KeyCorp Revenue Climbs on First Niagara Deal
October 25 2016 - 8:00AM
Dow Jones News
By Joshua Jamerson
Regional lender KeyCorp said third-quarter revenue climbed in
the latest period on its merger with First Niagara Financial Group
Inc.
The Ohio-based regional bank announced plans last fall to buy
First Niagara for about $4.1 billion, and the deal closed over the
summer.
Over all, the Cleveland-based bank reported a profit of $172
million, or 17 cents a share, down from $219 million, or 25 cents a
share, a year earlier. Merger-related charges dented profit by 14
cents a share, the company said.
Revenue rose 25% to $1.34 billion.
Noninterest income rose 17% to to $549 million, helped by
Investment banking and debt placement fees as well as cards and
payments income.
Like many other lenders, Key has moved to cut costs and has
closed some branches. Deal-related costs added up to $189 million
in the quarter, but excluding merger-related charges and the impact
of adding in First Niagara, noninterest expense rose 4% from a year
ago.
KeyCorp's net interest margin -- a gauge of lending
profitability that measures how much a bank earns from the
difference between what it pays on deposits and what it takes in on
loans and investments -- was 2.83%, up from 2.74% in the prior
quarter but down slightly from 2.84% a year ago.
KeyCorp shares, which have risen 12% in the past three months,
were inactive premarket.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
October 25, 2016 07:45 ET (11:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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