
|
|
|
(1,623)
|
|
|
|
|
(1,413)
|
|
|
|
|
Accrued income and
other assets
|
$
|
16,531
|
|
|
|
|
$
|
16,398
|
|
|
|
|
$
|
15,704
|
|
|
|
|
Discontinued
assets
|
650
|
|
|
|
|
686
|
|
|
|
|
793
|
|
|
|
|
Total
assets
|
$
|
178,520
|
|
|
|
|
$
|
172,919
|
|
|
|
|
$
|
164,892
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
83,981
|
|
$
|
9
|
|
.05
|
|
|
$
|
81,439
|
|
$
|
10
|
|
.05
|
|
|
$
|
75,297
|
|
$
|
56
|
|
.30
|
|
|
Savings
deposits
|
6,859
|
|
1
|
|
.03
|
|
|
6,203
|
|
1
|
|
.03
|
|
|
5,130
|
|
—
|
|
.04
|
|
|
Certificates of
deposit ($100,000 or more)
|
$
|
2,212
|
|
$
|
4
|
|
.72
|
|
|
$
|
2,571
|
|
$
|
6
|
|
.96
|
|
|
$
|
4,950
|
|
$
|
24
|
|
1.93
|
|
|
Other time
deposits
|
2,630
|
|
2
|
|
.38
|
|
|
2,902
|
|
4
|
|
.57
|
|
|
4,333
|
|
16
|
|
1.52
|
|
|
Total
interest-bearing deposits
|
$
|
95,682
|
|
$
|
16
|
|
.07
|
|
|
$
|
93,115
|
|
$
|
21
|
|
.09
|
|
|
$
|
89,710
|
|
$
|
96
|
|
.43
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
251
|
|
—
|
|
.02
|
|
|
243
|
|
—
|
|
.04
|
|
|
242
|
|
—
|
|
.03
|
|
|
Bank notes and other
short-term borrowings
|
$
|
744
|
|
$
|
3
|
|
1.19
|
|
|
$
|
878
|
|
$
|
1
|
|
.64
|
|
|
$
|
2,869
|
|
$
|
5
|
|
.57
|
|
|
Long-term debt
(f), (g)
|
11,978
|
|
54
|
|
1.83
|
|
|
12,831
|
|
60
|
|
1.93
|
|
|
12,954
|
|
71
|
|
2.30
|
|
|
Total
interest-bearing liabilities
|
$
|
108,655
|
|
$
|
73
|
|
.27
|
|
|
$
|
107,067
|
|
$
|
82
|
|
.31
|
|
|
$
|
105,775
|
|
$
|
172
|
|
.66
|
|
|
Noninterest-bearing
deposits
|
48,640
|
|
|
|
|
44,625
|
|
|
|
|
38,267
|
|
|
|
|
Accrued expense and
other liabilities
|
$
|
3,304
|
|
|
|
|
$
|
2,772
|
|
|
|
|
$
|
2,369
|
|
|
|
|
Discontinued
liabilities (g)
|
650
|
|
|
|
|
686
|
|
|
|
|
793
|
|
|
|
|
Total
liabilities
|
$
|
161,249
|
|
|
|
|
$
|
155,150
|
|
|
|
|
$
|
147,204
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Key shareholders'
equity
|
$
|
17,271
|
|
|
|
|
$
|
17,769
|
|
|
|
|
$
|
17,688
|
|
|
|
|
Noncontrolling
interests
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
Total
equity
|
$
|
17,271
|
|
|
|
|
$
|
17,769
|
|
|
|
|
$
|
17,688
|
|
|
|
|
Total liabilities
and equity
|
$
|
178,520
|
|
|
|
|
$
|
172,919
|
|
|
|
|
$
|
164,892
|
|
|
|
Interest rate spread
(TE)
|
|
|
2.45
|
%
|
|
|
|
2.50
|
%
|
|
|
|
2.56
|
%
|
Net interest income
(TE) and net interest margin (TE)
|
|
1,023
|
|
2.52
|
%
|
|
|
1,012
|
|
2.61
|
%
|
|
|
1,025
|
|
2.76
|
%
|
TE adjustment
(b)
|
|
6
|
|
|
|
7
|
|
|
|
7
|
|
|
Net interest income,
GAAP basis
|
|
$
|
1,017
|
|
|
|
|
$
|
1,005
|
|
|
|
|
$
|
1,018
|
|
|
(a)
|
Results are from
continuing operations. Interest excludes the interest
associated with the liabilities referred to in (g) 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 21% for the three months ended June 30, 2021,
March 31, 2021, and June 30,
2020.
|
(c)
|
For purposes of these
computations, nonaccrual loans are included in average loan
balances.
|
(d)
|
Commercial and
industrial average balances include $132 million, $126 million, and
$135 million of assets from commercial credit cards for the three
months ended June 30, 2021, March 31, 2021, and
June 30, 2020, respectively.
|
(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 Key's matched
funds transfer pricing methodology to discontinued
operations.
|
TE = Taxable
Equivalent, GAAP = U.S. generally accepted accounting
principles
|
Consolidated
Average Balance Sheets, and Net Interest Income and
Yields/Rates From Continuing Operations
|
(dollars in
millions)
|
|
|
Six months ended
June 30, 2021
|
|
|
Six months ended
June 30, 2020
|
|
|
Average
|
|
Yield/
|
|
|
Average
|
|
Yield/
|
|
|
Balance
|
Interest
(a)
|
Rate
(a)
|
|
|
Balance
|
Interest
(a)
|
Rate
(a)
|
Assets
|
|
|
|
|
|
|
|
|
|
Loans: (b),
(c)
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial (d)
|
$
|
52,194
|
|
$
|
902
|
|
3.48
|
%
|
|
|
$
|
54,973
|
|
$
|
1,026
|
|
3.75
|
%
|
|
Real estate —
commercial mortgage
|
12,742
|
|
232
|
3.67
|
|
|
|
13,529
|
|
283
|
4.20
|
|
|
Real estate —
construction
|
2,099
|
|
39
|
|
3.71
|
|
|
|
1,711
|
|
37
|
|
4.35
|
|
|
Commercial lease
financing
|
4,101
|
|
61
|
|
2.99
|
|
|
|
4,575
|
|
72
|
|
3.17
|
|
|
Total commercial
loans
|
71,136
|
|
1,234
|
|
3.49
|
|
|
|
74,788
|
|
1,418
|
|
3.81
|
|
|
Real estate —
residential mortgage
|
10,380
|
|
154
|
|
2.97
|
|
|
|
7,500
|
|
137
|
|
3.66
|
|
|
Home equity
loans
|
9,189
|
|
173
|
|
3.79
|
|
|
|
10,052
|
|
210
|
|
4.19
|
|
|
Consumer direct
loans
|
4,864
|
|
113
|
|
4.70
|
|
|
|
3,930
|
|
109
|
|
5.56
|
|
|
Credit
cards
|
920
|
|
46
|
|
10.12
|
|
|
|
1,032
|
|
56
|
|
10.89
|
|
|
Consumer indirect
loans
|
4,288
|
|
69
|
|
3.25
|
|
|
|
4,756
|
|
91
|
|
3.84
|
|
|
Total consumer
loans
|
29,641
|
|
555
|
|
3.77
|
|
|
|
27,270
|
|
603
|
|
4.44
|
|
|
Total
loans
|
100,777
|
|
1,789
|
|
3.58
|
|
|
|
102,058
|
|
2,021
|
|
3.98
|
|
|
Loans held for
sale
|
1,574
|
|
22
|
|
2.74
|
|
|
|
2,174
|
|
40
|
|
3.71
|
|
|
Securities available
for sale (b), (e)
|
31,841
|
|
263
|
|
1.66
|
|
|
|
20,960
|
|
250
|
|
2.46
|
|
|
Held-to-maturity
securities (b)
|
6,818
|
|
90
|
|
2.63
|
|
|
|
9,575
|
|
118
|
|
2.47
|
|
|
Trading account
assets
|
842
|
|
10
|
|
2.35
|
|
|
|
913
|
|
13
|
|
2.73
|
|
|
Short-term
investments
|
17,670
|
|
11
|
|
0.13
|
|
|
|
4,828
|
|
13
|
|
0.52
|
|
|
Other investments
(e)
|
618
|
|
4
|
|
1.21
|
|
|
|
643
|
|
1
|
|
0.34
|
|
|
Total earning
assets
|
160,140
|
|
2,189
|
|
2.75
|
|
|
|
141,151
|
|
2,456
|
|
3.51
|
|
|
Allowance for loan
and lease losses
|
(1532)
|
|
|
|
|
|
(1255)
|
|
|
|
|
Accrued income and
other assets
|
16,463
|
|
|
|
|
|
15,268
|
|
|
|
|
Discontinued
assets
|
668
|
|
|
|
|
|
815
|
|
|
|
|
Total
assets
|
$
|
175,739
|
|
|
|
|
|
$
|
155,979
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
82,717
|
|
20
|
|
.05
|
|
|
|
$
|
71,009
|
|
168
|
|
.47
|
|
|
Savings
deposits
|
6,533
|
|
1
|
|
.03
|
|
|
|
4,893
|
|
1
|
|
.04
|
|
|
Certificates of
deposit ($100,000 or more)
|
2,390
|
|
10
|
|
.85
|
|
|
|
5,630
|
|
58
|
|
2.08
|
|
|
Other time
deposits
|
2,766
|
|
6
|
|
.48
|
|
|
|
4,617
|
|
38
|
|
1.67
|
|
|
Total interest-bearing
deposits
|
94,406
|
|
37
|
|
.08
|
|
|
|
86,149
|
|
265
|
|
.62
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
247
|
|
—
|
|
.03
|
|
|
|
1,122
|
|
6
|
|
1.05
|
|
|
Bank notes and other
short-term borrowings
|
811
|
|
4
|
|
.89
|
|
|
|
2,135
|
|
10
|
|
.90
|
|
|
Long-term debt
(f), (g)
|
12,402
|
|
114
|
|
1.87
|
|
|
|
12,698
|
|
161
|
|
2.62
|
|
|
Total interest-bearing
liabilities
|
107,866
|
|
155
|
|
.29
|
|
|
|
102,104
|
|
442
|
|
.87
|
|
|
Noninterest-bearing
deposits
|
46,638
|
|
|
|
|
|
33,004
|
|
|
|
|
Accrued expense and
other liabilities
|
3,048
|
|
|
|
|
|
2,604
|
|
|
|
|
Discontinued
liabilities (g)
|
668
|
|
|
|
|
|
815
|
|
|
|
|
Total
liabilities
|
158,220
|
|
|
|
|
|
138,527
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
Key shareholders'
equity
|
17,519
|
|
|
|
|
|
17,452
|
|
|
|
|
Noncontrolling
interests
|
—
|
|
|
|
|
|
—
|
|
|
|
|
Total
equity
|
17,519
|
|
|
|
|
|
17,452
|
|
|
|
|
Total liabilities
and equity
|
$
|
175,739
|
|
|
|
|
|
$
|
155,979
|
|
|
|
Interest rate spread
(TE)
|
|
|
2.46
|
%
|
|
|
|
|
2.64
|
%
|
Net interest income
(TE) and net interest margin (TE)
|
|
2,035
|
2.56
|
%
|
|
|
|
2,014
|
|
2.88
|
%
|
TE adjustment
(b)
|
|
13
|
|
|
|
|
15
|
|
|
|
Net interest income,
GAAP basis
|
|
$
|
2,022
|
|
|
|
|
|
$
|
1,999
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Results are from
continuing operations. Interest excludes the interest
associated with the liabilities referred to in (g) 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 21% for the six months ended June 30, 2021, and
June 30, 2020, respectively.
|
(c)
|
For purposes of these
computations, nonaccrual loans are included in average loan
balances.
|
(d)
|
Commercial and
industrial average balances include $129 million and $140 million
of assets from commercial credit cards for the six months ended
June 30, 2021, and June 30, 2020, respectively.
|
(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 Key's matched
funds transfer pricing methodology to discontinued
operations.
|
TE = Taxable
Equivalent, GAAP = U.S. generally accepted accounting
principles
|
Noninterest
Expense
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Personnel
(a)
|
$
|
623
|
|
$
|
624
|
|
$
|
572
|
|
|
$
|
1,247
|
|
$
|
1,087
|
|
Net
occupancy
|
75
|
|
76
|
|
71
|
|
|
151
|
|
147
|
|
Computer
processing
|
71
|
|
73
|
|
56
|
|
|
144
|
|
111
|
|
Business services and
professional fees
|
51
|
|
50
|
|
49
|
|
|
101
|
|
93
|
|
Equipment
|
25
|
|
25
|
|
25
|
|
|
50
|
|
49
|
|
Operating lease
expense
|
31
|
|
34
|
|
34
|
|
|
65
|
|
70
|
|
Marketing
|
31
|
|
26
|
|
24
|
|
|
57
|
|
45
|
|
Intangible asset
amortization
|
14
|
|
15
|
|
18
|
|
|
29
|
|
35
|
|
Other
expense
|
155
|
|
148
|
|
164
|
|
|
303
|
|
307
|
|
Total noninterest
expense
|
$
|
1,076
|
|
$
|
1,071
|
|
$
|
1,013
|
|
|
$
|
2,147
|
|
$
|
1,944
|
|
Average full-time
equivalent employees (b)
|
17,157
|
|
17,086
|
|
16,646
|
|
|
17,122
|
|
16,587
|
|
(a)
|
Additional detail
provided in Personnel Expense 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
|
|
Six months
ended
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Salaries and contract
labor
|
$
|
321
|
|
$
|
320
|
|
$
|
332
|
|
|
$
|
641
|
|
$
|
648
|
|
Incentive and
stock-based compensation
|
210
|
|
196
|
|
162
|
|
|
406
|
|
264
|
|
Employee
benefits
|
92
|
|
107
|
|
76
|
|
|
199
|
|
168
|
|
Severance
|
—
|
|
1
|
|
2
|
|
|
1
|
|
7
|
|
Total personnel
expense
|
$
|
623
|
|
$
|
624
|
|
$
|
572
|
|
|
$
|
1,247
|
|
$
|
1,087
|
|
Loan
Composition
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
Percent change
6/30/2021 vs
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
3/31/2021
|
6/30/2020
|
Commercial and
industrial (a)
|
$
|
50,672
|
|
$
|
52,486
|
|
$
|
58,297
|
|
|
(3.5)
|
%
|
(13.1)
|
%
|
Commercial real
estate:
|
|
|
|
|
|
|
Commercial
mortgage
|
12,965
|
|
12,702
|
|
13,465
|
|
|
2.1
|
|
(3.7)
|
|
Construction
|
2,132
|
|
2,122
|
|
1,919
|
|
|
.5
|
|
11.1
|
|
Total
commercial real estate loans
|
15,097
|
|
14,824
|
|
15,384
|
|
|
1.8
|
|
(1.9)
|
|
Commercial lease
financing (b)
|
4,061
|
|
4,104
|
|
4,524
|
|
|
(1.0)
|
|
(10.2)
|
|
Total
commercial loans
|
69,830
|
|
71,414
|
|
78,205
|
|
|
(2.2)
|
|
(10.7)
|
|
Residential — prime
loans:
|
|
|
|
|
|
|
Real estate —
residential mortgage
|
12,131
|
|
10,300
|
|
8,149
|
|
|
17.8
|
|
48.9
|
|
Home equity
loans
|
9,047
|
|
9,158
|
|
9,782
|
|
|
(1.2)
|
|
(7.5)
|
|
Total
residential — prime loans
|
21,178
|
|
19,458
|
|
17,931
|
|
|
8.8
|
|
18.1
|
|
Consumer direct
loans
|
5,049
|
|
4,862
|
|
4,327
|
|
|
3.8
|
|
16.7
|
|
Credit
cards
|
923
|
|
909
|
|
974
|
|
|
1.5
|
|
(5.2)
|
|
Consumer indirect
loans
|
3,750
|
|
4,283
|
|
4,722
|
|
|
(12.4)
|
|
(20.6)
|
|
Total consumer
loans
|
30,900
|
|
29,512
|
|
27,954
|
|
|
4.7
|
|
10.5
|
|
Total loans (c),
(d)
|
$
|
100,730
|
|
$
|
100,926
|
|
$
|
106,159
|
|
|
(.2)
|
%
|
(5.1)
|
%
|
(a)
|
Loan balances include
$135 million, $126 million, and $132 million of commercial credit
card balances at June 30, 2021, March 31, 2021, and
June 30, 2020, respectively.
|
(b)
|
Commercial lease
financing includes receivables held as collateral for a secured
borrowing of $19 million, $21 million, and $18 million at
June 30, 2021, March 31, 2021, and June 30, 2020,
respectively. Principal reductions are based on the cash payments
received from these related receivables.
|
(c)
|
Total loans exclude
loans of $636 million at June 30, 2021, $675 million at
March 31, 2021, and $780 million at June 30, 2020,
related to the discontinued operations of the education lending
business.
|
(d)
|
Accrued interest of
$225 million, $241 million, and $225 million at June 30, 2021,
March 31, 2021, and June 30, 2020, respectively,
presented in "other assets" on the Consolidated Balance Sheets is
excluded from the amortized cost basis disclosed in this
table.
|
Loans Held for
Sale Composition
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent change
6/30/2021 vs
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
3/31/2021
|
6/30/2020
|
Commercial and
industrial
|
$
|
233
|
|
$
|
1,175
|
|
$
|
419
|
|
|
(80.2)
|
%
|
(44.4)
|
%
|
Real estate —
commercial mortgage
|
1,073
|
|
837
|
|
1,107
|
|
|
28.2
|
|
(3.1)
|
|
Commercial lease
financing
|
—
|
|
—
|
|
—
|
|
|
N/M
|
N/M
|
Real estate —
residential mortgage
|
231
|
|
236
|
|
250
|
|
|
(2.1)
|
|
(7.6)
|
|
Consumer direct
loans
|
—
|
|
48
|
|
231
|
|
|
N/M
|
N/M
|
Total loans held for
sale
|
$
|
1,537
|
|
$
|
2,296
|
|
$
|
2,007
|
|
|
(33.1)
|
%
|
(23.4)
|
%
|
Summary of Changes
in Loans Held for Sale
|
(in
millions)
|
|
|
|
|
|
|
|
2Q21
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
Balance at beginning
of period
|
$
|
2,296
|
|
$
|
1,583
|
|
$
|
1,724
|
|
$
|
2,007
|
|
$
|
2,143
|
|
New
originations
|
3,573
|
|
4,010
|
|
3,835
|
|
3,282
|
|
3,621
|
|
Transfers from (to)
held to maturity, net
|
(71)
|
|
83
|
|
(24)
|
|
75
|
|
(15)
|
|
Loan sales
|
(4,195)
|
|
(3,303)
|
|
(3,932)
|
|
(3,583)
|
|
(3,679)
|
|
Loan draws (payments),
net
|
(27)
|
|
(73)
|
|
(19)
|
|
(57)
|
|
(61)
|
|
Valuation and other
adjustments
|
(39)
|
|
(4)
|
|
—
|
|
—
|
|
(2)
|
|
Balance at end of
period
|
$
|
1,537
|
|
$
|
2,296
|
|
$
|
1,583
|
|
$
|
1,724
|
|
$
|
2,007
|
|
Summary of Loan
and Lease Loss Experience From Continuing Operations
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
6/30/2021
|
3/31/2021
|
6/30/2020
|
|
6/30/2021
|
6/30/2020
|
Average loans
outstanding
|
$
|
100,814
|
|
$
|
100,728
|
|
$
|
107,941
|
|
|
$
|
100,777
|
|
$
|
102,058
|
|
Allowance for loan
and lease losses at the end of the prior period
|
$
|
1,438
|
|
$
|
1,626
|
|
$
|
1359
|
|
|
$
|
1,626
|
|
$
|
900
|
|
Cumulative effect
from change in accounting principle (a)
|
—
|
|
—
|
|
—
|
|
|
—
|
|
204
|
|
Allowance for loan
and lease losses at the beginning of the period
|
1,438
|
|
1,626
|
|
1,359
|
|
|
1,626
|
|
1,104
|
|
Loans charged
off:
|
|
|
|
|
|
|
Commercial and
industrial
|
41
|
|
73
|
|
71
|
|
|
114
|
|
351
|
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
4
|
|
35
|
|
2
|
|
|
39
|
|
19
|
|
Real estate —
construction
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Total
commercial real estate loans
|
4
|
|
35
|
|
2
|
|
|
39
|
|
19
|
|
Commercial lease
financing
|
—
|
|
4
|
|
4
|
|
|
4
|
|
35
|
|
Total
commercial loans
|
45
|
|
112
|
|
77
|
|
|
157
|
|
405
|
|
Real estate —
residential mortgage
|
1
|
|
—
|
|
2
|
|
|
1
|
|
2
|
|
Home equity
loans
|
4
|
|
2
|
|
2
|
|
|
6
|
|
11
|
|
Consumer direct
loans
|
7
|
|
8
|
|
10
|
|
|
15
|
|
37
|
|
Credit
cards
|
9
|
|
6
|
|
12
|
|
|
15
|
|
39
|
|
Consumer indirect
loans
|
5
|
|
7
|
|
7
|
|
|
12
|
|
28
|
|
Total consumer
loans
|
26
|
|
23
|
|
33
|
|
|
49
|
|
117
|
|
Total loans
charged off
|
71
|
|
135
|
|
110
|
|
|
206
|
|
522
|
|
Recoveries:
|
|
|
|
|
|
|
Commercial and
industrial
|
32
|
|
8
|
|
5
|
|
|
40
|
|
34
|
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
6
|
|
1
|
|
—
|
|
|
7
|
|
3
|
|
Real estate —
construction
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
Total
commercial real estate loans
|
6
|
|
1
|
|
—
|
|
|
7
|
|
3
|
|
Commercial lease
financing
|
—
|
|
1
|
|
1
|
|
|
1
|
|
1
|
|
Total
commercial loans
|
38
|
|
10
|
|
6
|
|
|
48
|
|
38
|
|
Real estate —
residential mortgage
|
—
|
|
1
|
|
—
|
|
|
1
|
|
1
|
|
Home equity
loans
|
1
|
|
1
|
|
1
|
|
|
2
|
|
7
|
|
Consumer direct
loans
|
2
|
|
2
|
|
2
|
|
|
4
|
|
7
|
|
Credit
cards
|
3
|
|
2
|
|
2
|
|
|
5
|
|
8
|
|
Consumer indirect
loans
|
5
|
|
5
|
|
3
|
|
|
10
|
|
18
|
|
Total consumer
loans
|
11
|
|
11
|
|
8
|
|
|
22
|
|
41
|
|
Total
recoveries
|
49
|
|
21
|
|
14
|
|
|
70
|
|
78
|
|
Net loan
charge-offs
|
(22)
|
|
(114)
|
|
(96)
|
|
|
(136)
|
|
(443)
|
|
Provision (credit)
for loan and lease losses
|
(196)
|
|
(74)
|
|
445
|
|
|
(270)
|
|
965
|
|
Allowance for loan
and lease losses at end of period
|
$
|
1,220
|
|
$
|
1,438
|
|
$
|
1,708
|
|
|
$
|
1,220
|
|
$
|
1,626
|
|
|
|
|
|
|
|
|
Liability for credit
losses on lending-related commitments at the end of the prior
period
|
$
|
178
|
|
$
|
197
|
|
$
|
161
|
|
|
$
|
197
|
|
$
|
68
|
|
Liability for credit
losses on contingent guarantees at the end of the prior
period
|
—
|
|
—
|
|
—
|
|
|
—
|
|
7
|
|
Cumulative effect from
change in accounting principle (a), (b)
|
—
|
|
—
|
|
—
|
|
|
—
|
|
66
|
|
Liability for credit
losses on lending-related commitments at beginning of
period
|
178
|
|
197
|
|
161
|
|
|
197
|
|
141
|
|
Provision (credit) for
losses on lending-related commitments
|
(26)
|
|
(19)
|
|
37
|
|
|
(45)
|
|
56
|
|
Liability for credit
losses on lending-related commitments at end of period
(c)
|
$
|
152
|
|
$
|
178
|
|
$
|
198
|
|
|
$
|
152
|
|
$
|
197
|
|
|
|
|
|
|
|
|
Total allowance for
credit losses at end of period
|
$
|
1,372
|
|
$
|
1,616
|
|
$
|
1,906
|
|
|
$
|
1,372
|
|
$
|
1,823
|
|
|
|
|
|
|
|
|
Net loan charge-offs
to average total loans
|
.09
|
%
|
.46
|
%
|
.36
|
%
|
|
.27
|
%
|
.35
|
%
|
Allowance for loan
and lease losses to period-end loans
|
1.21
|
|
1.42
|
|
1.61
|
|
|
1.21
|
|
1.61
|
|
Allowance for credit
losses to period-end loans
|
1.36
|
|
1.60
|
|
1.80
|
|
|
1.36
|
|
1.80
|
|
Allowance for loan
and lease losses to nonperforming loans
|
175.8
|
|
197.5
|
|
224.7
|
|
|
175.8
|
|
224.7
|
|
Allowance for credit
losses to nonperforming loans
|
197.7
|
|
222.0
|
|
250.8
|
|
|
197.7
|
|
250.8
|
|
|
|
|
|
|
|
|
Discontinued
operations — education lending business:
|
|
|
|
|
|
|
Loans charged
off
|
$
|
1
|
|
1
|
|
$
|
2
|
|
|
$
|
2
|
|
$
|
5
|
|
Recoveries
|
—
|
|
1
|
|
2
|
|
|
1
|
|
5
|
|
Net loan
charge-offs
|
$
|
(1)
|
|
—
|
|
$
|
—
|
|
|
(1)
|
|
$
|
(1)
|
|
(a)
|
The cumulative effect
from change in accounting principle relates to the January 1, 2020,
adoption of ASU 2016-13.
|
(b)
|
Six months ended June
30, 2020, excludes $4 million related to the provision for other
financial assets as a result of the change in accounting
principle.
|
(c)
|
Included in "Accrued
expense and other liabilities" on the balance sheet.
|
Asset Quality
Statistics From Continuing Operations
|
(dollars in
millions)
|
|
2Q21
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
Net loan
charge-offs
|
$
|
22
|
|
$
|
114
|
|
$
|
135
|
|
$
|
128
|
|
$
|
96
|
|
Net loan charge-offs
to average total loans
|
.09
|
%
|
.46
|
%
|
.53
|
%
|
.49
|
%
|
.36
|
%
|
Allowance for loan
and lease losses
|
$
|
1,220
|
|
$
|
1,438
|
|
$
|
1,626
|
|
$
|
1,730
|
|
$
|
1,708
|
|
Allowance for credit
losses (a)
|
1,372
|
|
1,616
|
|
1,823
|
|
1,938
|
|
1,906
|
|
Allowance for loan
and lease losses to period-end loans
|
1.21
|
%
|
1.42
|
%
|
1.61
|
%
|
1.68
|
%
|
1.61
|
%
|
Allowance for credit
losses to period-end loans
|
1.36
|
|
1.60
|
|
1.80
|
|
1.88
|
|
1.80
|
|
Allowance for loan
and lease losses to nonperforming loans
|
175.8
|
|
197.5
|
|
207.1
|
|
207.4
|
|
224.7
|
|
Allowance for credit
losses to nonperforming loans
|
197.7
|
|
222.0
|
|
232.2
|
|
232.4
|
|
250.8
|
|
Nonperforming loans
at period end
|
$
|
694
|
|
$
|
728
|
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
Nonperforming assets
at period end
|
738
|
|
790
|
|
937
|
|
1,003
|
|
951
|
|
Nonperforming loans
to period-end portfolio loans
|
.69
|
%
|
.72
|
%
|
.78
|
%
|
.81
|
%
|
.72
|
%
|
Nonperforming assets
to period-end portfolio loans plus OREO and other
nonperforming assets
|
.73
|
|
.78
|
|
.92
|
|
.97
|
|
.89
|
|
(a)
|
Includes the
allowance for loan and lease losses plus the liability for credit
losses on lending-related commitments.
|
Summary of
Nonperforming Assets and Past Due Loans From Continuing
Operations
|
(dollars in
millions)
|
|
6/30/2021
|
3/31/2021
|
12/31/2020
|
9/30/2020
|
6/30/2020
|
Commercial and
industrial
|
$
|
355
|
|
$
|
387
|
|
$
|
385
|
|
$
|
459
|
|
$
|
404
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
66
|
|
66
|
|
104
|
|
104
|
|
91
|
|
Real estate —
construction
|
—
|
|
—
|
|
—
|
|
1
|
|
1
|
|
Total commercial real
estate loans
|
66
|
|
66
|
|
104
|
|
105
|
|
92
|
|
Commercial lease
financing
|
7
|
|
8
|
|
8
|
|
6
|
|
9
|
|
Total commercial
loans
|
428
|
|
461
|
|
497
|
|
570
|
|
505
|
|
Real estate —
residential mortgage
|
99
|
|
95
|
|
110
|
|
96
|
|
89
|
|
Home equity
loans
|
146
|
|
148
|
|
154
|
|
146
|
|
141
|
|
Consumer direct
loans
|
4
|
|
5
|
|
5
|
|
3
|
|
3
|
|
Credit
cards
|
3
|
|
3
|
|
2
|
|
2
|
|
2
|
|
Consumer indirect
loans
|
14
|
|
16
|
|
17
|
|
17
|
|
20
|
|
Total consumer
loans
|
266
|
|
267
|
|
288
|
|
264
|
|
255
|
|
Total nonperforming
loans
|
694
|
|
728
|
|
785
|
|
834
|
|
760
|
|
OREO
|
9
|
|
12
|
|
100
|
|
105
|
|
112
|
|
Nonperforming loans
held for sale
|
32
|
|
47
|
|
49
|
|
61
|
|
75
|
|
Other nonperforming
assets
|
3
|
|
3
|
|
3
|
|
3
|
|
4
|
|
Total nonperforming
assets
|
$
|
738
|
|
$
|
790
|
|
$
|
937
|
|
$
|
1,003
|
|
$
|
951
|
|
Accruing loans past
due 90 days or more
|
74
|
|
92
|
|
86
|
|
73
|
|
87
|
|
Accruing loans past
due 30 through 89 days
|
190
|
|
191
|
|
241
|
|
336
|
|
419
|
|
Restructured loans —
accruing and nonaccruing (a)
|
334
|
|
376
|
|
363
|
|
306
|
|
310
|
|
Restructured loans
included in nonperforming loans (a)
|
177
|
|
192
|
|
229
|
|
168
|
|
166
|
|
Nonperforming assets
from discontinued operations — education lending
business
|
5
|
|
5
|
|
5
|
|
6
|
|
7
|
|
Nonperforming loans
to period-end portfolio loans
|
.69
|
%
|
.72
|
%
|
.78
|
%
|
.81
|
%
|
.72
|
%
|
Nonperforming assets
to period-end portfolio loans plus OREO and other nonperforming
assets
|
.73
|
|
.78
|
|
.92
|
|
.97
|
|
.89
|
|
(a)
|
Restructured loans
(i.e., troubled debt restructuring) are those for which Key, for
reasons related to a borrower's 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.
|
Summary of Changes
in Nonperforming Loans From Continuing Operations
|
(in
millions)
|
|
2Q21
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
Balance at beginning
of period
|
$
|
728
|
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
$
|
632
|
|
Loans placed on
nonaccrual status
|
186
|
|
196
|
|
300
|
|
387
|
|
293
|
|
Charge-offs
|
(74)
|
|
(135)
|
|
(160)
|
|
(150)
|
|
(111)
|
|
Loans sold
|
(10)
|
|
(13)
|
|
(9)
|
|
(6)
|
|
(5)
|
|
Payments
|
(92)
|
|
(37)
|
|
(83)
|
|
(83)
|
|
(29)
|
|
Transfers to
OREO
|
—
|
|
(3)
|
|
(3)
|
|
—
|
|
—
|
|
Transfers to
nonperforming loans held for sale
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Loans returned to
accrual status
|
(44)
|
|
(65)
|
|
(94)
|
|
(74)
|
|
(20)
|
|
Balance at end of
period
|
$
|
694
|
|
$
|
728
|
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
Line of Business
Results
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage change
2Q21 vs.
|
|
2Q21
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
|
1Q21
|
2Q20
|
Consumer
Bank
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
|
854
|
|
$
|
867
|
|
$
|
899
|
|
$
|
866
|
|
$
|
835
|
|
|
(1.5)
|
%
|
2.3
|
%
|
Provision for credit
losses
|
(70)
|
|
(23)
|
|
(5)
|
|
(3)
|
|
155
|
|
|
(204.3)
|
|
145.2
|
|
Noninterest
expense
|
584
|
|
601
|
|
606
|
|
567
|
|
552
|
|
|
(2.8)
|
|
5.8
|
|
Net income (loss)
attributable to Key
|
259
|
|
220
|
|
228
|
|
231
|
|
98
|
|
|
17.7
|
|
164.3
|
|
Average loans and
leases
|
40,598
|
|
39,249
|
|
39,455
|
|
38,476
|
|
37,300
|
|
|
3.4
|
|
8.8
|
|
Average
deposits
|
88,412
|
|
85,033
|
|
82,854
|
|
82,836
|
|
79,235
|
|
|
4.0
|
|
11.6
|
|
Net loan
charge-offs
|
34
|
|
36
|
|
28
|
|
23
|
|
40
|
|
|
(5.6)
|
|
(15.0)
|
|
Net loan charge-offs
to average total loans
|
.34
|
%
|
.37
|
%
|
.28
|
%
|
.24
|
%
|
.43
|
%
|
|
(8.1)
|
|
(20.9)
|
|
Nonperforming assets
at period end
|
$
|
274
|
|
$
|
345
|
|
$
|
374
|
|
$
|
353
|
|
$
|
332
|
|
|
(20.6)
|
|
(17.5)
|
|
Return on average
allocated equity
|
28.74
|
%
|
26.10
|
%
|
25.95
|
%
|
26.44
|
%
|
11.50
|
%
|
|
10.1
|
|
149.9
|
|
|
|
|
|
|
|
|
|
|
Commercial
Bank
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
|
874
|
|
$
|
859
|
|
$
|
923
|
|
$
|
813
|
|
$
|
879
|
|
|
1.7
|
%
|
(.6)
|
%
|
Provision for credit
losses
|
(131)
|
|
(67)
|
|
44
|
|
150
|
|
326
|
|
|
95.5
|
|
(120.6)
|
|
Noninterest
expense
|
451
|
|
443
|
|
498
|
|
447
|
|
441
|
|
|
1.8
|
|
2.3
|
|
Net income (loss)
attributable to Key
|
434
|
|
384
|
|
311
|
|
174
|
|
106
|
|
|
13.0
|
|
309.4
|
|
Average loans and
leases
|
59,953
|
|
61,221
|
|
62,016
|
|
66,264
|
|
70,336
|
|
|
(2.1)
|
|
(14.8)
|
|
Average loans held
for sale
|
1,341
|
|
1,237
|
|
1,285
|
|
1,383
|
|
2,012
|
|
|
8.4
|
|
(33.3)
|
|
Average
deposits
|
54,814
|
|
51,894
|
|
52,489
|
|
51,585
|
|
47,954
|
|
|
5.6
|
|
14.3
|
|
Net loan
charge-offs
|
9
|
|
78
|
|
108
|
|
103
|
|
57
|
|
|
(88.5)
|
|
(84.2)
|
|
Net loan charge-offs
to average total loans
|
.06
|
%
|
.52
|
%
|
.69
|
%
|
.62
|
%
|
.33
|
%
|
|
N/A
|
|
N/A
|
|
Nonperforming assets
at period end
|
$
|
464
|
|
$
|
441
|
|
$
|
558
|
|
$
|
645
|
|
$
|
616
|
|
|
5.2
|
|
(24.7)
|
|
Return on average
allocated equity
|
20.79
|
%
|
17.45
|
%
|
23.87
|
%
|
13.43
|
%
|
8.66
|
%
|
|
N/A
|
|
N/A
|
|
TE = Taxable
Equivalent, N/A = Not Applicable, N/M = Not Meaningful
|
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SOURCE KeyCorp