Boston, MA 04/17/2014 (wallstreetpr) – There is a reason for KeyCorp (NYSE:KEY)‘s investors to rejoice and it is none other than the bank’s above par performance in the first quarter of the year 2014.
In Line With Expectations
During the first quarter earnings, KeyCorp (NYSE:KEY) said that it was able to cut down its expenses in the reported period, which helped it to counterbalance the effect of lower revenue. While borrowing from consumers and businesses continued to be weak, the bank as well as other regional banks remained benefitted from the loan quality improvement.
For the period, Keycorp posted profit to the tune of $236 million; that is $0.27 per share as against profit of $199 million or $0.22 per share in the previous year’s same quarter. Income from continuing operations declines from $0.21 to $0.26 per share while revenue fell to $1 billion, reporting a decline of 1%. Analysts were expecting earnings of $0.24 per share on revenue of $1.01 billion.
Lower Expenses Balanced Lower Revenue
On the expenses front, KeyCorp (NYSE:KEY) said that its non-interest expense declined 2.8%, at the same time, loan and lease losses provisioning also fell enormously from $55 million to $6 million, in the last one year. The company’s loan book swelled 4% to $54.7 billion in the first quarter, mainly due to growth observed in agricultural, financial and commercial loans. Its loan book a year earlier stood at $52.6 billion.
However, its net interest margin declined from 3.24% in the previous year to $3.01 in the reported quarter. The net margin measures the difference between what the bank charge on loans and what it pays to depositors. Keycorp said that the reason behind the decline is accredited to the lower asset yields and loan fees that masked the impact of growth in loan statistics.
The shares of KeyCorp (NYSE:KEY) were trading 1.48% up in the pre-market.
