CLEVELAND, April 20, 2021
/PRNewswire/ -- KeyCorp (NYSE: KEY) today announced net income from
continuing operations attributable to Key common shareholders of
$591 million, or $.61 per diluted common share for the first
quarter of 2021. This compared to $549
million, or $.56 per diluted
common share, for the fourth quarter of 2020 and $118 million, or $.12 per diluted common share, for the first
quarter of 2020.
This was a strong start to the year for Key as we executed
our strategy, grew and expanded client relationships, and delivered
positive operating leverage. Our results reflect strong credit
quality as well as record first quarter revenues, with strength in
our investment banking business and ongoing momentum from our
consumer growth engines.
We have continued to make investments in our business to
position the company for success. In March, we successfully
launched Laurel Road for Doctors, a digital platform
tailored to the unique financial needs of healthcare professionals.
Additionally, this platform expands our digital reach nationally,
for this targeted client segment. Laurel Road for Doctors
underscores our commitment to both targeted scale and digital
transformation.
Credit quality continued to be a strength this quarter. Our
strong risk management practices contributed to broad-based
improvement in our credit metrics.
Maintaining our strong capital position also remains a
priority. Our Common Equity Tier 1 ratio at the end of the
first quarter was 9.8%, which is above our targeted range of 9.0%
to 9.5%. In January, our Board of Directors authorized a
$900 million share repurchase program
of which we executed $135 million in
the first quarter.
I remain optimistic about the future as we emerge from the
pandemic and the economic recovery continues. Key is
well-positioned to grow and deliver on our commitments to all of
our stakeholders.
- Chris Gorman, Chairman and CEO
Selected Financial
Highlights
|
|
|
|
|
|
|
|
|
dollars in
millions, except per share data
|
|
Change 1Q21
vs.
|
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
591
|
|
$
|
549
|
|
$
|
118
|
|
|
7.7
|
%
|
400.8
|
%
|
Income (loss) from
continuing operations attributable to Key common shareholders
per
common share — assuming
dilution
|
.61
|
|
.56
|
|
.12
|
|
|
8.9
|
|
408.3
|
|
Return on average
tangible common equity from continuing operations
(a)
|
18.25
|
%
|
16.61
|
%
|
3.82
|
%
|
|
N/A
|
N/A
|
Return on average
total assets from continuing operations
|
1.44
|
|
1.35
|
|
.40
|
|
|
N/A
|
N/A
|
Common Equity Tier 1
ratio (b)
|
9.8
|
|
9.7
|
|
8.9
|
|
|
N/A
|
N/A
|
Book value at period
end
|
$
|
16.22
|
|
$
|
16.53
|
|
$
|
15.95
|
|
|
(1.9)
|
%
|
1.7
|
%
|
Net interest margin
(TE) from continuing operations
|
2.61
|
%
|
2.70
|
%
|
3.01
|
%
|
|
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)
|
March 31, 2021
ratio is estimated.
|
TE = Taxable
Equivalent, N/A = Not Applicable
|
INCOME STATEMENT
HIGHLIGHTS
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Net interest income
(TE)
|
$
|
1,012
|
|
$
|
1,043
|
|
$
|
989
|
|
|
(3.0)
|
%
|
2.3
|
%
|
Noninterest
income
|
738
|
|
802
|
|
477
|
|
|
(8.0)
|
|
54.7
|
|
Total
revenue
|
$
|
1,750
|
|
$
|
1,845
|
|
$
|
1,466
|
|
|
(5.1)
|
%
|
19.4
|
%
|
|
|
|
|
|
|
|
Taxable-equivalent net interest income was $1.0 billion for the first quarter of 2021,
compared to taxable-equivalent net interest income of $989 million for the first quarter of 2020. The
increase in net interest income reflects higher earning asset
balances and loan fees, partially offset by a lower net interest
margin. 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 fourth quarter of 2020, taxable-equivalent net
interest income decreased by $31
million and the net interest margin decreased by 9 basis
points. The decrease in both net interest income and the net
interest margin reflects lower reinvestment yields, lower loan
fees, and an unfavorable balance sheet mix, including elevated
levels of liquidity, partly offset by lower interest-bearing
deposit costs. Net interest income was also impacted by two fewer
days in the first quarter of 2021.
Noninterest
Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Trust and investment
services income
|
$
|
133
|
|
$
|
123
|
|
$
|
133
|
|
|
8.1
|
%
|
—
|
%
|
Investment banking
and debt placement fees
|
162
|
|
243
|
|
116
|
|
|
(33.3)
|
|
39.7
|
|
Service charges on
deposit accounts
|
73
|
|
82
|
|
84
|
|
|
(11.0)
|
|
(13.1)
|
|
Operating lease
income and other leasing gains
|
38
|
|
39
|
|
30
|
|
|
(2.6)
|
|
26.7
|
|
Corporate services
income
|
64
|
|
63
|
|
62
|
|
|
1.6
|
|
3.2
|
|
Cards and payments
income
|
105
|
|
97
|
|
66
|
|
|
8.2
|
|
59.1
|
|
Corporate-owned life
insurance income
|
31
|
|
38
|
|
36
|
|
|
(18.4)
|
|
(13.9)
|
|
Consumer mortgage
income
|
47
|
|
43
|
|
20
|
|
|
9.3
|
|
135.0
|
|
Commercial mortgage
servicing fees
|
34
|
|
32
|
|
18
|
|
|
6.3
|
|
88.9
|
|
Other
income
|
51
|
|
42
|
|
(88)
|
|
|
21.4
|
|
(158.0)
|
|
Total noninterest
income
|
$
|
738
|
|
$
|
802
|
|
$
|
477
|
|
|
(8.0)
|
%
|
54.7
|
%
|
|
|
|
|
|
|
|
Compared to the first quarter of 2020, noninterest income
increased by $261 million, primarily
driven by a $139 million increase in
other income including $92 million of
market-related valuation adjustments in the year-ago quarter.
Investment banking and debt placement fees increased $46 million from the year-ago period, due to
strength in the debt and equity markets. Cards and payments income
increased $39 million, due to
heightened prepaid card activity. Additionally, investments made in
Key's mortgage business continue to drive consumer mortgage income
and commercial mortgage servicing fees, which increased
$27 million and $16 million, respectively, from the year-ago
quarter.
Compared to the fourth quarter of 2020, noninterest income
decreased by $64 million. The largest
driver of the quarter-over-quarter decrease was a $81 million decrease in investment banking and
debt placement fees, partially driven by expected seasonality.
Partially offsetting the decrease was a $10
million increase in trust and investment services income and
a $8 million increase in cards and
payments income.
Noninterest
Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Personnel
expense
|
$
|
624
|
|
$
|
661
|
|
$
|
515
|
|
|
(5.6)
|
%
|
21.2
|
%
|
Nonpersonnel
expense
|
447
|
|
467
|
|
416
|
|
|
(4.3)
|
|
7.5
|
|
Total noninterest
expense
|
$
|
1,071
|
|
$
|
1,128
|
|
$
|
931
|
|
|
(5.1)
|
%
|
15.0
|
%
|
|
|
|
|
|
|
|
Key's noninterest expense was $1.1
billion for the first quarter of 2021, an increase of
$140 million from the year-ago
period. The increase is primarily related to higher personnel costs
of $109 million, reflecting higher
incentive and stock-based compensation, attributed to an increase
in revenue and stock performance and an increase in employee
benefits. Other drivers for the year-over-year increases include
payments-related expenses from prepaid card activity incurred in
the current period, as well as computer processing expenses.
Compared to the fourth quarter of 2020, noninterest expense
decreased $57 million. This was
largely due to decreases in severance, incentive and stock-based
compensation, and salaries and contract labor. Additionally, other
expense decreased $22 million,
partially due to lower charitable contributions.
BALANCE SHEET
HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Commercial and
industrial (a)
|
$
|
52,581
|
|
$
|
53,562
|
|
$
|
49,466
|
|
|
(1.8)
|
%
|
6.3
|
%
|
Other commercial
loans
|
18,848
|
|
19,174
|
|
19,779
|
|
|
(1.7)
|
|
(4.7)
|
|
Total consumer
loans
|
29,299
|
|
28,974
|
|
26,929
|
|
|
1.1
|
|
8.8
|
|
Total loans
|
$
|
100,728
|
|
$
|
101,710
|
|
$
|
96,174
|
|
|
(1.0)
|
%
|
4.7
|
%
|
|
|
|
|
|
|
|
|
|
(a)
|
Commercial and
industrial average loan balances include $126 million, $129
million, and $145 million of assets from commercial credit cards at
March 31, 2021, December 31, 2020, and March 31,
2020, respectively.
|
Average loans were $100.7 billion
for the first quarter of 2021, an increase of $4.6 billion compared to the first quarter of
2020. Commercial loans increased $2.2
billion, reflecting Key's participation in the Paycheck
Protection Program ("PPP"), partially offset by decreased
utilization versus the year-ago period. Consumer loans increased
$2.4 billion, driven by strength from
Laurel Road and Key's consumer mortgage business.
Compared to the fourth quarter of 2020, average loans decreased
by $1.0 billion. Commercial loans
declined due to the forgiveness of a portion of PPP loans and lower
commercial utilization rates. Consumer loans continue to reflect
strength from Key's consumer mortgage business, as well as Laurel
Road.
Average
Deposits
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Non-time
deposits
|
$
|
132,267
|
|
$
|
129,529
|
|
$
|
99,117
|
|
|
2.1
|
%
|
33.4
|
%
|
Certificates of
deposit ($100,000 or more)
|
2,571
|
|
2,983
|
|
6,310
|
|
|
(13.8)
|
|
(59.3)
|
|
Other time
deposits
|
2,902
|
|
3,209
|
|
4,901
|
|
|
(9.6)
|
|
(40.8)
|
|
Total
deposits
|
$
|
137,740
|
|
$
|
135,721
|
|
$
|
110,328
|
|
|
1.5
|
%
|
24.8
|
%
|
|
|
|
|
|
|
|
Cost of total
deposits
|
.06
|
%
|
.08
|
%
|
.62
|
%
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
Average deposits totaled $137.7
billion for the first quarter of 2021, an increase of
$27.4 billion compared to the
year-ago quarter, reflecting growth from consumer and commercial
relationships, partially offset by a decline in time deposits as a
result of lower interest rates.
Compared to the fourth quarter of 2020, average deposits
increased by $2.0 billion, primarily
driven by broad-based commercial growth and higher consumer
balances.
ASSET
QUALITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Net loan
charge-offs
|
$
|
114
|
|
$
|
135
|
|
$
|
84
|
|
|
(15.6)
|
%
|
35.7
|
%
|
Net loan charge-offs
to average total loans
|
.46
|
%
|
.53
|
%
|
.35
|
%
|
|
N/A
|
N/A
|
Nonperforming loans
at period end
|
$
|
728
|
|
$
|
785
|
|
$
|
632
|
|
|
(7.3)
|
|
15.2
|
|
Nonperforming assets
at period end
|
790
|
|
937
|
|
844
|
|
|
(15.7)
|
|
(6.4)
|
|
Allowance for loan
and lease losses
|
1,438
|
|
1,626
|
|
1,359
|
|
|
(11.6)
|
|
5.8
|
|
Allowance for credit
losses
|
1,616
|
|
1,823
|
|
1,520
|
|
|
(11.4)
|
|
6.3
|
|
Allowance for loan
and lease losses to nonperforming loans
|
197.5
|
%
|
207.1
|
%
|
215.0
|
%
|
|
N/A
|
N/A
|
Allowance for credit
losses to nonperforming loans
|
222.0
|
|
232.2
|
|
240.5
|
|
|
N/A
|
N/A
|
Provision for credit
losses
|
$
|
(93)
|
|
$
|
20
|
|
$
|
359
|
|
|
(565.0)
|
%
|
(125.9)
|
%
|
|
|
|
|
|
|
|
Key's provision for credit losses was a net benefit of
$93 million, including a $207 million reserve release for the first
quarter of 2021, compared to an expense of $359 million in the first quarter of 2020 and an
expense of $20 million in the fourth
quarter of 2020. The reserve release was largely driven by expected
improvement in the economic outlook.
Net loan charge-offs for the first quarter of 2021 totaled
$114 million, or .46% of average
total loans. These results compare to $84
million, or .35%, for the first quarter of 2020 and
$135 million, or .53%, for the fourth
quarter of 2020. Key's allowance for credit losses was $1.6 billion, or 1.60% of total period-end loans
at March 31, 2021, compared to 1.47% at March 31, 2020,
and 1.80% at December 31, 2020.
At March 31, 2021, Key's nonperforming loans totaled
$728 million, which represented .72%
of period-end portfolio loans. These results compare to .61% at
March 31, 2020, and .78% at December 31, 2020.
Nonperforming assets at March 31, 2021, totaled $790 million, and represented .78% of period-end
portfolio loans and OREO and other nonperforming assets. These
results compare to .82% at March 31, 2020, and .92% at
December 31, 2020.
CAPITAL
Key's estimated risk-based capital ratios included in the
following table continued to exceed all "well-capitalized"
regulatory benchmarks at March 31, 2021.
Capital
Ratios
|
|
|
|
|
|
|
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Common Equity Tier 1
(a)
|
9.8
|
%
|
9.7
|
%
|
8.9
|
%
|
Tier 1 risk-based
capital (a)
|
11.2
|
|
11.1
|
|
10.2
|
|
Total risk-based
capital (a)
|
13.4
|
|
13.4
|
|
12.2
|
|
Tangible common
equity to tangible assets (b)
|
7.5
|
|
7.9
|
|
8.3
|
|
Leverage
(a)
|
8.9
|
|
8.9
|
|
9.8
|
|
|
|
|
|
|
|
(a)
|
March 31, 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 first quarter of
2021. As shown in the preceding table, at March 31, 2021,
Key's estimated Common Equity Tier 1 and Tier 1 risk-based capital
ratios stood at 9.8% and 11.2%, respectively. Key's tangible common
equity ratio was 7.5% at March 31, 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 25 basis points.
Summary of Changes
in Common Shares Outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
in
thousands
|
|
|
|
|
Change 1Q21
vs.
|
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Shares outstanding at
beginning of period
|
975,773
|
|
976,205
|
|
977,189
|
|
|
—
|
|
(.1)
|
%
|
Open market
repurchases and return of shares under employee compensation
plans
|
(9,277)
|
|
(1,092)
|
|
(7,862)
|
|
|
749.5
|
|
18.0
|
|
Shares issued under
employee compensation plans (net of cancellations)
|
6,091
|
|
660
|
|
5,992
|
|
|
822.9
|
%
|
1.7
|
|
|
Shares outstanding at
end of period
|
972,587
|
|
975,773
|
|
975,319
|
|
|
(.3)
|
|
(.3)
|
%
|
|
|
|
|
|
|
|
|
Consistent with Key's 2020 Capital Plan, during the first
quarter of 2021, Key declared a dividend of $.185 per common share. In January, Key announced
a new share repurchase authorization program of up to $900 million, applicable through September 30, 2021. During the first quarter, Key
completed $135 million of common
share repurchases.
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 1Q21
vs.
|
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Revenue from
continuing operations (TE)
|
|
|
|
|
|
|
Consumer
Bank
|
$
|
864
|
|
$
|
896
|
|
$
|
810
|
|
|
(3.6)
|
%
|
6.7
|
%
|
Commercial
Bank
|
858
|
|
922
|
|
641
|
|
|
(6.9)
|
|
33.9
|
|
Other
(a)
|
28
|
|
27
|
|
15
|
|
|
3.7
|
|
86.7
|
|
|
Total
|
$
|
1,750
|
|
$
|
1,845
|
|
$
|
1,466
|
|
|
(5.1)
|
%
|
19.4
|
%
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key
|
|
|
|
|
|
|
Consumer
Bank
|
$
|
217
|
|
$
|
225
|
|
$
|
103
|
|
|
(3.6)
|
%
|
110.7
|
%
|
Commercial
Bank
|
383
|
|
310
|
|
66
|
|
|
23.5
|
|
480.3
|
|
Other
(a)
|
18
|
|
40
|
|
(24)
|
|
|
(55.0)
|
|
N/M
|
|
Total
|
$
|
618
|
|
$
|
575
|
|
$
|
145
|
|
|
7.5
|
%
|
326.2
|
%
|
|
|
|
|
|
|
|
|
|
|
(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 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Summary of
operations
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
|
607
|
|
$
|
638
|
|
$
|
581
|
|
|
(4.9)
|
%
|
4.5
|
%
|
Noninterest
income
|
257
|
|
258
|
|
229
|
|
|
(.4)
|
|
12.2
|
|
Total revenue
(TE)
|
864
|
|
896
|
|
810
|
|
|
(3.6)
|
|
6.7
|
|
Provision for credit
losses
|
(23)
|
|
(5)
|
|
136
|
|
|
(360.0)
|
|
(116.9)
|
|
Noninterest
expense
|
601
|
|
606
|
|
539
|
|
|
(.8)
|
|
11.5
|
|
Income (loss) before
income taxes (TE)
|
286
|
|
295
|
|
135
|
|
|
(3.1)
|
|
111.9
|
|
Allocated income
taxes (benefit) and TE adjustments
|
69
|
|
70
|
|
32
|
|
|
(1.4)
|
|
115.6
|
|
Net income (loss)
attributable to Key
|
$
|
217
|
|
$
|
225
|
|
$
|
103
|
|
|
(3.6)
|
%
|
110.7
|
%
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
Loans and
leases
|
$
|
39,249
|
|
$
|
39,448
|
|
$
|
33,175
|
|
|
(.5)
|
%
|
18.3
|
%
|
Total
assets
|
42,476
|
|
42,666
|
|
36,415
|
|
|
(.4)
|
|
16.6
|
|
Deposits
|
85,033
|
|
82,845
|
|
73,133
|
|
|
2.6
|
|
16.3
|
|
|
|
|
|
|
|
|
Assets under
management at period end
|
$
|
45,218
|
|
$
|
44,140
|
|
$
|
36,189
|
|
|
2.4
|
%
|
24.9
|
%
|
|
|
|
|
|
|
|
Additional
Consumer Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Noninterest
income
|
|
|
|
|
|
|
Trust and investment
services income
|
$
|
101
|
|
$
|
95
|
|
$
|
93
|
|
|
6.3
|
%
|
8.6
|
%
|
Service charges on
deposit accounts
|
39
|
|
49
|
|
55
|
|
|
(20.4)
|
|
(29.1)
|
|
Cards and payments
income
|
54
|
|
54
|
|
49
|
|
|
—
|
|
10.2
|
|
Consumer mortgage
income
|
47
|
|
43
|
|
20
|
|
|
9.3
|
|
135.0
|
|
Other noninterest
income
|
16
|
|
17
|
|
12
|
|
|
(5.9)
|
|
33.3
|
|
Total noninterest
income
|
$
|
257
|
|
$
|
258
|
|
$
|
229
|
|
|
(.4)
|
%
|
12.2
|
%
|
|
|
|
|
|
|
|
Average deposit
balances
|
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
54,684
|
|
$
|
53,045
|
|
$
|
45,569
|
|
|
3.1
|
%
|
20.0
|
%
|
Savings
deposits
|
5,878
|
|
5,407
|
|
4,345
|
|
|
8.7
|
|
35.3
|
|
Certificates of
deposit ($100,000 or more)
|
2,424
|
|
2,801
|
|
5,587
|
|
|
(13.5)
|
|
(56.6)
|
|
Other time
deposits
|
2,888
|
|
3,187
|
|
4,869
|
|
|
(9.4)
|
|
(40.7)
|
|
Noninterest-bearing
deposits
|
19,159
|
|
18,406
|
|
12,763
|
|
|
4.1
|
|
50.1
|
|
Total
deposits
|
$
|
85,033
|
|
$
|
82,845
|
|
$
|
73,133
|
|
|
2.6
|
|
16.3
|
%
|
|
|
|
|
|
|
|
Home equity
loans
|
|
|
|
|
|
|
Average
balance
|
$
|
9,234
|
|
$
|
9,360
|
|
$
|
10,093
|
|
|
|
|
Combined
weighted-average loan-to-value ratio (at date of
origination)
|
69
|
%
|
69
|
%
|
70
|
%
|
|
|
|
Percent first lien
positions
|
68
|
|
66
|
|
62
|
|
|
|
|
|
|
|
|
|
|
|
Other
data
|
|
|
|
|
|
|
Branches
|
1,068
|
|
1,073
|
|
1,082
|
|
|
|
|
Automated teller
machines
|
1,368
|
|
1,386
|
|
1,398
|
|
|
|
|
|
|
|
|
|
|
|
Consumer Bank Summary of Operations (1Q21 vs. 1Q20)
- Net income attributable to Key of $217
million for the first quarter of 2021, compared to
$103 million for the year-ago
quarter
- Taxable-equivalent net interest income increased by
$26 million, or 4.5%, compared to the
first quarter of 2020, driven by strong balance sheet growth and
fees related to PPP loans, partially offset by the lower interest
rate environment
- Average loans and leases increased $6.1
billion, or 18.3%, driven by benefit from the PPP, as well
as growth from Laurel Road and consumer mortgage
- Average deposits increased $11.9
billion, or 16.3%, from the first quarter of 2020. This was
driven by consumer stimulus payments and relationship growth
- Provision for credit losses decreased $159 million compared to the first 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 $28
million, or 12.2%, from the year ago quarter, due to higher
trust and investment services income, and strength in consumer
mortgage income
- Noninterest expense increased $62
million, or 11.5%, from the year ago quarter, driven by
higher variable compensation from significantly favorable revenue
and higher variable expenses related to higher loan volumes
Commercial
Bank
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Summary of
operations
|
|
|
|
|
|
|
Net interest income
(TE)
|
$
|
411
|
|
$
|
420
|
|
$
|
421
|
|
|
(2.1)
|
%
|
(2.4)
|
%
|
Noninterest
income
|
447
|
|
502
|
|
220
|
|
|
(11.0)
|
|
103.2
|
|
Total revenue
(TE)
|
858
|
|
922
|
|
641
|
|
|
(6.9)
|
|
33.9
|
|
Provision for credit
losses
|
(67)
|
|
44
|
|
222
|
|
|
(252.3)
|
|
(130.2)
|
|
Noninterest
expense
|
443
|
|
498
|
|
362
|
|
|
(11.0)
|
|
22.4
|
|
Income (loss) before
income taxes (TE)
|
482
|
|
380
|
|
57
|
|
|
26.8
|
|
745.6
|
|
Allocated income
taxes and TE adjustments
|
99
|
|
70
|
|
(9)
|
|
|
41.4
|
|
N/M
|
Net income (loss)
attributable to Key
|
$
|
383
|
|
$
|
310
|
|
$
|
66
|
|
|
23.5
|
%
|
480.3
|
%
|
|
|
|
|
|
|
|
Average
balances
|
|
|
|
|
|
|
Loans and
leases
|
$
|
60,885
|
|
$
|
61,680
|
|
$
|
62,104
|
|
|
(1.3)
|
%
|
(2.0)
|
%
|
Loans held for
sale
|
1,237
|
|
1,285
|
|
1,607
|
|
|
(3.7)
|
|
(23.0)
|
|
Total
assets
|
70,114
|
|
70,969
|
|
71,410
|
|
|
(1.2)
|
|
(1.8)
|
|
Deposits
|
51,894
|
|
52,489
|
|
36,443
|
|
|
(1.1)
|
%
|
42.4
|
%
|
|
|
|
|
|
|
|
|
TE = Taxable
Equivalent, N/M = Not Meaningful
|
Additional
Commercial Bank Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
dollars in
millions
|
|
|
|
|
Change 1Q21
vs.
|
|
1Q21
|
4Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Noninterest
income
|
|
|
|
|
|
|
Trust and investment
services income
|
$
|
32
|
|
$
|
28
|
|
$
|
39
|
|
|
14.3
|
%
|
(17.9)
|
|
Investment banking
and debt placement fees
|
162
|
|
243
|
|
116
|
|
|
(33.3)
|
|
39.7
|
%
|
Operating lease
income and other leasing gains
|
38
|
|
39
|
|
30
|
|
|
(2.6)
|
|
26.7
|
|
|
|
|
|
|
|
|
Corporate services
income
|
56
|
|
55
|
|
58
|
|
|
1.8
|
|
(3.4)
|
|
Service charges on
deposit accounts
|
33
|
|
32
|
|
29
|
|
|
3.1
|
|
13.8
|
|
Cards and payments
income
|
51
|
|
43
|
|
17
|
|
|
18.6
|
|
200.0
|
|
Payments and services
income
|
140
|
|
130
|
|
104
|
|
|
7.7
|
|
34.6
|
|
|
|
|
|
|
|
|
Commercial mortgage
servicing fees
|
34
|
|
32
|
|
18
|
|
|
6.3
|
|
88.9
|
|
Other noninterest
income
|
41
|
|
30
|
|
(87)
|
|
|
36.7
|
|
147.1
|
|
Total noninterest
income
|
$
|
447
|
|
$
|
502
|
|
$
|
220
|
|
|
(11.0)
|
%
|
103.2
|
%
|
|
|
|
|
|
|
|
Commercial Bank Summary of Operations (1Q21 vs. 1Q20)
- Net income attributable to Key of $383
million for the first quarter of 2021, compared to
$66 million for the year-ago
quarter
- Taxable-equivalent net interest income decreased by
$10 million, compared to the first
quarter of 2020, as the lower interest rate environment offset fees
related to PPP loans
- Average loan and lease balances decreased $1.2 billion, compared to the first quarter of
2020 as lower utilization offset PPP loans
- Average deposit balances increased $15.5
billion, or 42.4%, compared to the first quarter of 2020,
driven by growth in targeted relationships and the impact of
government programs
- Provision for credit losses decreased $289 million compared to the first quarter of
2020. The provision for credit losses was a net benefit and was
driven by expected improvements in economic conditions
- Noninterest income increased $227
million, from the year-ago quarter, driven by favorable
market-related adjustments to customer derivatives compared to
detriments in 2020, increased investment banking client activity,
and higher cards and payments income related to prepaid card
revenue
- Noninterest expense increased by $81
million, or 22.4%, from the first quarter of 2020, driven by
higher variable compensation from significantly favorable revenue
and elevated variable expenses related to prepaid card
*******************************************
KeyCorp's roots trace back 190 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 $176.2
billion at March 31, 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 1,400 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 Tuesday, April 20,
2021. A replay of the call will be available through
April 29, 2021.
For up-to-date company information, media contacts, and facts
and figures about Key's lines of business, visit our Media Newsroom
at https://www.key.com/newsroom.
*****
KeyCorp
|
First Quarter
2021
|
Financial
Supplement
|
|
Page
|
|
14
|
Financial
Highlights
|
15
|
GAAP to Non-GAAP
Reconciliation
|
17
|
Consolidated Balance
Sheets
|
18
|
Consolidated
Statements of Income
|
19
|
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
|
|
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Summary of
operations
|
|
|
|
|
Net interest income
(TE)
|
$
|
1,012
|
|
$
|
1,043
|
|
$
|
989
|
|
|
Noninterest
income
|
738
|
|
802
|
|
477
|
|
|
|
Total revenue
(TE)
|
1,750
|
|
1,845
|
|
1,466
|
|
|
Provision for credit
losses
|
(93)
|
|
20
|
|
359
|
|
|
Noninterest
expense
|
1,071
|
|
1,128
|
|
931
|
|
|
Income (loss) from
continuing operations attributable to Key
|
618
|
|
575
|
|
145
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
4
|
|
7
|
|
1
|
|
|
Net income (loss)
attributable to Key
|
622
|
|
582
|
|
146
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
591
|
|
549
|
|
118
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
4
|
|
7
|
|
1
|
|
|
Net income (loss)
attributable to Key common shareholders
|
595
|
|
556
|
|
119
|
|
|
|
|
|
|
|
Per common
share
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.61
|
|
$
|
.57
|
|
$
|
.12
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
.01
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
.62
|
|
.57
|
|
.12
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common shareholders —
assuming dilution
|
.61
|
|
.56
|
|
.12
|
|
|
Income (loss) from
discontinued operations, net of taxes — assuming
dilution
|
—
|
|
.01
|
|
—
|
|
|
Net income (loss)
attributable to Key common shareholders — assuming dilution
(a)
|
.61
|
|
.57
|
|
.12
|
|
|
|
|
|
|
|
|
Cash dividends
declared
|
.185
|
|
.185
|
|
.185
|
|
|
Book value at period
end
|
16.22
|
|
16.53
|
|
15.95
|
|
|
Tangible book value
at period end
|
13.30
|
|
13.61
|
|
12.98
|
|
|
Market price at
period end
|
19.98
|
|
16.41
|
|
10.37
|
|
|
|
|
|
|
|
Performance
ratios
|
|
|
|
|
From continuing
operations:
|
|
|
|
|
Return on average
total assets
|
1.44
|
%
|
1.35
|
%
|
.40
|
%
|
|
Return on average
common equity
|
14.98
|
|
13.65
|
|
3.10
|
|
|
Return on average
tangible common equity (b)
|
18.25
|
|
16.61
|
|
3.82
|
|
|
Net interest margin
(TE)
|
2.61
|
|
2.70
|
|
3.01
|
|
|
Cash efficiency ratio
(b)
|
60.3
|
|
60.3
|
|
62.3
|
|
|
|
|
|
|
|
|
From consolidated
operations:
|
|
|
|
|
Return on average
total assets
|
1.45
|
%
|
1.36
|
%
|
.40
|
%
|
|
Return on average
common equity
|
15.08
|
|
13.82
|
|
3.12
|
|
|
Return on average
tangible common equity (b)
|
18.37
|
|
16.82
|
|
3.86
|
|
|
Net interest margin
(TE)
|
2.60
|
|
2.69
|
|
3.00
|
|
|
Loan to deposit
(c)
|
73.1
|
|
76.5
|
|
92.1
|
|
|
|
|
|
|
|
Capital ratios at
period end
|
|
|
|
|
Key shareholders'
equity to assets
|
10.0
|
%
|
10.6
|
%
|
11.1
|
%
|
|
Key common
shareholders' equity to assets
|
9.0
|
|
9.5
|
|
10.0
|
|
|
Tangible common
equity to tangible assets (b)
|
7.5
|
|
7.9
|
|
8.3
|
|
|
Common Equity Tier 1
(d)
|
9.8
|
|
9.7
|
|
8.9
|
|
|
Tier 1 risk-based
capital (d)
|
11.2
|
|
11.1
|
|
10.2
|
|
|
Total risk-based
capital (d)
|
13.4
|
|
13.4
|
|
12.2
|
|
|
Leverage
(d)
|
8.9
|
|
8.9
|
|
9.8
|
|
|
|
|
|
|
|
Asset quality —
from continuing operations
|
|
|
|
|
Net loan
charge-offs
|
$
|
114
|
|
$
|
135
|
|
$
|
84
|
|
|
Net loan charge-offs
to average loans
|
.46
|
%
|
.53
|
%
|
.35
|
%
|
|
Allowance for loan
and lease losses
|
$
|
1,438
|
|
$
|
1,626
|
|
$
|
1,359
|
|
|
Allowance for credit
losses
|
1,616
|
|
1,823
|
|
1,520
|
|
|
Allowance for loan
and lease losses to period-end loans
|
1.42
|
%
|
1.61
|
%
|
1.32
|
%
|
|
Allowance for credit
losses to period-end loans
|
1.60
|
|
1.80
|
|
1.47
|
|
|
Allowance for loan
and lease losses to nonperforming loans
|
197.5
|
|
207.1
|
|
215.0
|
|
|
Allowance for credit
losses to nonperforming loans
|
222.0
|
|
232.2
|
|
240.5
|
|
|
Nonperforming loans
at period-end
|
$
|
728
|
|
$
|
785
|
|
$
|
632
|
|
|
Nonperforming assets
at period-end
|
790
|
|
937
|
|
844
|
|
|
Nonperforming loans
to period-end portfolio loans
|
.72
|
%
|
.78
|
%
|
.61
|
%
|
|
Nonperforming assets
to period-end portfolio loans plus OREO and other nonperforming
assets
|
.78
|
|
.92
|
|
.82
|
|
|
|
|
|
|
|
Trust
assets
|
|
|
|
|
Assets under
management
|
$
|
45,218
|
|
$
|
44,140
|
|
$
|
36,189
|
|
|
|
|
|
|
|
Other
data
|
|
|
|
|
Average full-time
equivalent employees
|
17,086
|
|
17,029
|
|
16,529
|
|
|
Branches
|
1,068
|
|
1,073
|
|
1,082
|
|
|
Taxable-equivalent
adjustment
|
$
|
7
|
|
$
|
8
|
|
$
|
8
|
|
|
|
(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)
|
March 31, 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
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Tangible common
equity to tangible assets at period-end
|
|
|
|
Key shareholders'
equity (GAAP)
|
$
|
17,634
|
|
$
|
17,981
|
|
$
|
17,411
|
|
Less: Intangible
assets (a)
|
2,842
|
|
2,848
|
|
2,894
|
|
Preferred
Stock (b)
|
1,856
|
|
1,856
|
|
1,856
|
|
Tangible common equity
(non-GAAP)
|
$
|
12,936
|
|
$
|
13,277
|
|
$
|
12,661
|
|
Total assets
(GAAP)
|
$
|
176,203
|
|
$
|
170,336
|
|
$
|
156,197
|
|
Less: Intangible
assets (a)
|
2,842
|
|
2,848
|
|
2,894
|
|
Tangible assets
(non-GAAP)
|
$
|
173,361
|
|
$
|
167,488
|
|
$
|
153,303
|
|
Tangible common equity
to tangible assets ratio (non-GAAP)
|
7.46
|
%
|
7.93
|
%
|
8.26
|
%
|
Pre-provision net
revenue
|
|
|
|
Net interest income
(GAAP)
|
$
|
1,005
|
|
$
|
1,035
|
|
$
|
981
|
|
Plus:
Taxable-equivalent adjustment
|
7
|
|
8
|
|
8
|
|
Noninterest
income
|
738
|
|
802
|
|
477
|
|
Less: Noninterest
expense
|
1,071
|
|
1,128
|
|
931
|
|
Pre-provision net
revenue from continuing operations (non-GAAP)
|
$
|
679
|
|
$
|
717
|
|
$
|
535
|
|
Average tangible
common equity
|
|
|
|
Average Key
shareholders' equity (GAAP)
|
$
|
17,769
|
|
$
|
17,905
|
|
$
|
17,216
|
|
Less: Intangible
assets (average) (c)
|
2,844
|
|
2,855
|
|
2,902
|
|
Preferred stock
(average)
|
1,900
|
|
1,900
|
|
1,900
|
|
Average tangible
common equity (non-GAAP)
|
$
|
13,025
|
|
$
|
13,150
|
|
$
|
12,414
|
|
Return on average
tangible common equity from continuing operations
|
|
|
|
Net income (loss) from
continuing operations attributable to Key common shareholders
(GAAP)
|
$
|
591
|
|
$
|
549
|
|
$
|
118
|
|
Average tangible
common equity (non-GAAP)
|
13,025
|
|
13,150
|
|
12,414
|
|
|
|
|
|
Return on average
tangible common equity from continuing operations
(non-GAAP)
|
18.25
|
%
|
16.61
|
%
|
3.82
|
%
|
Return on average
tangible common equity consolidated
|
|
|
|
Net income (loss)
attributable to Key common shareholders (GAAP)
|
$
|
595
|
|
$
|
556
|
|
$
|
119
|
|
Average tangible
common equity (non-GAAP)
|
13,025
|
|
13,150
|
|
12,414
|
|
|
|
|
|
Return on average
tangible common equity consolidated (non-GAAP)
|
18.37
|
%
|
16.82
|
%
|
3.86
|
%
|
GAAP to Non-GAAP
Reconciliations (continued)
|
(dollars in
millions)
|
|
Three months
ended
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Cash efficiency
ratio
|
|
|
|
Noninterest expense
(GAAP)
|
$
|
1,071
|
|
$
|
1,128
|
|
$
|
931
|
|
Less: Intangible asset
amortization
|
15
|
|
15
|
|
17
|
|
Adjusted noninterest
expense (non-GAAP)
|
$
|
1,056
|
|
$
|
1,113
|
|
$
|
914
|
|
|
|
|
|
Net interest income
(GAAP)
|
$
|
1,005
|
|
$
|
1,035
|
|
$
|
981
|
|
Plus:
Taxable-equivalent adjustment
|
7
|
|
8
|
|
8
|
|
Noninterest
income
|
738
|
|
802
|
|
477
|
|
Total
taxable-equivalent revenue (non-GAAP)
|
$
|
1,750
|
|
$
|
1,845
|
|
$
|
1,466
|
|
|
|
|
|
Cash efficiency ratio
(non-GAAP)
|
60.3
|
%
|
60.3
|
%
|
62.3
|
%
|
|
|
|
|
(a)
|
For the three months
ended March 31, 2021, December 31, 2020, and
March 31, 2020, intangible assets exclude $4 million, $4
million, and $6 million, respectively, of period-end purchased
credit card receivables.
|
(b)
|
Net of capital
surplus.
|
(c)
|
For the three months
ended March 31, 2021, December 31, 2020, and
March 31, 2020, average intangible assets exclude $4 million,
$5 million, and $7 million, respectively, of average purchased
credit card receivables.
|
GAAP = U.S. generally
accepted accounting principles
|
Consolidated
Balance Sheets
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Assets
|
|
|
|
|
Loans
|
$
|
100,926
|
|
$
|
101,185
|
|
$
|
103,198
|
|
|
Loans held for
sale
|
2,296
|
|
1,583
|
|
2,143
|
|
|
Securities available
for sale
|
33,923
|
|
27,556
|
|
20,807
|
|
|
Held-to-maturity
securities
|
6,857
|
|
7,595
|
|
9,638
|
|
|
Trading account
assets
|
811
|
|
735
|
|
795
|
|
|
Short-term
investments
|
15,376
|
|
16,194
|
|
4,073
|
|
|
Other
investments
|
621
|
|
621
|
|
679
|
|
|
|
Total earning
assets
|
160,810
|
|
155,469
|
|
141,333
|
|
|
Allowance for loan
and lease losses
|
(1,438)
|
|
(1,626)
|
|
(1,359)
|
|
|
Cash and due from
banks
|
938
|
|
1,091
|
|
865
|
|
|
Premises and
equipment
|
737
|
|
753
|
|
791
|
|
|
Goodwill
|
2,673
|
|
2,664
|
|
2,664
|
|
|
Other intangible
assets
|
173
|
|
188
|
|
236
|
|
|
Corporate-owned life
insurance
|
4,296
|
|
4,286
|
|
4,243
|
|
|
Accrued income and
other assets
|
7,347
|
|
6,812
|
|
6,604
|
|
|
Discontinued
assets
|
667
|
|
699
|
|
820
|
|
|
|
Total
assets
|
$
|
176,203
|
|
170,336
|
|
156,197
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Deposits in domestic
offices:
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
82,777
|
|
$
|
80,427
|
|
$
|
71,005
|
|
|
|
Savings
deposits
|
6,655
|
|
5,913
|
|
4,753
|
|
|
|
Certificates of
deposit ($100,000 or more)
|
2,437
|
|
2,733
|
|
5,630
|
|
|
|
Other time
deposits
|
2,782
|
|
3,010
|
|
4,623
|
|
|
|
Total
interest-bearing deposits
|
94,651
|
|
92,083
|
|
86,011
|
|
|
|
Noninterest-bearing
deposits
|
47,532
|
|
43,199
|
|
29,293
|
|
|
|
Total
deposits
|
142,183
|
|
135,282
|
|
115,304
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
281
|
|
220
|
|
2,444
|
|
|
Bank notes and other
short-term borrowings
|
744
|
|
759
|
|
4,606
|
|
|
Accrued expense and
other liabilities
|
2,862
|
|
2,385
|
|
2,700
|
|
|
Long-term
debt
|
12,499
|
|
13,709
|
|
13,732
|
|
|
|
Total
liabilities
|
158,569
|
|
152,355
|
|
138,786
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
Preferred
stock
|
1,900
|
|
1,900
|
|
1,900
|
|
|
Common
shares
|
1,257
|
|
1,257
|
|
1,257
|
|
|
Capital
surplus
|
6,213
|
|
6,281
|
|
6,222
|
|
|
Retained
earnings
|
13,166
|
|
12,751
|
|
12,174
|
|
|
Treasury stock, at
cost
|
(5,005)
|
|
(4,946)
|
|
(4,956)
|
|
|
Accumulated other
comprehensive income (loss)
|
103
|
|
738
|
|
814
|
|
|
|
Key shareholders'
equity
|
17,634
|
|
17,981
|
|
17,411
|
|
|
Noncontrolling
interests
|
—
|
|
—
|
|
—
|
|
|
|
Total
equity
|
17,634
|
|
17,981
|
|
17,411
|
|
Total liabilities
and equity
|
$
|
176,203
|
|
$
|
170,336
|
|
$
|
156,197
|
|
|
|
|
|
|
|
Common shares
outstanding (000)
|
972,587
|
|
975,773
|
|
975,319
|
|
Consolidated
Statements of Income
|
(dollars in millions,
except per share amounts)
|
|
|
|
Three months
ended
|
|
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Interest
income
|
|
|
|
|
Loans
|
$
|
889
|
|
$
|
933
|
|
$
|
1,026
|
|
|
Loans held for
sale
|
11
|
|
11
|
|
19
|
|
|
Securities available
for sale
|
130
|
|
119
|
|
129
|
|
|
Held-to-maturity
securities
|
45
|
|
51
|
|
62
|
|
|
Trading account
assets
|
5
|
|
4
|
|
8
|
|
|
Short-term
investments
|
5
|
|
4
|
|
6
|
|
|
Other
investments
|
2
|
|
3
|
|
1
|
|
|
|
Total interest
income
|
1,087
|
|
1,125
|
|
1,251
|
|
Interest
expense
|
|
|
|
|
Deposits
|
21
|
|
28
|
|
169
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
—
|
|
—
|
|
6
|
|
|
Bank notes and other
short-term borrowings
|
1
|
|
1
|
|
5
|
|
|
Long-term
debt
|
60
|
|
61
|
|
90
|
|
|
|
Total interest
expense
|
82
|
|
90
|
|
270
|
|
Net interest
income
|
1,005
|
|
1,035
|
|
981
|
|
Provision for credit
losses
|
(93)
|
|
20
|
|
359
|
|
Net interest income
after provision for credit losses
|
1,098
|
|
1,015
|
|
622
|
|
Noninterest
income
|
|
|
|
|
Trust and investment
services income
|
133
|
|
123
|
|
133
|
|
|
Investment banking
and debt placement fees
|
162
|
|
243
|
|
116
|
|
|
Service charges on
deposit accounts
|
73
|
|
82
|
|
84
|
|
|
Operating lease
income and other leasing gains
|
38
|
|
39
|
|
30
|
|
|
Corporate services
income
|
64
|
|
63
|
|
62
|
|
|
Cards and payments
income
|
105
|
|
97
|
|
66
|
|
|
Corporate-owned life
insurance income
|
31
|
|
38
|
|
36
|
|
|
Consumer mortgage
income
|
47
|
|
43
|
|
20
|
|
|
Commercial mortgage
servicing fees
|
34
|
|
32
|
|
18
|
|
|
Other
income
|
51
|
|
42
|
|
(88)
|
|
|
|
Total noninterest
income
|
738
|
|
802
|
|
477
|
|
Noninterest
expense
|
|
|
|
|
Personnel
|
624
|
|
661
|
|
515
|
|
|
Net
occupancy
|
76
|
|
75
|
|
76
|
|
|
Computer
processing
|
73
|
|
62
|
|
55
|
|
|
Business services and
professional fees
|
50
|
|
54
|
|
44
|
|
|
Equipment
|
25
|
|
26
|
|
24
|
|
|
Operating lease
expense
|
34
|
|
35
|
|
36
|
|
|
Marketing
|
26
|
|
30
|
|
21
|
|
|
Intangible asset
amortization
|
15
|
|
15
|
|
17
|
|
|
Other
expense
|
148
|
|
170
|
|
143
|
|
|
|
Total noninterest
expense
|
1,071
|
|
1,128
|
|
931
|
|
Income (loss) from
continuing operations before income taxes
|
765
|
|
689
|
|
168
|
|
|
Income
taxes
|
147
|
|
114
|
|
23
|
|
Income (loss) from
continuing operations
|
618
|
|
575
|
|
145
|
|
|
Income (loss) from
discontinued operations, net of taxes
|
4
|
|
7
|
|
1
|
|
Net income
(loss)
|
622
|
|
582
|
|
146
|
|
|
Less: Net
income (loss) attributable to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
Net income (loss)
attributable to Key
|
$
|
622
|
|
$
|
582
|
|
$
|
146
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
591
|
|
$
|
549
|
|
$
|
118
|
|
Net income (loss)
attributable to Key common shareholders
|
595
|
|
556
|
|
119
|
|
Per common
share
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.61
|
|
$
|
.57
|
|
$
|
.12
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
.01
|
|
—
|
|
Net income (loss)
attributable to Key common shareholders (a)
|
.62
|
|
.57
|
|
.12
|
|
Per common share —
assuming dilution
|
|
|
|
Income (loss) from
continuing operations attributable to Key common
shareholders
|
$
|
.61
|
|
$
|
.56
|
|
$
|
.12
|
|
Income (loss) from
discontinued operations, net of taxes
|
—
|
|
.01
|
|
—
|
|
Net income (loss)
attributable to Key common
shareholders (a)
|
.61
|
|
.57
|
|
.12
|
|
|
|
|
|
|
|
Cash dividends
declared per common share
|
$
|
.185
|
|
$
|
.185
|
|
$
|
.185
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding (000)
|
964,878
|
|
967,987
|
|
967,446
|
|
|
Effect of common
share options and other stock awards
|
9,419
|
|
8,473
|
|
8,664
|
|
Weighted-average
common shares and potential common shares outstanding
(000) (b)
|
974,297
|
|
976,460
|
|
976,110
|
|
|
|
(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)
|
|
|
First Quarter
2021
|
|
Fourth Quarter
2020
|
|
First 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)
|
$
|
52,581
|
|
$
|
453
|
|
3.48
|
%
|
|
$
|
53,562
|
|
$
|
477
|
|
3.54
|
%
|
|
$
|
49,466
|
|
$
|
508
|
|
4.13
|
%
|
|
Real estate —
commercial mortgage
|
12,658
|
|
114
|
|
3.67
|
|
|
12,862
|
|
121
|
|
3.74
|
|
|
13,548
|
|
155
|
|
4.60
|
|
|
Real estate —
construction
|
2,048
|
|
19
|
|
3.75
|
|
|
1,959
|
|
19
|
|
3.79
|
|
|
1,666
|
|
20
|
|
4.75
|
|
|
Commercial lease
financing
|
4,142
|
|
31
|
|
2.99
|
|
|
4,353
|
|
32
|
|
2.92
|
|
|
4,565
|
|
39
|
|
3.39
|
|
|
Total commercial
loans
|
71,429
|
|
617
|
|
3.50
|
|
|
72,736
|
|
649
|
|
3.55
|
|
|
69,245
|
|
722
|
|
4.19
|
|
|
Real estate —
residential mortgage
|
9,699
|
|
76
|
|
3.12
|
|
|
8,968
|
|
74
|
|
3.29
|
|
|
7,215
|
|
68
|
|
3.75
|
|
|
Home equity
loans
|
9,282
|
|
85
|
|
3.73
|
|
|
9,410
|
|
91
|
|
3.81
|
|
|
10,155
|
|
113
|
|
4.49
|
|
|
Consumer direct
loans
|
4,817
|
|
56
|
|
4.72
|
|
|
4,583
|
|
56
|
|
4.93
|
|
|
3,709
|
|
54
|
|
5.91
|
|
|
Credit
cards
|
933
|
|
24
|
|
10.45
|
|
|
973
|
|
26
|
|
10.57
|
|
|
1,082
|
|
31
|
|
11.50
|
|
|
Consumer indirect
loans
|
4,568
|
|
37
|
|
3.30
|
|
|
5,040
|
|
45
|
|
3.56
|
|
|
4,768
|
|
46
|
|
3.86
|
|
|
Total consumer
loans
|
29,299
|
|
278
|
|
3.84
|
|
|
28,974
|
|
292
|
|
4.01
|
|
|
26,929
|
|
312
|
|
4.66
|
|
|
Total loans
|
100,728
|
|
895
|
|
3.60
|
|
|
101,710
|
|
941
|
|
3.68
|
|
|
96,174
|
|
1,034
|
|
4.32
|
|
|
Loans held for
sale
|
1,531
|
|
11
|
|
2.89
|
|
|
1,621
|
|
11
|
|
2.76
|
|
|
1,885
|
|
19
|
|
3.99
|
|
|
Securities available
for sale (b), (e)
|
30,039
|
|
130
|
|
1.76
|
|
|
28,046
|
|
119
|
|
1.75
|
|
|
21,172
|
|
129
|
|
2.49
|
|
|
Held-to-maturity
securities (b)
|
7,188
|
|
45
|
|
2.53
|
|
|
7,939
|
|
51
|
|
2.56
|
|
|
9,820
|
|
62
|
|
2.51
|
|
|
Trading account
assets
|
848
|
|
5
|
|
2.15
|
|
|
744
|
|
4
|
|
2.21
|
|
|
1,065
|
|
8
|
|
2.95
|
|
|
Short-term
investments
|
16,510
|
|
5
|
|
.13
|
|
|
14,111
|
|
4
|
|
0.14
|
|
|
1,764
|
|
6
|
|
1.42
|
|
|
Other investments
(e)
|
614
|
|
2
|
|
1.40
|
|
|
615
|
|
3
|
|
1.31
|
|
|
614
|
|
1
|
|
0.40
|
|
|
Total earning
assets
|
157,458
|
|
1,094
|
|
2.81
|
|
|
154,786
|
|
1,133
|
|
2.93
|
|
|
132,494
|
|
1,259
|
|
3.82
|
|
|
Allowance for loan
and lease losses
|
(1,623)
|
|
|
|
|
(1,715)
|
|
|
|
|
(1,097)
|
|
|
|
|
Accrued income and
other assets
|
16,398
|
|
|
|
|
15,861
|
|
|
|
|
14,831
|
|
|
|
|
Discontinued
assets
|
686
|
|
|
|
|
717
|
|
|
|
|
838
|
|
|
|
|
Total
assets
|
$
|
172,919
|
|
|
|
|
$
|
169,649
|
|
|
|
|
$
|
147,066
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and money market
deposit accounts
|
$
|
81,439
|
|
10
|
|
.05
|
|
|
$
|
80,636
|
|
12
|
|
.06
|
|
|
$
|
66,721
|
|
112
|
|
.67
|
|
|
Savings
deposits
|
6,203
|
|
1
|
|
.03
|
|
|
5,737
|
|
—
|
|
.03
|
|
|
4,655
|
|
1
|
|
.05
|
|
|
Certificates of
deposit ($100,000 or more)
|
2,571
|
|
6
|
|
.96
|
|
|
2,983
|
|
9
|
|
1.20
|
|
|
6,310
|
|
34
|
|
2.20
|
|
|
Other time
deposits
|
2,902
|
|
4
|
|
.57
|
|
|
3,209
|
|
7
|
|
.80
|
|
|
4,901
|
|
22
|
|
1.81
|
|
|
Total interest-bearing
deposits
|
93,115
|
|
21
|
|
.09
|
|
|
92,565
|
|
28
|
|
.12
|
|
|
82,587
|
|
169
|
|
.82
|
|
|
Federal funds
purchased and securities sold under repurchase
agreements
|
243
|
|
—
|
|
.04
|
|
|
220
|
|
—
|
|
.04
|
|
|
2,002
|
|
6
|
|
1.17
|
|
|
Bank notes and other
short-term borrowings
|
878
|
|
1
|
|
.64
|
|
|
791
|
|
1
|
|
.73
|
|
|
1,401
|
|
5
|
|
1.58
|
|
|
Long-term debt
(f), (g)
|
12,831
|
|
60
|
|
1.93
|
|
|
12,118
|
|
61
|
|
2.05
|
|
|
12,443
|
|
90
|
|
2.96
|
|
|
Total interest-bearing
liabilities
|
107,067
|
|
82
|
|
.31
|
|
|
105,694
|
|
90
|
|
.34
|
|
|
98,433
|
|
270
|
|
1.10
|
|
|
Noninterest-bearing
deposits
|
44,625
|
|
|
|
|
43,156
|
|
|
|
|
27,741
|
|
|
|
|
Accrued expense and
other liabilities
|
2,772
|
|
|
|
|
2,177
|
|
|
|
|
2,838
|
|
|
|
|
Discontinued
liabilities (g)
|
686
|
|
|
|
|
717
|
|
|
|
|
838
|
|
|
|
|
Total
liabilities
|
155,150
|
|
|
|
|
151,744
|
|
|
|
|
129,850
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Key shareholders'
equity
|
17,769
|
|
|
|
|
17,905
|
|
|
|
|
17,216
|
|
|
|
|
Noncontrolling
interests
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
Total
equity
|
17,769
|
|
|
|
|
17,905
|
|
|
|
|
17,216
|
|
|
|
|
Total liabilities
and equity
|
$
|
172,919
|
|
|
|
|
$
|
169,649
|
|
|
|
|
$
|
147,066
|
|
|
|
Interest rate spread
(TE)
|
|
|
2.50
|
%
|
|
|
|
2.59
|
%
|
|
|
|
2.72
|
%
|
Net interest income
(TE) and net interest margin (TE)
|
|
1,012
|
|
2.61
|
%
|
|
|
1,043
|
|
2.70
|
%
|
|
|
989
|
|
3.01
|
%
|
TE adjustment
(b)
|
|
7
|
|
|
|
|
8
|
|
|
|
|
8
|
|
|
|
Net interest income,
GAAP basis
|
|
$
|
1,005
|
|
|
|
|
$
|
1,035
|
|
|
|
|
$
|
981
|
|
|
|
|
(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 March 31, 2021,
December 31, 2020, and March 31,
2020.
|
(c)
|
For purposes of these
computations, nonaccrual loans are included in average loan
balances.
|
(d)
|
Commercial and
industrial average balances include $126 million, $129 million, and
$145 million of assets from commercial credit cards for the three
months ended March 31, 2021, December 31, 2020, and
March 31, 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
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Personnel
(a)
|
$
|
624
|
|
$
|
661
|
|
$
|
515
|
|
Net
occupancy
|
76
|
|
75
|
|
76
|
|
Computer
processing
|
73
|
|
62
|
|
55
|
|
Business services and
professional fees
|
50
|
|
54
|
|
44
|
|
Equipment
|
25
|
|
26
|
|
24
|
|
Operating lease
expense
|
34
|
|
35
|
|
36
|
|
Marketing
|
26
|
|
30
|
|
21
|
|
Intangible asset
amortization
|
15
|
|
15
|
|
17
|
|
Other
expense
|
148
|
|
170
|
|
143
|
|
Total noninterest
expense
|
$
|
1,071
|
|
$
|
1,128
|
|
$
|
931
|
|
Average full-time
equivalent employees (b)
|
17,086
|
|
17,029
|
|
16,529
|
|
|
|
(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
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Salaries and contract
labor
|
$
|
320
|
|
$
|
342
|
|
$
|
316
|
|
Incentive and
stock-based compensation
|
196
|
|
208
|
|
102
|
|
Employee
benefits
|
107
|
|
89
|
|
92
|
|
Severance
|
1
|
|
22
|
|
5
|
|
Total personnel
expense
|
$
|
624
|
|
$
|
661
|
|
$
|
515
|
|
Loan
Composition
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
Percent change
3/31/2021 vs
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
|
12/31/2020
|
3/31/2020
|
Commercial and
industrial (a)
|
$
|
52,486
|
|
$
|
52,907
|
|
$
|
55,983
|
|
|
(.8)
|
%
|
(6.2)
|
%
|
Commercial real
estate:
|
|
|
|
|
|
|
Commercial
mortgage
|
12,702
|
|
12,687
|
|
13,548
|
|
|
.1
|
|
(6.2)
|
|
Construction
|
2,122
|
|
1,987
|
|
1,710
|
|
|
6.8
|
|
24.1
|
|
Total commercial real
estate loans
|
14,824
|
|
14,674
|
|
15,258
|
|
|
1.0
|
|
(2.8)
|
|
Commercial lease
financing (b)
|
4,104
|
|
4,399
|
|
4,677
|
|
|
(6.7)
|
|
(12.3)
|
|
Total commercial
loans
|
71,414
|
|
71,980
|
|
75,918
|
|
|
(.8)
|
|
(5.9)
|
|
Residential — prime
loans:
|
|
|
|
|
|
|
Real estate —
residential mortgage
|
10,300
|
|
9,298
|
|
7,498
|
|
|
10.8
|
|
37.4
|
|
Home equity
loans
|
9,158
|
|
9,360
|
|
10,103
|
|
|
(2.2)
|
|
(9.4)
|
|
Total residential —
prime loans
|
19,458
|
|
18,658
|
|
17,601
|
|
|
4.3
|
|
10.6
|
|
Consumer direct
loans
|
4,862
|
|
4,714
|
|
3,833
|
|
|
3.1
|
|
26.8
|
|
Credit
cards
|
909
|
|
989
|
|
1,041
|
|
|
(8.1)
|
|
(12.7)
|
|
Consumer indirect
loans
|
4,283
|
|
4,844
|
|
4,805
|
|
|
(11.6)
|
|
(10.9)
|
|
Total consumer
loans
|
29,512
|
|
29,205
|
|
27,280
|
|
|
1.1
|
|
8.2
|
|
Total loans (c),
(d)
|
$
|
100,926
|
|
$
|
101,185
|
|
$
|
103,198
|
|
|
(.3)
|
%
|
(2.2)
|
%
|
|
|
(a)
|
Loan balances include
$126 million, $127 million, and $143 million of commercial credit
card balances at March 31, 2021, December 31, 2020, and
March 31, 2020, respectively.
|
(b)
|
Commercial lease
financing includes receivables held as collateral for a secured
borrowing of $21 million, $23 million, and $14 million at
March 31, 2021, December 31, 2020, and March 31,
2020, respectively. Principal reductions are based on the cash
payments received from these related receivables.
|
(c)
|
Total loans exclude
loans of $675 million at March 31, 2021, $710 million at
December 31, 2020, and $821 million at March 31, 2020,
related to the discontinued operations of the education lending
business.
|
(d)
|
Accrued interest of
$242 million, $241 million, and $241 million at March 31,
2021, December 31, 2020, and March 31, 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
3/31/2021 vs
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
|
12/31/2020
|
3/31/2020
|
Commercial and
industrial
|
$
|
1,175
|
|
$
|
249
|
|
$
|
446
|
|
|
371.9
|
%
|
163.5
|
%
|
Real estate —
commercial mortgage
|
837
|
|
1,014
|
|
1,284
|
|
|
(17.5)
|
|
(34.8)
|
|
Commercial lease
financing
|
—
|
|
—
|
|
8
|
|
|
N/M
|
N/M
|
Real estate —
residential mortgage
|
236
|
|
264
|
|
152
|
|
|
(10.6)
|
|
55.3
|
|
Consumer direct
loans
|
48
|
|
56
|
|
253
|
|
|
(14.3)
|
|
(81.0)
|
|
Total loans held for
sale
|
$
|
2,296
|
|
$
|
1,583
|
|
$
|
2,143
|
|
|
45.0
|
%
|
7.1
|
%
|
Summary of Changes
in Loans Held for Sale
|
(in
millions)
|
|
|
|
|
|
|
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
1Q20
|
Balance at beginning
of period
|
$
|
1,583
|
|
$
|
1,724
|
|
$
|
2,007
|
|
$
|
2,143
|
|
$
|
1,334
|
|
New
originations
|
4,010
|
|
3,835
|
|
3,282
|
|
3,621
|
|
3,333
|
|
Transfers from (to)
held to maturity, net
|
83
|
|
(24)
|
|
75
|
|
(15)
|
|
200
|
|
Loan sales
|
(3,303)
|
|
(3,932)
|
|
(3,583)
|
|
(3,679)
|
|
(2,649)
|
|
Loan draws (payments),
net
|
(73)
|
|
(19)
|
|
(57)
|
|
(61)
|
|
(77)
|
|
Valuation
adjustments
|
(4)
|
|
—
|
|
—
|
|
(2)
|
|
2
|
|
Balance at end of
period
|
$
|
2,296
|
|
$
|
1,583
|
|
$
|
1,724
|
|
$
|
2,007
|
|
$
|
2,143
|
|
Summary of Loan
and Lease Loss Experience From Continuing Operations
|
(dollars in
millions)
|
|
|
|
|
|
Three months
ended
|
|
3/31/2021
|
12/31/2020
|
3/31/2020
|
Average loans
outstanding
|
$
|
100,728
|
|
$
|
101,710
|
|
$
|
96,174
|
|
Allowance for loan
and lease losses at the end of the prior period
|
$
|
1,626
|
|
$
|
1,730
|
|
$
|
900
|
|
Cumulative effect
from change in accounting principle (a)
|
—
|
|
—
|
|
204
|
|
Allowance for loan
and lease losses at the beginning of the period
|
1,626
|
|
1,730
|
|
1,104
|
|
Loans charged
off:
|
|
|
|
Commercial and
industrial
|
73
|
|
119
|
|
60
|
|
|
|
|
|
Real estate —
commercial mortgage
|
35
|
|
1
|
|
3
|
|
Real estate —
construction
|
—
|
|
—
|
|
—
|
|
Total commercial real
estate loans
|
35
|
|
1
|
|
3
|
|
Commercial lease
financing
|
4
|
|
19
|
|
2
|
|
Total commercial
loans
|
112
|
|
139
|
|
65
|
|
Real estate —
residential mortgage
|
—
|
|
—
|
|
—
|
|
Home equity
loans
|
2
|
|
1
|
|
4
|
|
Consumer direct
loans
|
8
|
|
7
|
|
12
|
|
Credit
cards
|
6
|
|
7
|
|
11
|
|
Consumer indirect
loans
|
7
|
|
6
|
|
9
|
|
Total consumer
loans
|
23
|
|
21
|
|
36
|
|
Total loans charged
off
|
135
|
|
160
|
|
101
|
|
Recoveries:
|
|
|
|
Commercial and
industrial
|
8
|
|
15
|
|
5
|
|
|
|
|
|
Real estate —
commercial mortgage
|
1
|
|
—
|
|
1
|
|
Real estate —
construction
|
—
|
|
—
|
|
—
|
|
Total commercial real
estate loans
|
1
|
|
—
|
|
1
|
|
Commercial lease
financing
|
1
|
|
—
|
|
—
|
|
Total commercial
loans
|
10
|
|
15
|
|
6
|
|
Real estate —
residential mortgage
|
1
|
|
—
|
|
—
|
|
Home equity
loans
|
1
|
|
1
|
|
2
|
|
Consumer direct
loans
|
2
|
|
1
|
|
2
|
|
Credit
cards
|
2
|
|
2
|
|
2
|
|
Consumer indirect
loans
|
5
|
|
6
|
|
5
|
|
Total consumer
loans
|
11
|
|
10
|
|
11
|
|
Total
recoveries
|
21
|
|
25
|
|
17
|
|
Net loan
charge-offs
|
(114)
|
|
(135)
|
|
(84)
|
|
Provision (credit)
for loan and lease losses
|
(74)
|
|
31
|
|
339
|
|
Allowance for loan
and lease losses at end of period
|
$
|
1,438
|
|
$
|
1,626
|
|
$
|
1,359
|
|
|
|
|
|
Liability for credit
losses on lending-related commitments at the end of the prior
period
|
$
|
197
|
|
$
|
208
|
|
$
|
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
|
197
|
|
208
|
|
141
|
|
Provision (credit) for
losses on lending-related commitments
|
(19)
|
|
(11)
|
|
20
|
|
Liability for credit
losses on lending-related commitments at end of period
(c)
|
$
|
178
|
|
$
|
197
|
|
$
|
161
|
|
|
|
|
|
Total allowance for
credit losses at end of period
|
$
|
1,616
|
|
$
|
1,823
|
|
$
|
1,520
|
|
|
|
|
|
Net loan charge-offs
to average total loans
|
.46
|
%
|
.53
|
%
|
.35
|
%
|
Allowance for loan
and lease losses to period-end loans
|
1.42
|
|
1.61
|
|
1.32
|
|
Allowance for credit
losses to period-end loans
|
1.60
|
|
1.80
|
|
1.47
|
|
Allowance for loan
and lease losses to nonperforming loans
|
197.5
|
|
207.1
|
|
215.0
|
|
Allowance for credit
losses to nonperforming loans
|
222.0
|
|
232.2
|
|
240.5
|
|
|
|
|
|
Discontinued
operations — education lending business:
|
|
|
|
Loans charged
off
|
$
|
1
|
|
1
|
|
$
|
2
|
|
Recoveries
|
1
|
|
2
|
|
1
|
|
Net loan
charge-offs
|
$
|
—
|
|
1
|
|
$
|
(1)
|
|
|
|
(a)
|
The cumulative effect
from change in accounting principle relates to the January 1, 2020,
adoption of ASU 2016-13.
|
(b)
|
Three months ended
March 31, 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)
|
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
1Q20
|
Net loan
charge-offs
|
$
|
114
|
|
$
|
135
|
|
$
|
128
|
|
$
|
96
|
|
$
|
84
|
|
Net loan charge-offs
to average total loans
|
.46
|
%
|
.53
|
%
|
.49
|
%
|
.36
|
%
|
.35
|
%
|
Allowance for loan
and lease losses
|
$
|
1,438
|
|
$
|
1,626
|
|
$
|
1,730
|
|
$
|
1,708
|
|
$
|
1,359
|
|
Allowance for credit
losses (a)
|
1,616
|
|
1,823
|
|
1,938
|
|
1,906
|
|
1,520
|
|
Allowance for loan
and lease losses to period-end loans
|
1.42
|
%
|
1.61
|
%
|
1.68
|
%
|
1.61
|
%
|
1.32
|
%
|
Allowance for credit
losses to period-end loans
|
1.60
|
|
1.80
|
|
1.88
|
|
1.80
|
|
1.47
|
|
Allowance for loan
and lease losses to nonperforming loans
|
197.5
|
|
207.1
|
|
207.4
|
|
224.7
|
|
215.0
|
|
Allowance for credit
losses to nonperforming loans
|
222.0
|
|
232.2
|
|
232.4
|
|
250.8
|
|
240.5
|
|
Nonperforming loans
at period end
|
$
|
728
|
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
$
|
632
|
|
Nonperforming assets
at period end
|
790
|
|
937
|
|
1,003
|
|
951
|
|
844
|
|
Nonperforming loans
to period-end portfolio loans
|
.72
|
%
|
.78
|
%
|
.81
|
%
|
.72
|
%
|
.61
|
%
|
Nonperforming assets
to period-end portfolio loans plus OREO and other nonperforming
assets
|
.78
|
|
.92
|
|
.97
|
|
.89
|
|
.82
|
|
|
|
(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)
|
|
3/31/2021
|
12/31/2020
|
9/30/2020
|
6/30/2020
|
3/31/2020
|
Commercial and
industrial
|
$
|
387
|
|
$
|
385
|
|
$
|
459
|
|
$
|
404
|
|
$
|
277
|
|
|
|
|
|
|
|
Real estate —
commercial mortgage
|
66
|
|
104
|
|
104
|
|
91
|
|
87
|
|
Real estate —
construction
|
—
|
|
—
|
|
1
|
|
1
|
|
2
|
|
Total commercial real
estate loans
|
66
|
|
104
|
|
105
|
|
92
|
|
89
|
|
Commercial lease
financing
|
8
|
|
8
|
|
6
|
|
9
|
|
5
|
|
Total commercial
loans
|
461
|
|
497
|
|
570
|
|
505
|
|
371
|
|
Real estate —
residential mortgage
|
95
|
|
110
|
|
96
|
|
89
|
|
89
|
|
Home equity
loans
|
148
|
|
154
|
|
146
|
|
141
|
|
143
|
|
Consumer direct
loans
|
5
|
|
5
|
|
3
|
|
3
|
|
4
|
|
Credit
cards
|
3
|
|
2
|
|
2
|
|
2
|
|
3
|
|
Consumer indirect
loans
|
16
|
|
17
|
|
17
|
|
20
|
|
22
|
|
Total consumer
loans
|
267
|
|
288
|
|
264
|
|
255
|
|
261
|
|
Total nonperforming
loans
|
728
|
|
785
|
|
834
|
|
760
|
|
632
|
|
OREO
|
12
|
|
100
|
|
105
|
|
112
|
|
119
|
|
Nonperforming loans
held for sale
|
47
|
|
49
|
|
61
|
|
75
|
|
89
|
|
Other nonperforming
assets
|
3
|
|
3
|
|
3
|
|
4
|
|
4
|
|
Total nonperforming
assets
|
$
|
790
|
|
$
|
937
|
|
$
|
1,003
|
|
$
|
951
|
|
$
|
844
|
|
Accruing loans past
due 90 days or more
|
92
|
|
86
|
|
73
|
|
87
|
|
128
|
|
Accruing loans past
due 30 through 89 days
|
191
|
|
241
|
|
336
|
|
419
|
|
393
|
|
Restructured loans —
accruing and nonaccruing (a)
|
376
|
|
363
|
|
306
|
|
310
|
|
340
|
|
Restructured loans
included in nonperforming loans (a)
|
192
|
|
229
|
|
168
|
|
166
|
|
172
|
|
Nonperforming assets
from discontinued operations — education lending
business
|
5
|
|
5
|
|
6
|
|
7
|
|
7
|
|
Nonperforming loans
to period-end portfolio loans
|
.72
|
%
|
.78
|
%
|
.81
|
%
|
.72
|
%
|
.61
|
%
|
Nonperforming assets
to period-end portfolio loans plus OREO and other nonperforming
assets
|
.78
|
|
.92
|
|
.97
|
|
.89
|
|
.82
|
|
|
|
(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)
|
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
1Q20
|
Balance at beginning
of period
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
$
|
632
|
|
$
|
577
|
|
Loans placed on
nonaccrual status
|
196
|
|
300
|
|
387
|
|
293
|
|
219
|
|
Charge-offs
|
(135)
|
|
(160)
|
|
(150)
|
|
(111)
|
|
(100)
|
|
Loans sold
|
(13)
|
|
(9)
|
|
(6)
|
|
(5)
|
|
(4)
|
|
Payments
|
(37)
|
|
(83)
|
|
(83)
|
|
(29)
|
|
(31)
|
|
Transfers to
OREO
|
(3)
|
|
(3)
|
|
—
|
|
—
|
|
(3)
|
|
Transfers to
nonperforming loans held for sale
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
Loans returned to
accrual status
|
(65)
|
|
(94)
|
|
(74)
|
|
(20)
|
|
(26)
|
|
Balance at end of
period
|
$
|
728
|
|
$
|
785
|
|
$
|
834
|
|
$
|
760
|
|
$
|
632
|
|
Line of Business
Results
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage change
1Q21 vs.
|
|
1Q21
|
4Q20
|
3Q20
|
2Q20
|
1Q20
|
|
4Q20
|
1Q20
|
Consumer
Bank
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
|
864
|
|
$
|
896
|
|
$
|
864
|
|
$
|
832
|
|
$
|
810
|
|
|
(3.6)
|
%
|
6.7
|
%
|
Provision for credit
losses
|
(23)
|
|
(5)
|
|
(3)
|
|
155
|
|
136
|
|
|
(360.0)
|
|
(103.7)
|
|
Noninterest
expense
|
601
|
|
606
|
|
567
|
|
552
|
|
539
|
|
|
(.8)
|
|
11.5
|
|
Net income (loss)
attributable to Key
|
217
|
|
225
|
|
229
|
|
96
|
|
103
|
|
|
(3.6)
|
|
110.7
|
|
Average loans and
leases
|
39,249
|
|
39,448
|
|
38,468
|
|
37,291
|
|
33,175
|
|
|
(.5)
|
|
18.3
|
|
Average
deposits
|
85,033
|
|
82,845
|
|
82,829
|
|
79,233
|
|
73,133
|
|
|
2.6
|
|
16.3
|
|
Net loan
charge-offs
|
36
|
|
28
|
|
23
|
|
40
|
|
43
|
|
|
28.6
|
|
(16.3)
|
|
Net loan charge-offs
to average total loans
|
.37
|
%
|
.28
|
%
|
.24
|
%
|
.43
|
%
|
.52
|
%
|
|
N/A
|
N/A
|
Nonperforming assets
at period end
|
$
|
345
|
|
$
|
374
|
|
$
|
353
|
|
$
|
332
|
|
$
|
342
|
|
|
(7.8)
|
|
.9
|
|
Return on average
allocated equity
|
25.76
|
%
|
25.61
|
%
|
26.22
|
%
|
11.28
|
%
|
12.30
|
%
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
|
Commercial
Bank
|
|
|
|
|
|
|
|
|
Summary of
operations
|
|
|
|
|
|
|
|
|
Total revenue
(TE)
|
$
|
858
|
|
$
|
922
|
|
$
|
811
|
|
$
|
867
|
|
$
|
641
|
|
|
(6.9)
|
%
|
33.9
|
%
|
Provision for credit
losses
|
(67)
|
|
44
|
|
150
|
|
326
|
|
222
|
|
|
(252.3)
|
|
(80.2)
|
|
Noninterest
expense
|
443
|
|
498
|
|
447
|
|
441
|
|
362
|
|
|
(11.0)
|
|
22.4
|
|
Net income (loss)
attributable to Key
|
383
|
|
310
|
|
173
|
|
96
|
|
66
|
|
|
23.5
|
|
480.3
|
|
Average loans and
leases
|
60,885
|
|
61,680
|
|
65,928
|
|
69,945
|
|
62,104
|
|
|
(1.3)
|
|
(2.0)
|
|
Average loans held
for sale
|
1,237
|
|
1,285
|
|
1,383
|
|
2,012
|
|
1,607
|
|
|
(3.7)
|
|
(23.0)
|
|
Average
deposits
|
51,894
|
|
52,489
|
|
51,585
|
|
47,954
|
|
36,443
|
|
|
(1.1)
|
|
42.4
|
|
Net loan
charge-offs
|
78
|
|
108
|
|
104
|
|
57
|
|
40
|
|
|
(27.8)
|
|
95.0
|
|
Net loan charge-offs
to average total loans
|
.52
|
%
|
.70
|
%
|
.63
|
%
|
.33
|
%
|
.26
|
%
|
|
N/A
|
N/A
|
Nonperforming assets
at period end
|
$
|
441
|
|
$
|
558
|
|
$
|
645
|
|
$
|
616
|
|
$
|
407
|
|
|
(21.0)
|
|
8.4
|
|
Return on average
allocated equity
|
17.47
|
%
|
23.87
|
%
|
13.40
|
%
|
7.87
|
%
|
5.57
|
%
|
|
N/A
|
N/A
|
|
TE = Taxable
Equivalent, N/A = Not Applicable, N/M = Not Meaningful
|
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SOURCE KeyCorp