KeyCorp On Track To Report First FY Profit Since 2007

KeyCorp

reported 3Q10 profits from continuing operations of $0.19 vs. a net loss from continuing operations of ($0.50) in 3Q09. KEY is on track to report its first full year of profits since 2007 as credit quality measures continued to evidence broad-based improvement and pre-provision profits remained resilient. Both non-performing assets and net charge-offs continued to trend lower. As a result, the company released $262mm of reserves ($0.20/shr), which Collins suspects will continue on a fairly similar pace over the next few qtrs. In addition, pre-provision profits improved, including a higher margin and lower expense levels. Loan balances, however, continued to decline. Tangible equity levels edged higher on the profits in the qtr and smaller balance sheet. Collins Stewart has a Neutral rating with a PT of $9 KEY closed Friday at $8.30