KeyBank 2014 Annual Report Download - page 142

2. Earnings Per Common Share
Basic earnings per share is the amount of earnings (adjusted for dividends declared on our preferred stock)
available to each common share outstanding during the reporting periods. Diluted earnings per share is the
amount of earnings available to each common share outstanding during the reporting periods adjusted to include
the effects of potentially dilutive common shares. Potentially dilutive common shares include incremental shares
issued for the conversion of our convertible Series A Preferred Stock, stock options, and other stock-based
awards. Potentially dilutive common shares are excluded from the computation of diluted earnings per share in
the periods where the effect would be antidilutive. For diluted earnings per share, net income available to
common shareholders can be affected by the conversion of our convertible Series A Preferred Stock. Where the
effect of this conversion would be dilutive, net income available to common shareholders is adjusted by the
amount of preferred dividends associated with our Series A Preferred Stock.
Our basic and diluted earnings per common share are calculated as follows:
Year ended December 31,
dollars in millions, except per share amounts 2014 2013 2012
EARNINGS
Income (loss) from continuing operations $ 946 $ 870 $ 842
Less: Net income (loss) attributable to noncontrolling interests 7—7
Income (loss) from continuing operations attributable to Key 939 870 835
Less: Dividends on Series A Preferred Stock 22 23 22
Income (loss) from continuing operations attributable to Key common shareholders 917 847 813
Income (loss) from discontinued operations, net of taxes (a) (39) 40 23
Net income (loss) attributable to Key common shareholders $ 878 $ 887 $ 836
WEIGHTED-AVERAGE COMMON SHARES
Weighted-average common shares outstanding (000) 871,464 906,524 938,941
Effect of convertible preferred stock ———
Effect of common share options and other stock awards 6,735 6,047 4,318
Weighted-average common shares and potential common shares outstanding (000) (b) 878,199 912,571 943,259
EARNINGS PER COMMON SHARE
Income (loss) from continuing operations attributable to Key common shareholders $ 1.05 $ .93 $ .87
Income (loss) from discontinued operations, net of taxes (a) (.04) .04 .02
Net income (loss) attributable to Key common shareholders (c) 1.01 .98 .89
Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution $ 1.04 $ .93 $ .86
Income (loss) from discontinued operations, net of taxes (a) (.04) .04 .02
Net income (loss) attributable to Key common shareholders — assuming dilution (c) .99 .97 .89
(a) In April 2009, we decided to wind down the operations of Austin, a subsidiary that specialized in managing hedge fund investments for
institutional customers. In September 2009, we decided to discontinue the education lending business conducted through Key Education
Resources, the education payment and financing unit of KeyBank. In February 2013, we decided to sell Victory to a private equity fund.
As a result of these decisions, we have accounted for these businesses as discontinued operations. For further discussion regarding the
income (loss) from discontinued operations, see Note 13 (“Acquisitions and Discontinued Operations”).
(b) Assumes conversion of common share options and other stock awards and/or convertible preferred stock, as applicable.
(c) EPS may not foot due to rounding.
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