KeyCorp Posts 11% Decline in Profit Amid Expenses to Cut JobsLaura Marcinek
KeyCorp, Ohio’s second-largest bank, said second-quarter profit declined 11 percent on costs related to a job-cutting program.
Operating net income fell to $193 million, or 21 cents a share, from $217 million, or 23 cents, a year earlier, the Cleveland-based lender said today in a statement. The average estimate of 25 analysts surveyed by Bloomberg was for earnings of 20 cents a share.
“Compared to the first quarter, cautious client behavior led to slower loan growth” and “greater-than-anticipated pressure on our net interest margin,” Chief Executive Officer Beth Mooney said in the statement.
The lender also said its after-tax gain on the sale of its Victory Capital Management unit will be between $100 million to $115 million, less than it previously projected. The company said it incurred $37 million of costs in the quarter related to its efficiency initiative, as severance payments helped push personnel costs up $29 million.
KeyCorp shares have gained 38 percent this year, outpacing the 26 percent advance of the 24-company KBW Bank Index.