KeyCorp (NYSE: KEY) today announced second quarter net income from continuing operations attributable to Key common shareholders of $56 million, or $.06 per common share. These results compare to a net loss from continuing operations attributable to Key common shareholders of $394 million, or $.68 per common share, for the second quarter of 2009, which was negatively impacted by an $823 million loan loss provision. Second quarter net income attributable to Key common shareholders was $29 million compared to a net loss attributable to Key common shareholders of $390 million for the second quarter of 2009. Net loss attributable to Key common shareholders for the six-month period ended June 30, 2010 was $67 million compared to a net loss attributable to Key common shareholders of $926 million for the same period one year ago.
Key's second quarter earnings improvement results from a lower provision for loan losses, higher fee income, and well-controlled expenses when compared to the first quarter of 2010. Credit quality continued to improve across the majority of the loan portfolios in both Community Banking and National Banking. Net charge-offs declined by $87 million, and nonperforming loans decreased by $362 million from March 31, 2010.
"These results are encouraging and the return to profitability represents an important step forward for our company," said Chief Executive Officer Henry L Meyer, III. "Continued improvement in credit quality across most of our businesses was the principal contributor to the quarterly performance."
Meyer continued: "Key is now focusing on opportunities in a gradually improving economy. That said, some uncertainty remains in the markets, and consumer and business loan demand is soft. Recognizing current economic conditions, we remain focused on investing in our relationship businesses, maintaining our strong capital and liquidity positions, reducing risk, and careful expense control as we navigate through the economic cycle."
At June 30, 2010, Key's estimated Tier 1 common equity ratio was 8.01% compared to 7.51% at March 31, 2010, and estimated Tier 1 risk-based capital ratio was 13.55% up from 12.92% one quarter ago.
Key's strong capital and liquidity positions enable the Company to support the borrowing needs of clients. The Company originated approximately $7.6 billion in new or renewed lending commitments to consumers and businesses during the quarter.
Meyer also noted that Key opened 18 new branches during the first six months and expects to open an additional 22 new branches during the remainder of 2010, increasing its market presence in selected markets of its 14-state branch network. In addition, Key continues with its plans to modernize its existing branches.
Source: Community and Public Relations of KeyBank 7.22.2010