KEYCORP REPORTS FOURTH QUARTER 2025 NET INCOME OF $474 MILLION, OR $.43 PER DILUTED COMMON SHARE

Revenue of $2.0 billion; Record full year revenue of $7.5 billion, up 16% year-over-year adjusted for selected items^(a),(b)

Pre-provision net revenue^(b) increased $46 million quarter-over-quarter; Full year pre-provision net revenue increased 44% year-over-year adjusted for selected items^(a),(b) 

Net interest income increased 3% quarter-over-quarter, and net interest margin of 2.82% increased 7 bps

Nonperforming assets decreased 6% quarter-over-quarter; Net charge-offs decreased 3 bps to 39 bps

Common Equity Tier 1 ratio of 11.7%^(c); Repurchased $200 million of common shares during the quarter

CLEVELAND, Jan. 20, 2026 /PRNewswire/ -- KeyCorp (NYSE:KEY) today announced net income from continuing operations attributable to Key common shareholders of $474 million, or $.43 per diluted common share, or adjusted net income of $458 million, or $.41 per diluted common share^(b), for the fourth quarter of 2025. The fourth quarter of 2025 included a $16 million after-tax benefit related to the updated FDIC special assessment^(a). For the third quarter of 2025, net income from continuing operations attributable to Key common shareholders was $454 million, or $.41 per diluted common share, or adjusted net income of $450 million, or $.41 per diluted common share^(b). For the fourth quarter of 2024, KeyCorp reported a net loss from continuing operations attributable to Key common shareholders of $(279) million, or $(.28) per diluted common share, or adjusted net income of $378 million, or $.38 per diluted common share^(b). Included in the fourth quarter of 2024 are after-tax charges of $(657) million, or $(.66) per diluted common share, related to the loss on the sale of securities^(a), a $2 million after-tax charge related to the Scotiabank investment agreement valuation^(a), and a $2 million after-tax benefit related to the updated FDIC special assessment^(a).

Comments from Chairman and CEO, Chris Gorman

"Our strong fourth quarter and full-year results demonstrate the consistent and significant progress we are making on our path to achieving sustainable mid-to-high teens returns on tangible common equity. Fourth quarter revenue exceeded $2 billion, and full year revenue was a record, up 16% year-over-year^(b). Full year results met or exceeded each of the financial targets we communicated at the beginning of the year. During the year, we generated approximately 1,200 basis points of adjusted operating leverage^(b) and 280 basis points of adjusted fee-based operating leverage^(b). Tangible book value per share grew 3% sequentially and 18% year-over-year.

In addition to driving greater return on capital, we remain committed to the return of capital. To this end, we resumed share repurchases at an accelerated pace, buying back $200 million of common shares in the fourth quarter while maintaining peer-leading capital ratios. Given our excess capital position and meaningful capital generation capabilities, we are well positioned to further increase our return of capital to our shareholders in 2026. 

Looking forward, I am confident that we will deliver another year of strong organic revenue and earnings growth. Our strategic investments - particularly in front-line bankers and technology - continue to fuel organic growth and enhance our ability to deliver best-in-class capabilities and service to our clients. Business momentum remains strong. Assets under management reached a record $70 billion. Investment banking and debt placement fees recorded the second-best annual performance in our history, and pipelines remain elevated.

I am incredibly proud of our results, our continued momentum, and most importantly, the talented teammates behind our success. This morning, we announced changes to the composition of our Board which reflect strong leadership that will drive the next phase of value creation for Key. I remain confident that our focus, resilience, and dedication will continue to deliver value to the stakeholders we serve – our shareholders, our clients, and our communities."

 

 

Taxable-equivalent net interest income was $1.22 billion for the fourth quarter of 2025 and the net interest margin was 2.82%. Compared to the fourth quarter of 2024, net interest income increased by $162 million, and the net interest margin increased by 41 basis points. These increases primarily reflect lower deposit costs, the reinvestment of proceeds from maturing low-yielding investment securities, swaps and fixed-rate loans into higher-yielding investments, and the repositioning of the available-for-sale portfolio during the fourth quarter of 2024. Additionally, the balance sheet composition shifted to reflect a more favorable mix of higher-yielding commercial and industrial loans and an improved funding mix as lower-cost deposits increased while wholesale borrowings declined. These benefits were partially offset by the impact of lower interest rates on variable-rate earning assets.

Compared to the third quarter of 2025, taxable-equivalent net interest income increased by $30 million, and the net interest margin increased by 7 basis points. These increases were driven by lower deposit costs, an improved funding mix as lower-cost deposit balances increased while wholesale borrowings declined, and a shift in the balance sheet composition to a more favorable mix of higher-yielding commercial and industrial loans. These benefits were partially offset by the impact of lower interest rates on variable-rate earning assets.

Compared to the fourth quarter of 2024, noninterest income increased by $978 million. The increase was primarily driven by the impact of a $915 million loss on the sale of securities as part of the strategic repositioning of the portfolio in the fourth quarter of 2024. Adjusted noninterest income^(a) grew 8% primarily driven by a $22 million increase in investment banking and debt placement fees, a $12 million increase in corporate services income, and continued momentum in trust and investment services and commercial payments.

Compared to the third quarter of 2025, noninterest income increased by $80 million. The increase was driven by a $59 million increase in investment banking and debt placement fees reflective of higher merger and acquisition advisory fees as well as commercial debt placement fees, a $9 million increase in corporate services income, and a $6 million increase in trust and investment services income.

Compared to the fourth quarter of 2024, noninterest expense increased by $12 million. The increase was predominantly driven by a $56 million increase in personnel expense primarily related to incentive compensation associated with noninterest income growth, continued investments in people, and employee benefits. These were partially offset by a decrease in other expense related to a $21 million benefit associated with the updated FDIC special assessment.

Compared to the third quarter of 2025, noninterest expense increased by $64 million. The increase was predominantly driven by a $48 million increase in personnel expense, primarily related to incentive compensation associated with noninterest income growth, seasonally higher employee benefits, and continued investments in people. Business services and professional fees increased by $17 million due to technology-related investments and seasonality. These were partially offset by a decrease in other expense related to a $21 million benefit associated with the updated FDIC special assessment.

 

Average loans were $106.3 billion for the fourth quarter of 2025, an increase of $1.6 billion compared to the fourth quarter of 2024. Average commercial loans increased by $3.9 billion, primarily driven by a $4.7 billion increase in commercial and industrial loans, partially offset by modest reduction in commercial real estate loans. Average consumer loans declined by $2.3 billion, reflective of the intentional run-off of low-yielding loans, primarily consumer mortgages.

Compared to the third quarter of 2025, average loans increased by $89 million. Average commercial loans increased $641 million, primarily driven by an increase in commercial and industrial loans. Average consumer loans declined by $552 million, reflective of the intentional run-off of low-yielding loans.

Average deposits totaled $150.7 billion for the fourth quarter of 2025, an increase of $977 million compared to the year-ago quarter, reflecting growth in commercial deposits.

Compared to the third quarter of 2025, average deposits increased by $336 million, driven by higher commercial client balances which offset a $1.3 billion decline in brokered CDs. The rate paid on interest-bearing deposits declined by 20 basis points, and the overall cost of deposits declined by 16 basis points to 1.81%.

Net loan charge-offs for the fourth quarter of 2025 totaled $104 million, or 0.39% of average total loans. These results compare to $114 million, or 0.43%, for the fourth quarter of 2024 and $114 million, or 0.42%, for the third quarter of 2025.

Key's allowance for credit losses was $1.7 billion, or 1.63% of total period-end loans at December 31, 2025, compared to 1.63% at December 31, 2024, and 1.64% at September 30, 2025. A relatively stable reserve build of $4 million during the fourth quarter of 2025 was the result of the net impact of improving credit quality trends and resilient economic forecasts offset by growth in unfunded commitments.

At December 31, 2025, Key's nonperforming loans totaled $615 million, which represented 0.58% of period-end portfolio loans. These results compare to 0.73% at December 31, 2024, and 0.62% at September 30, 2025. Nonperforming assets at December 31, 2025, totaled $627 million, and represented 0.59% of period-end portfolio loans and OREO and other nonperforming assets. These results compare to 0.74% at December 31, 2024, and 0.63% at September 30, 2025.

CAPITAL

Key's estimated risk-based capital ratios, included in the following table, continued to exceed all "well-capitalized" regulatory benchmarks at December 31, 2025.

Key's regulatory capital position remained strong in the fourth quarter of 2025. As shown in the preceding table, at December 31, 2025, Key's estimated Common Equity Tier 1 and Tier 1 risk-based capital ratios stood at 11.7% and 13.4%, respectively.

During the fourth quarter of 2025, Key declared a dividend of $.205 per common share. The reduction in share count was driven by $200 million of common shares repurchased.

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.

 

 

Consumer Bank Summary of Operations (4Q25 vs. 4Q24)

• Key's Consumer Bank recorded net income attributable to Key of $137 million for the fourth quarter of 2025, compared to $83 million for the year-ago quarter
• Taxable-equivalent net interest income increased by $64 million, or 10.1%, compared to the fourth quarter of 2024
• Average loans and leases decreased $2.9 billion, or 7.7%, from the fourth quarter of 2024, driven by intentional run-off of low-yielding loans
• Average deposits increased $262 million, or 0.3%, from the fourth quarter of 2024. The increase was driven by growth in money market deposits, offset by a decrease in time deposits
• Provision for credit losses decreased $11 million compared to the fourth quarter of 2024 driven by lower charge-offs and the impacts from ongoing loan run-off
• Noninterest income increased $19 million from the year-ago quarter, primarily driven by higher trust and investment services income
• Noninterest expense increased $22 million from the year-ago quarter, primarily driven by higher support and overhead expense

 

Commercial Bank Summary of Operations (4Q25 vs. 4Q24)

• Key's Commercial Bank recorded net income attributable to Key of $410 million for the fourth quarter of 2025, compared to $381 million for the year-ago quarter
• Taxable-equivalent net interest income increased by $79 million, or 14.7%, compared to the fourth quarter of 2024
• Average loan and lease balances increased $4.4 billion, or 6.6%, compared to the fourth quarter of 2024, driven by an increase in commercial and industrial loans
• Average deposit balances increased $749 million compared to the fourth quarter of 2024, driven by higher client deposits
• Provision for credit losses increased $76 million compared to the fourth quarter of 2024, driven by higher loan balances and commitments
• Noninterest income increased $29 million compared to the fourth quarter of 2024, primarily driven by an increase in investment banking and debt placement fees and corporate services income
• Noninterest expense decreased $3 million compared to the fourth quarter of 2024, primarily driven by a decrease in other direct noninterest expense

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KeyCorp's roots trace back more than 200 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 $184 billion at December 31, 2025.

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 approximately 950 branches and approximately 1,200 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 Member FDIC.

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 8:00 a.m. ET, on January 20, 2026. A replay of the call will be available on our website through January 20, 2027.

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KeyCorp

Fourth Quarter 2025

Financial Supplement

Basis of Presentation

Use of Non-GAAP Financial Measures

This document contains GAAP financial measures and non-GAAP financial measures where management believes it to be helpful in understanding Key's results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in this document, the financial supplement, or conference call slides related to this document, all of which can be found on Key's website (www.key.com/ir).  

Forward-Looking Non-GAAP Financial Measures 

From time to time Key may discuss forward-looking non-GAAP financial measures. Key is unable to provide a reconciliation of forward-looking non-GAAP financial measures to their most directly comparable GAAP financial measures because Key is unable to provide, without unreasonable effort, a meaningful or accurate calculation or estimation of amounts that would be necessary for the reconciliation due to the complexity and inherent difficulty in forecasting and quantifying future amounts or when they may occur. Such unavailable information could be significant for future results.

Annualized Data

Certain returns, yields, performance ratios, or quarterly growth rates are presented on an "annualized" basis. This is done for analytical and decision-making purposes to better discern underlying performance trends when compared to full-year or year-over-year amounts.

Taxable Equivalent

The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. Income from tax-exempt earning assets is increased by an amount equivalent to the taxes that would have been paid if this income had been taxable at the federal statutory rate. This adjustment puts all earning assets, most notably tax-exempt loans, and certain lease assets, on a common basis that facilitates comparison of results to peers.

Earnings Per Share Equivalent 

Certain income or expense items may be expressed on a per common share basis. This is done for analytical and decision-making purposes to better discern underlying trends in total consolidated earnings per share performance excluding the impact of such items. When the impact of certain income or expense items is disclosed separately, the after-tax amount is computed using the marginal tax rate, unless otherwise specified, with this then being the amount used to calculate the earnings per share equivalent.

 

 

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," "adjusted return on average tangible common equity," "pre-provision net revenue," "adjusted pre-provision net revenue," "cash efficiency ratio," "adjusted taxable-equivalent revenue," "adjusted noninterest income," "adjusted noninterest expense," "adjusted income (loss) available from continuing operations attributable to Key common shareholders," and "diluted earnings per share - adjusted."

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. Adjusted return on average tangible common equity excludes significant or unusual items that management does not consider indicative of ongoing financial performance. Management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods.

The table also shows the computation for pre-provision net revenue and adjusted pre-provision net revenue, which are 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. Further, management believes that adjusting pre-provision net revenue for significant or unusual items that management does not consider indicative of ongoing financial performance provides a greater understanding of ongoing operations and enhances comparability of results with prior periods.

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 provides 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. The adjusted cash efficiency ratio excludes significant or unusual items that management does not consider indicative of ongoing financial performance.

Adjusted taxable-equivalent revenue or adjusted revenue is a non-GAAP measure in that it adjusts revenue for certain tax-exempt instruments and selected items. The interest income earned on certain earning assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments. To provide more meaningful comparisons of net interest income, we use interest income on a taxable-equivalent basis by increasing the interest income earned on tax-exempt assets to make it fully equivalent to interest income earned on taxable instruments. Additionally, management believes adjusting for the selected items provide investors with useful information to gain a better understanding of ongoing operations and enhance comparability of results with prior periods, as well as demonstrate the effects of the financial impacts related to those selected items.

Adjusted noninterest income and adjusted noninterest expense are non-GAAP measures in that they exclude significant or unusual items that management does not consider indicative of ongoing financial performance. Management believes these measures provides a greater understanding of ongoing operations and enhances comparability of results with prior periods.

Adjusted income (loss) available from continuing operations attributable to Key common shareholders (or "adjusted net income") and diluted earnings per share - adjusted (or "adjusted earnings per share") are non-GAAP in that these measures exclude significant or unusual items, net of tax, that management does not consider indicative of ongoing financial performance. Management believes these measures provide investors with useful information to gain a better understanding of ongoing operations and enhance comparability of results with prior periods.

Adjusted operating leverage and fee-based adjusted operating leverage are non-GAAP performance measure in that it utilizes revenue on a tax-equivalent basis and adjusts revenue and expense for significant and unusual items. Management utilizes this measurement in analyzing performance and believes that adjusting for significant and unusual items provide investors with useful information to gain a better understanding of ongoing operations and enhance comparability of results with prior periods.

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.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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SOURCE KeyCorp