KeyCorp, a regional bank with a national digital bank reach, has revealed its strong financial standing and strategic initiatives in its latest press release. The company reported a 7% year-over-year growth in noninterest income, reaching $64 billion in assets under management. Additionally, commercial loan growth saw a 5% increase year-to-date, while client deposits and net new relationship household growth experienced a 2% uptick year-over-year.
In terms of balance sheet performance, KeyCorp demonstrated a 11.7% common equity tier 1, marking an increase of approximately 120 basis points year-over-year. Furthermore, its marked common equity tier 1 also saw a significant rise of around 270 basis points year-over-year, reaching 10.0%. Notably, the company's risk management excellence was underscored by a decrease in nonperforming assets (NPAs) to loans plus other real estate owned (OREO) by 8 basis points compared to the previous quarter, and a decline in net charge-offs (NCOs) to average loans by 8 basis points compared to the fourth quarter of the previous year.
The company's financials for the first half of 2025 also demonstrated positive growth. Net interest income (te) grew by 26% year-over-year, amounting to $2.255 billion, while noninterest income increased by 7%, reaching $1.358 billion. These figures contributed to an 18% growth in revenue (te), totaling $3.613 billion. Furthermore, KeyCorp maintained discipline in managing expenses, with noninterest expenses increasing by only 4% year-over-year.
In terms of the company's investment focus, KeyCorp outlined a 10% planned increase in front-line producers, signaling its commitment to growth and innovation. Additionally, the company highlighted its diversified fee business with a high revenue contribution, as noninterest income as a percentage of average assets grew from 0.81% to 1.69% over the years, showcasing its ability to monetize commercial assets and relationships better than most regional banks.
KeyCorp's wealth management segment also demonstrated growth, with assets under management reaching $64 billion, representing a 9% compound annual growth rate. The company's wealth management segments, including Key Private Client, Key Private Bank, Family Wealth, and Institutional Services Group, are targeting underserved clients, with a mass affluent strategy aiming to cross-sell existing KeyCorp clients and enroll new clients to generate investments and deposits.
As a result of these announcements, the company's shares have moved 0.42% on the market, and are now trading at a price of $18.89. For the full picture, make sure to review KEYCORP /NEW/'s 8-K report.
