Quarterly net income at KeyCorp slipped by more than 4 percent by the end of March, due mainly to a year-over-year increase in acquisition- and employee benefits-related expenses.
The Cleveland-based parent company of KeyBank N.A., the third-largest bank in Western New York, reported $222 million in first-quarter net income available to Key common shareholders. That’s down 4.3 percent from the same quarter in 2014 when Key reported $232 million.
Earnings per share for both quarters totaled 26 cents, meeting analysts’ expectations.
KeyCorp (NYSE: KEY) attributed the dip in profits to costs related to its third-quarter acquisition of Pacific Crest Securities LLC, a Portland, Ore.-based investment bank providing financial advisory services to financial institutions, and higher personnel costs, including $7 million in expenses tied to Key’s ongoing efficiency plan, which has involved branch closures and management realignments.
Despite the decline, KeyCorp chairman and CEO Beth Mooney was upbeat about the quarter. She pointed to solid loan growth and more business in the trust and investment services lines.
“Our first quarter results were solid and reflect our continued focus on growing our businesses,” Mooney said in a release. “Revenue was up from the prior year and expenses were well-managed as we generated positive operating leverage. Our asset quality continued to be strong, and we remain committed to improving productivity and efficiency.”
KeyBank’s local headquarters in downtown Buffalo will be shifting this summer from Key Center at Fountain Plaza to the emerging 250 Delaware Building, a 12-story mixed-use facility to be anchored by Delaware North. Key’s retail branch at Fountain Plaza will also move.