KeyCorp (KEY) has reported a 21.46 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $172 million, or $0.17 a share in the quarter, compared with $219 million, or $0.25 a share for the same period last year.
Revenue during the quarter grew 25 percent to $1,270 million from $1,016 million in the previous year period. Net interest income for the quarter rose 31.98 percent over the prior year period to $780 million. Non-interest income for the quarter rose 16.81 percent over the last year period to $549 million.
KeyCorp has made provision of $59 million for loan losses during the quarter, up 31.11 percent from $45 million in the same period last year.
Net interest margin contracted 1 basis points to 2.83 percent in the quarter from 2.84 percent in the last year period. Efficiency ratio for the quarter deteriorated to 80 percent from 66.90 percent in the previous year period. A rise in efficiency ratio suggests a fall in profitability.
"Third quarter results reflect strong momentum and performance in Key's core businesses, and we achieved a significant milestone with the completion of our First Niagara acquisition," said Chairman and Chief Executive Officer Beth Mooney. "Excluding the impact from the acquisition and merger-related charges, Key’s revenue was up 6%, benefiting from solid loan growth and strong fee income, including a record quarter for investment banking and debt placement fees. Credit quality remained solid with net charge-offs as a percent of average loans remaining below our targeted range. Also, during the quarter, we leveraged Key’s strong capital position by reinitiating our share repurchase program."
Liabilities outpace assets growth
Total assets stood at $135,805 million as on Sep. 30, 2016, up 42.32 percent compared with $95,422 million on Sep. 30, 2015. On the other hand, total liabilities stood at $120,807 million as on Sep. 30, 2016, up 42.62 percent from $84,705 million on Sep. 30, 2015.
Deposits stood at $104,185 million as on Sep. 30, 2016, up 46.59 percent compared with $71,073 million on Sep. 30, 2015. Loans to deposits ratio was 84.70 percent for the quarter, down from 89.30 percent for the previous year quarter.
Noninterest-bearing deposit liabilities were $32,024 million or 30.74 percent of total deposits on Sep. 30, 2016, compared with $25,985 million or 36.56 percent of total deposits on Sep. 30, 2015.
Investments stood at $35,728 million as on Sep. 30, 2016, up 51.58 percent or $12,157 million from year-ago. Shareholders equity stood at $14,998 million as on Sep. 30, 2016, up 39.95 percent or $4,281 million from year-ago.
Return on average assets moved down 40 basis points to 0.55 percent in the quarter from 0.95 percent in the last year period. At the same time, return on average equity decreased 307 basis points to 5.12 percent in the quarter from 8.19 percent in the last year period.
Nonperforming assets moved up 82.25 percent or $343 million to $760 million on Sep. 30, 2016 from $417 million on Sep. 30, 2015. Meanwhile, nonperforming assets to total assets was 0.89 percent in the quarter, up from 0.69 percent in the last year period.
Book value per share was $12.78 for the quarter, up 2.49 percent or $0.31 compared to $12.47 for the same period last year.
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