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Victory Capital Management did not fit with KeyCorp's retail strategy so the Cleveland company decided to sell it and has since asked regulators to let it use capital from the deal to buy back shares, CEO Beth Mooney said.
April 19
KeyCorp (KEY) reported higher third-quarter profit after recording a gain from the sale of its investment management and broker-dealer units.
The Cleveland company said Wednesday that it earned $266 million, up 24% from a year earlier. Earnings per share were 29 cents, beating analyst estimates collected by Bloomberg by six cents.
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Revenue declined almost 5%, to $1 billion, from a year earlier. Net interest income rose about 1%, to $584 million, as average total loans rose about 5%, to $53.3 billion. Noninterest income fell about 11%, to $459 million, primarily because of a $54 million gain associated with the redemption of trust-preferred securities a year earlier.
KeyCorp recorded $41 million, or three cents per share, in costs tied to its previously announced efficiency effort and a pension settlement charge. Last year the $90.7 billion-asset company
KeyCorp also acquired a commercial mortgage servicing portfolio and special servicing business, adding more than $1 billion in low-cost funding through escrow deposit balances.