KeyCorp reported a net income of $454 million for the third quarter of 2025, translating to a diluted earnings per share of $0.41. This marks a significant recovery from a net loss of $410 million in the same quarter of the previous year. The company's net interest income on a taxable-equivalent basis reached $1.19 billion, an increase of $229 million, or 24%, compared to the third quarter of 2024. The net interest margin also improved, rising by 58 basis points to 2.75%, primarily due to lower deposit costs and a favorable shift in the balance sheet composition towards higher-yielding commercial loans.
In terms of operational metrics, KeyCorp's average loans for the quarter were $106.2 billion, slightly down from $106.24 billion a year earlier. However, average commercial loans increased by $2.3 billion, driven by growth in commercial and industrial loans. The bank's total deposits rose to $150.8 billion, up $1 billion from the end of 2024, reflecting a 2% year-over-year increase in client deposits and net new relationship households. The company also reported a record high of $67.9 billion in assets under management, an 11% increase year-over-year.
KeyCorp's provision for credit losses was $107 million for the third quarter, up from $95 million in the same period last year, reflecting a higher reserve provision due to economic uncertainties. The bank's noninterest income for the quarter was $702 million, a substantial recovery from a net loss of $269 million in the prior year, driven by strong performance in investment banking and trust services. The company also noted a significant increase in other noninterest income, which rose by 128% compared to the previous year, largely due to the absence of losses from securities repositioning that had impacted the prior year's results.
Looking ahead, KeyCorp anticipates a slight decline in average loans for the full year 2025, projecting a decrease of 1% to 3% compared to 2024. However, it expects ending loans to increase by approximately 2% by year-end 2025. The bank's net interest income is projected to rise by 22% for the full year, with a net interest margin forecasted to remain between 2.75% and 2.80% in the fourth quarter. KeyCorp's capital ratios remain strong, with a Common Equity Tier 1 ratio of 11.8%, positioning the bank well to support its clients amid ongoing economic challenges.
About KEYCORP /NEW/
KeyCorp is a diversified financial services company providing retail and commercial banking, investment management, and related services through its subsidiary KeyBank. It serves individual, small business, corporate, and institutional clients across the U.S., offering deposit accounts, loans, trust, and wealth management. Its business model emphasizes customer-centric banking, financial advisory, and capital markets services, leveraging extensive branch networks, digital platforms, and a focus on risk management and regulatory compliance.
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