KeyBank 2006 Annual Report Download - page 58

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58
MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION & RESULTS OF OPERATIONS KEYCORP AND SUBSIDIARIES
2006 Quarters 2005 Quarters
dollars in millions, except per share amounts Fourth Third Second First Fourth Third Second First
FOR THE QUARTER
Interest income $1,413 $1,389 $1,327 $1,251 $1,202 $1,114 $1,058 $1,009
Interest expense 701 684 623 557 516 455 399 357
Net interest income 712 705 704 694 686 659 659 652
Provision for loan losses 53 35 23 39 35 43 19 46
Noninterest income 558 543 545 481 552 531 485 499
Noninterest expense 809 790 798 752 812 762 730 750
Income from continuing operations before
income taxes and cumulative effect
of accounting change 408 423 428 384 391 385 395 355
Income from continuing operations before
cumulative effect of accounting change 311 305 303 274 284 269 284 253
Income (loss) from discontinued operations,
net of taxes (165) 7 5 10 12 9 7 11
Income before cumulative effect
of accounting change 146 312 308 284 296 278 291 264
Net income 146 312 308 289 296 278 291 264
PER COMMON SHARE
Income from continuing operations before
cumulative effect of accounting change $ .77 $ .76 $ .75 $ .67 $ .70 $ .66 $ .69 $ .62
Income (loss) from discontinued operations (.41) .02 .01 .02 .03 .02 .02 .03
Income before cumulative effect
of accounting change .36 .77 .76 .70 .72 .68 .71 .65
Net income .36 .77 .76 .71 .72 .68 .71 .65
Income from continuing operations before
cumulative effect of accounting change —
assuming dilution .76 .74 .74 .66 .69 .65 .69 .61
Income (loss) from discontinued operations —
assuming dilution (.40) .02 .01 .02 .03 .02 .02 .03
Income beforecumulative effect of accounting
change — assuming dilution .36 .76 .75 .69 .72 .67 .70 .64
Net income — assuming dilution .36 .76 .75 .70 .72 .67 .70 .64
Cash dividends declared .345 .345 .345 .345 .325 .325 .325 .325
Book value at period end 19.30 19.73 19.21 18.85 18.69 18.41 18.01 17.58
Market price:
High 38.63 38.15 38.31 37.67 34.05 35.00 33.80 34.07
Low 35.73 34.48 34.24 32.68 30.10 31.65 31.52 31.00
Close 38.03 37.44 35.68 36.80 32.93 32.25 33.15 32.45
Weighted-average common shares
outstanding (000) 402,329 403,780 404,528 407,386 408,431 410,456 408,754 408,264
Weighted-average common shares and
potential common shares outstanding (000) 407,828 409,428 410,559 413,140 412,542 415,441 414,309 413,762
AT PERIOD END
Loans $65,826 $65,551 $67,408 $66,980 $66,478 $65,575 $64,690 $64,018
Earning assets 80,090 83,132 81,737 81,087 80,143 80,096 78,548 77,937
Total assets 92,337 96,155 94,794 93,391 93,126 92,323 91,015 90,276
Deposits 59,116 61,429 60,838 59,402 58,765 58,071 58,063 57,127
Long-termdebt 14,533 13,654 14,050 14,032 13,939 14,037 13,588 14,100
Shareholders’ equity 7,703 7,947 7,737 7,638 7,598 7,522 7,352 7,162
PERFORMANCE RATIOS
From continuing operations:
Return on average total assets 1.33% 1.31% 1.33% 1.25% 1.26% 1.22% 1.31% 1.17%
Returnon average equity 15.63 15.52 15.85 14.94 14.96 14.36 15.76 14.46
Net interest margin (taxable equivalent) 3.66 3.61 3.68 3.72 3.68 3.63 3.67 3.62
From consolidated operations:
Return of average total assets .61% 1.30% 1.32% 1.26% 1.27% 1.22% 1.30% 1.18%
Return of average equity 7.34 15.88 16.11 15.48 15.59 14.84 16.15 15.09
Net interest margin (taxable equivalent) 3.69 3.63 3.69 3.77 3.71 3.67 3.71 3.66
CAPITAL RATIOS ATPERIOD END
Equity to assets 8.34% 8.26% 8.16% 8.18% 8.16% 8.15% 8.08% 7.93%
Tangible equity to tangible assets 7.01 6.81 6.68 6.71 6.68 6.68 6.60 6.43
Tier 1 risk-based capital 8.24 8.02 7.90 7.64 7.59 7.72 7.68 7.34
Total risk-based capital 12.43 12.13 12.08 11.91 11.47 11.83 11.72 11.58
Leverage 8.98 8.89 8.82 8.52 8.53 8.60 8.49 7.91
TRUST AND BROKERAGE ASSETS
Assets under management $84,699 $84,060 $80,349 $79,558 $77,144 $76,341 $76,807 $76,334
Nonmanaged and brokerage assets 56,292 55,221 57,682 56,944 56,509 57,313 57,006 61,375
OTHER DATA
Average full-time equivalent employees 20,100 20,264 19,931 19,694 19,417 19,456 19,429 19,571
KeyCenters 950 949 946 945 947 946 945 940
Note 3 (“Acquisitions and Divestitures”), which begins on page 75, contains specificinformation about the acquisitions that Key completed during the past three years to help in understanding
how those transactions may have impacted Key’s financial condition and results of operations.
FIGURE 37. SELECTED QUARTERLY FINANCIAL DATA
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