Released on October 19, 2023, KeyCorp (KEY, Financial) announced a net income from continuing operations attributable to Key common shareholders of $266 million, or $.29 per diluted common share for the third quarter of 2023. This is a 6.4% increase from $250 million, or $.27 per diluted common share, for the second quarter of 2023. However, it is a decrease from $513 million, or $.55 per diluted common share, for the third quarter of 2022.
Financial Highlights
KeyCorp's Common Equity Tier 1 ratio increased by 50 basis points to 9.8%, reflecting proactive balance sheet management. The company also reported a reduction in risk-weighted assets, down $7 billion compared to the prior quarter. Average deposits increased by $2 billion compared to the previous quarter, strengthening liquidity and funding. Noninterest income, which represents approximately 40% of total revenue, also saw growth.
CEO Commentary
Key’s third quarter results reflect continued momentum across our franchise, supported by our strong balance sheet and disciplined risk management. Our focus on relationship banking drove both core deposit growth and a planned reduction in non-relationship loan balances. We remain committed to strengthening both capital and liquidity, managing risk, and improving earnings while continuing to invest. I am confident in the long-term outlook for Key and in our ability to deliver value to all of our stakeholders." - Chris Gorman, Chairman and CEO
Income Statement Highlights
KeyCorp's net interest income was $923 million for the third quarter of 2023, a decrease of $280 million compared to the third quarter of 2022. The decrease in net interest income reflects higher interest-bearing deposit costs and a shift in funding mix to higher cost deposits and borrowings due to the higher interest rate environment.
Balance Sheet Highlights
Average loans were $117.6 billion for the third quarter of 2023, an increase of $3.2 billion compared to the third quarter of 2022. The growth in average loans was driven by commercial loans, which increased by $3.2 billion. Average deposits totaled $144.8 billion for the third quarter of 2023, an increase of $596 million compared to the year-ago quarter.
Capital
KeyCorp's capital position remained strong in the third quarter of 2023. The estimated Common Equity Tier 1 and Tier 1 risk-based capital ratios stood at 9.8% and 11.4%, respectively. Key's tangible common equity ratio was 4.4% at the end of the quarter.
For more detailed financial information, visit KeyCorp's Investor Relations page.
