KEYCORP /NEW/ - FORM 8-K - EX-99.1

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Exhibit 99.1

News

KeyCorp

127 Public Square

Cleveland, OH 44114


CONTACTS:	ANALYSTS	MEDIA
	Vernon L. Patterson	David Reavis
	216.689.0520	216.471.2886
	Vernon_Patterson@KeyBank.com	David_Reavis@KeyBank.com

	Kelly L. Lammers
	216.689.3133
	Kelly_L_Lammers@KeyBank.com


INVESTOR		KEY MEDIA
RELATIONS: www.key.com/ir		NEWSROOM: www.key.com/newsroom

FOR IMMEDIATE RELEASE

KEYCORP CONTINUES EARNINGS MOMENTUM,

REPORTS THIRD QUARTER 2011 AND YEAR-TO-DATE

NET INCOME OF $229 MILLION AND $656 MILLION

•

Net income from continuing operations of $229 million, or $.24 per common share, for the third quarter of 2011

•

Year-to-date net income from continuing operations of $656 million, or $.71 per common share

•

Net interest margin at 3.09% for the third quarter of 2011

•

Nonperforming loans declined to $788 million, or 1.64% of period-end loans, and nonperforming assets decreased to $914 million

•

Loan loss reserve at 2.35% of total period-end loans and 144% of nonperforming loans at September 30, 2011

•

Third quarter of 2011 net charge-offs of $109 million, or .90% of average loan balances

•

Tier 1 common equity and Tier 1 risk-based capital ratios estimated at 11.34% and 13.55%, respectively, at September 30, 2011

CLEVELAND, October 20, 2011 – KeyCorp (NYSE: KEY) today announced third quarter net income from continuing operations attributable to Key common shareholders of $229 million, or $.24 per common share. Key’s third quarter 2011 results compare to net income from continuing operations attributable to Key common shareholders of $163 million, or $.19 per common share, for the third quarter of 2010. The results for the third quarter of 2011 reflect an improvement in noninterest expense and lower credit costs from the same period one year ago. Third quarter 2011 net income attributable to Key common shareholders was $212 million compared to net income attributable to Key common shareholders of $178 million for the same quarter one year ago.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 2

For the nine-month period ended September 30, 2011, net income from continuing operations attributable to Key common shareholders was $656 million, or $.71 per common share, compared to net income from continuing operations attributable to Key common shareholders of $121 million, or $.14 per common share, for the same period one year ago. Net income attributable to Key common shareholders for the nine-month period ended September 30, 2011, was $619 million compared to net income attributable to Key common shareholders of $111 million for the same period one year ago.

During the third quarter of 2011, the Company continued to benefit from improved asset quality. Nonperforming loans decreased by $584 million and nonperforming assets declined by $887 million from the year-ago quarter to $788 million and $914 million, respectively. Net charge-offs declined to $109 million, or .90% of average loan balances for the third quarter of 2011, compared to $357 million, or 2.69% of average loan balances for the same period one year ago.

Chairman and Chief Executive Officer Beth Mooney stated, “Our financial results demonstrate consistent positive momentum for Key as we continue executing our relationship strategy, improving credit quality and maintaining disciplined expense control. We are also pleased that our commercial, financial and agricultural loan portfolio grew for the second consecutive quarter. Our clients continue to benefit from our ability to work together across business lines to deliver value by combining local knowledge and service with specialized industry expertise and advisory capabilities.”

Mooney continued: “We look forward to continuing our support of small- and medium-sized businesses and have committed $5 billion in lending capital over the next three years to foster growth and expansion in this important segment.”

At September 30, 2011, Key’s estimated Tier 1 common equity and Tier 1 risk-based capital ratios were 11.34% and 13.55%, compared to 11.14% and 13.93%, respectively, at June 30, 2011.

The Company originated approximately $9.7 billion in new or renewed lending commitments to consumers and businesses during the quarter.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 3

The following table shows Key’s continuing and discontinued operating results for the comparative quarters and for the nine-month periods ended September 30, 2011 and 2010.

Results of Operations


	Three months ended								Nine months ended
in millions, except per share amounts	9-30-11			6-30-11			9-30-10		9-30-11			9-30-10
Summary of operations
Income (loss) from continuing operations attributable to Key	$	234		$	249		$	204	$	757		$	244
Income (loss) from discontinued operations, net of taxes^(a)		(17	)		(9	)		15		(37	)		(10	)

Net income (loss) attributable to Key	$	217		$	240		$	219	$	720		$	234

Income (loss) from continuing operations attributable to Key	$	234		$	249		$	204	$	757		$	244
Less: Dividends on Series A Preferred Stock		5			6			6		17			17
Cash dividends on Series B Preferred Stock^(b)		—			—			31		31			94
Amortization of discount on Series B Preferred Stock ^(b)		—			—			4		53			12

Income (loss) from continuing operations attributable to Key common shareholders		229			243			163		656			121
Income (loss) from discontinued operations, net of taxes ^(a)		(17	)		(9	)		15		(37	)		(10	)

Net income (loss) attributable to Key common shareholders	$	212		$	234		$	178	$	619		$	111


Per common share — assuming dilution
Income (loss) from continuing operations attributable to Key common shareholders	$	.24		$	.26		$	.19	$	.71		$	.14
Income (loss) from discontinued operations, net of taxes ^(a)		(.02	)		(.01	)		.02		(.04	)		(.01	)

Net income (loss) attributable to Key common shareholders ^(c)	$	.22		$	.25		$	.20	$	.67		$	.13

(a)

In September 2009, management made the decision to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank National Association. In April 2009, management made the decision to curtail the operations of Austin Capital Management, Ltd., an investment subsidiary that specializes in managing hedge fund investments for its institutional customer base. As a result of these decisions, Key has accounted for these businesses as discontinued operations. The loss from discontinued operations for the nine-month period ended September 30, 2011, was primarily attributable to fair value adjustments related to the education lending securitization trusts.

(b)	Nine months ended 9-30-11 includes a $49 million deemed dividend recorded in the first quarter of 2011 related to the repurchase of the $2.5 billion Fixed-Rate Perpetual Preferred Stock, Series B.

(c)	Earnings per share may not foot due to rounding.

SUMMARY OF CONTINUING OPERATIONS

Taxable-equivalent net interest income was $555 million for the third quarter of 2011, and the net interest margin was 3.09%. These results compare to taxable-equivalent net interest income of $647 million and a net interest margin of 3.35% for the third quarter of 2010. The decrease in net interest income is attributable to both a decline in earning assets and tighter spread between asset yields and funding costs.

Compared to the second quarter of 2011, taxable-equivalent net interest income decreased by $15 million, and the net interest margin declined 10 basis points. The decline in the net interest margin and net interest income reflects a higher level of lower yielding short-term investments. The unfavorable impact of the shift in asset mix was partially offset by rate reductions on deposits, maturities of higher rate certificates of deposit, and the impact of the redemptions on September 1, 2011, of certain capital securities.

Key’s noninterest income was $483 million for the third quarter of 2011, compared to $486 million for the year-ago quarter. Compared to the same period one year ago, investment banking and capital markets income decreased $17 million, operating lease income declined $11 million and corporate-owned life insurance income decreased $8 million due to a $12 million dividend recognized in the third quarter of 2010. Letter of credit and loan fees also decreased $6 million from one year ago. These declines were offset by increases of $16 million in net gains (losses) from principal investing (including results attributable to noncontrolling interests) and $24 million in other income, which included a $13 million gain associated with the redemption of certain capital securities.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 4

The major components of Key’s noninterest income for the past five quarters are shown in the following table.

Noninterest Income – Major Components


in millions	3Q11		2Q11		1Q11		4Q10			3Q10
Trust and investment services income	$	107	$	113	$	110	$	108		$	110
Service charges on deposit accounts		74		69		68		70			75
Operating lease income		30		32		35		42			41
Letter of credit and loan fees		55		47		55		51			61
Corporate-owned life insurance income		31		28		27		42			39
Electronic banking fees		33		33		30		31			30
Insurance income		13		14		15		12			15
Net gains (losses) from loan sales		18		11		19		29			18
Net gains (losses) from principal investing		34		17		35		(6	)		18
Investment banking and capital markets income (loss)		25		42		43		63			42

Compared to the second quarter of 2011, noninterest income increased by $29 million. The increase was a result of higher net gains (losses) from principal investing (including results attributable to noncontrolling interests) of $17 million and other income of $15 million which included a $13 million gain associated with the redemption of certain capital securities. Also contributing to the improvement in noninterest income were increases of $8 million in letter of credit and loan fees, $7 million in net gains (losses) from loan sales and $5 million in service charges on deposit accounts. These increases were partially offset by decreases in investment banking and capital markets income of $17 million and trust and investment services income of $6 million.

Key’s noninterest expense was $692 million for the third quarter of 2011, compared to $736 million for the same period last year. The improvement in expense levels resulted from declines of $20 million in FDIC deposit insurance premiums, $17 million in operating lease expense, and $28 million in various other miscellaneous expenses. These decreases were partially offset by a $23 million increase in personnel expense, which included a $10 million increase to pension expense.

Compared to the second quarter of 2011, noninterest expense increased by $12 million, primarily as a result of an $11 million decrease in the credit for losses on lending-related commitments. Marketing expense also increased $6 million as Key continues to promote, support and advertise relationship-based products, services and capabilities. These increases were partially offset by decreases in various miscellaneous expenses.

ASSET QUALITY

Key’s provision for loan and lease losses was a charge of $10 million for the third quarter of 2011, compared to a charge of $94 million for the year-ago quarter and a credit of $8 million for the second quarter of 2011. Key’s allowance for loan and lease losses was $1.1 billion, or 2.35% of total period-end loans, at September 30, 2011, compared to 2.57% at June 30, 2011, and 3.81% at September 30, 2010.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 5

Selected asset quality statistics for Key for each of the past five quarters are presented in the following table.

Selected Asset Quality Statistics from Continuing Operations


dollars in millions	3Q11			2Q11			1Q11			4Q10			3Q10
Net loan charge-offs	$	109		$	134		$	193		$	256		$	357
Net loan charge-offs to average loans		.90	%		1.11	%		1.59	%		2.00	%		2.69	%
Allowance for loan and lease losses	$	1,131		$	1,230		$	1,372		$	1,604		$	1,957
Allowance for credit losses^(a)		1,187			1,287			1,441			1,677			2,056
Allowance for loan and lease losses to period-end loans		2.35	%		2.57	%		2.83	%		3.20	%		3.81	%
Allowance for credit losses to period-end loans		2.46			2.69			2.97			3.35			4.00
Allowance for loan and lease losses to nonperforming loans		143.53			146.08			155.03			150.19			142.64
Allowance for credit losses to nonperforming loans		150.63			152.85			162.82			157.02			149.85
Nonperforming loans at period end	$	788		$	842		$	885		$	1,068		$	1,372
Nonperforming assets at period end		914			950			1,089			1,338			1,801
Nonperforming loans to period-end portfolio loans		1.64	%		1.76	%		1.82	%		2.13	%		2.67	%
Nonperforming assets to period-end portfolio loans plus
OREO and other nonperforming assets		1.89			1.98			2.23			2.66			3.48

(a)	Includes the allowance for loan and lease losses plus the liability for credit losses on lending-related commitments.

Net loan charge-offs for the quarter totaled $109 million, or .90% of average loans. These results compare to $357 million, or 2.69%, for the same period last year and $134 million, or 1.11%, for the previous quarter. Net loan charge-offs have declined for the last seven consecutive quarters. For the first time since the first quarter of 2008, the percentage of net loan charge-offs to average loans is less than one percent.

Key’s net loan charge-offs by loan type for each of the past five quarters are shown in the following table.

Net Loan Charge-offs from Continuing Operations


dollars in millions	3Q11			2Q11			1Q11			4Q10			3Q10
Commercial, financial and agricultural	$	23		$	36		$	32		$	80		$	136
Real estate — commercial mortgage		25			12			43			52			46
Real estate — construction		8			24			30			28			76
Commercial lease financing		2			4			11			12			16
Total commercial loans		58			76			116			172			274
Home equity — Key Community Bank		18			27			24			26			35
Home equity — Other		8			10			14			13			13
Marine		11			4			19			17			12
Other		14			17			20			28			23
Total consumer loans		51			58			77			84			83

Total net loan charge-offs	$	109		$	134		$	193		$	256		$	357
Net loan charge-offs to average loans from continuing operations		.90	%		1.11	%		1.59	%		2.00	%		2.69	%
Net loan charge-offs from discontinued operations — education lending business	$	31		$	32		$	35		$	32		$	22

Compared to the second quarter of 2011, net loan charge-offs in the commercial loan portfolio decreased by $18 million which was primarily attributable to a decline in the real estate – construction and commercial, financial and agricultural categories. As shown in the table on page 6, Key’s exit loan portfolio accounted for $27 million, or 24.8%, of Key’s total net loan charge-offs for the third quarter of 2011. Net charge-offs in the exit loan portfolio increased by $2 million from the second quarter of 2011, primarily driven by an increase in net charge-offs in the marine loan portfolio.

At September 30, 2011, Key’s nonperforming loans totaled $788 million and represented 1.64% of period-end portfolio loans, compared to 1.76% at June 30, 2011, and 2.67% at September 30, 2010. Nonperforming assets at September 30, 2011, totaled $914

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 6

million and represented 1.89% of portfolio loans and OREO and other nonperforming assets, compared to 1.98% at June 30, 2011, and 3.48% at September 30, 2010. The following table illustrates the trend in Key’s nonperforming assets by loan type over the past five quarters.

Nonperforming Assets from Continuing Operations


dollars in millions	3Q11			2Q11			1Q11			4Q10			3Q10
Commercial, financial and agricultural	$	188		$	213		$	221		$	242		$	335
Real estate — commercial mortgage		237			230			245			255			362
Real estate — construction		93			131			146			241			333
Commercial lease financing		31			41			42			64			84
Total consumer loans		239			227			231			266			258

Total nonperforming loans		788			842			885			1,068			1,372
Nonperforming loans held for sale		42			42			86			106			230
OREO and other nonperforming assets		84			66			118			164			199

Total nonperforming assets	$	914		$	950		$	1,089		$	1,338		$	1,801

Restructured loans — accruing and nonaccruing^(a)	$	277		$	252		$	242		$	297		$	360
Restructured loans included in nonperforming loans^(a)		178			144			136			202			228
Nonperforming assets from discontinued operations — education lending business		22			21			22			40			38
Nonperforming loans to period-end portfolio loans		1.64	%		1.76	%		1.82	%		2.13	%		2.67	%
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets		1.89			1.98			2.23			2.66			3.48

(a)

Restructured loans (i.e. troubled debt restructurings) are those for which Key, for reasons related to a borrower’s financial difficulties, grants a concession to the borrower that it would not otherwise consider. These concessions are made to improve the collectability of the loan and generally take the form of a reduction of the interest rate, extension of the maturity date or reduction in the principal balance.

Nonperforming assets continued to decrease during the third quarter of 2011, representing the eighth consecutive quarterly decline. As shown in the following table, Key’s exit loan portfolio accounted for $119 million, or 13.0%, of Key’s total nonperforming assets at September 30, 2011.

The following table shows the composition of Key’s exit loan portfolio at September 30, 2011, and June 30, 2011, the net charge-offs recorded on this portfolio for the second and third quarters of 2011, and the nonperforming status of these loans at September 30, 2011, and June 30, 2011.

Exit Loan Portfolio from Continuing Operations


	Balance Outstanding				Change 9-30-11 vs. 6-30-11			Net Loan Charge-offs				Balance on Nonperforming Status
in millions	9-30-11		6-30-11		Change 9-30-11 vs. 6-30-11			3Q11		2Q11		9-30-11		6-30-11
Residential properties — homebuilder	$	48	$	62	$	(14	)	$	4	$	1	$	28	$	33
Marine and RV floor plan		92		122		(30	)		3		1		38		31
Commercial lease financing^(a)		1,728		1,826		(98	)		—		7		9		19

Total commercial loans		1,868		2,010		(142	)		7		9		75		83
Home equity — Other		565		595		(30	)		8		10		12		11
Marine		1,871		1,989		(118	)		11		4		32		32
RV and other consumer		131		142		(11	)		1		2		—		—

Total consumer loans		2,567		2,726		(159	)		20		16		44		43

Total exit loans in loan portfolio	$	4,435	$	4,736	$	(301	)	$	27	$	25	$	119	$	126

Discontinued operations — education lending business (not included in exit loans above)^(b)	$	5,984	$	6,261	$	(277	)	$	31	$	32	$	22	$	21

(a)	Includes the business aviation, commercial vehicle, office products, construction and industrial leases, and Canadian lease financing portfolios; and all remaining balances related to lease in, lease out; sale in, sale out; service contract leases; and qualified technological equipment leases.

(b)	Includes loans in Key’s consolidated education loan securitization trusts.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 7

CAPITAL

Key’s estimated risk-based capital ratios included in the following table continued to exceed all “well-capitalized” regulatory benchmarks at September 30, 2011.

Capital Ratios


	9-30-11			6-30-11			3-31-11			12-31-10			9-30-10
Tier 1 common equity^{(a), (b)}		11.34	%		11.14	%		10.74	%		9.34	%		8.61	%
Tier 1 risk-based capital^(a)		13.55			13.93			13.48			15.16			14.30
Total risk-based capital^(a)		17.13			17.88			17.38			19.12			18.22
Tangible common equity to tangible assets^(b)		9.82			9.67			9.16			8.19			8.00

(a)	9-30-11 ratio is estimated.

(b)

The table entitled “GAAP to Non-GAAP Reconciliations” presents the computations of certain financial measures related to “tangible common equity” and “Tier 1 common equity.” The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons.

As shown in the preceding table, at September 30, 2011, Key’s estimated Tier 1 common equity and Tier 1 risk-based capital ratios stood at 11.34% and 13.55%, respectively. In addition, the tangible common equity ratio was 9.82% at September 30, 2011.

Based upon current expectations and subject to Key’s regulators issuance of the final capital planning guidelines, the Company expects its capital planning process to include assessment of certain capital distributions, including potential dividend increases and share repurchases.

The changes in Key’s outstanding common shares over the past five quarters are summarized in the following table.

Summary of Changes in Common Shares Outstanding


in thousands	3Q11			2Q11			1Q11		4Q10		3Q10
Shares outstanding at beginning of period		953,822			953,926			880,608		880,328		880,515
Common shares issued		—			—			70,621		—		—
Shares reissued (returned) under employee benefit plans		(1,014	)		(104	)		2,697		280		(187	)

Shares outstanding at end of period		952,808			953,822			953,926		880,608		880,328

During the first quarter of 2011, Key successfully completed a $625 million common equity offering and a $1 billion debt offering. The proceeds from the equity and debt offerings, along with other available funds, were used to repurchase the $2.5 billion of Fixed-Rate Perpetual Preferred Stock, Series B issued to the U.S. Treasury Department as a result of Key’s participation in the U.S. Treasury’s Capital Purchase Program.

LINE OF BUSINESS RESULTS

The following table shows the contribution made by each major business segment to Key’s taxable-equivalent revenue from continuing operations and income (loss) from continuing operations attributable to Key for the periods presented. The specific lines of business that comprise each of the major business segments are described under the heading “Line of Business Descriptions.” For more detailed financial information pertaining to each business segment and its respective lines of business, see the tables at the end of this release.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 8

Major Business Segments

		0000000000			0000000000		0000000000			0000000000			0000000000
									Percent change 3Q11 vs.
dollars in millions	3Q11			2Q11		3Q10			2Q11			3Q10
Revenue from continuing operations (TE)
Key Community Bank	$	565		$	559	$	596			1.1	%		(5.2	)%
Key Corporate Bank		368			388		424			(5.2	)		(13.2	)
Other Segments		105			70		114			50.0			(7.9	)

Total Segments		1,038			1,017		1,134			2.1			(8.5	)
Reconciling Items		—			7		(1	)		(100.0	)		N/M

Total	$	1,038		$	1,024	$	1,133			1.4	%		(8.4	)%

Income (loss) from continuing operations attributable to Key
Key Community Bank	$	58		$	34	$	53			70.6	%		9.4	%
Key Corporate Bank		122			163		134			(25.2	)		(9.0	)
Other Segments		55			43		17			27.9			223.5

Total Segments		235			240		204			(2.1	)		15.2
Reconciling Items		(1	)		9		—			(111.1	)		N/M

Total	$	234		$	249	$	204			(6.0	)%		14.7	%

TE = Taxable Equivalent, N/M = Not Meaningful

Key Community Bank

		0000000000		0000000000			0000000000		0000000000			0000000000
								Percent change 3Q11 vs.
dollars in millions	3Q11		2Q11			3Q10		2Q11			3Q10
Summary of operations
Net interest income (TE)	$	371	$	374		$	403		(.8	)%		(7.9	)%
Noninterest income		194		185			193		4.9			.5

Total revenue (TE)		565		559			596		1.1			(5.2	)
Provision (credit) for loan and lease losses		39		79			75		(50.6	)		(48.0	)
Noninterest expense		456		447			459		2.0			(.7	)

Income (loss) before income taxes (TE)		70		33			62		112.1			12.9
Allocated income taxes and TE adjustments		12		(1	)		9		N/M			33.3

Net income (loss) attributable to Key	$	58	$	34		$	53		70.6	%		9.4	%

Average balances
Loans and leases	$	26,270	$	26,242		$	26,772		.1	%		(1.9	)%
Total assets		29,681		29,688			30,009		—			(1.1	)
Deposits		47,672		47,719			48,682		(.1	)		(2.1	)
Assets under management at period end	$	17,195	$	19,787		$	17,816		(13.1	)%		(3.5	)%

TE = Taxable Equivalent, N/M = Not Meaningful

		0000000000			0000000000			0000000000			0000000000			0000000000
Additional Key Community Bank Data										Percent change 3Q11 vs.
dollars in millions	3Q11			2Q11			3Q10			2Q11			3Q10
Average deposit balances
NOW and money market deposit accounts	$	21,967		$	21,864		$	20,123			.5	%		9.2	%
Savings deposits		1,971			1,976			1,872			(.3	)		5.3
Certificates of deposit ($100,000 or more)		3,862			4,080			5,449			(5.3	)		(29.1	)
Other time deposits		6,928			7,315			9,597			(5.3	)		(27.8	)
Deposits in foreign office		336			411			368			(18.2	)		(8.7	)
Noninterest-bearing deposits		12,608			12,073			11,273			4.4			11.8

Total deposits	$	47,672		$	47,719		$	48,682			(.1	)%		(2.1	)%

Home equity loans
Average balance	$	9,388		$	9,441		$	9,709
Weighted-average loan-to-value ratio (at date of origination)		70	%		70	%		70	%
Percent first lien positions		53			53			52

Other data
Branches		1,063			1,048			1,029
Automated teller machines		1,584			1,564			1,522

Key Community Bank Summary of Operations

Key Community Bank recorded net income attributable to Key of $58 million for the third quarter of 2011, compared to net income attributable to Key of $53 million for the year-ago quarter. Decreases in the provision for loan and lease losses and noninterest expense were partially offset by lower net interest income in the third quarter of 2011.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 9

Taxable-equivalent net interest income declined by $32 million, or 8%, from the third quarter of 2010. Average earning assets decreased by $557 million, or 2%, from the year-ago quarter, reflecting reductions in the commercial and home equity loan portfolios. Average deposits declined by $1 billion, or 2%, as higher-costing certificates of deposit matured, partially offset by growth in noninterest-bearing deposits and NOW and money market deposit accounts.

Noninterest income increased by $1 million, or 1%, from the year-ago quarter, primarily due to higher income from electronic banking fees and letter of credit and loan fees. This was partially offset by lower insurance income.

The provision for loan and lease losses declined by $36 million, or 48%, compared to the third quarter of 2010 due to lower net charge-offs and nonperforming loans from the same period one year ago.

Noninterest expense declined by $3 million, or 1%, from the year-ago quarter. The decrease was driven by reductions in FDIC deposit insurance premiums of $18 million, partially offset by increases in personnel expense and real estate costs associated with investments in Key’s branch network.

Key Corporate Bank


										Percent change 3Q11 vs.
dollars in millions	3Q11			2Q11			3Q10			2Q11			3Q10
Summary of operations
Net interest income (TE)	$	170		$	173		$	199			(1.7	)%		(14.6	)%
Noninterest income		198			215			225			(7.9	)		(12.0	)

Total revenue (TE)		368			388			424			(5.2	)		(13.2	)
Provision (credit) for loan and lease losses		(40	)		(76	)		(25	)		N/M			N/M
Noninterest expense		216			206			237			4.9			(8.9	)

Income (loss) before income taxes (TE)		192			258			212			(25.6	)		(9.4	)
Allocated income taxes and TE adjustments		70			94			79			(25.5	)		(11.4	)

Net income (loss)		122			164			133			(25.6	)		(8.3	)
Less: Net income (loss) attributable to noncontrolling interests		—			1			(1	)		(100.0	)		N/M

Net income (loss) attributable to Key	$	122		$	163		$	134			(25.2	)%		(9.0	)%


Average balances
Loans and leases	$	16,985		$	17,168		$	19,540			(1.1	)%		(13.1	)%
Loans held for sale		273			302			380			(9.6	)		(28.2	)
Total assets		21,168			21,467			23,772			(1.4	)		(11.0	)
Deposits		10,544			10,195			11,565			3.4			(8.8	)


Assets under management at period end	$	34,389		$	39,466		$	41,902			(12.9	)%		(17.9	)%

TE = Taxable Equivalent, N/M = Not Meaningful

Key Corporate Bank Summary of Operations

Key Corporate Bank recorded net income attributable to Key of $122 million for the third quarter of 2011, compared to net income attributable to Key of $134 million for the same period one year ago. This decline was driven by lower net interest income and investment banking and capital markets income. The decrease in revenues was partially offset by a significant decline in noninterest expense. The provision for loan and lease losses also decreased as net charge-offs significantly declined between periods.

Taxable-equivalent net interest income decreased by $29 million, or 15%, compared to the third quarter of 2010, due to lower average deposits and average earning assets. Average deposits declined by $1 billion, or 9%, from one year ago primarily as a result of the movement of $1.5 billion in escrow balances out of the Real Estate Capital line of business to a third party in the first quarter of 2011. Average earning assets decreased by $2.9 billion, or 13%, from the

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 10

year-ago quarter, while lower levels of nonperforming assets and better pricing helped to partially offset volume-related declines.

Noninterest income declined by $27 million, or 12%, from the third quarter of 2010. Contributing to the decline in noninterest income was the impact from a slowing merger and acquisition market and the third quarter volatility in the capital markets, which resulted in a decrease in investment banking and capital markets income of $18 million. In addition, letter of credit and loan fees and operating lease revenue both decreased $7 million from the year-ago quarter. These declines were partially offset by improvements in gains on leased equipment of $5 million and mortgage banking fees of $3 million.

The provision for loan and lease losses in the third quarter of 2011 was a credit of $40 million compared to a credit of $25 million for the same period one year ago. Key Corporate Bank continued to experience improved asset quality for the eighth quarter in a row.

Noninterest expense decreased by $21 million, or 9%, from the third quarter of 2010. Contributing to the improvement in expense levels were decreases in operating lease expense of $7 million, corporate support costs of $5 million, and various other miscellaneous expense items of $11 million. Personnel expense also declined $4 million as a result of lower investment banking and capital markets income. These improvements were partially offset by an increase in the provision for losses on lending-related commitments of $5 million.

Other Segments

Other Segments consist of Corporate Treasury, Key’s Principal Investing unit and various exit portfolios. Other Segments generated net income attributable to Key of $55 million for the third quarter of 2011, compared to net income attributable to Key of $17 million for the same period last year. These results were primarily attributable to a decrease in the provision for loan and lease losses of $34 million in the exit portfolio.

Line of Business Descriptions

Key Community Bank

Regional Banking provides individuals with branch-based deposit and investment products, personal finance services and loans, including residential mortgages, home equity and various types of installment loans. This line of business also provides small businesses with deposit, investment and credit products, and business advisory services.

Regional Banking also offers financial, estate and retirement planning, and asset management services to assist high-net-worth clients with their banking, trust, portfolio management, insurance, charitable giving and related needs.

Commercial Banking provides midsize businesses with products and services that include commercial lending, cash management, equipment leasing, investment and employee benefit programs, succession planning, access to capital markets, derivatives and foreign exchange.

Key Corporate Bank

Real Estate Capital and Corporate Banking Services consists of two business units, Real Estate Capital and Corporate Banking Services.

Real Estate Capital is a national business that provides construction and interim lending, permanent debt placements and servicing, equity and investment banking, and other commercial banking products and services to developers, brokers and owner-investors. This

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 11

unit deals primarily with nonowner-occupied properties (i.e., generally properties in which at least 50% of the debt service is provided by rental income from nonaffiliated third parties). Real Estate Capital emphasizes providing clients with finance solutions through access to the capital markets.

Corporate Banking Services provides cash management, interest rate derivatives, and foreign exchange products and services to clients served by both the Key Community Bank and Key Corporate Bank groups. Through its Public Sector and Financial Institutions businesses, Corporate Banking Services also provides a full array of commercial banking products and services to government and not-for-profit entities and community banks. A variety of cash management services are provided through the Global Treasury Management unit.

Equipment Finance meets the equipment leasing needs of companies worldwide and provides equipment manufacturers, distributors and resellers with financing options for their clients. Lease financing receivables and related revenues are assigned to other lines of business (primarily Institutional and Capital Markets and Commercial Banking) if those businesses are principally responsible for maintaining the relationship with the client.

Institutional and Capital Markets, through its KeyBanc Capital Markets unit, provides commercial lending, treasury management, investment banking, derivatives, foreign exchange, equity and debt underwriting and trading, and syndicated finance products and services to large corporations and middle-market companies.

Institutional and Capital Markets, through its Victory Capital Management unit, also manages or offers advice regarding investment portfolios for a national client base, including corporations, labor unions, not-for-profit organizations, governments and individuals. These portfolios may be managed in separate accounts, common funds or the Victory family of mutual funds.

Cleveland-based KeyCorp (NYSE: KEY) is one of the nation’s largest bank-based financial services companies, with assets of approximately $89 billion at September 30, 2011. Key companies provide investment management, retail and commercial banking, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally. In 2010, KeyBank scored significantly higher than its four largest competitor banks in a customer satisfaction survey conducted by the American Customer Satisfaction Index and significantly better than bank industry scores across multiple dimensions, most notably Customer Loyalty. Key also has been recognized for excellence in numerous areas of the multi-channel customer banking experience, including Corporate Insight’s 2010 edition of Bank Monitor for online service. For more information about Key, visit https://www.key.com/.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 12

Notes to Editors:

A live Internet broadcast of KeyCorp’s conference call to discuss quarterly results and currently anticipated earnings trends and to answer analysts’ questions can be accessed through the Investor Relations section at https://www.key.com/ir at 9:00 a.m. ET, on Thursday, October 20, 2011. An audio replay of the call will be available through October 27, 2011.

For up-to-date company information, media contacts and facts and figures about Key’s lines of business, visit our Media Newsroom at https://www.key.com/newsroom.

This earnings release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about Key’s financial condition, results of operations, earnings outlook, asset quality trends and profitability. Forward-looking statements are not historical facts but instead represent only management’s current expectations and forecasts regarding future events, many of which, by their nature, are inherently uncertain and outside of Key’s control. Key’s actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. Factors that could cause Key’s actual results to differ materially from those described in the forward-looking statements can be found in KeyCorp’s Annual Report on Form 10-K for the year ended December 31, 2010, and its Quarterly Reports on Form 10-Q for the periods ended March 31, 2011, and June 30, 2011, which have been filed with the Securities and Exchange Commission and are available on Key’s website (www.key.com/ir) and on the Securities and Exchange Commission’s website (www.sec.gov). Forward-looking statements are not guarantees of future performance and should not be relied upon as representing management’s views as of any subsequent date. Key does not undertake any obligation to update the forward-looking statements to reflect the impact of circumstances or events that may arise after the date of the forward-looking statements.

*****

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 13

Financial Highlights

(dollars in millions, except per share amounts)


	Three months ended
	9-30-11			6-30-11			9-30-10
Summary of operations
Net interest income (TE)	$	555		$	570		$	647
Noninterest income		483			454			486
Total revenue (TE)		1,038			1,024			1,133
Provision (credit) for loan and lease losses		10			(8	)		94
Noninterest expense		692			680			736
Income (loss) from continuing operations attributable to Key		234			249			204
Income (loss) from discontinued operations, net of taxes^(b)		(17	)		(9	)		15
Net income (loss) attributable to Key		217			240			219

Income (loss) from continuing operations attributable to Key common shareholders	$	229		$	243		$	163
Income (loss) from discontinued operations, net of taxes^(b)		(17	)		(9	)		15
Net income (loss) attributable to Key common shareholders		212			234			178

Per common share
Income (loss) from continuing operations attributable to Key common shareholders	$	.24		$	.26		$	.19
Income (loss) from discontinued operations, net of taxes^(b)		(.02	)		(.01	)		.02
Net income (loss) attributable to Key common shareholders		.22			.25			.20

Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution		.24			.26			.19
Income (loss) from discontinued operations, net of taxes — assuming dilution^(b)		(.02	)		(.01	)		.02
Net income (loss) attributable to Key common shareholders — assuming dilution		.22			.25			.20

Cash dividends paid		.03			.03			.01
Book value at period end		10.09			9.88			9.54
Tangible book value at period end		9.10			8.90			8.46
Market price at period end		5.93			8.33			7.96

Performance ratios
From continuing operations:
Return on average total assets		1.14	%		1.23	%		.93	%
Return on average common equity		9.52			10.51			7.82
Net interest margin (TE)		3.09			3.19			3.35

From consolidated operations:
Return on average total assets		.98	%		1.10	%		.93	%
Return on average common equity		8.82			10.12			8.54
Net interest margin (TE)		3.02			3.11			3.26
Loan to deposit^(d)		85.71			86.10			91.80

Capital ratios at period end
Key shareholders’ equity to assets		11.09	%		10.95	%		11.84	%
Tangible Key shareholders’ equity to tangible assets		10.15			10.00			10.93
Tangible common equity to tangible assets^(a)		9.82			9.67			8.00
Tier 1 common equity^{(a), (c)}		11.34			11.14			8.61
Tier 1 risk-based capital^(c)		13.55			13.93			14.30
Total risk-based capital^(c)		17.13			17.88			18.22
Leverage^(c)		11.87			12.13			12.53

Asset quality — from continuing operations
Net loan charge-offs	$	109		$	134		$	357
Net loan charge-offs to average loans		.90	%		1.11	%		2.69	%
Allowance for loan and lease losses	$	1,131		$	1,230		$	1,957
Allowance for credit losses		1,187			1,287			2,056
Allowance for loan and lease losses to period-end loans		2.35	%		2.57	%		3.81	%
Allowance for credit losses to period-end loans		2.46			2.69			4.00
Allowance for loan and lease losses to nonperforming loans		143.53			146.08			142.64
Allowance for credit losses to nonperforming loans		150.63			152.85			149.85
Nonperforming loans at period end	$	788		$	842		$	1,372
Nonperforming assets at period end		914			950			1,801
Nonperforming loans to period-end portfolio loans		1.64	%		1.76	%		2.67	%
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets		1.89			1.98			3.48

Trust and brokerage assets
Assets under management	$	51,584		$	59,253		$	59,718
Nonmanaged and brokerage assets		28,007			29,472			26,913

Other data
Average full-time equivalent employees		15,490			15,349			15,584
Branches		1,063			1,048			1,029

Taxable-equivalent adjustment	$	6		$	6		$	7

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 14

Financial Highlights (continued)

(dollars in millions, except per share amounts)


	Nine months ended
	9-30-11			9-30-10
Summary of operations
Net interest income (TE)	$	1,729		$	1,902
Noninterest income		1,394			1,428

Total revenue (TE)		3,123			3,330
Provision (credit) for loan and lease losses		(38	)		735
Noninterest expense		2,073			2,290
Income (loss) from continuing operations attributable to Key		757			244
Income (loss) from discontinued operations, net of taxes^(b)		(37	)		(10	)
Net income (loss) attributable to Key		720			234

Income (loss) from continuing operations attributable to Key common shareholders	$	656		$	121
Income (loss) from discontinued operations, net of taxes^(b)		(37	)		(10	)
Net income (loss) attributable to Key common shareholders		619			111

Per common share
Income (loss) from continuing operations attributable to Key common shareholders	$	.71		$	.14
Income (loss) from discontinued operations, net of taxes^(b)		(.04	)		(.01	)
Net income (loss) attributable to Key common shareholders		.67			.13

Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution		.71			.14
Income (loss) from discontinued operations, net of taxes — assuming dilution^(b)		(.04	)		(.01	)
Net income (loss) attributable to Key common shareholders — assuming dilution		.67			.13

Cash dividends paid		.07			.03

Performance ratios
From continuing operations:
Return on average total assets		1.23	%		.37	%
Return on average common equity		9.62			2.00
Net interest margin (TE)		3.18			3.24

From consolidated operations:
Return on average total assets		1.09	%		.33	%
Return on average common equity		9.08			1.84
Net interest margin (TE)		3.10			3.15

Asset quality — from continuing operations
Net loan charge-offs	$	436		$	1,314
Net loan charge-offs to average loans		1.20	%		3.19	%

Other data
Average full-time equivalent employees		15,381			15,673

Taxable-equivalent adjustment	$	19		$	20

(a)

The following table entitled “GAAP to Non-GAAP Reconciliations” presents the computations of certain financial measures related to “tangible common equity” and “Tier 1 common equity.” The table reconciles the GAAP performance measures to the corresponding non-GAAP measures, which provides a basis for period-to-period comparisons.

(b)

(c)	9-30-11 ratio is estimated.

(d)	Represents period-end consolidated total loans and loans held for sale (excluding education loans in the securitization trusts) divided by period-end consolidated total deposits (excluding deposits in foreign office).

TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 15

GAAP to Non-GAAP Reconciliations

(dollars in millions, except per share amounts)

The table below presents the computations of certain financial measures related to “tangible common equity,” “Tier 1 common equity” and “pre-provision net revenue.” The tangible common equity ratio has become a focus of some investors, and management believes that this ratio may assist investors in analyzing Key’s capital position absent the effects of intangible assets and preferred stock. Traditionally, the banking regulators have assessed bank and bank holding company capital adequacy based on both the amount and composition of capital, the calculation of which is prescribed in federal banking regulations. As a result of the Supervisory Capital Assessment Program, the Federal Reserve has focused its assessment of capital adequacy on a component of Tier 1 capital, known as Tier 1 common equity. Because the Federal Reserve has long indicated that voting common shareholders’ equity (essentially Tier 1 capital less preferred stock, qualifying capital securities and noncontrolling interests in subsidiaries) generally should be the dominant element in Tier 1 capital, such a focus is consistent with existing capital adequacy guidelines and does not imply a new or ongoing capital standard. Because Tier 1 common equity is neither formally defined by GAAP nor prescribed in amount by federal banking regulations, this measure is considered to be a non-GAAP financial measure. Since analysts and banking regulators may assess Key’s capital adequacy using tangible common equity and Tier 1 common equity, management believes it is useful to provide investors the ability to assess Key’s capital adequacy on these same bases. The table also reconciles the GAAP performance measures to the corresponding non-GAAP measures.

The table also shows the computation for pre-provision net revenue, which is not formally defined by GAAP. Management believes that eliminating the effects of provision for loan and lease losses facilitates the analysis of results by presenting them on a more comparable basis.

Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. To mitigate these limitations, Key has procedures in place to ensure that these measures are calculated using the appropriate GAAP or regulatory components, and to ensure that Key’s performance is properly reflected to facilitate period-to-period comparisons. Although these non-GAAP financial measures are frequently used by investors in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP.


	Three months ended
	9-30-11			6-30-11			9-30-10
Tangible common equity to tangible assets at period end
Key shareholders’ equity (GAAP)	$	9,901		$	9,719		$	11,134
Less: Intangible assets		935			936			956
Preferred Stock, Series B		—			—			2,442
Preferred Stock, Series A		291			291			291

Tangible common equity (non-GAAP)	$	8,675		$	8,492		$	7,445

Total assets (GAAP)	$	89,262		$	88,782		$	94,043
Less: Intangible assets		935			936			956

Tangible assets (non-GAAP)	$	88,327		$	87,846		$	93,087

Tangible common equity to tangible assets ratio (non-GAAP)		9.82	%		9.67	%		8.00	%

Tier 1 common equity at period end
Key shareholders’ equity (GAAP)	$	9,901		$	9,719		$	11,134
Qualifying capital securities		1,376			1,791			1,791
Less: Goodwill		917			917			917
Accumulated other comprehensive income (loss)^(a)		88			47			247
Other assets^(b)		72			157			383

Total Tier 1 capital (regulatory)		10,200			10,389			11,378
Less: Qualifying capital securities		1,376			1,791			1,791
Preferred Stock, Series B		—			—			2,442
Preferred Stock, Series A		291			291			291

Total Tier 1 common equity (non-GAAP)	$	8,533		$	8,307		$	6,854

Net risk-weighted assets (regulatory)^{(b), (c)}	$	75,271		$	74,578		$	79,572

Tier 1 common equity ratio (non-GAAP)^(c)		11.34	%		11.14	%		8.61	%

Pre-provision net revenue
Net interest income (GAAP)	$	549		$	564		$	640
Plus: Taxable-equivalent adjustment		6			6			7
Noninterest income		483			454			486
Less: Noninterest expense		692			680			736

Pre-provision net revenue from continuing operations (non-GAAP)	$	346		$	344		$	397

(a)

Includes net unrealized gains or losses on securities available for sale (except for net unrealized losses on marketable equity securities), net gains or losses on cash flow hedges, and amounts resulting from the December 31, 2006, adoption and subsequent application of the applicable accounting guidance for defined benefit and other postretirement plans.

(b)

Other assets deducted from Tier 1 capital and net risk-weighted assets consist of disallowed deferred tax assets of $75 million at June 30, 2011 and $277 million at September 30, 2010, disallowed intangible assets (excluding goodwill) and deductible portions of nonfinancial equity investments. There were no disallowed deferred tax assets at September 30, 2011.

(c)	9-30-11 amount is estimated.

GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 16

Consolidated Balance Sheets

(dollars in millions)


	9-30-11			6-30-11			9-30-10
Assets
Loans	$	48,195		$	47,840		$	51,354
Loans held for sale		479			381			637
Securities available for sale		17,612			18,680			21,241
Held-to-maturity securities		1,176			19			18
Trading account assets		729			769			1,155
Short-term investments		4,766			4,563			1,871
Other investments		1,210			1,195			1,405

Total earning assets		74,167			73,447			77,681
Allowance for loan and lease losses		(1,131	)		(1,230	)		(1,957	)
Cash and due from banks		828			853			823
Premises and equipment		924			919			888
Operating lease assets		393			453			563
Goodwill		917			917			917
Other intangible assets		18			19			39
Corporate-owned life insurance		3,227			3,208			3,145
Derivative assets		940			900			1,258
Accrued income and other assets		2,946			2,968			3,936
Discontinued assets		6,033			6,328			6,750

Total assets	$	89,262		$	88,782		$	94,043

Liabilities
Deposits in domestic offices:
NOW and money market deposit accounts	$	27,548		$	26,277		$	26,350
Savings deposits		1,968			1,973			1,856
Certificates of deposit ($100,000 or more)		4,457			4,939			6,850
Other time deposits		6,695			7,167			9,014

Total interest-bearing deposits		40,668			40,356			44,070
Noninterest-bearing deposits		19,803			19,318			16,275
Deposits in foreign office — interest-bearing		561			736			1,073

Total deposits		61,032			60,410			61,418
Federal funds purchased and securities sold under repurchase agreements		1,728			1,668			2,793
Bank notes and other short-term borrowings		519			511			685
Derivative liabilities		1,141			991			1,330
Accrued expense and other liabilities		1,556			1,518			1,862
Long-term debt		10,717			10,997			11,443
Discontinued liabilities		2,651			2,950			3,124

Total liabilities		79,344			79,045			82,655

Equity
Preferred stock, Series A		291			291			291
Preferred stock, Series B		—			—			2,442
Common shares		1,017			1,017			946
Common stock warrant		—			—			87
Capital surplus		4,191			4,191			3,710
Retained earnings		6,079			5,926			5,287
Treasury stock, at cost		(1,820	)		(1,815	)		(1,914	)
Accumulated other comprehensive income (loss)		143			109			285

Key shareholders’ equity		9,901			9,719			11,134
Noncontrolling interests		17			18			254

Total equity		9,918			9,737			11,388

Total liabilities and equity	$	89,262		$	88,782		$	94,043

Common shares outstanding (000)		952,808			953,822			880,328

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 17

Consolidated Statements of Income

(dollars in millions, except per share amounts)


	Three months ended									Nine months ended
	9-30-11			6-30-11			9-30-10			9-30-11			9-30-10
Interest income
Loans	$	543		$	551		$	649		$	1,664		$	2,036
Loans held for sale		3			3			4			10			13
Securities available for sale		140			149			170			455			474
Held-to-maturity securities		2			1			1			3			2
Trading account assets		5			9			8			21			29
Short-term investments		3			1			1			5			5
Other investments		9			12			11			33			38

Total interest income		705			726			844			2,191			2,597

Interest expense
Deposits		95			100			147			305			547
Federal funds purchased and securities sold under repurchase agreements		1			2			1			4			4
Bank notes and other short-term borrowings		3			3			4			9			11
Long-term debt		57			57			52			163			153

Total interest expense		156			162			204			481			715

Net interest income		549			564			640			1,710			1,882
Provision (credit) for loan and lease losses		10			(8	)		94			(38	)		735

Net interest income (expense) after provision for loan and lease losses		539			572			546			1,748			1,147

Noninterest income
Trust and investment services income		107			113			110			330			336
Service charges on deposit accounts		74			69			75			211			231
Operating lease income		30			32			41			97			131
Letter of credit and loan fees		55			47			61			157			143
Corporate-owned life insurance income		31			28			39			86			95
Net securities gains (losses)^(a)		—			2			1			1			2
Electronic banking fees		33			33			30			96			86
Gains on leased equipment		7			5			4			16			14
Insurance income		13			14			15			42			52
Net gains (losses) from loan sales		18			11			18			48			47
Net gains (losses) from principal investing		34			17			18			86			72
Investment banking and capital markets income (loss)		25			42			42			110			82
Other income		56			41			32			114			137

Total noninterest income		483			454			486			1,394			1,428

Noninterest expense
Personnel		382			380			359			1,133			1,106
Net occupancy		65			62			70			192			200
Operating lease expense		23			25			40			76			114
Computer processing		40			42			46			124			140
Business services and professional fees		47			44			41			129			120
FDIC assessment		7			9			27			45			97
OREO expense, net		1			(3	)		4			8			58
Equipment		26			26			24			78			74
Marketing		16			10			21			36			50
Provision (credit) for losses on lending-related commitments		(1	)		(12	)		(10	)		(17	)		(22	)
Other expense		86			97			114			269			353

Total noninterest expense		692			680			736			2,073			2,290

Income (loss) from continuing operations before income taxes		330			346			296			1,069			285
Income taxes		95			94			85			300			14

Income (loss) from continuing operations		235			252			211			769			271
Income (loss) from discontinued operations, net of taxes		(17	)		(9	)		15			(37	)		(10	)

Net income (loss)		218			243			226			732			261
Less: Net income (loss) attributable to noncontrolling interests		1			3			7			12			27

Net income (loss) attributable to Key	$	217		$	240		$	219		$	720		$	234

Income (loss) from continuing operations attributable to Key common shareholders	$	229		$	243		$	163		$	656		$	121
Net income (loss) attributable to Key common shareholders		212			234			178			619			111

Per common share
Income (loss) from continuing operations attributable to Key common shareholders	$	.24		$	.26		$	.19		$	.71		$	.14
Income (loss) from discontinued operations, net of taxes		(.02	)		(.01	)		.02			(.04	)		(.01	)
Net income (loss) attributable to Key common shareholders		.22			.25			.20			.67			.13

Per common share — assuming dilution
Income (loss) from continuing operations attributable to Key common shareholders	$	.24		$	.26		$	.19		$	.71		$	.14
Income (loss) from discontinued operations, net of taxes		(.02	)		(.01	)		.02			(.04	)		(.01	)
Net income (loss) attributable to Key common shareholders		.22			.25			.20			.67			.13

Cash dividends declared per common share	$	.03		$	.03		$	.01		$	.07		$	.03

Weighted-average common shares outstanding (000)		948,702			947,565			874,433			926,298			874,495
Weighted-average common shares and potential common shares outstanding (000)^(b)		950,686			952,133			874,433			930,449			874,495

(a)	For the three months ended September 30, 2011, June 30, 2011, and September 30, 2010, Key did not have any impairment losses related to securities.

(b)	Assumes conversion of stock options and/or Preferred Series A shares, as applicable.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 18

Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations

(dollars in millions)


	Third Quarter 2011								Second Quarter 2011								Third Quarter 2010
	Average Balance			Interest^(a)		Yield/ Rate^(a)			Average Balance			Interest^(a)		Yield/ Rate^(a)			Average Balance			Interest^(a)		Yield/ Rate^(a)
Assets
Loans:^{(b), (c)}
Commercial, financial and agricultural	$	17,381		$	175		3.98	%	$	16,922		$	174		4.13	%	$	16,948		$	193		4.52	%
Real estate — commercial mortgage		7,978			89		4.47			8,460			95		4.47			9,822			122		4.94
Real estate — construction		1,545			18		4.46			1,760			19		4.44			3,165			37		4.58
Commercial lease financing		6,045			72		4.80			6,094			75		4.93			6,587			87		5.25

Total commercial loans		32,949			354		4.27			33,236			363		4.38			36,522			439		4.77
Real estate — residential mortgage		1,853			25		5.23			1,818			24		5.33			1,843			26		5.59
Home equity:
Key Community Bank		9,388			97		4.12			9,441			97		4.13			9,709			102		4.19
Other		582			11		7.69			611			12		7.66			732			14		7.61

Total home equity loans		9,970			108		4.33			10,052			109		4.35			10,441			116		4.43
Consumer other — Key Community Bank		1,169			28		9.60			1,151			27		9.39			1,156			33		11.20
Consumer other:
Marine		1,928			30		6.29			2,051			32		6.20			2,423			38		6.25
Other		139			3		7.89			146			3		7.81			181			4		7.95

Total consumer other		2,067			33		6.40			2,197			35		6.31			2,604			42		6.37

Total consumer loans		15,059			194		5.14			15,218			195		5.13			16,044			217		5.37

Total loans		48,008			548		4.54			48,454			558		4.61			52,566			656		4.95
Loans held for sale		341			3		3.75			376			3		3.72			501			4		3.48
Securities available for sale^{(b), (e)}		18,165			141		3.16			19,005			149		3.19			20,276			170		3.43
Held-to-maturity securities^(b)		354			2		2.59			19			—		10.72			19			1		11.05
Trading account assets		869			5		2.45			893			9		3.96			1,074			8		3.03
Short-term investments		3,348			3		.25			1,913			1		.23			1,594			1		.23
Other investments^(e)		1,190			9		2.94			1,328			12		3.24			1,426			11		3.00

Total earning assets		72,275			711		3.93			71,988			732		4.09			77,456			851		4.39
Allowance for loan and lease losses		(1,176	)							(1,279	)							(2,092	)
Accrued income and other assets		10,360								10,677								11,363
Discontinued assets — education lending business		6,079								6,350								6,762

Total assets	$	87,538							$	87,736							$	93,489

Liabilities
NOW and money market deposit accounts	$	26,917			18		.26		$	26,354			19		.29		$	25,783			23		.35
Savings deposits		1,980			—		.06			1,981			1		.06			1,885			—		.06
Certificates of deposit ($100,000 or more)^(f)		4,762			36		3.03			5,075			38		3.02			7,635			61		3.12
Other time deposits		6,942			40		2.28			7,330			42		2.31			9,648			63		2.59
Deposits in foreign office		675			1		.28			869			—		.34			958			—		.37

Total interest-bearing deposits		41,276			95		.91			41,609			100		.97			45,909			147		1.27
Federal funds purchased and securities sold under repurchase agreements		1,724			1		.28			2,089			2		.27			2,300			1		.31
Bank notes and other short-term borrowings		598			3		1.85			672			3		1.96			669			4		2.36
Long-term debt^{(f), (g)}		7,777			57		3.14			7,576			57		3.26			7,308			52		3.08

Total interest-bearing liabilities		51,375			156		1.21			51,946			162		1.27			56,186			204		1.46

Noninterest-bearing deposits		17,624								16,932								15,949
Accrued expense and other liabilities		2,612								2,767								3,344
Discontinued liabilities — education lending business^{(d), (g)}		6,079								6,350								6,762

Total liabilities		77,690								77,995								82,241

Equity
Key shareholders’ equity		9,831								9,561								10,999
Noncontrolling interests		17								180								249

Total equity		9,848								9,741								11,248

Total liabilities and equity	$	87,538							$	87,736							$	93,489

Interest rate spread (TE)							2.72	%							2.82	%							2.93	%

Net interest income (TE) and net interest margin (TE)					555		3.09	%					570		3.19	%					647		3.35	%

TE adjustment^(b)					6								6								7

Net interest income, GAAP basis				$	549							$	564							$	640

(a)	Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (d) below, calculated using a matched funds transfer pricing methodology.

(b)	Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%.

(c)	For purposes of these computations, nonaccrual loans are included in average loan balances.

(d)	Discontinued liabilities include the liabilities of the education lending business and the dollar amount of any additional liabilities assumed necessary to support the assets associated with this business.

(e)	Yield is calculated on the basis of amortized cost.

(f)	Rate calculation excludes basis adjustments related to fair value hedges.

(g)	A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying our matched funds transfer pricing methodology to discontinued operations.

TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 19

Consolidated Average Balance Sheets, and Net Interest Income and Yields/Rates From Continuing Operations

(dollars in millions)


	Nine months ended September 30, 2011								Nine months ended September 30, 2010
	Average Balance			Interest^(a)		Yield/ Rate^(a)			Average Balance			Interest^(a)		Yield/ Rate^(a)
Assets
Loans:^{(b), (c)}
Commercial, financial and agricultural	$	16,875		$	523		4.14	%	$	17,816		$	624		4.68	%
Real estate — commercial mortgage		8,554			288		4.51			10,200			374		4.90
Real estate — construction		1,777			57		4.28			3,820			123		4.29
Commercial lease financing		6,157			227		4.92			6,845			270		5.25

Total commercial loans		33,363			1,095		4.39			38,681			1,391		4.80
Real estate — residential mortgage		1,827			73		5.29			1,825			77		5.61
Home equity:
Key Community Bank		9,427			291		4.13			9,837			310		4.22
Other		613			35		7.65			773			44		7.59

Total home equity loans		10,040			326		4.35			10,610			354		4.46
Consumer other — Key Community Bank		1,159			83		9.62			1,154			102		11.80
Consumer other:
Marine		2,050			96		6.26			2,565			119		6.20
Other		147			9		7.87			195			12		7.84

Total consumer other		2,197			105		6.36			2,760			131		6.32

Total consumer loans		15,223			587		5.15			16,349			664		5.42

Total loans		48,586			1,682		4.63			55,030			2,055		4.99
Loans held for sale		369			10		3.66			470			13		3.75
Securities available for sale^{(b), (e)}		19,432			456		3.18			17,972			475		3.58
Held-to-maturity securities^(b)		132			3		3.37			21			2		10.17
Trading account assets		926			21		3.04			1,102			29		3.54
Short-term investments		2,413			5		.24			2,739			5		.25
Other investments^(e)		1,292			33		3.18			1,456			38		3.15

Total earning assets		73,150			2,210		4.05			78,790			2,617		4.44
Allowance for loan and lease losses		(1,315	)							(2,348	)
Accrued income and other assets		10,534								11,316
Discontinued assets — education lending business		6,301								6,678

	$	88,670							$	94,436

Liabilities
NOW and money market deposit accounts	$	26,758			56		.28		$	25,262			70		.37
Savings deposits		1,956			1		.06			1,865			1		.06
Certificates of deposit ($100,000 or more)^(f)		5,152			117		3.03			9,209			226		3.28
Other time deposits		7,414			129		2.33			11,179			248		2.97
Deposits in foreign office		860			2		.32			824			2		.34

Total interest-bearing deposits		42,140			305		.97			48,339			547		1.51
Federal funds purchased and securities
sold under repurchase agreements		2,060			4		.27			1,979			4		.32
Bank notes and other short-term borrowings		669			9		1.83			567			11		2.59
Long-term debt^{(f), (g)}		7,385			163		3.17			7,105			153		3.11

Total interest-bearing liabilities		52,254			481		1.24			57,990			715		1.67

Noninterest-bearing deposits		17,016								15,524
Accrued expense and other liabilities		2,751								3,187
Discontinued liabilities — education lending business^{(d), (g)}		6,301								6,678

		78,322								83,379

Equity
Key shareholders’ equity		10,197								10,798
Noncontrolling interests		151								259

Total equity		10,348								11,057

Total liabilities and equity	$	88,670							$	94,436

Interest rate spread (TE)							2.81	%							2.77	%

Net interest income (TE) and net interest margin (TE)					1,729		3.18	%					1,902		3.24	%

TE adjustment^(b)					19								20

Net interest income, GAAP basis				$	1,710							$	1,882

(a)	Results are from continuing operations. Interest excludes the interest associated with the liabilities referred to in (d) below, calculated using a matched funds transfer pricing methodology.

(b)	Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%.

(c)	For purposes of these computations, nonaccrual loans are included in average loan balances.

(d)	Discontinued liabilities include the liabilities of the education lending business and the dollar amount of any additional liabilities assumed necessary to support the assets associated with this business.

(e)	Yield is calculated on the basis of amortized cost.

(f)	Rate calculation excludes basis adjustments related to fair value hedges.

(g)	A portion of long-term debt and the related interest expense is allocated to discontinued liabilities as a result of applying our matched funds transfer pricing methodology to discontinued operations.

TE = Taxable Equivalent, GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 20

Noninterest Income

(in millions)


	Three months ended						Nine months ended
	9-30-11		6-30-11		9-30-10		9-30-11		9-30-10
Trust and investment services income^(a)	$	107	$	113	$	110	$	330	$	336
Service charges on deposit accounts		74		69		75		211		231
Operating lease income		30		32		41		97		131
Letter of credit and loan fees		55		47		61		157		143
Corporate-owned life insurance income		31		28		39		86		95
Net securities gains (losses)		—		2		1		1		2
Electronic banking fees		33		33		30		96		86
Gains on leased equipment		7		5		4		16		14
Insurance income		13		14		15		42		52
Net gains (losses) from loan sales		18		11		18		48		47
Net gains (losses) from principal investing		34		17		18		86		72
Investment banking and capital markets income (loss) ^(a)		25		42		42		110		82
Other income		56		41		32		114		137

Total noninterest income	$	483	$	454	$	486	$	1,394	$	1,428

(a)	Additional detail provided in tables below.

Trust and Investment Services Income

(in millions)


	Three months ended						Nine months ended
	9-30-11		6-30-11		9-30-10		9-30-11		9-30-10
Brokerage commissions and fee income	$	34	$	33	$	33	$	99	$	102
Personal asset management and custody fees		37		40		37		115		111
Institutional asset management and custody fees		36		40		40		116		123

Total trust and investment services income	$	107	$	113	$	110	$	330	$	336

Investment Banking and Capital Markets Income (Loss)

(in millions)


	Three months ended									Nine months ended
	9-30-11			6-30-11			9-30-10			9-30-11			9-30-10
Investment banking income	$	16		$	25		$	38		$	67		$	79
Income (loss) from other investments		6			10			2			18			6
Dealer trading and derivatives income (loss)		(8	)		(3	)		(10	)		(7	)		(34	)
Foreign exchange income		11			10			12			32			31

Total investment banking and capital markets income (loss)	$	25		$	42		$	42		$	110		$	82

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 21

Noninterest Expense

(dollars in millions)


	Three months ended									Nine months ended
	9-30-11			6-30-11			9-30-10			9-30-11			9-30-10
Personnel^(a)	$	382		$	380		$	359		$	1,133		$	1,106
Net occupancy		65			62			70			192			200
Operating lease expense		23			25			40			76			114
Computer processing		40			42			46			124			140
Business services and professional fees		47			44			41			129			120
FDIC assessment		7			9			27			45			97
OREO expense, net		1			(3	)		4			8			58
Equipment		26			26			24			78			74
Marketing		16			10			21			36			50
Provision (credit) for losses on lending-related commitments		(1	)		(12	)		(10	)		(17	)		(22	)
Other expense		86			97			114			269			353

Total noninterest expense	$	692		$	680		$	736		$	2,073		$	2,290

Average full-time equivalent employees^(b)		15,490			15,349			15,584			15,381			15,673

(a)	Additional detail provided in table below.

(b)	The number of average full-time equivalent employees has not been adjusted for discontinued operations.

Personnel Expense

(in millions)


	Three months ended						Nine months ended
	9-30-11		6-30-11		9-30-10		9-30-11		9-30-10
Salaries	$	233	$	228	$	230	$	685	$	681
Incentive compensation		78		73		69		224		181
Employee benefits		54		58		45		174		190
Stock-based compensation		11		16		12		32		41
Severance		6		5		3		18		13

Total personnel expense	$	382	$	380	$	359	$	1,133	$	1,106

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 22

Loan Composition

(dollars in millions)


							Percent change 9-30-11 vs.
	9-30-11		6-30-11		9-30-10		6-30-11			9-30-10
Commercial, financial and agricultural	$	17,848	$	16,883	$	16,451		5.7	%		8.5	%
Commercial real estate:
Commercial mortgage		7,958		8,069		9,673		(1.4	)		(17.7	)
Construction		1,456		1,631		2,731		(10.7	)		(46.7	)

Total commercial real estate loans		9,414		9,700		12,404		(2.9	)		(24.1	)
Commercial lease financing		5,957		6,105		6,583		(2.4	)		(9.5	)

Total commercial loans		33,219		32,688		35,438		1.6			(6.3	)
Residential — prime loans:
Real estate — residential mortgage		1,875		1,838		1,853		2.0			1.2
Home equity:
Key Community Bank		9,347		9,431		9,655		(.9	)		(3.2	)
Other		565		595		707		(5.0	)		(20.1	)

Total home equity loans		9,912		10,026		10,362		(1.1	)		(4.3	)

Total residential — prime loans		11,787		11,864		12,215		(.6	)		(3.5	)
Consumer other — Key Community Bank		1,187		1,157		1,174		2.6			1.1
Consumer other:
Marine		1,871		1,989		2,355		(5.9	)		(20.6	)
Other		131		142		172		(7.7	)		(23.8	)

Total consumer — indirect loans		2,002		2,131		2,527		(6.1	)		(20.8	)

Total consumer loans		14,976		15,152		15,916		(1.2	)		(5.9	)

Total loans^(a)	$	48,195	$	47,840	$	51,354		.7	%		(6.2	)%

Loans Held for Sale Composition

(dollars in millions)


							Percent change 9-30-11 vs.
	9-30-11		6-30-11		9-30-10		6-30-11			9-30-10
Commercial, financial and agricultural	$	29	$	80	$	128		(63.8	)%		(77.3	)%
Real estate — commercial mortgage		325		198		327		64.1			(.6	)
Real estate — construction		20		39		77		(48.7	)		(74.0	)
Commercial lease financing		26		6		13		333.3			100.0
Real estate — residential mortgage		79		58		92		36.2			(14.1	)

Total loans held for sale^(b)	$	479	$	381	$	637		25.7	%		(24.8	)%

Summary of Changes in Loans Held for Sale

(dollars in millions)


	3Q11			2Q11			1Q11			4Q10			3Q10
Balance at beginning of period	$	381		$	426		$	467		$	637		$	699
New originations		853			914			980			1,053			684
Transfers from held to maturity, net		23			16			32			—			202
Loan sales		(759	)		(1,039	)		(991	)		(1,174	)		(835	)
Loan draws (payments), net		1			73			(62	)		(49	)		(49	)
Transfers to OREO / valuation adjustments		(20	)		(9	)		—			—			(64	)

Balance at end of period	$	479		$	381		$	426		$	467		$	637

(a)	Excluded at September 30, 2011, June 30, 2011 and September 30, 2010, are loans in the amount of $6 billion, $6.3 billion, and $6.6 billion, respectively, related to the discontinued operations of the education lending business.

(b)	Excluded at September 30, 2010, are loans held for sale in the amount of $15 million related to the discontinued operations of the education lending business. There were no loans held for sale in the discontinued operations of the education lending business at September 30, 2011 and June 30, 2011.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 23

Summary of Loan and Lease Loss Experience from Continuing Operations

(dollars in millions)


	Three months ended									Nine months ended
	9-30-11			6-30-11			9-30-10			9-30-11			9-30-10
Average loans outstanding	$	48,008		$	48,454		$	52,566		$	48,586		$	55,030

Allowance for loan and lease losses at beginning of period	$	1,230		$	1,372		$	2,219		$	1,604		$	2,534
Loans charged off:
Commercial, financial and agricultural		31			51			170			124			461

Real estate — commercial mortgage		27			16			50			89			287
Real estate — construction		19			27			88			81			331

Total commercial real estate loans		46			43			138			170			618
Commercial lease financing		10			9			22			36			68

Total commercial loans		87			103			330			330			1,147
Real estate — residential mortgage		5			7			7			22			25
Home equity:
Key Community Bank		25			28			36			78			95
Other		9			11			14			35			49

Total home equity loans		34			39			50			113			144
Consumer other — Key Community Bank		11			11			15			34			48
Consumer other:
Marine		18			15			25			60			104
Other		2			2			3			7			11

Total consumer other		20			17			28			67			115

Total consumer loans		70			74			100			236			332

Total loans charged off		157			177			430			566			1,479
Recoveries:
Commercial, financial and agricultural		8			15			34			33			63

Real estate — commercial mortgage		2			4			4			9			9
Real estate — construction		11			3			12			19			23

Total commercial real estate loans		13			7			16			28			32
Commercial lease financing		8			5			6			19			17

Total commercial loans		29			27			56			80			112
Real estate — residential mortgage		1			1			1			3			2
Home equity:
Key Community Bank		7			1			1			9			5
Other		1			1			1			3			3

Total home equity loans		8			2			2			12			8
Consumer other — Key Community Bank		2			2			1			6			5
Consumer other:
Marine		7			11			13			26			35
Other		1			—			—			3			3

Total consumer other		8			11			13			29			38

Total consumer loans		19			16			17			50			53

Total recoveries		48			43			73			130			165

Net loan charge-offs		(109	)		(134	)		(357	)		(436	)		(1,314	)
Provision (credit) for loan and lease losses		10			(8	)		94			(38	)		735
Foreign currency translation adjustment		—			—			1			1			2

Allowance for loan and lease losses at end of period	$	1,131		$	1,230		$	1,957		$	1,131		$	1,957

Liability for credit losses on lending-related commitments at beginning of period	$	57		$	69		$	109		$	73		$	121
Provision (credit) for losses on lending-related commitments		(1	)		(12	)		(10	)		(17	)		(22	)

Liability for credit losses on lending-related commitments at end of period^(a)	$	56		$	57		$	99		$	56		$	99

Total allowance for credit losses at end of period	$	1,187		$	1,287		$	2,056		$	1,187		$	2,056

Net loan charge-offs to average loans		.90	%		1.11	%		2.69	%		1.20	%		3.19	%
Allowance for loan and lease losses to period-end loans		2.35			2.57			3.81			2.35			3.81
Allowance for credit losses to period-end loans		2.46			2.69			4.00			2.46			4.00
Allowance for loan and lease losses to nonperforming loans		143.53			146.08			142.64			143.53			142.64
Allowance for credit losses to nonperforming loans		150.63			152.85			149.85			150.63			149.85

Discontinued operations — education lending business:
Loans charged off	$	34		$	35		$	26		$	107		$	95
Recoveries		3			3			4			9			6

Net loan charge-offs	$	(31	)	$	(32	)	$	(22	)	$	(98	)	$	(89	)

(a)	Included in “accrued expense and other liabilities” on the balance sheet.

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 24

Summary of Nonperforming Assets and Past Due Loans From Continuing Operations

(dollars in millions)


	9-30-11			6-30-11			3-31-11			12-31-10			9-30-10
Commercial, financial and agricultural	$	188		$	213		$	221		$	242		$	335

Real estate — commercial mortgage		237			230			245			255			362
Real estate — construction		93			131			146			241			333

Total commercial real estate loans		330			361			391			496			695
Commercial lease financing		31			41			42			64			84

Total commercial loans		549			615			654			802			1,114
Real estate — residential mortgage		88			79			84			98			90
Home equity:
Key Community Bank		102			101			99			102			106
Other		12			11			13			18			16

Total home equity loans		114			112			112			120			122
Consumer other — Key Community Bank		4			3			3			4			3
Consumer other:
Marine		32			32			31			42			41
Other		1			1			1			2			2

Total consumer other		33			33			32			44			43

Total consumer loans		239			227			231			266			258

Total nonperforming loans		788			842			885			1,068			1,372
Nonperforming loans held for sale		42			42			86			106			230
OREO		63			52			97			129			163
Other nonperforming assets		21			14			21			35			36

Total nonperforming assets	$	914		$	950		$	1,089		$	1,338		$	1,801

Accruing loans past due 90 days or more	$	118		$	118		$	153		$	239		$	152
Accruing loans past due 30 through 89 days		478			465			474			476			662
Restructured loans — accruing and nonaccruing^(a)		277			252			242			297			360
Restructured loans included in nonperforming loans^(a)		178			144			136			202			228
Nonperforming assets from discontinued operations — education lending business		22			21			22			40			38
Nonperforming loans to period-end portfolio loans		1.64	%		1.76	%		1.82	%		2.13	%		2.67	%
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets		1.89			1.98			2.23			2.66			3.48

(a)

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 25

Summary of Changes in Nonperforming Loans From Continuing Operations

(in millions)


	3Q11			2Q11			1Q11			4Q10			3Q10
Balance at beginning of period	$	842		$	885		$	1,068		$	1,372		$	1,703
Loans placed on nonaccrual status		292			410			335			544			691
Charge-offs		(157	)		(177	)		(232	)		(343	)		(430	)
Loans sold		(16	)		(11	)		(74	)		(162	)		(92	)
Payments		(125	)		(156	)		(114	)		(250	)		(200	)
Transfers to OREO		(11	)		(6	)		(12	)		(14	)		(39	)
Transfers to nonperforming loans held for sale		(24	)		(15	)		(39	)		(41	)		(163	)
Transfers to other nonperforming assets		(3	)		—			(2	)		(3	)		(7	)
Loans returned to accrual status		(10	)		(88	)		(45	)		(35	)		(91	)

Balance at end of period	$	788		$	842		$	885		$	1,068		$	1,372

Summary of Changes in Nonperforming Loans Held For Sale From Continuing Operations

(in millions)


	3Q11			2Q11			1Q11			4Q10			3Q10
Balance at beginning of period	$	42		$	86		$	106		$	230		$	221
Transfers in		24			15			39			41			162
Net advances / (payments)		(5	)		(13	)		(20	)		(26	)		(35	)
Loans sold		(5	)		(37	)		(38	)		(139	)		(50	)
Transfers to OREO		(19	)		(5	)		—			—			(58	)
Valuation adjustments		(1	)		(4	)		(1	)		—			(6	)
Loans returned to accrual status / other		6			—			—			—			(4	)

Balance at end of period	$	42		$	42		$	86		$	106		$	230

Summary of Changes in Other Real Estate Owned, Net of Allowance, From Continuing Operations

(in millions)


	3Q11			2Q11			1Q11			4Q10			3Q10
Balance at beginning of period	$	52		$	97		$	129		$	163		$	136
Properties acquired — nonperforming loans		30			11			12			14			97
Valuation adjustments		(3	)		(7	)		(11	)		(9	)		(7	)
Properties sold		(16	)		(49	)		(33	)		(39	)		(63	)

Balance at end of period	$	63		$	52		$	97		$	129		$	163

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 26

Line of Business Results

(dollars in millions)

Key Community Bank


																Percent change 3Q11 vs.
	3Q11			2Q11			1Q11			4Q10			3Q10			2Q11			3Q10
Summary of operations
Total revenue (TE)	$	565		$	559		$	565		$	597		$	596			1.1	%		(5.2	)%
Provision (credit) for loan and lease losses		39			79			11			74			75			(50.6	)		(48.0	)
Noninterest expense		456			447			446			457			459			2.0			(.7	)
Net income (loss) attributable to Key		58			34			81			58			53			70.6			9.4
Average loans and leases		26,270			26,242			26,312			26,436			26,772			.1			(1.9	)
Average deposits		47,672			47,719			48,108			48,124			48,682			(.1	)		(2.1	)
Net loan charge-offs		60			79			76			115			129			(24.1	)		(53.5	)
Net loan charge-offs to average loans		.91	%		1.21	%		1.17	%		1.73	%		1.91	%		N/A			N/A
Nonperforming assets at period end	$	439		$	455		$	475		$	497		$	567			(3.5	)		(22.6	)
Return on average allocated equity		7.37	%		4.28	%		10.07	%		6.83	%		6.08	%		N/A			N/A
Average full-time equivalent employees		8,641			8,504			8,378			8,291			8,303			1.6			4.1

Supplementary information (lines of business)
Regional Banking
Total revenue (TE)	$	448		$	449		$	448		$	470		$	478			(.2	)%		(6.3	)%
Provision (credit) for loan and lease losses		48			63			17			77			105			(23.8	)		(54.3	)
Noninterest expense		407			398			400			413			417			2.3			(2.4	)
Net income (loss) attributable to Key		10			6			33			4			(13	)		66.7			N/M
Average loans and leases		17,407			17,495			17,597			17,810			18,072			(.5	)		(3.7	)
Average deposits		41,204			41,710			42,189			42,371			43,327			(1.2	)		(4.9	)
Net loan charge-offs		53			65			62			77			89			(18.5	)		(40.4	)
Net loan charge-offs to average loans		1.21	%		1.49	%		1.43	%		1.72	%		1.95	%		N/A			N/A
Nonperforming assets at period end	$	292		$	302		$	294		$	326		$	350			(3.3	)		(16.6	)
Return on average allocated equity		1.80	%		1.08	%		5.96	%		.69	%		(2.23	)%		N/A			N/A
Average full-time equivalent employees		8,275			8,138			8,009			7,930			7,950			1.7			4.1

Commercial Banking
Total revenue (TE)	$	117		$	110		$	117		$	127		$	118			6.4	%		(.8	)%
Provision (credit) for loan and lease losses		(9	)		16			(6	)		(3	)		(30	)		(156.3	)		N/M
Noninterest expense		49			49			46			44			42			—			16.7
Net income (loss) attributable to Key		48			28			48			54			66			71.4			(27.3	)
Average loans and leases		8,863			8,747			8,715			8,626			8,700			1.3			1.9
Average deposits		6,468			6,009			5,919			5,753			5,355			7.6			20.8
Net loan charge-offs		7			14			14			38			40			(50.0	)		(82.5	)
Net loan charge-offs to average loans		.31	%		.64	%		.65	%		1.75	%		1.82	%		N/A			N/A
Nonperforming assets at period end	$	147		$	153		$	181		$	171		$	217			(3.9	)		(32.3	)
Return on average allocated equity		20.59	%		11.72	%		19.20	%		19.86	%		22.75	%		N/A			N/A
Average full-time equivalent employees		366			366			369			361			353			—			3.7

KeyCorp Reports Third Quarter 2011 Results

October 20, 2011

Page 27

Line of Business Results (continued)

(dollars in millions)

Key Corporate Bank


																Percent change 3Q11 vs.
	3Q11			2Q11			1Q11			4Q10			3Q10			2Q11			3Q10
Summary of operations
Total revenue (TE)	$	368		$	388		$	403		$	434		$	424			(5.2	)%		(13.2	)%
Provision (credit) for loan and lease losses		(40	)		(76	)		(21	)		(263	)		(25	)		N/M			N/M
Noninterest expense		216			206			228			240			237			4.9			(8.9	)
Net income (loss) attributable to Key		122			163			125			289			134			(25.2	)		(9.0	)
Average loans and leases		16,985			17,168			17,677			18,602			19,540			(1.1	)		(13.1	)
Average loans held for sale		273			302			275			253			380			(9.6	)		(28.2	)
Average deposits		10,544			10,195			11,282			12,766			11,565			3.4			(8.8	)
Net loan charge-offs		22			29			75			61			122			(24.1	)		(82.0	)
Net loan charge-offs to average loans		.51	%		.68	%		1.72	%		1.30	%		2.48	%		N/A			N/A
Nonperforming assets at period end	$	326		$	339		$	427		$	575		$	886			(3.8	)		(63.2	)
Return on average allocated equity		22.54	%		28.61	%		19.82	%		41.07	%		17.73	%		N/A			N/A
Average full-time equivalent employees		2,288			2,191			2,155			2,169			2,210			4.4			3.5

Supplementary information (lines of business)
Real Estate Capital and Corporate Banking Services
Total revenue (TE)	$	144		$	154		$	165		$	177		$	169			(6.5	)%		(14.8	)%
Provision (credit) for loan and lease losses		(38	)		(49	)		9			(211	)		22			N/M			(272.7	)
Noninterest expense		65			49			69			83			87			32.7			(25.3	)
Net income (loss) attributable to Key		74			96			56			192			38			(22.9	)		94.7
Average loans and leases		7,088			7,713			8,583			9,381			10,306			(8.1	)		(31.2	)
Average loans held for sale		173			229			140			199			202			(24.5	)		(14.4	)
Average deposits		7,286			7,371			8,611			10,409			9,146			(1.2	)		(20.3	)
Net loan charge-offs		19			26			65			57			103			(26.9	)		(81.6	)
Net loan charge-offs to average loans		1.06	%		1.35	%		3.07	%		2.41	%		3.97	%		N/A			N/A
Nonperforming assets at period end	$	240		$	245		$	334		$	442		$	719			(2.0	)		(66.6	)
Return on average allocated equity		26.47	%		31.36	%		15.42	%		46.14	%		8.27	%		N/A			N/A
Average full-time equivalent employees		942			902			882			889			895			4.4			5.3

Equipment Finance
Total revenue (TE)	$	68		$	63		$	63		$	66		$	63			7.9	%		7.9	%
Provision (credit) for loan and lease losses		(8	)		(30	)		(26	)		(16	)		(12	)		N/M			N/M
Noninterest expense		45			45			52			52			53			—			(15.1	)
Net income (loss) attributable to Key		20			30			23			19			14			(33.3	)		42.9
Average loans and leases		4,619			4,545			4,621			4,656			4,515			1.6			2.3
Average loans held for sale		7			—			4			—			2			N/M			250.0
Average deposits		11			12			6			2			5			(8.3	)		120.0
Net loan charge-offs		(1	)		2			10			7			25			(150.0	)		(104.0	)
Net loan charge-offs to average loans		(.09	)%		.18	%		.88	%		.60	%		2.20	%		N/A			N/A
Nonperforming assets at period end	$	31		$	39		$	44		$	68		$	86			(20.5	)		(64.0	)
Return on average allocated equity		25.76	%		37.96	%		28.53	%		22.04	%		16.58	%		N/A			N/A
Average full-time equivalent employees		511			511			521			529			536			—			(4.7	)

Institutional and Capital Markets
Total revenue (TE)	$	156		$	171		$	175		$	191		$	192			(8.8	)%		(18.8	)%
Provision (credit) for loan and lease losses		6			3			(4	)		(36	)		(35	)		100.0			N/M
Noninterest expense		106			112			107			105			97			(5.4	)		9.3
Net income (loss) attributable to Key		28			37			46			78			82			(24.3	)		(65.9	)
Average loans and leases		5,278			4,910			4,473			4,565			4,719			7.5			11.8
Average loans held for sale		93			73			131			54			176			27.4			(47.2	)
Average deposits		3,247			2,812			2,665			2,355			2,414			15.5			34.5
Net loan charge-offs		4			1			—			(3	)		(6	)		300.0			N/M
Net loan charge-offs to average loans		.30	%		.08	%		—			(.26	)%		(.50	)%		N/A			N/A
Nonperforming assets at period end	$	55		$	55		$	49		$	65		$	81			—			(32.1	)
Return on average allocated equity		15.22	%		20.05	%		24.61	%		38.73	%		38.68	%		N/A			N/A
Average full-time equivalent employees		835			778			752			751			779			7.3			7.2

TE = Taxable Equivalent, N/A = Not Applicable, N/M = Not Meaningful

KEYCORP /NEW/ - FORM 8-K - EX-99.1 - October 20, 2011

Attached files

KEYCORP /NEW/ Reports