KeyCorp Falls as Fourth-Quarter Costs Exceed Guidance

KeyCorp (KEY), the top performer last year in the KBW Bank Index (BKX), fell the most in four months as fourth-quarter expenses exceeded the lender’s forecast.

KeyCorp declined 3.3 percent to $13.68 in New York, the most since Sept. 19. The Cleveland-based bank, which today posted a 21 percent profit increase, said noninterest expenses in the period were $712 million, surpassing its guidance of $680 million to $700 million, including one-time charges.

KeyCorp, led by Chief Executive Officer Beth E. Mooney, made improved efficiency a priority for 2013. The company incurred $24 million in costs related to its efficiency initiative and a pension settlement in the quarter, according to a statement. The firm forecast expenses to decline in 2014 by a single digit percentage from the previous year.

“If you look into the tone and tenor of the call, I think a lot of people were looking for more aggressive guidance than we ultimately gave them,” Mooney, 58, said in a phone interview, referring to today’s conference call with analysts. “I think they hoped for more.”

Net income rose to $229 million, or 26 cents a share, from $190 million, or 20 cents, a year earlier, according to the statement. Profit excluding one-time items was 28 cents a share, beating the 25-cent average estimate of 25 analysts surveyed by Bloomberg.

“We have been an out-performer now for some period of time and as we said today we are giving a little of that back,” Mooney said.

KeyCorp climbed 59 percent last year to lead the 24-company KBW Bank index, which advanced 35 percent.

To contact the reporter on this story: Sarah Jacob in New York at

To contact the editor responsible for this story: Peter Eichenbaum at

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.