KeyCorp Q3 Net Income Hits $454M, AUM Jumps 11%

Ticker: KEY-PL · Form: 10-Q · Filed: Nov 4, 2025 · CIK: 91576

Keycorp /New/ 10-Q Filing Summary
FieldDetail
CompanyKeycorp /New/ (KEY-PL)
Form Type10-Q
Filed DateNov 4, 2025
Risk Levelmedium
Pages14
Reading Time17 min
Key Dollar Amounts$1, $454 million, $0, $67.9 billion, $107.7 Billion
Sentimentbullish

Sentiment: bullish

Topics: Regional Banking, Financial Performance, Capital Adequacy, Asset Management, Net Interest Income, Fee Income, Credit Quality

Related Tickers: KEY-PL, KEY

TL;DR

**KeyCorp's Q3 results show solid growth and strong capital, making it a stable bet in a volatile market.**

AI Summary

KeyCorp reported a net income from continuing operations attributable to common shareholders of $454 million, or $0.41 diluted earnings per share, for the third quarter of 2025. The company demonstrated strong client growth, with client deposits and net new relationship households increasing 2% year-over-year on an annualized basis. Assets Under Management reached a record high of $67.9 billion, an 11% increase year-over-year, driven by positive cash inflows and market impacts. Noninterest income showed strength, with Investment banking and debt placement fees up 8% and Trust and investment services fees up 7% compared to the prior year. KeyCorp maintained a robust capital position, ending the quarter with an estimated Common Equity Tier 1 ratio of 11.8%, an increase of over 100 basis points year-over-year. The company projects full-year 2025 net interest income (TE) to be up 22% to $3,810 million, and adjusted noninterest income to be up 5-6% to $2,645 million, while net charge-offs to average loans are expected to be between 40 to 45 basis points.

Why It Matters

KeyCorp's strong third-quarter performance, marked by a 2% annualized increase in client deposits and an 11% rise in Assets Under Management to $67.9 billion, signals healthy organic growth and effective client engagement. The estimated 11.8% Common Equity Tier 1 ratio, up over 100 basis points year-over-year, provides a solid capital buffer, reassuring investors of the bank's stability in a competitive financial landscape. This robust capital position allows KeyCorp to continue supporting its clients and potentially pursue strategic opportunities, differentiating it from competitors facing tighter capital constraints. For employees, this growth suggests job security and potential expansion, while customers benefit from a stable and growing financial partner.

Risk Assessment

Risk Level: medium — While KeyCorp reported strong capital with an estimated Common Equity Tier 1 ratio of 11.8% and net charge-offs tracking within the 40-45 basis points outlook, the filing highlights significant risks. These include 'deterioration of commercial real estate market fundamentals' and 'our concentrated credit exposure in commercial and industrial loans,' which could impact future asset quality and profitability despite current positive trends.

Analyst Insight

Investors should consider KeyCorp's consistent growth in client deposits and AUM, coupled with its strong capital position, as indicators of stability. While monitoring commercial real estate and C&I loan exposures, the positive outlook for net interest income (up 22%) and noninterest income (up 5-6%) suggests continued profitability, making KEY-PL a potentially attractive holding for income-focused investors.

Financial Highlights

net Income
$454M
eps
$0.41

Revenue Breakdown

SegmentRevenueGrowth
Investment banking and debt placement fees+8%
Trust and investment services fees+7%

Key Numbers

Key Players & Entities

FAQ

What was KeyCorp's net income for the third quarter of 2025?

KeyCorp reported a net income from continuing operations attributable to Key common shareholders of $454 million for the third quarter of 2025.

How did KeyCorp's Assets Under Management perform in Q3 2025?

KeyCorp's Assets Under Management reached a record high of $67.9 billion for the third quarter of 2025, representing an 11% increase year-over-year.

What is KeyCorp's estimated Common Equity Tier 1 ratio as of September 30, 2025?

KeyCorp's estimated Common Equity Tier 1 ratio was 11.8% as of September 30, 2025, which is up over 100 basis points year-over-year.

What is KeyCorp's outlook for full-year 2025 net interest income?

KeyCorp expects full-year 2025 net interest income (TE) to be up 22% compared to full-year 2024, reaching $3,810 million.

How much did KeyCorp's client deposits and net new relationship households increase?

Client deposits and net new relationship households increased 2% year-over-year on an annualized basis, reflecting strong client growth.

What were the key drivers of KeyCorp's noninterest income strength in Q3 2025?

Noninterest income strength was driven by Investment banking and debt placement fees, which were up 8%, and Trust and investment services fees, which were up 7% versus the prior year.

What are the projected net charge-offs to average loans for KeyCorp in FY2025?

KeyCorp projects net charge-offs to average loans for full-year 2025 to be between 40 to 45 basis points.

What are KeyCorp's medium-term targets for Return on tangible common equity and Net Interest Margin by the end of 2027?

KeyCorp has established medium-term targets reflecting expected run rates by the end of 2027: Return on tangible common equity of 15.0%+ and Net Interest Margin of 3.25%+.

What are some of the key risks identified by KeyCorp in its 10-Q filing?

Key risks include the extensive regulation of the U.S. financial services industry, operational or risk management failures, cybersecurity threats, and deterioration of commercial real estate market fundamentals.

How does KeyCorp manage its capital adequacy?

KeyCorp and KeyBank are subject to regulatory capital requirements based on the Basel III international capital framework, requiring them to meet minimum capital and leverage ratios, including Common Equity Tier 1.

Risk Factors

Industry Context

The banking industry is characterized by intense competition, evolving regulatory landscapes, and a growing emphasis on digital transformation and customer experience. KeyCorp operates within this environment, facing pressure from traditional banks, credit unions, and fintech challengers. Trends include increasing demand for personalized financial advice, integrated digital platforms, and robust cybersecurity measures.

Regulatory Implications

KeyCorp must navigate stringent regulatory requirements, including capital adequacy rules like the Common Equity Tier 1 ratio (currently 11.8%). Changes in monetary policy, consumer protection laws, and capital requirements can significantly impact operations and profitability. Maintaining compliance and strong capital buffers is paramount.

What Investors Should Do

  1. Monitor Net Interest Income (NII) trends
  2. Assess Asset Quality
  3. Evaluate Noninterest Income Growth Drivers
  4. Observe Capital Adequacy

Key Dates

Glossary

Continuing Operations
Refers to all of KeyCorp's businesses excluding its government-guaranteed and private education lending business, which is accounted for as discontinued operations. (Helps to isolate the performance of the core, ongoing business segments.)
Common Equity Tier 1 (CET1) Ratio
A measure of a bank's core capital strength, calculated as common equity divided by risk-weighted assets. It's a key indicator of financial stability. (KeyCorp's estimated CET1 ratio of 11.8% demonstrates a strong capital position, important for regulatory compliance and investor confidence.)
Net Interest Income (TE)
The difference between interest income generated by a bank and the interest paid out to its lenders (like depositors). 'TE' likely refers to 'Taxable Equivalent'. (A primary driver of profitability for banks; the projected 22% growth indicates strong expected performance in this area.)
Assets Under Management (AUM)
The total market value of assets that an investment company manages on behalf of its clients. (Record AUM of $67.9 billion signifies successful client acquisition and asset growth, contributing to fee income.)
Net Charge-offs
The amount of loans deemed uncollectible and charged against the allowance for loan losses. (Indicates the level of credit risk realized; the projected 40-45 bps for FY2025 provides an outlook on credit quality.)

Year-Over-Year Comparison

Compared to the prior year, KeyCorp demonstrates significant positive momentum. Client deposits and net new relationship households grew 2% year-over-year, while Assets Under Management reached a record $67.9 billion, up 11%. Noninterest income segments like investment banking and trust services saw healthy growth of 8% and 7% respectively. Furthermore, the company's capital position strengthened, with the Common Equity Tier 1 ratio increasing by over 100 basis points year-over-year to an estimated 11.8%.

Filing Stats: 4,329 words · 17 min read · ~14 pages · Grade level 12.6 · Accepted 2025-11-04 15:38:39

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Page Number

Financial Statements

Item 1. Financial Statements 48 Consolidated Balance Sheets 48 Consolidated Statements of Income 49 Consolidated Statements of Comprehensive Income 50 Consolidated Statements of Changes in Equity 51 Consolidated Statements of Cash Flows 52

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 53 Note 1. Basis of Presentation and Accounting Policies 53 Note 2. Earnings Per Common Share 53 Note 3. Loan Portfolio 54 Note 4. Asset Quality 54 Note 5. Fair Value Measurements 67 Note 6. Securities 72 Note 7. Derivatives and Hedging Activities 74 Note 8. Mortgage Servicing Assets 79 Note 9. Leases 80 Note 10. Goodwill 81 Note 11. Variable Interest Entities 81 Note 12. Income Taxes 83 Note 13. Discontinued Operations 84 Note 14. Employee Benefits 84 Note 15. Trust Preferred Securities Issued by Unconsolidated Subsidiaries 84 Note 16. Contingent Liabilities and Guarantees 85 Note 17. Accumulated Other Comprehensive Income 87 Note 18. Shareholders' Equity 88 Note 19. Business Segment Reporting 89 Note 20. Revenue from Contracts with Customers 91 Report of Independent Registered Public Accounting Firm (PCAOB ID: 42) 92 2 Table of contents

Management's Discussion & Analysis of Financial Condition & Results of Operations

Item 2. Management's Discussion & Analysis of Financial Condition & Results of Operations 4 Introduction 4 Terminology 4

Forward-looking statements

Forward-looking statements 5 Executive overview 7 Business outlook 7 Demographics 7 Supervision and regulation 8 Results of Operations 11 Earnings overview 11 Net interest income 11 Provision for credit losses 15 Noninterest income 15 Noninterest expense 17 Income taxes 19 Business Segment Results 19 Consumer Bank 19 Commercial Bank 20 Financial Condition 22 Loans and loans held for sale 22 Securities 27 Deposits and other sources of funds 29 Capital 30 Risk Management 33 Overview 33 Market risk management 34 Liquidity risk management 38 Credit risk management 40 Operational and compliance risk management 44 GAAP to Non-GAAP Reconciliations 45 Critical Accounting Policies and Estimates 46 Accounting and Reporting Developments 47

Quantitative and Qualitative Disclosure about Market Risk

Item 3. Quantitative and Qualitative Disclosure about Market Risk 93

Controls and Procedures

Item 4. Controls and Procedures 93

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 93

Risk Factors

Item 1A. Risk Factors 93

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 93

Other Information

Item 5. Other Information 94

Exhibits

Item 6. Exhibits 95 Signature 96 3 Table of contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Management's Discussion & Analysis of Financial Condition & Results of Operations

Item 2. Management's Discussion & Analysis of Financial Condition & Results of Operations Introduction This section reviews the financial condition and results of operations of KeyCorp and its subsidiaries for the quarterly periods ended September 30, 2025, and September 30, 2024. Some tables may include additional periods to comply with disclosure requirements or to illustrate trends in greater depth. When you read this discussion, you should also refer to the consolidated financial statements and related notes in this report. The page locations of specific sections and notes that we refer to are presented in the Table of Contents. References to our "2024 Form 10-K" refer to our Form 10-K for the year ended December 31, 2024, which has been filed with the SEC and is available on its website ( www.sec.gov ) and on our website ( www.key.com/ir ). Terminology Throughout this discussion, references to "Key," "we," "our," "us," and similar terms refer to the consolidated entity consisting of KeyCorp and its subsidiaries. "KeyCorp" refers solely to the parent holding company, and "KeyBank" refers solely to KeyCorp's subsidiary bank, KeyBank National Association. "KeyBank (consolidated)" refers to the consolidated entity consisting of KeyBank and its subsidiaries. We want to explain some industry-specific terms at the outset so you can better understand the discussion that follows. We use the phrase continuing operations in this document to mean all of our businesses other than our government-guaranteed and private education lending business, which are accounted for as discontinued operations . We engage in capital markets activities primarily through business conducted by our Commercial Bank segment . These activities encompass a variety of products and services. Among other things, we trade securities as a dealer, enter into derivative contracts (both to accommodate clients' financing needs and to mitigate certain risks), and conduct transactions in foreig

Forward-looking Statements

Forward-looking Statements From time to time, we have made or will make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements do not relate strictly to historical or current facts. Forward-looking statements usually can be identified by the use of words such as "goal," "objective," "plan," "expect," "assume," "anticipate," "intend," "project," "believe," "estimate," "will," "would," "should," "could," or other words of similar meaning. Forward-looking statements provide our current expectations or forecasts of future events, circumstances, results or aspirations. Our disclosures in this report contain forward-looking statements. We may also make forward-looking statements in other documents filed with or furnished to the SEC. In addition, we may make forward-looking statements orally to analysts, investors, representatives of the media and others. Forward-looking statements, by their nature, are subject to assumptions, risks, and uncertainties, many of which are outside of our control. Our actual results may differ materially from those set forth in our forward-looking statements. There is no assurance that any list of risks and uncertainties or risk factors is complete. In addition, no assurance can be given that any plan, initiative, projection, goal, commitment, expectation, or prospect set forth in this report 5 Table of contents can or will be achieved. Factors that could cause our actual results to differ from those described in forward-looking statements include, but are not limited to: the extensive regulation of the U.S. financial services industry; complex and evolving laws and regulations regarding privacy and cybersecurity; operational or risk management failures by us or critical third parties; breaches of security or failures of our technology systems due to technological or other factors, cybersecurity threats, and increased risks resulting from remote work; an ineffectiv

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