Keycorp · NYSE:KEY
Keycorp — Keycorp /New/ — Q4 2009 Earnings Presentation
21 slides from Keycorp's earnings presentation, Jan 21, 2010
Slide 1: Fourth Quarter 2009 Review
Fourth Quarter 2009 Review January 21, 2010 Speakers: Henry Meyer Jeff Weeden
Slide 2: Forward-Looking Statement Disclosure
2 PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 FORWARD-LOOKING STATEMENT DISCLOSURE This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Key's financial condition, results of operations, earni
Slide 3: Strong Balance Sheet - Positioned for Growth
3 Strong Balance Sheet - Positioned for Growth Strengthened balance sheet 12/31/08 12/31/09 - - Tier 1 risk-based capital (a) 10.92% 12.68% - - Allowance for loan losses / period-end loans 2.24 4.31 - - Average loans to deposits (b) 125 98 Proactively addressed credit and reduced risk profile - - Re
Slide 4: Financial Summary - Fourth Quarter 2009
4 Financial Summary?Fourth Quarter 2009 Loss from continuing operations attributable to Key common shareholders $ (.30) Significant items included in net loss Credits related to IRS audit and leveraged lease tax litigation $ .12 Net gains from principal investing (a) .03 Realized and unrealized loss
Slide 5: Net Interest Margin (TE) Continuing Operations
Net Interest Margin (TE) 5 $ in millions Continuing Operations $800 3.50% $700 $642 $637 $613 $595 $591 $600 3.00% $500 3.04% 2.87% 2.87% $400 2.79% 2.77% $300 2.53% 2.50% $200 2.45% 2.38% 2.37% $100 2.30% $0 2.00% 4Q08 (a) 1Q09 2Q09 (a) 3Q09 (a) 4Q09 Net Interest Income Net Interest Margin Net Inte
Slide 6: Average Loans
Average Loans 6 $ in billions Continuing Operations $80 $73.3 $71.6 Exit Portfolios - Average Balances $68.7 $64.8 $60.5 $60 $12 $11.2 $10.6 $9.8 $8.9 $40 $9 $8.0 $6 $20 $3 $0 $0 4Q08 1Q09 2Q09 3Q09 4Q09 4Q08 1Q09 2Q09 3Q09 4Q09 Leasing $4.4 $4.2 $3.8 $3.5 $3.1 CFA $26.7 $25.5 $23.7 $21.5 $19.3 CRE
Slide 7: Average Deposits
7 Average Deposits (a) $ in billions $70 $66.8 $67.4 $66.8 $63.2 $64.0 $60 13.6 12.8 11.7 12.5 DDA CDs $100K 11.3 22% 17% $50 13.8 14.9 14.8 14.6 14.7 $40 1.8 1.8 1.8 CDs $100K 1.7 1.7 $30 21% 24.4 24.9 NOW/MMDA 24.9 24.0 24.1 $20 37% $10 Savings 11.1 12.4 13.6 14.6 10.7 3% $0 4Q08 1Q09 2Q09 3Q09 4Q
Slide 8: Strengthened Liquidity
Strengthened Liquidity 8 Average Earning Assets (a) Average Deposit Funding Sources (b) 4Q08 4Q09 4Q08 4Q09 3% 3% 4% 15% 4% 16% 9% 1% 19% 3% 12% 1% 83% 1% 73% 71% 81% 1% Total Loans ST Investments Core Deposits ST Borrowings Loans HFS Other Investments Dep. In Foreign Offices LT Debt Investment Secu
Slide 9: Net Loan Charge-offs
Net Loan Charge-offs 9 $ in millions Continuing Operations 4Q09 Net Loan Charge-offs = $708 million Commercial, financial and agricultural - 31% Consumer other - 7% Home equity - 6% CRE - commercial Residential mortgages - 1% mortgage - 23% Commercial lease financing - 6% CRE -construction - 26% Net
Slide 10: Nonperforming Assets
Nonperforming Assets 10 $ in millions 4Q09 Nonperforming Loans (a) = $2.2 billion Continuing Operations Commercial, financial and agricultural - 27% Consumer other - 2% Home equity - 6% CRE - commercial Residential mortgages - 3% mortgage - 28% Commercial lease financing - 5% CRE -construction - 29%
Slide 11: Capital Ratios
12 Capital Ratios Tangible Common Equity To Tangible Assets Tier 1 Common Equity (a) 10.00% 10.00% 8.00% 7.58% 7.56% 8.00% 7.36% 7.64% 7.46% 7.35% 5.95% 6.06% 5.62% 5.62% 6.00% 6.00% 4.00% 4.00% 2.00% 2.00% 0.00% 0.00% 4Q08 1Q09 2Q09 3Q09 4Q09 4Q08 1Q09 2Q09 3Q09 4Q09 Tier 1 Risk-Based Capital (a) T
Slide 12: Appendix
13 Appendix
Slide 13: Credit Quality by Portfolio
14 Credit Quality by Portfolio $ in millions Net loan Allowance / Period-end Average Net loan charge-offs (a) / Nonperforming Ending period-end Allowance / loans loans charge-offs loans (b) allowance(c) NPLs average loans loans 12/31/09 4Q09 4Q09 3Q09 4Q09 3Q09 12/31/09 9/30/09 12/31/09 12/31/09 12/
Slide 14: Commercial Portfolio - Continuing Ops.
Commercial Portfolio - Continuing Ops. 15 Average Loans, NCOs and NPLs Fourth Quarter 2009 Real Estate Institutional Regional Commercial Capital & Corp. Equipment & Capital Consumer $ in millions Banking Banking Bank Srvs. Finance Markets Finance Total Average Loans Commercial, financial and agricul
Slide 15: Commercial Real Estate
16 Commercial Real Estate $ in millions Period-end Nonperforming Net loan loans loans charge-offs 12-31-09 9-30-09 12-31-09 9-30-09 4Q09 3Q09 Multifamily properties $2,568 $2,603 $196 $80 $22 $52 Retail properties 2,557 2,690 290 275 90 73 Office builldings 1,285 1,362 48 41 17 15 Health facilities
Slide 16: Commercial Real Estate Loans
Commercial Real Estate Loans 17 December 31, 2009 $ in millions Geographic Region % of Commercial West Southwest Central Midwest Southeast Northeast Total Total CRE Mortgage Construction Nonowner-occupied: Multifamily properties $450 $444 $497 $254 $575 $348 $2,568 16.9 % $1,558 $1,010 Retail proper
Slide 17: Commercial Real Estate Period-end Balances
18 Commercial Real Estate Period-end Balances $ in billions $20 $18.5 $18.3 $17.9 $16.6 $16 $15.2 $12 $8 $4 $0 4Q08 1Q09 2Q09 3Q09 4Q09 Nonperforming Loans Net Charge-Offs $ in millions $ in millions $1,400 $350 $346 $1,268 $1,254 $1,200 $1,170 $300 $297 $1,000 $856 $250 $220 $800 $200 $564 $600 $15
Slide 18: Reducing Risk - CRE Residential Properties
19 Reducing Risk - CRE Residential Properties $ in millions Total Period-end Loans (a) Reduced the Residential Properties $4,000 $3,638 (Homebuilder) portfolio by 69% since 1Q08 Initiated process in 2Q08 to aggressively sell $3,000 $2,715 $2,356 at-risk homebuilder loans $2,154 $2,000 $1,839 $1,641
Slide 19: Home Equity Loans
Home Equity Loans 20 December 31, 2009 $ in millions Vintage (% of Loans) Loan Average Loan Average Average % of Loans 2005 and Balances Size ($) FICO LTV LTV90% 2009 2008 2007 2006 prior Regional Banking Home Equity loans and lines First Lien $ 5,289 $ 57,189 748 66 % 6. % 15 % 13 % 10 % 9 % 53 % S
Slide 20: Exit Loan Portfolio
21 Exit Loan Portfolio $ in millions Balance on Balance Change Net Loan Nonperforming Outstanding 12-31-09 vs. Charge-offs Status 12-31-09 9-30-09 9-30-09 4Q09 3Q09 12-31-09 9-30-09 Residential properties - homebuilder $379 $518 $(139) $53 $33 $211(b) $260 Residential properties - held for sale 52 6
Slide 21: Net Charge-offs to Average Loans
22 Net Charge-offs to Average Loans Continuing Operations 4Q09 3Q09 2Q09 1Q09 4Q08 Commercial, financial and agricultural 4.36 % 3.02 % 2.75 % 3.56 % 1.71 % Real estate - commercial mortgage 6.03 2.79 2.93 .78 1.60 Real estate - construction 13.69 14.69 8.52 5.62 2.54 Commercial lease financing 2.04