Ohio | 34-6542451 | ||||
State or other jurisdiction of incorporation or organization: | I.R.S. Employer Identification Number: |
127 Public Square, | Cleveland, | Ohio | 44114-1306 | ||||||||
Address of principal executive offices: | Zip Code: |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Shares, $1 par value | KEY | New York Stock Exchange | ||||||
Depositary Shares (each representing a 1/40th interest in a share of Fixed-to-Floating Rate | KEY PrI | New York Stock Exchange | ||||||
Perpetual Non-Cumulative Preferred Stock, Series E) | ||||||||
Depositary Shares (each representing a 1/40th interest in a share of Fixed Rate Perpetual Non- | KEY PrJ | New York Stock Exchange | ||||||
Cumulative Preferred Stock, Series F) | ||||||||
Depositary Shares (each representing a 1/40th interest in a share of Fixed Rate Perpetual Non- | KEY PrK | New York Stock Exchange | ||||||
Cumulative Preferred Stock, Series G) | ||||||||
Depositary Shares (each representing a 1/40th interest in a share of Fixed Rate Reset Perpetual Non- | KEY PrL | New York Stock Exchange | ||||||
Cumulative Preferred Stock, Series H) |
Large accelerated filer | ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | ||||||||||||
Smaller reporting company | ☐ | Emerging growth company | ☐ |
ABO: Accumulated benefit obligation. ALCO: Asset/Liability Management Committee. ALLL: Allowance for loan and lease losses. A/LM: Asset/liability management. AML: Anti-money laundering. AOCI: Accumulated other comprehensive income (loss). APBO: Accumulated postretirement benefit obligation. AQN Strategies: Arbitria Quum Notitia, LLC. ARRC: Alternative Reference Rates Committee. ASC: Accounting Standards Codification. ASR: Accelerated Stock Repurchase. ASU: Accounting Standards Update. ATMs: Automated teller machines. BSA: Bank Secrecy Act. BHCA: Bank Holding Company Act of 1956, as amended. BHCs: Bank holding companies. Board: KeyCorp Board of Directors. CAPM: Capital Asset Pricing Model. CARES Act: Coronavirus Aid, Relief, and Economic Security Act. CCAR: Comprehensive Capital Analysis and Review. Cain Brothers: Cain Brothers & Company, LLC. CECL: Current Expected Credit Losses. CFPB: Consumer Financial Protection Bureau, also known as the Bureau of Consumer Financial Protection. CFTC: Commodities Futures Trading Commission. CMBS: Commercial mortgage-backed securities. CMO: Collateralized mortgage obligation. Common Shares: KeyCorp common shares, $1 par value. CVA: Credit Valuation Adjustment. DCF: Discounted cash flow. DIF: Deposit Insurance Fund of the FDIC. Dodd-Frank Act: Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. EAD: Exposure at default. EBITDA: Earnings before interest, taxes, depreciation, and amortization. EPS: Earnings per share. ERISA: Employee Retirement Income Security Act of 1974. ERM: Enterprise risk management. ESG: Environmental, social, and governance EVE: Economic value of equity. FASB: Financial Accounting Standards Board. FDIA: Federal Deposit Insurance Act, as amended. FDIC: Federal Deposit Insurance Corporation. Federal Reserve: Board of Governors of the Federal Reserve System. FHLB: Federal Home Loan Bank of Cincinnati. FHLMC: Federal Home Loan Mortgage Corporation. FICO: Fair Isaac Corporation. FINRA: Financial Industry Regulatory Authority. First Niagara: First Niagara Financial Group, Inc. FNMA: Federal National Mortgage Association. | FSOC: Financial Stability Oversight Council. FVA: Fair value of employee benefit plan assets. GAAP: U.S. generally accepted accounting principles. GNMA: Government National Mortgage Association. HTC: Historic tax credit. IRS: Internal Revenue Service. ISDA: International Swaps and Derivatives Association. KBCM: KeyBanc Capital Markets, Inc. KCC: Key Capital Corporation. KCDC: Key Community Development Corporation. KCIC: Key Community Investment Capital LLC. KEF: Key Equipment Finance. LCR: Liquidity coverage ratio. LGD: Loss given default. LIBOR: London Interbank Offered Rate. LIHTC: Low-income housing tax credit. LTV: Loan-to-value. Moody’s: Moody’s Investor Services, Inc. MRM: Market Risk Management group. MRC: Market Risk Committee. N/A: Not applicable. NAV: Net asset value. NFA: National Futures Association. N/M: Not meaningful. NMTC: New market tax credit. NOW: Negotiable Order of Withdrawal. NPR: Notice of proposed rulemaking. NYSE: New York Stock Exchange. OCC: Office of the Comptroller of the Currency. OCI: Other comprehensive income (loss). OREO: Other real estate owned. PBO: Projected benefit obligation. PCCR: Purchased credit card relationship. PCD: Purchased credit deteriorated. PD: Probability of default. PPP: Paycheck Protection Program. RMBS: Residential mortgage-backed securities. S&P: Standard and Poor’s Ratings Services, a Division of The McGraw-Hill Companies, Inc. SEC: U.S. Securities & Exchange Commission. SIFIs: Systemically important financial institutions, including large, interconnected BHCs and nonbank financial companies designated by FSOC for supervision by the Federal Reserve. SOFR: Secured Overnight Financing Rate. TDR: Troubled debt restructuring. TE: Taxable-equivalent. U.S. Treasury: United States Department of the Treasury. VaR: Value at risk. VEBA: Voluntary Employee Beneficiary Association. VIE: Variable interest entity. |
Item Number | Page Number | ||||||||||
PART I | |||||||||||
1 | |||||||||||
1A | |||||||||||
1B | |||||||||||
2 | |||||||||||
3 | |||||||||||
4 | |||||||||||
PART II | |||||||||||
5 | |||||||||||
6 | |||||||||||
7 | |||||||||||
7A | |||||||||||
8 | |||||||||||
9 | |||||||||||
9A | |||||||||||
9B | |||||||||||
9C | |||||||||||
PART III | |||||||||||
10 | |||||||||||
11 | |||||||||||
12 | |||||||||||
13 | |||||||||||
14 | |||||||||||
PART IV | |||||||||||
15 | |||||||||||
16 | |||||||||||
Region | Employee Count | |||||||
East | 13,775 | |||||||
West | 1,974 | |||||||
All Other | 3,142 |
Ratios (including stress capital buffer) | Regulatory Minimum Requirement | Stress Capital Buffer (b) | Regulatory Minimum With Stress Capital Buffer | KeyCorp December 31, 2022 (c) | ||||||||||
Common Equity Tier 1 | 4.50 | % | 2.50 | % | 7.00 | % | 9.10 | % | ||||||
Tier 1 Capital | 6.00 | 2.50 | 8.50 | 10.60 | ||||||||||
Total Capital | 8.00 | 2.50 | 10.50 | 12.79 | ||||||||||
Leverage (a) | 4.00 | N/A | 4.00 | 8.88 |
Prompt Corrective Action | Capital Category | |||||||||||||
Ratio | Well Capitalized (a) | Adequately Capitalized | ||||||||||||
Common Equity Tier 1 Risk-Based | 6.5 | % | 4.5 | % | ||||||||||
Tier 1 Risk-Based | 8.0 | 6.0 | ||||||||||||
Total Risk-Based | 10.0 | 8.0 | ||||||||||||
Tier 1 Leverage (b) | 5.0 | 4.0 |
Page(s) | |||||
Discussion of dividends in the section captioned “Capital — Dividends” | 68 | ||||
Discussion of our common shares, shareholder information, and repurchase activities in the section captioned “Capital — Common Shares outstanding” | 68 |
Calendar month | Total number of shares repurchased(a) | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs(a) | Dollar value of shares that may yet be purchased as part of publicly announced plans or programs | ||||||||||
October 1 - 31 | — | $ | — | — | $ | 745,991,117 | ||||||||
November 1 - 30 | — | — | — | 745,991,117 | ||||||||||
December 1 - 31 | 2,401 | 17.89 | 2,401 | 745,948,169 | ||||||||||
Total | 2,401 | $ | 17.89 | 2,401 | ||||||||||
Page Number | |||||
Year ended December 31, | 2022 | 2021 | 2020 | ||||||||||||||||||||||||||||||||
Dollars in millions | 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 and industrial (d) | $ | 54,970 | $ | 2,148 | 3.91 | % | $ | 50,931 | $ | 1,795 | 3.52 | % | $ | 55,145 | $ | 1,977 | 3.59 | % | |||||||||||||||||
Real estate — commercial mortgage | 15,572 | 633 | 4.07 | 13,118 | 472 | 3.60 | 13,279 | 521 | 3.92 | ||||||||||||||||||||||||||
Real estate — construction | 2,229 | 99 | 4.44 | 2,113 | 77 | 3.61 | 1,843 | 74 | 3.99 | ||||||||||||||||||||||||||
Commercial lease financing | 3,869 | 98 | 2.54 | 4,019 | 114 | 2.84 | 4,497 | 139 | 3.09 | ||||||||||||||||||||||||||
Total commercial loans | 76,640 | 2,978 | 3.89 | 70,181 | 2,458 | 3.50 | 74,764 | 2,711 | 3.63 | ||||||||||||||||||||||||||
Real estate — residential mortgage | 19,036 | 559 | 2.94 | 12,252 | 348 | 2.84 | 8,094 | 284 | 3.50 | ||||||||||||||||||||||||||
Home equity loans | 8,115 | 347 | 4.28 | 8,967 | 336 | 3.74 | 9,772 | 392 | 4.01 | ||||||||||||||||||||||||||
Consumer direct loans | 6,490 | 277 | 4.27 | 5,105 | 233 | 4.56 | 4,213 | 221 | 5.26 | ||||||||||||||||||||||||||
Credit cards | 959 | 107 | 11.23 | 925 | 94 | 10.11 | 1,001 | 107 | 10.65 | ||||||||||||||||||||||||||
Consumer indirect loans | 62 | — | — | 2,839 | 90 | 3.19 | 4,845 | 180 | 3.72 | ||||||||||||||||||||||||||
Total consumer loans | 34,662 | 1,290 | 3.72 | 30,088 | 1,101 | 3.66 | 27,925 | 1,184 | 4.24 | ||||||||||||||||||||||||||
Total loans | 111,302 | 4,268 | 3.84 | 100,269 | 3,559 | 3.55 | 102,689 | 3,895 | 3.79 | ||||||||||||||||||||||||||
Loans held for sale | 1,278 | 56 | 4.41 | 1,700 | 50 | 2.96 | 1,972 | 69 | 3.49 | ||||||||||||||||||||||||||
Securities available for sale (b), (e) | 42,325 | 752 | 1.62 | 35,765 | 546 | 1.53 | 23,742 | 484 | 2.10 | ||||||||||||||||||||||||||
Held-to-maturity securities (b) | 7,676 | 213 | 2.77 | 7,035 | 185 | 2.63 | 8,938 | 222 | 2.49 | ||||||||||||||||||||||||||
Trading account assets | 850 | 31 | 3.61 | 820 | 19 | 2.35 | 814 | 20 | 2.47 | ||||||||||||||||||||||||||
Short-term investments | 4,264 | 97 | 2.28 | 17,529 | 28 | .16 | 9,096 | 18 | .20 | ||||||||||||||||||||||||||
Other investments (e) | 952 | 22 | 2.26 | 621 | 7 | 1.14 | 635 | 6 | .87 | ||||||||||||||||||||||||||
Total earning assets | 168,647 | 5,439 | 3.15 | 163,739 | 4,394 | 2.69 | 147,886 | 4,714 | 3.20 | ||||||||||||||||||||||||||
Allowance for loan and lease losses | (1,101) | (1,340) | (1,481) | ||||||||||||||||||||||||||||||||
Accrued income and other assets | 18,340 | 16,520 | 15,650 | ||||||||||||||||||||||||||||||||
Discontinued assets | 492 | 632 | 775 | ||||||||||||||||||||||||||||||||
Total assets | $ | 186,378 | $ | 179,551 | $ | 162,830 | |||||||||||||||||||||||||||||
LIABILITIES | |||||||||||||||||||||||||||||||||||
NOW and money market deposit accounts | $ | 85,673 | $ | 234 | .27 | % | $ | 84,736 | $ | 41 | .05 | % | $ | 75,733 | $ | 206 | .27 | % | |||||||||||||||||
Savings deposits | 7,798 | 1 | .01 | 6,893 | 1 | .02 | 5,252 | 2 | .04 | ||||||||||||||||||||||||||
Certificates of deposit ($100,000 or more)(f) | 1,455 | 8 | .56 | 2,135 | 16 | .72 | 4,520 | 83 | 1.83 | ||||||||||||||||||||||||||
Other time deposits | 2,892 | 36 | 1.25 | 2,540 | 9 | .37 | 4,041 | 56 | 1.38 | ||||||||||||||||||||||||||
Total interest-bearing deposits | 97,818 | 279 | .29 | 96,304 | 67 | .07 | 89,546 | 347 | .39 | ||||||||||||||||||||||||||
Federal funds purchased and securities sold under repurchase agreements | 2,107 | 41 | 1.93 | 239 | — | .02 | 670 | 6 | .88 | ||||||||||||||||||||||||||
Bank notes and other short-term borrowings | 2,963 | 90 | 3.02 | 770 | 8 | 1.08 | 1,452 | 12 | .85 | ||||||||||||||||||||||||||
Long-term debt (f), (g) | 14,915 | 475 | 3.19 | 12,391 | 221 | 1.79 | 12,578 | 286 | 2.36 | ||||||||||||||||||||||||||
Total interest-bearing liabilities | 117,803 | 885 | .75 | 109,704 | 296 | .27 | 104,246 | 651 | .63 | ||||||||||||||||||||||||||
Noninterest-bearing deposits | 49,044 | 48,731 | 37,740 | ||||||||||||||||||||||||||||||||
Accrued expense and other liabilities | 4,309 | 2,819 | 2,433 | ||||||||||||||||||||||||||||||||
Discontinued liabilities (g) | 492 | 632 | 775 | ||||||||||||||||||||||||||||||||
Total liabilities | 171,648 | 161,886 | 145,194 | ||||||||||||||||||||||||||||||||
EQUITY | |||||||||||||||||||||||||||||||||||
Key shareholders’ equity | 14,730 | 17,665 | 17,636 | ||||||||||||||||||||||||||||||||
Noncontrolling interests | — | — | — | ||||||||||||||||||||||||||||||||
Total equity | 14,730 | 17,665 | 17,636 | ||||||||||||||||||||||||||||||||
Total liabilities and equity | $ | 186,378 | $ | 179,551 | $ | 162,830 | |||||||||||||||||||||||||||||
Interest rate spread (TE) | 2.40 | % | 2.42 | % | 2.57 | % | |||||||||||||||||||||||||||||
Net interest income (TE) and net interest margin (TE) | $ | 4,554 | 2.64 | % | $ | 4,098 | 2.50 | % | $ | 4,063 | 2.77 | % | |||||||||||||||||||||||
Less: TE adjustment (b) | 27 | 27 | 29 | ||||||||||||||||||||||||||||||||
Net interest income, GAAP basis | $ | 4,527 | $ | 4,071 | $ | 4,034 | |||||||||||||||||||||||||||||
2022 vs. 2021 | |||||||||||
Dollars in millions | Average Volume | Yield/ Rate | Net Change(a) | ||||||||
INTEREST INCOME | |||||||||||
Loans | $ | 428 | $ | 281 | $ | 709 | |||||
Loans held for sale | (14) | 20 | 6 | ||||||||
Securities available for sale | 109 | 97 | 206 | ||||||||
Held-to-maturity securities | 17 | 11 | 28 | ||||||||
Trading account assets | 1 | 11 | 12 | ||||||||
Short-term investments | (36) | 105 | 69 | ||||||||
Other investments | 5 | 10 | 15 | ||||||||
Total interest income (TE) | 509 | 536 | 1,045 | ||||||||
INTEREST EXPENSE | |||||||||||
NOW and money market deposit accounts | — | 193 | 193 | ||||||||
Savings deposits | — | — | — | ||||||||
Certificates of deposit ($100,000 or more) | (4) | (4) | (8) | ||||||||
Other time deposits | 1 | 26 | 27 | ||||||||
Total interest-bearing deposits | (2) | 214 | 212 | ||||||||
Federal funds purchased and securities sold under repurchase agreements | — | 41 | 41 | ||||||||
Bank notes and other short-term borrowings | 49 | 33 | 82 | ||||||||
Long-term debt | 52 | 202 | 254 | ||||||||
Total interest expense | 99 | 490 | 589 | ||||||||
Net interest income (TE) | $ | 410 | $ | 46 | $ | 456 | |||||
Year ended December 31, | Change 2022 vs. 2021 | |||||||||||||
Dollars in millions | 2022 | 2021 | Amount | Percent | ||||||||||
Discretionary assets under management by investment type: | ||||||||||||||
Equity | $ | 28,313 | $ | 33,767 | $ | (5,454) | (16.2) | % | ||||||
Fixed income | 14,432 | 13,851 | 581 | 4.2 | ||||||||||
Money market | 5,238 | 4,541 | 697 | 15.3 | ||||||||||
Total discretionary assets under management | $ | 47,983 | $ | 52,159 | $ | (4,176) | (8.0) | % | ||||||
Non-discretionary assets under administration | $ | 3,299 | $ | 3,647 | $ | (348) | (9.5) | % | ||||||
Total | $ | 51,282 | $ | 55,806 | $ | (4,524) | (8.1) | % | ||||||
Year ended December 31, Dollars in millions | Change 2022 vs. 2021 | |||||||||||||
2022 | 2021 | Amount | Percent | |||||||||||
Salaries and contract labor | $ | 1,500 | $ | 1,311 | $ | 189 | 14.4 | % | ||||||
Incentive and stock-based compensation (a) | 693 | 861 | (168) | (19.5) | ||||||||||
Employee benefits | 363 | 388 | (25) | (6.4) | ||||||||||
Severance | 10 | 1 | 9 | N/M | ||||||||||
Total personnel expense | $ | 2,566 | $ | 2,561 | $ | 5 | 0.2 | % | ||||||
2022 | 2021 | |||||||||||||||||||||||||
December 31, Dollars in millions | Amount | Percent of Total | Amount | Percent of Total | ||||||||||||||||||||||
COMMERCIAL | ||||||||||||||||||||||||||
Commercial and industrial (a) | $ | 59,647 | 50.0 | % | $ | 50,525 | 49.6 | % | ||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||
Commercial mortgage | 16,352 | 13.7 | 14,244 | 13.9 | ||||||||||||||||||||||
Construction | 2,530 | 2.1 | 1,996 | 2.0 | ||||||||||||||||||||||
Total commercial real estate loans | 18,882 | 15.8 | 16,240 | 15.9 | ||||||||||||||||||||||
Commercial lease financing (b) | 3,936 | 3.3 | 4,071 | 4.0 | ||||||||||||||||||||||
Total commercial loans | 82,465 | 69.1 | 70,836 | 69.5 | ||||||||||||||||||||||
CONSUMER | ||||||||||||||||||||||||||
Real estate — residential mortgage | 21,401 | 17.9 | 15,756 | 15.5 | ||||||||||||||||||||||
Home equity loans | 7,951 | 6.6 | 8,467 | 8.3 | ||||||||||||||||||||||
Consumer direct loans | 6,508 | 5.4 | 5,753 | 5.6 | ||||||||||||||||||||||
Credit cards | 1,026 | 0.9 | 972 | 1.0 | ||||||||||||||||||||||
Consumer indirect loans | 43 | 0.1 | 70 | 0.1 | ||||||||||||||||||||||
Total consumer loans | 36,929 | 30.9 | 31,018 | 30.5 | ||||||||||||||||||||||
Total loans (c) | $ | 119,394 | 100.0 | % | $ | 101,854 | 100.0 | % | ||||||||||||||||||
December 31, 2022 | Commercial and industrial | Commercial real estate | Commercial lease financing | Total commercial loans | Percent of total | ||||||||||||||||||||||||
Dollars in millions | |||||||||||||||||||||||||||||
Industry classification: | |||||||||||||||||||||||||||||
Agriculture | $ | 907 | $ | 171 | $ | 96 | $ | 1,174 | 1.4 | % | |||||||||||||||||||
Automotive | 1,660 | 741 | 12 | 2,413 | 2.9 | ||||||||||||||||||||||||
Business products | 2,332 | 176 | 37 | 2,545 | 3.1 | ||||||||||||||||||||||||
Business services | 3,497 | 249 | 167 | 3,913 | 4.7 | ||||||||||||||||||||||||
Chemicals | 934 | 31 | 45 | 1,010 | 1.2 | ||||||||||||||||||||||||
Construction materials and contractors | 2,351 | 327 | 309 | 2,987 | 3.7 | ||||||||||||||||||||||||
Consumer goods | 4,312 | 544 | 286 | 5,142 | 6.2 | ||||||||||||||||||||||||
Consumer services | 4,963 | 873 | 346 | 6,182 | 7.5 | ||||||||||||||||||||||||
Equipment | 1,988 | 111 | 113 | 2,212 | 2.7 | ||||||||||||||||||||||||
Finance | 8,784 | 111 | 462 | 9,357 | 11.3 | ||||||||||||||||||||||||
Healthcare | 3,379 | 1,348 | 310 | 5,037 | 6.1 | ||||||||||||||||||||||||
Metals and mining | 1,453 | 86 | 94 | 1,633 | 2.0 | ||||||||||||||||||||||||
Oil and gas | 2,385 | 32 | 20 | 2,437 | 3.0 | ||||||||||||||||||||||||
Public exposure | 2,526 | 9 | 582 | 3,117 | 3.8 | ||||||||||||||||||||||||
Commercial real estate | 8,862 | 13,897 | 7 | 22,766 | 27.6 | ||||||||||||||||||||||||
Technology | 914 | 12 | 89 | 1,015 | 1.2 | ||||||||||||||||||||||||
Transportation | 1,139 | 159 | 497 | 1,795 | 2.2 | ||||||||||||||||||||||||
Utilities | 6,725 | 5 | 450 | 7,180 | 8.7 | ||||||||||||||||||||||||
Other | 536 | — | 14 | 550 | .7 | ||||||||||||||||||||||||
Total | $ | 59,647 | $ | 18,882 | $ | 3,936 | $ | 82,465 | 100.0 | % | |||||||||||||||||||
December 31, 2021 | Commercial and industrial | Commercial real estate | Commercial lease financing | Total commercial loans | Percent of total | ||||||||||||||||||||||||
Dollars in millions | |||||||||||||||||||||||||||||
Industry classification: | |||||||||||||||||||||||||||||
Agriculture | $ | 872 | $ | 161 | $ | 84 | $ | 1,117 | 1.6 | % | |||||||||||||||||||
Automotive | 1,253 | 609 | 18 | 1,880 | 2.7 | ||||||||||||||||||||||||
Business products | 1,732 | 131 | 39 | 1,902 | 2.7 | ||||||||||||||||||||||||
Business services | 3,202 | 235 | 177 | 3,614 | 5.1 | ||||||||||||||||||||||||
Chemicals | 786 | 25 | 22 | 833 | 1.2 | ||||||||||||||||||||||||
Construction materials and contractors | 2,248 | 338 | 264 | 2,850 | 4.0 | ||||||||||||||||||||||||
Consumer goods | 3,760 | 555 | 276 | 4,591 | 6.5 | ||||||||||||||||||||||||
Consumer services | 4,998 | 889 | 424 | 6,311 | 8.9 | ||||||||||||||||||||||||
Equipment | 1,650 | 97 | 138 | 1,885 | 2.7 | ||||||||||||||||||||||||
Finance | 6,676 | 98 | 380 | 7,154 | 10.1 | ||||||||||||||||||||||||
Healthcare | 3,138 | 1,302 | 245 | 4,685 | 6.6 | ||||||||||||||||||||||||
Metals and mining | 1,219 | 71 | 55 | 1,345 | 1.9 | ||||||||||||||||||||||||
Oil and gas | 1,758 | 26 | 35 | 1,819 | 2.6 | ||||||||||||||||||||||||
Public exposure | 2,768 | 15 | 720 | 3,503 | 4.9 | ||||||||||||||||||||||||
Commercial real estate | 6,494 | 11,456 | 9 | 17,959 | 25.3 | ||||||||||||||||||||||||
Technology | 649 | 9 | 149 | 807 | 1.1 | ||||||||||||||||||||||||
Transportation | 1,288 | 134 | 551 | 1,973 | 2.8 | ||||||||||||||||||||||||
Utilities | 5,491 | — | 467 | 5,958 | 8.4 | ||||||||||||||||||||||||
Other | 543 | 89 | 18 | 650 | .9 | ||||||||||||||||||||||||
Total | $ | 50,525 | $ | 16,240 | $ | 4,071 | $ | 70,836 | 100.0 | % | |||||||||||||||||||
Geographic Region | |||||||||||||||||||||||||||||||||||
Dollars in millions | West | Southwest | Central | Midwest | Southeast | Northeast | National | Total | Percent of Total | Construction | Commercial Mortgage | ||||||||||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||||||||||||||
Nonowner-occupied: | |||||||||||||||||||||||||||||||||||
Diversified | $ | 9 | $ | — | $ | — | $ | 4 | $ | — | $ | 24 | $ | 231 | $ | 268 | 1.4 | % | $ | — | $ | 268 | |||||||||||||
Industrial | 75 | 25 | 101 | 135 | 220 | 284 | 52 | 892 | 4.7 | 203 | 689 | ||||||||||||||||||||||||
Land & Residential | 1 | 3 | 3 | 3 | 3 | 24 | — | 37 | .2 | 15 | 22 | ||||||||||||||||||||||||
Lodging | 58 | — | 10 | 4 | 20 | 72 | 41 | 205 | 1.1 | 22 | 183 | ||||||||||||||||||||||||
Medical Office | 47 | — | 43 | 9 | 19 | 98 | 25 | 241 | 1.3 | 64 | 177 | ||||||||||||||||||||||||
Multifamily | 1,083 | 533 | 1,388 | 1,264 | 2,813 | 1,370 | 438 | 8,889 | 47.1 | 1,705 | 7,184 | ||||||||||||||||||||||||
Office | 189 | 1 | 173 | 113 | 128 | 300 | 95 | 999 | 5.3 | — | 999 | ||||||||||||||||||||||||
Retail | 282 | 35 | 112 | 183 | 69 | 395 | 235 | 1,311 | 6.9 | 106 | 1,205 | ||||||||||||||||||||||||
Self Storage | 85 | 13 | 50 | 20 | 79 | 37 | 202 | 486 | 2.6 | 4 | 482 | ||||||||||||||||||||||||
Senior Housing | 150 | 57 | 144 | 76 | 118 | 120 | 235 | 900 | 4.8 | 194 | 706 | ||||||||||||||||||||||||
Skilled Nursing | — | — | — | 52 | — | 239 | 143 | 434 | 2.3 | — | 434 | ||||||||||||||||||||||||
Student Housing | — | — | — | 53 | 199 | 13 | — | 265 | 1.4 | 39 | 226 | ||||||||||||||||||||||||
Other | 24 | 4 | 9 | 79 | 42 | 83 | 195 | 436 | 2.3 | 2 | 434 | ||||||||||||||||||||||||
Total nonowner-occupied | 2,003 | 671 | 2,033 | 1,995 | 3,710 | 3,059 | 1,892 | 15,363 | 81.4 | 2,354 | 13,009 | ||||||||||||||||||||||||
Owner-occupied | 1,149 | 5 | 364 | 580 | 128 | 1,293 | — | 3,519 | 18.6 | 176 | 3,343 | ||||||||||||||||||||||||
Total | $ | 3,152 | $ | 676 | $ | 2,397 | $ | 2,575 | $ | 3,838 | $ | 4,352 | $ | 1,892 | $ | 18,882 | 100.0 | % | $ | 2,530 | $ | 16,352 | |||||||||||||
Nonowner-occupied: | |||||||||||||||||||||||||||||||||||
Nonperforming loans | $ | — | $ | — | $ | — | $ | 2 | $ | — | $ | 7 | $ | 12 | $ | 21 | N/M | $ | — | $ | 21 | ||||||||||||||
Accruing loans past due 90 days or more | — | — | — | — | — | 8 | — | 8 | N/M | — | 8 | ||||||||||||||||||||||||
Accruing loans past due 30 through 89 days | — | — | 1 | 11 | — | 6 | — | 18 | N/M | — | 18 | ||||||||||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||||||||||||||
Nonowner-occupied: | |||||||||||||||||||||||||||||||||||
Diversified | $ | 18 | $ | — | $ | — | $ | 1 | $ | — | $ | 40 | $ | 183 | $ | 242 | 1.5 | % | $ | — | $ | 242 | |||||||||||||
Industrial | 47 | 25 | 44 | 44 | 218 | 224 | 114 | 716 | 4.4 | 90 | 626 | ||||||||||||||||||||||||
Land & Residential | 13 | 3 | 4 | 2 | 5 | 29 | — | 56 | .3 | 33 | 23 | ||||||||||||||||||||||||
Lodging | 75 | — | 21 | 4 | 30 | 101 | 28 | 259 | 1.6 | 27 | 232 | ||||||||||||||||||||||||
Medical Office | 46 | — | 44 | 5 | 6 | 95 | — | 196 | 1.2 | 24 | 172 | ||||||||||||||||||||||||
Multifamily | 855 | 490 | 1,166 | 941 | 1,651 | 1,392 | 239 | 6,734 | 41.5 | 1,249 | 5,485 | ||||||||||||||||||||||||
Office | 213 | — | 199 | 122 | 133 | 372 | 46 | 1,085 | 6.7 | 17 | 1,068 | ||||||||||||||||||||||||
Retail | 247 | 36 | 131 | 226 | 95 | 409 | 192 | 1,336 | 8.2 | 87 | 1,249 | ||||||||||||||||||||||||
Self Storage | 44 | 5 | 44 | 13 | 39 | 50 | 74 | 269 | 1.7 | 5 | 264 | ||||||||||||||||||||||||
Senior Housing | 115 | 32 | 109 | 57 | 107 | 198 | 222 | 840 | 5.2 | 114 | 726 | ||||||||||||||||||||||||
Skilled Nursing | — | 39 | 19 | 2 | 13 | 271 | 164 | 508 | 3.1 | — | 508 | ||||||||||||||||||||||||
Student Housing | 10 | — | 36 | 65 | 124 | 14 | — | 249 | 1.5 | 86 | 163 | ||||||||||||||||||||||||
Other | 20 | — | 6 | 77 | 33 | 120 | 89 | 345 | 2.1 | 2 | 343 | ||||||||||||||||||||||||
Total nonowner-occupied | 1,703 | 630 | 1,823 | 1,559 | 2,454 | 3,315 | 1,351 | 12,835 | 79.0 | 1,734 | 11,101 | ||||||||||||||||||||||||
Owner-occupied | 1,065 | — | 293 | 592 | 124 | 1,331 | — | 3,405 | 21.0 | 262 | 3,143 | ||||||||||||||||||||||||
Total | $ | 2,768 | $ | 630 | $ | 2,116 | $ | 2,151 | $ | 2,578 | $ | 4,646 | $ | 1,351 | $ | 16,240 | 100.0 | % | $ | 1,996 | $ | 14,244 | |||||||||||||
Nonperforming loans | $ | — | $ | — | $ | — | $ | 2 | $ | — | $ | 17 | $ | 25 | $ | 44 | N/M | $ | — | $ | 44 | ||||||||||||||
Accruing loans past due 90 days or more | 1 | — | 1 | — | — | 6 | — | 8 | N/M | 1 | 7 | ||||||||||||||||||||||||
Accruing loans past due 30 through 89 days | — | — | 5 | 1 | 24 | 5 | — | 35 | N/M | 16 | 19 |
West – | Alaska, California, Hawaii, Idaho, Montana, Oregon, Washington, and Wyoming | ||||
Southwest – | Arizona, Nevada, and New Mexico | ||||
Central – | Arkansas, Colorado, Oklahoma, Texas, and Utah | ||||
Midwest – | Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin | ||||
Southeast – | Alabama, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, Washington, D.C., and West Virginia | ||||
Northeast – | Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont | ||||
National – | Accounts in three or more regions |
Dollars in millions | Real estate — residential mortgage | Home equity loans | Consumer direct loans | Credit cards | Consumer indirect loans | Total | ||||||||||||||
December 31, 2022 | ||||||||||||||||||||
Washington | $ | 4,621 | $ | 1,100 | $ | 253 | $ | 87 | $ | 2 | $ | 6,063 | ||||||||
Ohio | 2,766 | 1,173 | 347 | 214 | 5 | 4,505 | ||||||||||||||
New York | 840 | 2,256 | 770 | 359 | 1 | 4,226 | ||||||||||||||
Colorado | 3,006 | 301 | 171 | 32 | — | 3,510 | ||||||||||||||
California | 2,357 | 16 | 538 | 4 | 6 | 2,921 | ||||||||||||||
Oregon | 1,268 | 630 | 117 | 43 | — | 2,058 | ||||||||||||||
Pennsylvania | 459 | 580 | 403 | 61 | 3 | 1,506 | ||||||||||||||
Florida | 851 | 45 | 453 | 14 | 6 | 1,369 | ||||||||||||||
Texas | 336 | 3 | 397 | 4 | 3 | 743 | ||||||||||||||
Illinois | 134 | 3 | 212 | 2 | 1 | 352 | ||||||||||||||
Other | 4,763 | 1,844 | 2,847 | 206 | 16 | 9,676 | ||||||||||||||
Total | $ | 21,401 | $ | 7,951 | $ | 6,508 | $ | 1,026 | $ | 43 | $ | 36,929 | ||||||||
December 31, 2021 | ||||||||||||||||||||
New York | $ | 679 | $ | 2,467 | $ | 638 | $ | 345 | $ | 4 | $ | 4,133 | ||||||||
Ohio | 2,631 | 1,284 | 485 | 206 | 8 | 4,614 | ||||||||||||||
Washington | 2,264 | 1,076 | 234 | 81 | 2 | 3,657 | ||||||||||||||
Pennsylvania | 351 | 634 | 327 | 55 | 4 | 1,371 | ||||||||||||||
California | 1,781 | 14 | 430 | 3 | 10 | 2,238 | ||||||||||||||
Texas | 184 | 5 | 343 | 4 | 4 | 540 | ||||||||||||||
Colorado | 2,602 | 284 | 156 | 30 | — | 3,072 | ||||||||||||||
Connecticut | 837 | 319 | 96 | 26 | 2 | 1,280 | ||||||||||||||
Oregon | 1,009 | 670 | 110 | 40 | 1 | 1,830 | ||||||||||||||
Florida | 591 | 46 | 378 | 13 | 10 | 1,038 | ||||||||||||||
Other | 2,827 | 1,668 | 2,556 | 169 | 25 | 7,245 | ||||||||||||||
Total | $ | 15,756 | $ | 8,467 | $ | 5,753 | $ | 972 | $ | 70 | $ | 31,018 | ||||||||
Dollars in millions | Commercial | Commercial Real Estate | Commercial Lease Financing | Residential Real Estate | Consumer Indirect | Total | ||||||||||||||
2022 | ||||||||||||||||||||
Fourth quarter | $ | 33 | $ | 2,774 | $ | 114 | $ | 235 | $ | — | $ | 3,156 | ||||||||
Third quarter | 211 | 1,882 | 43 | 353 | — | 2,489 | ||||||||||||||
Second quarter | 41 | 1,851 | 150 | 496 | — | 2,538 | ||||||||||||||
First quarter | 1,469 | 1,909 | 39 | 901 | — | 4,318 | ||||||||||||||
Total | $ | 1,754 | $ | 8,416 | $ | 346 | $ | 1,985 | $ | — | $ | 12,501 | ||||||||
2021 | ||||||||||||||||||||
Fourth quarter | $ | 296 | $ | 3,460 | $ | 93 | $ | 987 | $ | — | $ | 4,836 | ||||||||
Third quarter | 215 | 1,996 | 68 | 901 | 3,305 | 6,485 | ||||||||||||||
Second quarter | 1,085 | 1,907 | 75 | 1,192 | — | 4,259 | ||||||||||||||
First quarter | 124 | 1,930 | 156 | 1,129 | — | 3,339 | ||||||||||||||
Total | $ | 1,720 | $ | 9,293 | $ | 392 | $ | 4,209 | $ | 3,305 | $ | 18,919 | ||||||||
December 31, Dollars in millions | 2022 | 2021 | 2020 | 2019 | 2018 | ||||||||||||
Commercial real estate loans | $ | 488,478 | $ | 444,131 | $ | 371,016 | $ | 347,186 | $ | 291,158 | |||||||
Residential mortgage | 11,026 | 10,312 | 8,311 | 6,146 | 5,209 | ||||||||||||
Education loans | 312 | 415 | 516 | 625 | 766 | ||||||||||||
Commercial lease financing | 1,646 | 1,236 | 1,359 | 1,047 | 916 | ||||||||||||
Commercial loans | 723 | 750 | 684 | 591 | 549 | ||||||||||||
Consumer direct | 509 | 699 | 1,711 | 2,243 | — | ||||||||||||
Consumer indirect | 1,536 | 2,714 | — | — | — | ||||||||||||
Total | $ | 504,230 | $ | 460,257 | $ | 383,597 | $ | 357,838 | $ | 298,598 | |||||||
December 31, 2022 | |||||||||||||||||
Dollars in millions | Within One Year | One - Five Years | Five - Fifteen Years | Over Fifteen Years | Total | ||||||||||||
Commercial | |||||||||||||||||
Commercial and industrial | $ | 10,829 | $ | 41,764 | $ | 6,881 | $ | 173 | $ | 59,647 | |||||||
Commercial Mortgage | 4,020 | 8,680 | 3,322 | 330 | 16,352 | ||||||||||||
Real estate — construction | 1,071 | 1,057 | 81 | 321 | 2,530 | ||||||||||||
Commercial lease financing | 228 | 2,115 | 1,565 | 28 | 3,936 | ||||||||||||
Total commercial loans | $ | 16,148 | $ | 53,616 | $ | 11,849 | $ | 852 | $ | 82,465 | |||||||
Consumer | |||||||||||||||||
Real estate - residential mortgage | $ | 57 | $ | 26 | $ | 864 | $ | 20,454 | $ | 21,401 | |||||||
Home equity loans | 12 | 267 | 2,546 | 5,126 | 7,951 | ||||||||||||
Consumer direct loans | 521 | 1,074 | 2,763 | 2,150 | 6,508 | ||||||||||||
Credit Cards | 1,026 | — | — | — | 1,026 | ||||||||||||
Consumer indirect loans | 1 | 41 | 1 | — | 43 | ||||||||||||
Total consumer loans | 1,617 | 1,408 | 6,174 | 27,730 | 36,929 | ||||||||||||
Total loans | $ | 17,765 | $ | 55,024 | $ | 18,023 | $ | 28,582 | $ | 119,394 | |||||||
Loans with floating or adjustable interest rates (b) | $ | 49,234 | $ | 5,951 | $ | 13,410 | $ | 68,595 | |||||||||
Loans with predetermined interest rates (c) | 5,791 | 12,071 | 15,172 | 33,034 | |||||||||||||
Total | $ | 55,025 | $ | 18,022 | $ | 28,582 | $ | 101,629 | |||||||||
December 31, Dollars in millions | 2022 | 2021 | ||||||
FHLMC & FNMA | $ | 25,371 | $ | 28,461 | ||||
GNMA | 11,620 | 12,469 | ||||||
Total (a) | $ | 36,991 | $ | 40,930 | ||||
Dollars in millions | U.S. Treasury, Agencies, and Corporations | Agency Residential Collateralized Mortgage Obligations(a) | Agency Residential Mortgage-backed Securities(a),(b) | Agency Commercial Mortgage-backed Securities(a) | Other Securities | Total | Weighted-Average Yield(b) | ||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Remaining maturity: | |||||||||||||||||||||||
One year or less | $ | 1,133 | $ | 60 | $ | 2 | $ | 20 | $ | — | $ | 1,215 | 0.48 | % | |||||||||
After one through five years | 8,020 | 2,036 | 2,410 | 2,314 | — | 14,780 | 1.32 | ||||||||||||||||
After five through ten years | 157 | 10,734 | 1,271 | 5,808 | — | 17,970 | 1.98 | ||||||||||||||||
After ten years | 105 | 3,603 | 237 | 1,207 | — | 5,152 | 1.76 | ||||||||||||||||
Fair value | $ | 9,415 | $ | 16,433 | $ | 3,920 | $ | 9,349 | $ | — | $ | 39,117 | — | ||||||||||
Amortized cost | 10,044 | 20,180 | 4,616 | 10,712 | — | 45,552 | 1.67 | % | |||||||||||||||
Weighted-average yield (b) | 0.59 | % | 1.67 | % | 1.58 | % | 2.73 | % | — | % | 1.67 | % | — | ||||||||||
Weighted-average maturity | 1.9 years | 8.1 years | 4.9 years | 7.5 years | — years | 6.3 years | — | ||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||
Fair value | $ | 9,472 | $ | 21,119 | $ | 5,122 | $ | 9,651 | $ | — | $ | 45,364 | — | % | |||||||||
Amortized cost | 9,573 | 21,430 | 5,137 | 9,753 | — | 45,893 | 1.43 | % | |||||||||||||||
Dollars in millions | Agency Residential Collateralized Mortgage Obligations(a) | Agency Residential Mortgage-backed Securities(a) | Agency Commercial Mortgage-backed Securities(a) | Asset-backed securities | Other Securities | Total | Weighted-Average Yield(b) | ||||||||||||||||
December 31, 2022 | |||||||||||||||||||||||
Remaining maturity: | |||||||||||||||||||||||
One year or less | $ | 11 | $ | — | $ | 6 | $ | 2 | $ | 1 | $ | 20 | 2.16 | % | |||||||||
After one through five years | 1,569 | 127 | 1,720 | 1,405 | 13 | 4,834 | 2.85 | ||||||||||||||||
After five through ten years | 2,189 | 54 | 761 | — | — | 3,004 | 3.52 | ||||||||||||||||
After ten years | 817 | — | 35 | — | — | 852 | 4.24 | ||||||||||||||||
Amortized cost | $ | 4,586 | $ | 181 | $ | 2,522 | $ | 1,407 | $ | 14 | $ | 8,710 | 3.18 | % | |||||||||
Fair value | 4,308 | 165 | 2,315 | 1,311 | 14 | 8,113 | — | ||||||||||||||||
Weighted-average yield(b) | 3.60 | % | 2.87 | % | 3.16 | % | 2.10 | % | 2.43 | % | 3.22 | % | — | ||||||||||
Weighted-average maturity | 7.0 years | 5.4 years | 4.5 years | 1.6 years | 2.2 years | 5.4 years | — | ||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||
Amortized cost | $ | 2,196 | $ | 164 | $ | 2,678 | $ | 2,485 | $ | 16 | $ | 7,539 | 2.37 | % | |||||||||
Fair value | 2,229 | 170 | 2,796 | 2,454 | 16 | 7,665 | — | ||||||||||||||||
December 31, 2022 | Total | ||||
Dollars in millions | |||||
Remaining maturity: | |||||
Three months or less | $ | 32 | |||
After three through six months | 78 | ||||
After six through twelve months | 82 | ||||
After twelve months | 97 | ||||
Total | $ | 289 | |||
2022 Quarters | ||||||||||||||||||||
In thousands | 2022 | Fourth | Third | Second | First | 2021 | ||||||||||||||
Shares outstanding at beginning of period | 928,850 | 932,938 | 932,643 | 932,398 | 928,850 | 975,773 | ||||||||||||||
Open market repurchases, repurchases under an ASR program, and return of shares under employee compensation plans | (1,736) | (2) | (3) | (24) | (1,707) | (54,986) | ||||||||||||||
Shares issued under employee compensation plans (net of cancellations) | 6,211 | 389 | 298 | 269 | 5,255 | 8,063 | ||||||||||||||
Shares outstanding at end of period | 933,325 | 933,325 | 932,938 | 932,643 | 932,398 | 928,850 | ||||||||||||||
2022 | 2021 | ||||||||||||||||||||||||||||
Three months ended December 31, | Three months ended December 31, | ||||||||||||||||||||||||||||
Dollars in millions | High | Low | Mean | December 31, | High | Low | Mean | December 31, | |||||||||||||||||||||
Trading account assets: | |||||||||||||||||||||||||||||
Fixed income | $ | 1.1 | $ | .4 | $ | .7 | $ | .4 | $ | 1.5 | $ | .8 | $ | 1.2 | $ | .9 | |||||||||||||
Derivatives: | |||||||||||||||||||||||||||||
Interest rate | $ | .7 | $ | .2 | $ | .3 | $ | .6 | $ | .2 | $ | .1 | $ | .1 | $ | .1 |
2022 | 2021 | ||||||||||||||||||||||||||||
Three months ended December 31, | Three months ended December 31, | ||||||||||||||||||||||||||||
Dollars in millions | High | Low | Mean | December 31, | High | Low | Mean | December 31, | |||||||||||||||||||||
Trading account assets: | |||||||||||||||||||||||||||||
Fixed income | $ | 2.4 | $ | 1.1 | $ | 1.6 | $ | 1.1 | $ | 6.5 | $ | 3.4 | $ | 5.4 | $ | 3.6 | |||||||||||||
Derivatives: | |||||||||||||||||||||||||||||
Interest rate | $ | .7 | $ | .2 | $ | .3 | $ | .6 | $ | .6 | $ | .3 | $ | .3 | $ | .5 |
Dollars in millions | Maturity through June 30, 2023 | Maturity past June 30, 2023 | Total Exposures | ||||||||
Outstanding balance of loans | $ | 2,345 | $ | 15,659 | $ | 18,004 | |||||
Notional value of derivative contracts | 9,519 | 67,656 | 77,175 | ||||||||
Investment securities | — | 535 | 535 | ||||||||
Debt and equity instruments | — | 1,276 | 1,276 |
December 31, 2022 | December 31, 2021 | |||||||||||||
Basis point change assumption | -200 | +200 | -200 | +200 | ||||||||||
Assumed floor in market rates (in basis points) | — | N/A | — | N/A | ||||||||||
Rising rate beta | N/A | Mid 40s | N/A | High 20s | ||||||||||
Tolerance level | (5.50) | % | (5.50) | % | (5.50) | % | (5.50) | % | ||||||
Interest rate risk assessment | (1.66) | % | (2.61) | % | (3.86) | % | 5.15 | % | ||||||
+200 NII at risk beta sensitivity | December 31, 2022 | |||||||||||||
Beta assumption | Mid 40s | Low 40s | Mid 30s | Low 30s | ||||||||||
Interest rate risk assessment | (2.61) | % | (1.60) | % | (0.59) | % | 0.42 | % |
December 31, 2022 | ||||||||||||||||||||||||||||||||
Weighted-Average | December 31, 2021 | |||||||||||||||||||||||||||||||
Dollars in millions | Notional Amount | Fair Value | Maturity (Years) | Receive Rate | Pay Rate | Notional Amount | Fair Value | |||||||||||||||||||||||||
Receive fixed/pay variable — conventional A/LM (a) | $ | 28,450 | $ | (1,503) | 2.2 | 1.4 | % | 4.3 | % | $ | 23,950 | $ | 9 | |||||||||||||||||||
Receive fixed/pay variable — conventional debt | 10,995 | (551) | 4.1 | 2.2 | 4.2 | 7,432 | 137 | |||||||||||||||||||||||||
Receive fixed/pay variable — forward A/LM | 1,300 | (8) | 3.9 | 3.4 | 4.5 | 850 | (1) | |||||||||||||||||||||||||
Pay fixed/receive variable — conventional debt | 50 | 1 | 5.5 | 3.7 | 3.6 | 50 | (7) | |||||||||||||||||||||||||
Pay fixed/receive variable — forward securities | — | — | — | — | — | 6,280 | 135 | |||||||||||||||||||||||||
Pay fixed/receive variable — securities | 405 | 48 | 4.5 | 3.4 | 0.7 | — | — | |||||||||||||||||||||||||
Total portfolio swaps | $ | 41,200 | $ | (2,013) | (c) | 2.8 | 1.7 | % | 4.2 | % | $ | 38,562 | $ | 273 | (c) | |||||||||||||||||
December 31, 2022 | Short-Term Borrowings | Long-Term Deposits(a) | Senior Long-Term Debt | Subordinated Long-Term Debt | Capital Securities | Preferred Stock | ||||||||||||||
KEYCORP (THE PARENT COMPANY) | ||||||||||||||||||||
Standard & Poor’s | A-2 | N/A | BBB+ | BBB | BB+ | BB+ | ||||||||||||||
Moody’s | P-2 | N/A | Baa1 | Baa1 | Baa2 | Baa3 | ||||||||||||||
Fitch | F1 | N/A | A- | N/A | BB+ | BB+ | ||||||||||||||
DBRS | R-1 (low) | N/A | A | A (low) | A (low) | BBB | ||||||||||||||
KEYBANK | ||||||||||||||||||||
Standard & Poor’s | A-2 | N/A | A- | BBB+ | N/A | N/A | ||||||||||||||
Moody’s | P-2 | P-1/A1 | A3 | Baa1 | N/A | N/A | ||||||||||||||
Fitch | F1 | F1/A | A- | BBB+ | N/A | N/A | ||||||||||||||
DBRS | R-1 (middle) | A (high) | A (high) | A | N/A | N/A |
2022 | 2021 | ||||||||||||||||||||||
December 31, Dollars in millions | Total Allowance | Percent of Allowance to Total Allowance | Percent of Loan Type to Total Loans | Total Allowance | Percent of Allowance to Total Allowance | Percent of Loan Type to Total Loans | |||||||||||||||||
Commercial and industrial | $ | 601 | 45.0 | % | 50.0 | % | $ | 445 | 41.9 | % | 49.6 | % | |||||||||||
Commercial real estate: | |||||||||||||||||||||||
Commercial mortgage | 203 | 15.2 | 13.7 | 182 | 17.2 | 13.9 | |||||||||||||||||
Construction | 28 | 2.1 | 2.1 | 29 | 2.7 | 2.0 | |||||||||||||||||
Total commercial real estate loans | 231 | 17.3 | 15.8 | 211 | 19.9 | 15.9 | |||||||||||||||||
Commercial lease financing | 32 | 2.4 | 3.3 | 32 | 3.0 | 4.0 | |||||||||||||||||
Total commercial loans | 864 | 64.7 | 69.1 | 688 | 64.8 | 69.5 | |||||||||||||||||
Real estate — residential mortgage | 196 | 14.7 | 17.9 | 95 | 9.0 | 15.5 | |||||||||||||||||
Home equity loans | 98 | 7.3 | 6.6 | 110 | 10.4 | 8.3 | |||||||||||||||||
Consumer direct loans | 111 | 8.3 | 5.4 | 105 | 9.9 | 5.6 | |||||||||||||||||
Credit cards | 66 | 4.9 | .9 | 61 | 5.7 | 1.0 | |||||||||||||||||
Consumer indirect loans | 2 | .1 | .1 | 2 | .2 | .1 | |||||||||||||||||
Total consumer loans | 473 | 35.3 | 30.9 | 373 | 35.2 | 30.5 | |||||||||||||||||
Total loans (a) | $ | 1,337 | 100.0 | % | 100.0 | % | $ | 1,061 | 100.0 | % | 100.0 | % | |||||||||||
Year ended December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Commercial and industrial | $ | 103 | $ | 91 | ||||
Real estate — commercial mortgage | 18 | 31 | ||||||
Real estate — construction | (1) | — | ||||||
Commercial lease financing(a) | (2) | (1) | ||||||
Total commercial loans | 118 | 121 | ||||||
Real estate — residential mortgage(a) | (7) | (5) | ||||||
Home equity loans | (2) | 4 | ||||||
Consumer direct loans | 26 | 21 | ||||||
Credit cards | 24 | 19 | ||||||
Consumer indirect loans | 2 | 24 | ||||||
Total consumer loans | 43 | 63 | ||||||
Total net loan charge-offs | $ | 161 | $ | 184 | ||||
Net loan charge-offs to average loans | .14 | % | .18 | % | ||||
Net loan charge-offs from discontinued operations — education lending business | $ | 4 | $ | 2 |
Year ended December 31, | ||||||||
2022 | 2021 | |||||||
Commercial and industrial | 0.19 | % | 0.18 | % | ||||
Real estate — commercial mortgage | 0.12 | 0.24 | ||||||
Real estate — construction | (0.04) | — | ||||||
Commercial lease financing(a) | (0.05) | (0.02) | ||||||
Total commercial loans | 0.15 | 0.17 | ||||||
Real estate — residential mortgage(a) | (0.04) | (0.04) | ||||||
Home equity loans | (0.02) | 0.04 | ||||||
Consumer direct loans | 0.40 | 0.41 | ||||||
Credit cards | 2.50 | 2.05 | ||||||
Consumer indirect loans | 3.23 | 0.85 | ||||||
Total consumer loans | 0.12 | 0.21 | ||||||
Total net loan charge-offs | 0.14 | % | 0.18 | % | ||||
Year ended December 31, Dollars in millions | 2022 | 2021 | ||||||
Average loans outstanding | $ | 111,302 | $ | 100,269 | ||||
Allowance for loan and lease losses at beginning of period | $ | 1,061 | $ | 1,626 | ||||
Loans charged off: | ||||||||
Commercial and industrial | $ | 153 | $ | 174 | ||||
Real estate — commercial mortgage | 23 | 40 | ||||||
Real estate — construction | — | — | ||||||
Total commercial real estate loans (a) | 23 | 40 | ||||||
Commercial lease financing | 2 | 6 | ||||||
Total commercial loans (b) | 178 | 220 | ||||||
Real estate — residential mortgage | (2) | (2) | ||||||
Home equity loans | 1 | 9 | ||||||
Consumer direct loans | 34 | 29 | ||||||
Credit cards | 30 | 27 | ||||||
Consumer indirect loans | 4 | 39 | ||||||
Total consumer loans | 67 | 102 | ||||||
Total loans charged off | 245 | 322 | ||||||
Recoveries: | ||||||||
Commercial and industrial | 50 | 83 | ||||||
Real estate — commercial mortgage | 5 | 9 | ||||||
Real estate — construction | 1 | — | ||||||
Total commercial real estate loans (a) | 6 | 9 | ||||||
Commercial lease financing | 4 | 7 | ||||||
Total commercial loans (b) | 60 | 99 | ||||||
Real estate — residential mortgage | 5 | 3 | ||||||
Home equity loans | 3 | 5 | ||||||
Consumer direct loans | 8 | 8 | ||||||
Credit cards | 6 | 8 | ||||||
Consumer indirect loans | 2 | 15 | ||||||
Total consumer loans | 24 | 39 | ||||||
Total recoveries | 84 | 138 | ||||||
Net loan charge-offs | (161) | (184) | ||||||
Provision (credit) for loan and lease losses | 437 | (381) | ||||||
Allowance for loan and lease losses at end of year | $ | 1,337 | $ | 1,061 | ||||
Liability for credit losses on lending-related commitments at beginning of the year | 160 | 197 | ||||||
Provision (credit) for losses on lending-related commitments | 65 | (37) | ||||||
Liability for credit losses on lending-related commitments at end of the year (c) | $ | 225 | $ | 160 | ||||
Total allowance for credit losses at end of the year | $ | 1,562 | $ | 1,221 | ||||
Net loan charge-offs to average total loans | .14 | % | .18 | % | ||||
Allowance for loan and lease losses to period-end loans | 1.12 | 1.04 | ||||||
Allowance for credit losses to period-end loans | 1.31 | 1.20 | ||||||
Allowance for loan and lease losses to nonperforming loans | 345.5 | 233.7 | ||||||
Allowance for credit losses to nonperforming loans | 403.6 | 268.9 | ||||||
Discontinued operations — education lending business: | ||||||||
Loans charged off | $ | 6 | $ | 4 | ||||
Recoveries | 2 | 2 | ||||||
Net loan charge-offs | $ | (4) | $ | (2) | ||||
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Commercial and industrial | $ | 174 | $ | 191 | ||||
Real estate — commercial mortgage | 21 | 44 | ||||||
Real estate — construction | — | — | ||||||
Total commercial real estate loans (a) | 21 | 44 | ||||||
Commercial lease financing | 1 | 4 | ||||||
Total commercial loans (b) | 196 | 239 | ||||||
Real estate — residential mortgage | 77 | 72 | ||||||
Home equity loans | 107 | 135 | ||||||
Consumer direct loans | 3 | 4 | ||||||
Credit cards | 3 | 3 | ||||||
Consumer indirect loans | 1 | 1 | ||||||
Total consumer loans | 191 | 215 | ||||||
Total nonperforming loans | 387 | 454 | ||||||
Nonperforming loans held for sale | 20 | 24 | ||||||
OREO | 13 | 8 | ||||||
Other nonperforming assets | — | 3 | ||||||
Total nonperforming assets | $ | 420 | $ | 489 | ||||
Accruing loans past due 90 days or more | $ | 60 | $ | 68 | ||||
Accruing loans past due 30 through 89 days | 180 | 165 | ||||||
Restructured loans — accruing and nonaccruing (c) | 236 | 220 | ||||||
Restructured loans included in nonperforming loans (c) | 118 | 99 | ||||||
Nonperforming assets from discontinued operations — education lending business | 3 | 4 | ||||||
Nonperforming loans to period-end portfolio loans | .32 | % | .45 | % | ||||
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets (c) | .35 | .48 | ||||||
2022 Quarters | ||||||||||||||||||||
Dollars in millions | 2022 | Fourth | Third | Second | First | 2021 | ||||||||||||||
Balance at beginning of period | $ | 454 | $ | 390 | $ | 429 | $ | 439 | $ | 454 | $ | 785 | ||||||||
Loans placed on nonaccrual status | 398 | 113 | 80 | 118 | 87 | 614 | ||||||||||||||
Charge-offs | (244) | (67) | (68) | (59) | (50) | (326) | ||||||||||||||
Loans sold | (15) | (4) | (3) | (8) | — | (78) | ||||||||||||||
Payments | (113) | (22) | (29) | (35) | (27) | (333) | ||||||||||||||
Transfers to OREO | (5) | (1) | (1) | (2) | (1) | (5) | ||||||||||||||
Loans returned to accrual status | (88) | (22) | (18) | (24) | (24) | (203) | ||||||||||||||
Balance at end of period | $ | 387 | $ | 387 | $ | 390 | $ | 429 | $ | 439 | $ | 454 | ||||||||
Year ended December 31, | ||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | |||||||||||
Tangible common equity to tangible assets at period end | ||||||||||||||
Key shareholders’ equity (GAAP) | $ | 13,454 | $ | 17,423 | $ | 17,981 | ||||||||
Less: | Intangible assets (a) | 2,844 | 2,820 | 2,848 | ||||||||||
Preferred Stock (b) | 2,446 | 1,856 | 1,856 | |||||||||||
Tangible common equity (non-GAAP) | $ | 8,164 | $ | 12,747 | $ | 13,277 | ||||||||
Total assets (GAAP) | $ | 189,813 | $ | 186,346 | $ | 170,336 | ||||||||
Less: | Intangible assets (a) | 2,844 | 2,820 | 2,848 | ||||||||||
Tangible assets (non-GAAP) | $ | 186,969 | $ | 183,526 | $ | 167,488 | ||||||||
Tangible common equity to tangible assets ratio (non-GAAP) | 4.37 | % | 6.95 | % | 7.93 | % | ||||||||
Average tangible common equity | ||||||||||||||
Average Key shareholders’ equity (GAAP) | $ | 14,730 | $ | 17,665 | $ | 17,636 | ||||||||
Less: | Intangible assets (average) (c) | 2,839 | 2,829 | 2,878 | ||||||||||
Preferred Stock (average) | 2,114 | 1,900 | 1,900 | |||||||||||
Average tangible common equity (non-GAAP) | $ | 9,777 | $ | 12,936 | $ | 12,858 | ||||||||
Return on average tangible common equity from continuing operations | ||||||||||||||
Income (loss) from continuing operations attributable to Key common shareholders (GAAP) | $ | 1,793 | $ | 2,506 | $ | 1,223 | ||||||||
Average tangible common equity (non-GAAP) | $ | 9,777 | $ | 12,936 | $ | 12,858 | ||||||||
Return on average tangible common equity from continuing operations (non-GAAP) | 18.34 | % | 19.37 | % | 9.51 | % | ||||||||
Return on average tangible common equity consolidated | ||||||||||||||
Net income (loss) attributable to Key common shareholders (GAAP) | $ | 1,799 | $ | 2,519 | $ | 1,237 | ||||||||
Average tangible common equity (non-GAAP) | 9,777 | 12,936 | 12,858 | |||||||||||
Return on average tangible common equity consolidated (non-GAAP) | 18.40 | % | 19.47 | % | 9.62 | % |
Year ended December 31, | ||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | |||||||||||
Cash efficiency ratio | ||||||||||||||
Noninterest expense (GAAP) | $ | 4,410 | $ | 4,429 | $ | 4,109 | ||||||||
Less: | Intangible asset amortization (GAAP) | 47 | 58 | 65 | ||||||||||
Adjusted noninterest expense (non-GAAP) | $ | 4,363 | $ | 4,371 | $ | 4,044 | ||||||||
Net interest income (GAAP) | $ | 4,527 | $ | 4,071 | $ | 4,034 | ||||||||
Plus: | TE adjustment | 27 | 27 | 29 | ||||||||||
Noninterest income (GAAP) | 2,718 | 3,194 | 2,652 | |||||||||||
Total TE revenue (non-GAAP) | $ | 7,272 | $ | 7,292 | $ | 6,715 | ||||||||
Cash efficiency ratio (non-GAAP) | 60.0 | % | 59.9 | % | 60.2 | % |
Standard | Required Adoption | Description | Effect on Financial Statements or Other Significant Matters | ||||||||
ASU 2022-03, Fair Value Measurement - Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (Topic 820) | January 1, 2024 Early adoption is permitted. | The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and is not considered in measuring fair value. Entities cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments require disclosures for equity securities subject to contractual restrictions including; the fair value of equity securities subject to contractual sale restrictions reflected in the balance sheet, the nature and remaining duration of the restriction(s) and the circumstances that could cause a lapse in the restriction(s). The guidance should be applied prospectively with any adjustments from the adoption of the amendments recognized in earnings and disclosed on the date of adoption. | The guidance is not expected to have a material impact on Key’s financial condition or results of operations. |
Page Number | |||||
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42) | |||||
Cleveland, Ohio | ||
February 22, 2023 |
Allowance for Loan and Lease Losses | ||||||||
Description of the matter | KeyCorp’s loan and lease portfolio totaled $119.4 billion as of December 31, 2022 and the associated ALLL was $1.3 billion. As discussed in Note 1 and 5 of the financial statements, the ALLL represents management’s current estimate of lifetime credit losses inherent in the loan portfolio at the balance sheet date. Management estimates the ALLL using relevant available information, from internal and external sources, relating to past events, current portfolio specific and economic conditions, and reasonable and supportable forecasts. The ALLL is the sum of (i) asset specific / individual loan reserves; (ii) quantitative (formulaic or pooled) reserves; and (iii) qualitative (judgmental) reserves. Management estimates the quantitative reserves using probability of default / loss given default / exposure at default models (“loss forecasting models”), as well as other estimation methods for smaller loan portfolios. The ALLL also considers qualitative factors related to idiosyncratic risk factors, changes in current economic conditions that may not be reflected in quantitatively derived results, and other relevant factors to reflect management’s best estimate of current expected credit losses. Auditing management’s ALLL was complex due to the loss forecasting models used to compute the quantitative reserve and involves a high degree of subjectivity and judgment in evaluating management’s determination of the economic forecast and qualitative factor adjustments to the ALLL described above. | |||||||
How we addressed the matter in our audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the KeyCorp’s ALLL process, including controls over the appropriateness of the ALLL methodology, the development, operation and monitoring of loss forecasting models, the reliability and accuracy of data used in developing the ALLL estimate, and management’s review and approval process over the economic forecast, qualitative adjustments and overall ALLL results. With the assistance of EY specialists we tested management’s loss forecasting models including evaluating the conceptual soundness of model methodology, assessing model performance and governance, testing key modeling assumptions, including the reasonable and supportable forecast period, and independently recalculating model output. We also verified the underlying economic forecast data used to estimate the quantitative reserve was complete and accurate. To test the qualitative factor adjustments, among other procedures, we assessed management’s methodology and considered whether relevant risks were reflected in the models and whether adjustments to the model output were appropriate. We tested the completeness, accuracy and relevance of the underlying data used to estimate the qualitative adjustments. We evaluated whether qualitative adjustments were reasonable based on changes in economic conditions, the loan portfolio, management’s policies and procedures, and lending personnel. For example, we evaluated the reasonableness of qualitative adjustments (or lack thereof) for concentrations of credit by independently comparing to loan portfolio information. We also assessed whether qualitative adjustments were consistent with publicly available information (e.g. macroeconomic data). Further, we performed an independent search for the existence of new or contrary information relating to risks impacting the qualitative factor adjustments to validate that management’s considerations are appropriate. Additionally, we evaluated whether the overall ALLL, inclusive of qualitative factor adjustments, appropriately reflects losses expected in the loan and lease portfolio by comparing to peer bank data. |
We have served as KeyCorp’s auditor since 1994. | ||
Cleveland, Ohio | ||
February 22, 2023 |
December 31, | ||||||||
Dollars in millions, except per share data | 2022 | 2021 | ||||||
ASSETS | ||||||||
Cash and due from banks | $ | 887 | $ | 913 | ||||
Short-term investments | 2,432 | 11,010 | ||||||
Trading account assets | 829 | 701 | ||||||
Securities available for sale | 39,117 | 45,364 | ||||||
Held-to-maturity securities (fair value: $8,113 and $7,665) | 8,710 | 7,539 | ||||||
Other investments | 1,308 | 639 | ||||||
Loans, net of unearned income of $368 and $373 | 119,394 | 101,854 | ||||||
Allowance for loan and lease losses | (1,337) | (1,061) | ||||||
Net loans | 118,057 | 100,793 | ||||||
Loans held for sale (a) | 963 | 2,729 | ||||||
Premises and equipment | 636 | 681 | ||||||
Goodwill | 2,752 | 2,693 | ||||||
Other intangible assets | 94 | 130 | ||||||
Corporate-owned life insurance | 4,369 | 4,327 | ||||||
Accrued income and other assets | 9,223 | 8,265 | ||||||
Discontinued assets | 436 | 562 | ||||||
Total assets | $ | 189,813 | $ | 186,346 | ||||
LIABILITIES | ||||||||
Deposits in domestic offices: | ||||||||
NOW and money market deposit accounts | $ | 86,707 | $ | 89,207 | ||||
Savings deposits | 7,681 | 7,503 | ||||||
Certificates of deposit ($100,000 or more) | 1,708 | 1,705 | ||||||
Other time deposits | 5,665 | 2,153 | ||||||
Total interest-bearing deposits | 101,761 | 100,568 | ||||||
Noninterest-bearing deposits | 40,834 | 52,004 | ||||||
Total deposits | 142,595 | 152,572 | ||||||
Federal funds purchased and securities sold under repurchase agreements | 4,077 | 173 | ||||||
Bank notes and other short-term borrowings | 5,386 | 588 | ||||||
Accrued expense and other liabilities | 4,994 | 3,548 | ||||||
Long-term debt | 19,307 | 12,042 | ||||||
Total liabilities | 176,359 | 168,923 | ||||||
EQUITY | ||||||||
Preferred stock | 2,500 | 1,900 | ||||||
Common Shares, $1 par value; authorized 2,100,000,000 and 2,100,000,000 shares; issued 1,256,702,081 and 1,256,702,081 shares | 1,257 | 1,257 | ||||||
Capital surplus | 6,286 | 6,278 | ||||||
Retained earnings | 15,616 | 14,553 | ||||||
Treasury stock, at cost (323,377,500 and 327,852,311 shares) | (5,910) | (5,979) | ||||||
Accumulated other comprehensive income (loss) | (6,295) | (586) | ||||||
Total equity | 13,454 | 17,423 | ||||||
Total liabilities and equity | $ | 189,813 | $ | 186,346 | ||||
Year ended December 31, | |||||||||||
Dollars in millions, except per share amounts | 2022 | 2021 | 2020 | ||||||||
INTEREST INCOME | |||||||||||
Loans | $ | 4,241 | $ | 3,532 | $ | 3,866 | |||||
Loans held for sale | 56 | 50 | 69 | ||||||||
Securities available for sale | 752 | 546 | 484 | ||||||||
Held-to-maturity securities | 213 | 185 | 222 | ||||||||
Trading account assets | 31 | 19 | 20 | ||||||||
Short-term investments | 97 | 28 | 18 | ||||||||
Other investments | 22 | 7 | 6 | ||||||||
Total interest income | 5,412 | 4,367 | 4,685 | ||||||||
INTEREST EXPENSE | |||||||||||
Deposits | 279 | 67 | 347 | ||||||||
Federal funds purchased and securities sold under repurchase agreements | 41 | — | 6 | ||||||||
Bank notes and other short-term borrowings | 90 | 8 | 12 | ||||||||
Long-term debt | 475 | 221 | 286 | ||||||||
Total interest expense | 885 | 296 | 651 | ||||||||
NET INTEREST INCOME | 4,527 | 4,071 | 4,034 | ||||||||
Provision for credit losses | 502 | (418) | 1,021 | ||||||||
Net interest income after provision for credit losses | 4,025 | 4,489 | 3,013 | ||||||||
NONINTEREST INCOME | |||||||||||
Trust and investment services income | 526 | 530 | 507 | ||||||||
Investment banking and debt placement fees | 638 | 937 | 661 | ||||||||
Service charges on deposit accounts | 350 | 337 | 311 | ||||||||
Operating lease income and other leasing gains | 103 | 148 | 167 | ||||||||
Corporate services income | 372 | 288 | 213 | ||||||||
Cards and payments income | 341 | 415 | 368 | ||||||||
Corporate-owned life insurance income | 132 | 128 | 139 | ||||||||
Consumer mortgage income | 58 | 131 | 176 | ||||||||
Commercial mortgage servicing fees | 167 | 160 | 80 | ||||||||
Other income(a) | 31 | 120 | 30 | ||||||||
Total noninterest income | 2,718 | 3,194 | 2,652 | ||||||||
NONINTEREST EXPENSE | |||||||||||
Personnel | 2,566 | 2,561 | 2,336 | ||||||||
Net occupancy | 295 | 300 | 298 | ||||||||
Computer processing | 314 | 284 | 232 | ||||||||
Business services and professional fees | 212 | 227 | 196 | ||||||||
Equipment | 92 | 100 | 100 | ||||||||
Operating lease expense | 101 | 126 | 138 | ||||||||
Marketing | 123 | 126 | 97 | ||||||||
Other expense | 707 | 705 | 712 | ||||||||
Total noninterest expense | 4,410 | 4,429 | 4,109 | ||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 2,333 | 3,254 | 1,556 | ||||||||
Income taxes | 422 | 642 | 227 | ||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 1,911 | 2,612 | 1,329 | ||||||||
Income (loss) from discontinued operations | 6 | 13 | 14 | ||||||||
NET INCOME (LOSS) | 1,917 | 2,625 | 1,343 | ||||||||
Less: Net income (loss) attributable to noncontrolling interests | — | — | — | ||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO KEY | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||
Income (loss) from continuing operations attributable to Key common shareholders | $ | 1,793 | $ | 2,506 | $ | 1,223 | |||||
Net income (loss) attributable to Key common shareholders | 1,799 | 2,519 | 1,237 | ||||||||
Per Common Share: | |||||||||||
Income (loss) from continuing operations attributable to Key common shareholders | $ | 1.94 | $ | 2.64 | $ | 1.26 | |||||
Income (loss) from discontinued operations, net of taxes | .01 | .01 | .01 | ||||||||
Net income (loss) attributable to Key common shareholders (b) | 1.94 | 2.65 | 1.28 | ||||||||
Per Common Share — assuming dilution: | |||||||||||
Income (loss) from continuing operations attributable to Key common shareholders | $ | 1.92 | $ | 2.62 | $ | 1.26 | |||||
Income (loss) from discontinued operations, net of taxes | .01 | .01 | .01 | ||||||||
Net income (loss) attributable to Key common shareholders (b) | 1.93 | 2.63 | 1.27 | ||||||||
Weighted-average Common Shares outstanding (000) | 924,363 | 947,065 | 967,783 | ||||||||
Effect of convertible preferred stock | — | — | — | ||||||||
Effect of Common Share options and other stock awards | 8,696 | 10,349 | 7,024 | ||||||||
Weighted-average Common Shares and potential Common Shares outstanding (000)(c) | 933,059 | 957,414 | 974,807 |
Year ended December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
Net income (loss) | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Net unrealized gains (losses) on securities available for sale, net of income taxes of $1,415, $306, and $(143) | (4,492) | (970) | 452 | ||||||||
Net unrealized gains (losses) on derivative financial instruments, net of income taxes of $382, $122, and $(72) | (1,212) | (388) | 226 | ||||||||
Net pension and postretirement benefit costs, net of income taxes of $1, $(11), and $(9) | (5) | 34 | 34 | ||||||||
Total other comprehensive income (loss), net of tax | (5,709) | (1,324) | 712 | ||||||||
Comprehensive income (loss) attributable to Key | $ | (3,792) | $ | 1,301 | $ | 2,055 | |||||
Key Shareholders’ Equity | |||||||||||||||||||||||||||||
Dollars in millions, except per share amounts | Preferred Shares Outstanding (000) | Common Shares Outstanding (000) | Preferred Stock | Common Shares | Capital Surplus | Retained Earnings | Treasury Stock, at Cost | Accumulated Other Comprehensive Income (Loss) | Total Shareholder’s Equity | ||||||||||||||||||||
BALANCE AT DECEMBER 31, 2019 | 1,396 | 977,189 | $ | 1,900 | $ | 1,257 | $ | 6,295 | $ | 12,469 | $ | (4,909) | $ | 26 | $ | 17,038 | |||||||||||||
(230) | (230) | ||||||||||||||||||||||||||||
Net income (loss) | 1,343 | 1,343 | |||||||||||||||||||||||||||
Other reclassification of AOCI | (2) | (2) | |||||||||||||||||||||||||||
Other comprehensive income (loss) | 712 | 712 | |||||||||||||||||||||||||||
Deferred compensation | 4 | 4 | |||||||||||||||||||||||||||
Cash dividends declared | |||||||||||||||||||||||||||||
Common Shares ($.74 per share) | (723) | (723) | |||||||||||||||||||||||||||
Series D Preferred Stock ($50.00 per depositary share) | (26) | (26) | |||||||||||||||||||||||||||
Series E Preferred Stock ($1.531252 per depositary share) | (31) | (31) | |||||||||||||||||||||||||||
Series F Preferred Stock ($1.4125 per depositary share) | (24) | (24) | |||||||||||||||||||||||||||
Series G Preferred Stock ($.1.406252 per depositary share) | (25) | (25) | |||||||||||||||||||||||||||
Open market Common Share repurchases | (7,151) | (134) | (134) | ||||||||||||||||||||||||||
Employee equity compensation program Common Share repurchases | (1,823) | (18) | (36) | (54) | |||||||||||||||||||||||||
Common shares reissued (returned) for stock options and other employee benefit plans | 7,558 | 133 | 133 | ||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2020 | 1,396 | 975,773 | $ | 1,900 | $ | 1,257 | $ | 6,281 | $ | 12,751 | $ | (4,946) | $ | 738 | $ | 17,981 | |||||||||||||
Net income (loss) | 2,625 | 2,625 | |||||||||||||||||||||||||||
Other comprehensive income (loss) | (1,324) | (1,324) | |||||||||||||||||||||||||||
Deferred compensation | 9 | 9 | |||||||||||||||||||||||||||
Cash dividends declared | |||||||||||||||||||||||||||||
Common Shares ($.75 per share) | (717) | (717) | |||||||||||||||||||||||||||
Series D Preferred Stock ($50.00 per depositary share) | (26) | (26) | |||||||||||||||||||||||||||
Series E Preferred Stock ($1.531252 per depositary share) | (31) | (31) | |||||||||||||||||||||||||||
Series F Preferred Stock ($1.4125 per depositary share) | (25) | (25) | |||||||||||||||||||||||||||
Series G Preferred Stock ($1.406252 per depositary share) | (24) | (24) | |||||||||||||||||||||||||||
Open market Common Share repurchases | (27,346) | (559) | (559) | ||||||||||||||||||||||||||
Employee equity compensation program Common Share repurchases | (1,611) | — | (32) | (32) | |||||||||||||||||||||||||
Common Shares reissued (returned) for stock options and other employee benefit plans | 8,061 | (12) | 143 | 131 | |||||||||||||||||||||||||
Common Share repurchases under ASR program (b) | (26,027) | — | (585) | (585) | |||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2021 | 1,396 | 928,850 | $ | 1,900 | $ | 1,257 | $ | 6,278 | $ | 14,553 | $ | (5,979) | $ | (586) | $ | 17,423 | |||||||||||||
Net income (loss) | 1,917 | 1,917 | |||||||||||||||||||||||||||
Other comprehensive income (loss) | (5,709) | (5,709) | |||||||||||||||||||||||||||
Deferred compensation | (6) | (6) | |||||||||||||||||||||||||||
Cash dividends declared | |||||||||||||||||||||||||||||
Common Shares ($.79 per share) | (736) | (736) | |||||||||||||||||||||||||||
Series D Preferred Stock ($50.00 per depositary share) | (26) | (26) | |||||||||||||||||||||||||||
Series E Preferred Stock ($1.531252 per depositary share) | (31) | (31) | |||||||||||||||||||||||||||
Series F Preferred Stock ($1.4125 per depositary share) | (24) | (24) | |||||||||||||||||||||||||||
Series G Preferred Stock ($1.406252 per depositary share) | (25) | (25) | |||||||||||||||||||||||||||
Series H Preferred Stock ( $.477917 per depositary share) | (12) | (12) | |||||||||||||||||||||||||||
Open market Common Share repurchases | — | — | |||||||||||||||||||||||||||
Employee equity compensation program Common Share repurchases | (1,736) | (44) | (44) | ||||||||||||||||||||||||||
Common Shares reissued (returned) for stock options and other employee benefit plans | 6,211 | 24 | 113 | 137 | |||||||||||||||||||||||||
Issuance of Series H Preferred stock | 600 | 600 | (10) | 590 | |||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2022 | 1,996 | 933,325 | $ | 2,500 | $ | 1,257 | $ | 6,286 | $ | 15,616 | $ | (5,910) | $ | (6,295) | $ | 13,454 | |||||||||||||
Year ended December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
OPERATING ACTIVITIES | |||||||||||
Net income (loss) | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||
Provision for credit losses | 502 | (418) | 1,021 | ||||||||
Depreciation and amortization expense, net | 137 | 32 | 111 | ||||||||
Accretion of acquired loans | 27 | 24 | 28 | ||||||||
Increase in cash surrender value of corporate-owned life insurance | (113) | (113) | (119) | ||||||||
Stock-based compensation expense | 120 | 104 | 101 | ||||||||
Deferred income taxes (benefit) | (27) | 146 | (191) | ||||||||
Proceeds from sales of loans held for sale | 12,496 | 16,114 | 14,076 | ||||||||
Originations of loans held for sale, net of repayments | (10,684) | (16,497) | (13,856) | ||||||||
Net losses (gains) from sale of loans held for sale | (151) | (282) | (233) | ||||||||
Net losses (gains) on leased equipment | 7 | (12) | (21) | ||||||||
Net securities losses (gains) | (9) | (7) | (4) | ||||||||
Net losses (gains) on sales of fixed assets | (7) | 18 | 5 | ||||||||
Net decrease (increase) in trading account assets | (128) | 34 | 305 | ||||||||
Other operating activities, net | 382 | (615) | (893) | ||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 4,469 | 1,153 | 1,673 | ||||||||
INVESTING ACTIVITIES | |||||||||||
Purchases of intangible assets via acquisitions | (12) | — | — | ||||||||
Cash received (used) in acquisitions, net of cash acquired | (58) | (29) | — | ||||||||
Net decrease (increase) in short-term investments, excluding acquisitions | 8,578 | 5,184 | (14,922) | ||||||||
Purchases of securities available for sale | (4,473) | (28,190) | (15,619) | ||||||||
Proceeds from sales of securities available for sale | — | 1,375 | 583 | ||||||||
Proceeds from prepayments and maturities of securities available for sale | 4,545 | 7,623 | 9,923 | ||||||||
Proceeds from prepayments and maturities of held-to-maturity securities | 2,291 | 2,889 | 2,493 | ||||||||
Purchases of held-to-maturity securities | (3,670) | (3) | (17) | ||||||||
Purchases of other investments | (667) | (55) | (134) | ||||||||
Proceeds from sales of other investments | 17 | 41 | 101 | ||||||||
Proceeds from prepayments and maturities of other investments | 15 | 26 | 15 | ||||||||
Net decrease (increase) in loans, excluding acquisitions, sales, and transfers | (17,649) | (4,276) | (7,358) | ||||||||
Proceeds from sales of portfolio loans | 157 | 337 | 211 | ||||||||
Proceeds from corporate-owned life insurance | 72 | 72 | 66 | ||||||||
Purchases of premises, equipment, and software | (96) | (66) | (63) | ||||||||
Proceeds from sales of premises and equipment | 16 | 4 | — | ||||||||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | (10,934) | (15,068) | (24,721) | ||||||||
FINANCING ACTIVITIES | |||||||||||
Net increase (decrease) in deposits, excluding acquisitions | (9,977) | 17,290 | 23,412 | ||||||||
Net increase (decrease) in short-term borrowings | 8,702 | (218) | (113) | ||||||||
Net proceeds from issuance of long-term debt | 16,596 | 1,203 | 3,607 | ||||||||
Payments on long-term debt | (8,580) | (2,566) | (2,508) | ||||||||
Issuance of preferred shares | 590 | — | — | ||||||||
Open market common share repurchases | — | (559) | (134) | ||||||||
Employee equity compensation program Common Share repurchases | (44) | (32) | (36) | ||||||||
Common share purchases under ASR program | — | (585) | — | ||||||||
Net proceeds from reissuance of Common Shares | 6 | 27 | 8 | ||||||||
Cash dividends paid | (854) | (823) | (829) | ||||||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 6,439 | 13,737 | 23,407 | ||||||||
NET INCREASE (DECREASE) IN CASH AND DUE FROM BANKS | (26) | (178) | 359 | ||||||||
CASH AND DUE FROM BANKS AT BEGINNING OF YEAR | 913 | 1,091 | 732 | ||||||||
CASH AND DUE FROM BANKS AT END OF YEAR | $ | 887 | $ | 913 | $ | 1,091 | |||||
Additional disclosures relative to cash flows: | |||||||||||
Interest paid | $ | 601 | $ | 363 | $ | 731 | |||||
Income taxes paid | 292 | 277 | 241 | ||||||||
Noncash items: | |||||||||||
Reduction of secured borrowing and related collateral | $ | 9 | $ | 9 | $ | 7 | |||||
Loans transferred to portfolio from held for sale | 105 | 87 | 75 | ||||||||
Loans transferred to held for sale from portfolio | — | 3,403 | 310 | ||||||||
Loans transferred to other real estate owned | 6 | 4 | 96 | ||||||||
CMBS risk retentions | 12 | 28 | 40 | ||||||||
ABS risk retentions | 8 | 11 | 19 | ||||||||
Securities received as consideration | — | 2,825 | — |
Standard | Date of Adoption | Description | Effect on Financial Statements or Other Significant Matters | ||||||||
ASU 2020-04 and ASU 2021-01 — Reference Rate Reform (Topic 848) | March 12, 2020 through December 31, 2024 | London Interbank Offered Rate (LIBOR), a reference rate presumed to capture bank funding costs, is being phased out and will no longer be published. This transition to alternate rates will impact, among other things, contracts that reference LIBOR. This ASU provides relief from cumbersome accounting consequences for certain qualifying contract modifications undertaken as a result of reference rate reform. | Key has established an enterprise-wide program to identify and address all LIBOR related matters. We have elected to apply certain optional expedients for contract modifications and hedging relationships to derivative instruments impacted by the market-wide discounting transition. These optional expedients remove the requirement to remeasure contract modifications or dedesignate hedging relationships due to reference rate reform. We plan to elect any optional expedients for contract modifications and hedging relationships to any other financial instruments falling under the scope of reference rate reform. | ||||||||
ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40) | January 1, 2022 | The ASU simplifies the accounting for convertible debt instruments by eliminating the legacy accounting models for convertible instruments with beneficial conversion features or cash conversion features. The guidance also amends the guidance used to determine if a freestanding financial instrument or an embedded feature qualifies for a scope exception from derivative accounting. For freestanding financial instruments and embedded features that have all the characteristics of a derivative instrument and are potentially settled in an entity’s own stock, the guidance simplifies the settlement assessment that entities are required to perform. Also, this update now requires the use of the if-converted method for all convertible instruments and includes the effect of potential share settlement in diluted EPS if the effect is more dilutive. The new guidance also makes clarifications to the EPS calculation. Further, the ASU expands disclosure requirements. The guidance should be applied on a modified retrospective or retrospective basis. | The adoption of this accounting guidance did not have a material effect on our financial condition or results of operations. |
Standard | Date of Adoption | Description | Effect on Financial Statements or Other Significant Matters | ||||||||
ASU 2021-08, Business Combinations (Topic 805) | January 1, 2023 Early adoption is permitted. | At the acquisition date, an acquirer must account for any acquired revenue contracts in accordance with Topic 606 as if it had originated the contracts (i.e. measure contract assets and liabilities, generally consistent with acquiree's financial statements). The guidance should be applied on a prospective basis. | The adoption of this guidance did not have a material impact on Key’s financial condition or results of operations. | ||||||||
ASU 2022-01, Derivatives and Hedging (Topic 815) | January 1, 2023 Early adoption is permitted. | This guidance allows entities to apply the same portfolio hedging method to both prepayable and nonprepayable financial assets. It also allows multiple hedged layers to be designated for a single closed portfolio of financial assets or one or more beneficial interests secured by a portfolio of financial instruments. If a breach is anticipated, an entity is required to partially or fully dedesignate a hedged layer or layers until a breach is no longer anticipated. There are additional requirements and enhanced disclosures related to basis adjustments. The guidance should be applied on a prospective, retrospective or modified retrospective basis depending on the amendment. | The adoption of this guidance did not have a material impact on Key’s financial condition or results of operations. | ||||||||
ASU 2022-02, Financial Instruments—Credit Losses (Topic 326) | January 1, 2023 Early adoption is permitted. | The amendments eliminate current Troubled Debt Restructuring (TDR) guidance and instead require entities to apply the loan refinancing and restructuring guidance to determine whether a modification results in a new loan or is a continuation of an existing loan. Entities must disclose current-period gross write-offs on an amortized cost basis by credit quality indicator and class of financing receivable by year of origination. The guidance should be applied on a prospective basis except for amendments related to recognition and measurement of TDRs, where a modified retrospective transition method is optional. | The adoption of this guidance did not have a material impact on Key's financial condition or results of operations. |
Year ended December 31, | |||||||||||
Dollars in millions, except per share amounts | 2022 | 2021 | 2020 | ||||||||
EARNINGS | |||||||||||
Income (loss) from continuing operations | $ | 1,911 | $ | 2,612 | $ | 1,329 | |||||
Less: Net income (loss) attributable to noncontrolling interests | — | — | — | ||||||||
Income (loss) from continuing operations attributable to Key | 1,911 | 2,612 | 1,329 | ||||||||
Less: Dividends on preferred stock | 118 | 106 | 106 | ||||||||
Income (loss) from continuing operations attributable to Key common shareholders | 1,793 | 2,506 | 1,223 | ||||||||
Income (loss) from discontinued operations, net of taxes | 6 | 13 | 14 | ||||||||
Net income (loss) attributable to Key common shareholders | $ | 1,799 | $ | 2,519 | $ | 1,237 | |||||
WEIGHTED-AVERAGE COMMON SHARES | |||||||||||
Weighted-average Common Shares outstanding (000) | 924,363 | 947,065 | 967,783 | ||||||||
Effect of common share options and other stock awards | 8,696 | 10,349 | 7,024 | ||||||||
Weighted-average common shares and potential Common Shares outstanding (000) (a) | 933,059 | 957,414 | 974,807 | ||||||||
EARNINGS PER COMMON SHARE | |||||||||||
Income (loss) from continuing operations attributable to Key common shareholders | $ | 1.94 | $ | 2.64 | $ | 1.26 | |||||
Income (loss) from discontinued operations, net of taxes | .01 | .01 | .01 | ||||||||
Net income (loss) attributable to Key common shareholders (b) | 1.94 | 2.65 | 1.28 | ||||||||
Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution | 1.92 | 2.62 | 1.26 | ||||||||
Income (loss) from discontinued operations, net of taxes — assuming dilution | .01 | .01 | .01 | ||||||||
Net income (loss) attributable to Key common shareholders — assuming dilution (b) | 1.93 | 2.63 | 1.27 |
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Commercial and industrial (b) | $ | 59,647 | $ | 50,525 | ||||
Commercial real estate: | ||||||||
Commercial mortgage | 16,352 | 14,244 | ||||||
Construction | 2,530 | 1,996 | ||||||
Total commercial real estate loans | 18,882 | 16,240 | ||||||
Commercial lease financing (c) | 3,936 | 4,071 | ||||||
Total commercial loans | 82,465 | 70,836 | ||||||
Residential — prime loans: | ||||||||
Real estate — residential mortgage | 21,401 | 15,756 | ||||||
Home equity loans | 7,951 | 8,467 | ||||||
Total residential — prime loans | 29,352 | 24,223 | ||||||
Consumer direct loans | 6,508 | 5,753 | ||||||
Credit cards | 1,026 | 972 | ||||||
Consumer indirect loans | 43 | 70 | ||||||
Total consumer loans | 36,929 | 31,018 | ||||||
Total loans (d) | $ | 119,394 | $ | 101,854 | ||||
Dollars in millions | December 31, 2021 | Provision | Charge-offs | Recoveries | December 31, 2022 | |||||||||||||||
Commercial and Industrial | $ | 445 | $ | 259 | $ | (153) | $ | 50 | $ | 601 | ||||||||||
Commercial real estate: | ||||||||||||||||||||
Real estate — commercial mortgage | 182 | 39 | (23) | 5 | 203 | |||||||||||||||
Real estate — construction | 29 | (2) | — | 1 | 28 | |||||||||||||||
Total commercial real estate loans | 211 | 37 | (23) | 6 | 231 | |||||||||||||||
Commercial lease financing | 32 | (2) | (2) | 4 | 32 | |||||||||||||||
Total commercial loans | 688 | 294 | (178) | 60 | 864 | |||||||||||||||
Real estate — residential mortgage | 95 | 94 | 2 | 5 | 196 | |||||||||||||||
Home equity loans | 110 | (14) | (1) | 3 | 98 | |||||||||||||||
Consumer direct loans | 105 | 32 | (34) | 8 | 111 | |||||||||||||||
Credit cards | 61 | 29 | (30) | 6 | 66 | |||||||||||||||
Consumer indirect loans | 2 | 2 | (4) | 2 | 2 | |||||||||||||||
Total consumer loans | 373 | 143 | (67) | 24 | 473 | |||||||||||||||
Total ALLL — continuing operations | 1,061 | 437 | (a) | (245) | 84 | 1,337 | ||||||||||||||
Discontinued operations | 28 | (3) | (6) | 2 | 21 | |||||||||||||||
Total ALLL — including discontinued operations | $ | 1,089 | $ | 434 | $ | (251) | $ | 86 | $ | 1,358 | ||||||||||
Dollars in millions | December 31, 2020 | Provision | Charge-offs | Recoveries | December 31, 2021 | |||||||||||||||
Commercial and Industrial | $ | 678 | $ | (142) | $ | (174) | $ | 83 | $ | 445 | ||||||||||
Commercial real estate: | ||||||||||||||||||||
Real estate — commercial mortgage | 327 | (114) | (40) | 9 | 182 | |||||||||||||||
Real estate — construction | 47 | (18) | — | — | 29 | |||||||||||||||
Total commercial real estate loans | 374 | (132) | (40) | 9 | 211 | |||||||||||||||
Commercial lease financing | 47 | (16) | (6) | 7 | 32 | |||||||||||||||
Total commercial loans | 1,099 | (290) | (220) | 99 | 688 | |||||||||||||||
Real estate — residential mortgage | 102 | (12) | 2 | 3 | 95 | |||||||||||||||
Home equity loans | 171 | (57) | (9) | 5 | 110 | |||||||||||||||
Consumer direct loans | 128 | (2) | (29) | 8 | 105 | |||||||||||||||
Credit cards | 87 | (7) | (27) | 8 | 61 | |||||||||||||||
Consumer indirect loans | 39 | (13) | (39) | 15 | 2 | |||||||||||||||
Total consumer loans | 527 | (91) | (102) | 39 | 373 | |||||||||||||||
Total ALLL — continuing operations | 1,626 | (381) | (a) | (322) | 138 | 1,061 | ||||||||||||||
Discontinued operations | 36 | (6) | (4) | 2 | 28 | |||||||||||||||
Total ALLL — including discontinued operations | $ | 1,662 | $ | (387) | $ | (326) | $ | 140 | $ | 1,089 | ||||||||||
Dollars in millions | December 31, 2019 | Impact of ASC 326 Adoption | January 1, 2020 | Provision | Charge-offs | Recoveries | December 31, 2020 | |||||||||||||||||||
Commercial and industrial | $ | 551 | $ | (141) | $ | 410 | $ | 585 | $ | (351) | $ | 34 | $ | 678 | ||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||
Real estate — commercial mortgage | 143 | 16 | 159 | 184 | (19) | 3 | 327 | |||||||||||||||||||
Real estate — construction | 22 | (7) | 15 | 32 | — | — | 47 | |||||||||||||||||||
Total commercial real estate loans | 165 | 9 | 174 | 216 | (19) | 3 | 374 | |||||||||||||||||||
Commercial lease financing | 35 | 8 | 43 | 38 | (35) | 1 | 47 | |||||||||||||||||||
Total commercial loans | 751 | (124) | 627 | 839 | (405) | 38 | 1,099 | |||||||||||||||||||
Real estate — residential mortgage | 7 | 77 | 84 | 19 | (2) | 1 | 102 | |||||||||||||||||||
Home equity loans | 31 | 147 | 178 | (3) | (11) | 7 | 171 | |||||||||||||||||||
Consumer direct loans | 34 | 63 | 97 | 61 | (37) | 7 | 128 | |||||||||||||||||||
Credit cards | 47 | 35 | 82 | 36 | (39) | 8 | 87 | |||||||||||||||||||
Consumer indirect loans | 30 | 6 | 36 | 13 | (28) | 18 | 39 | |||||||||||||||||||
Total consumer loans | 149 | 328 | 477 | 126 | (117) | 41 | 527 | |||||||||||||||||||
Total ALLL — continuing operations | 900 | 204 | 1,104 | 965 | (a) | (522) | 79 | 1,626 | ||||||||||||||||||
Discontinued operations | 10 | 31 | 41 | (5) | (5) | 5 | 36 | |||||||||||||||||||
Total ALLL — including discontinued operations | $ | 910 | $ | 235 | $ | 1,145 | $ | 960 | $ | (527) | $ | 84 | $ | 1,662 | ||||||||||||
As of December 31, 2022 | Term Loans | Revolving Loans Amortized Cost Basis | Revolving Loans Converted to Term Loans Amortized Cost Basis | ||||||||||||||||||||||||||
Amortized Cost Basis by Origination Year and Internal Risk Rating | |||||||||||||||||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | Total | ||||||||||||||||||||||
Commercial and Industrial | |||||||||||||||||||||||||||||
Risk Rating: | |||||||||||||||||||||||||||||
Pass | $ | 11,580 | $ | 8,636 | $ | 3,540 | $ | 2,839 | $ | 1,787 | $ | 3,307 | $ | 25,565 | $ | 138 | $ | 57,392 | |||||||||||
Criticized (Accruing) | 40 | 357 | 131 | 160 | 227 | 205 | 936 | 25 | 2,081 | ||||||||||||||||||||
Criticized (Nonaccruing) | 34 | 2 | 5 | 4 | 22 | 20 | 87 | — | 174 | ||||||||||||||||||||
Total commercial and industrial | 11,654 | 8,995 | 3,676 | 3,003 | 2,036 | 3,532 | 26,588 | 163 | 59,647 | ||||||||||||||||||||
Real estate — commercial mortgage | |||||||||||||||||||||||||||||
Risk Rating: | |||||||||||||||||||||||||||||
Pass | 4,786 | 3,817 | 992 | 1,853 | 788 | 2,578 | 1,068 | 67 | 15,949 | ||||||||||||||||||||
Criticized (Accruing) | 6 | 13 | 20 | 48 | 73 | 175 | 47 | — | 382 | ||||||||||||||||||||
Criticized (Nonaccruing) | — | — | 1 | 1 | 1 | 15 | 3 | — | 21 | ||||||||||||||||||||
Total real estate — commercial mortgage | 4,792 | 3,830 | 1,013 | 1,902 | 862 | 2,768 | 1,118 | 67 | 16,352 | ||||||||||||||||||||
Real estate — construction | |||||||||||||||||||||||||||||
Risk Rating: | |||||||||||||||||||||||||||||
Pass | 698 | 895 | 445 | 262 | 107 | 48 | 1 | — | 2,456 | ||||||||||||||||||||
Criticized (Accruing) | 5 | 1 | 5 | 32 | 25 | 4 | — | 2 | 74 | ||||||||||||||||||||
Criticized (Nonaccruing) | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total real estate — construction | 703 | 896 | 450 | 294 | 132 | 52 | 1 | 2 | 2,530 | ||||||||||||||||||||
Commercial lease financing | |||||||||||||||||||||||||||||
Risk Rating: | |||||||||||||||||||||||||||||
Pass | 1,039 | 743 | 509 | 467 | 174 | 947 | — | — | 3,879 | ||||||||||||||||||||
Criticized (Accruing) | 15 | 1 | 9 | 12 | 9 | 10 | — | — | 56 | ||||||||||||||||||||
Criticized (Nonaccruing) | — | — | — | — | — | 1 | — | — | 1 | ||||||||||||||||||||
Total commercial lease financing | 1,054 | 744 | 518 | 479 | 183 | 958 | — | — | 3,936 | ||||||||||||||||||||
Total commercial loans | $ | 18,203 | $ | 14,465 | $ | 5,657 | $ | 5,678 | $ | 3,213 | $ | 7,310 | $ | 27,707 | $ | 232 | $ | 82,465 | |||||||||||
As of December 31, 2022 | Term Loans | Revolving Loans Amortized Cost Basis | Revolving Loans Converted to Term Loans Amortized Cost Basis | ||||||||||||||||||||||||||
Amortized Cost Basis by Origination Year and FICO Score | |||||||||||||||||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | Total | ||||||||||||||||||||||
Real estate — residential mortgage | |||||||||||||||||||||||||||||
FICO Score: | |||||||||||||||||||||||||||||
750 and above | $ | 5,205 | $ | 8,702 | $ | 2,584 | $ | 636 | $ | 64 | $ | 978 | $ | — | $ | — | $ | 18,169 | |||||||||||
660 to 749 | 1,286 | 919 | 282 | 106 | 28 | 260 | — | — | 2,881 | ||||||||||||||||||||
Less than 660 | 41 | 42 | 17 | 14 | 15 | 130 | — | — | 259 | ||||||||||||||||||||
No Score | 62 | 1 | 1 | 1 | 1 | 25 | 1 | — | 92 | ||||||||||||||||||||
Total real estate — residential mortgage | 6,594 | 9,664 | 2,884 | 757 | 108 | 1,393 | 1 | — | 21,401 | ||||||||||||||||||||
Home equity loans | |||||||||||||||||||||||||||||
FICO Score: | |||||||||||||||||||||||||||||
750 and above | 146 | 1,044 | 736 | 207 | 74 | 617 | 2,238 | 398 | 5,460 | ||||||||||||||||||||
660 to 749 | 83 | 291 | 194 | 79 | 32 | 187 | 974 | 126 | 1,966 | ||||||||||||||||||||
Less than 660 | 11 | 31 | 25 | 17 | 10 | 81 | 300 | 37 | 512 | ||||||||||||||||||||
No Score | 7 | — | — | — | — | 2 | 4 | — | 13 | ||||||||||||||||||||
Total home equity loans | 247 | 1,366 | 955 | 303 | 116 | 887 | 3,516 | 561 | 7,951 | ||||||||||||||||||||
Consumer direct loans | |||||||||||||||||||||||||||||
FICO Score: | |||||||||||||||||||||||||||||
750 and above | 1,291 | 1,632 | 811 | 351 | 45 | 97 | 102 | — | 4,329 | ||||||||||||||||||||
660 to 749 | 526 | 434 | 229 | 120 | 26 | 41 | 206 | — | 1,582 | ||||||||||||||||||||
Less than 660 | 58 | 63 | 32 | 23 | 7 | 9 | 57 | — | 249 | ||||||||||||||||||||
No Score | 59 | 32 | 22 | 11 | 9 | 22 | 193 | — | 348 | ||||||||||||||||||||
Total consumer direct loans | 1,934 | 2,161 | 1,094 | 505 | 87 | 169 | 558 | — | 6,508 | ||||||||||||||||||||
Credit cards | |||||||||||||||||||||||||||||
FICO Score: | |||||||||||||||||||||||||||||
750 and above | — | — | — | — | — | — | 524 | — | 524 | ||||||||||||||||||||
660 to 749 | — | — | — | — | — | — | 402 | — | 402 | ||||||||||||||||||||
Less than 660 | — | — | — | — | — | — | 99 | — | 99 | ||||||||||||||||||||
No Score | — | — | — | — | — | — | 1 | — | 1 | ||||||||||||||||||||
Total credit cards | — | — | — | — | — | — | 1,026 | — | 1,026 | ||||||||||||||||||||
Consumer indirect loans | |||||||||||||||||||||||||||||
FICO Score: | |||||||||||||||||||||||||||||
750 and above | — | 2 | — | — | — | 19 | — | — | 21 | ||||||||||||||||||||
660 to 749 | — | — | — | — | — | 15 | — | — | 15 | ||||||||||||||||||||
Less than 660 | — | — | — | — | — | 7 | — | — | 7 | ||||||||||||||||||||
No Score | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Total consumer indirect loans | — | 2 | — | — | — | 41 | — | — | 43 | ||||||||||||||||||||
Total consumer loans | $ | 8,775 | $ | 13,193 | $ | 4,933 | $ | 1,565 | $ | 311 | $ | 2,490 | $ | 5,101 | $ | 561 | $ | 36,929 | |||||||||||
December 31, 2022 | Current | 30-59 Days Past Due (b) | 60-89 Days Past Due (b) | 90 and Greater Days Past Due (b) | Non-performing Loans | Total Past Due and Non-performing Loans | Total Loans (c) | ||||||||||||||||
Dollars in millions | |||||||||||||||||||||||
LOAN TYPE | |||||||||||||||||||||||
Commercial and industrial | $ | 59,366 | $ | 43 | $ | 33 | $ | 31 | $ | 174 | $ | 281 | $ | 59,647 | |||||||||
Commercial real estate: | |||||||||||||||||||||||
Commercial mortgage | 16,305 | 16 | 2 | 8 | 21 | 47 | 16,352 | ||||||||||||||||
Construction | 2,530 | — | — | — | — | — | 2,530 | ||||||||||||||||
Total commercial real estate loans | 18,835 | 16 | 2 | 8 | 21 | 47 | 18,882 | ||||||||||||||||
Commercial lease financing | 3,928 | 3 | 1 | 3 | 1 | 8 | 3,936 | ||||||||||||||||
Total commercial loans | $ | 82,129 | $ | 62 | $ | 36 | $ | 42 | $ | 196 | $ | 336 | $ | 82,465 | |||||||||
Real estate — residential mortgage | $ | 21,307 | $ | 13 | $ | 3 | $ | 1 | $ | 77 | $ | 94 | $ | 21,401 | |||||||||
Home equity loans | 7,804 | 27 | 8 | 5 | 107 | 147 | 7,951 | ||||||||||||||||
Consumer direct loans | 6,478 | 15 | 7 | 5 | 3 | 30 | 6,508 | ||||||||||||||||
Credit cards | 1,007 | 5 | 4 | 7 | 3 | 19 | 1,026 | ||||||||||||||||
Consumer indirect loans | 42 | — | — | — | 1 | 1 | 43 | ||||||||||||||||
Total consumer loans | $ | 36,638 | $ | 60 | $ | 22 | $ | 18 | $ | 191 | $ | 291 | $ | 36,929 | |||||||||
Total loans | $ | 118,767 | $ | 122 | $ | 58 | $ | 60 | $ | 387 | $ | 627 | $ | 119,394 | |||||||||
December 31, 2021 | Current | 30-59 Days Past Due (b) | 60-89 Days Past Due (b) | 90 and Greater Days Past Due (b) | Non-performing Loans | Total Past Due and Non-performing Loans | Total Loans (c) | ||||||||||||||||
Dollars in millions | |||||||||||||||||||||||
LOAN TYPE | |||||||||||||||||||||||
Commercial and industrial | $ | 50,226 | $ | 19 | $ | 49 | $ | 40 | $ | 191 | $ | 299 | $ | 50,525 | |||||||||
Commercial real estate: | |||||||||||||||||||||||
Commercial mortgage | 14,174 | 10 | 9 | 7 | 44 | 70 | 14,244 | ||||||||||||||||
Construction | 1,978 | — | 17 | 1 | — | 18 | 1,996 | ||||||||||||||||
Total commercial real estate loans | 16,152 | 10 | 26 | 8 | 44 | 88 | 16,240 | ||||||||||||||||
Commercial lease financing | 4,061 | 6 | — | — | 4 | 10 | 4,071 | ||||||||||||||||
Total commercial loans | $ | 70,439 | $ | 35 | $ | 75 | $ | 48 | $ | 239 | $ | 397 | $ | 70,836 | |||||||||
Real estate — residential mortgage | $ | 15,669 | $ | 7 | $ | 3 | $ | 5 | $ | 72 | $ | 87 | $ | 15,756 | |||||||||
Home equity loans | 8,299 | 21 | 6 | 6 | 135 | 168 | 8,467 | ||||||||||||||||
Consumer direct loans | 5,736 | 8 | 2 | 3 | 4 | 17 | 5,753 | ||||||||||||||||
Credit cards | 956 | 4 | 3 | 6 | 3 | 16 | 972 | ||||||||||||||||
Consumer indirect loans | 68 | 1 | — | — | 1 | 2 | 70 | ||||||||||||||||
Total consumer loans | $ | 30,728 | $ | 41 | $ | 14 | $ | 20 | $ | 215 | $ | 290 | $ | 31,018 | |||||||||
Total loans | $ | 101,167 | $ | 76 | $ | 89 | $ | 68 | $ | 454 | $ | 687 | $ | 101,854 | |||||||||
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Commercial loans: | ||||||||
Extension of Maturity Date | $ | 36 | $ | — | ||||
Payment or Covenant Modification/Deferment | — | 7 | ||||||
Total | $ | 36 | $ | 7 | ||||
Consumer loans: | ||||||||
Interest rate reduction | $ | 13 | $ | 7 | ||||
Other | 20 | 19 | ||||||
Total | $ | 33 | $ | 26 | ||||
Total TDRs | $ | 69 | $ | 33 |
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Balance at beginning of the period | $ | 220 | $ | 363 | ||||
Additions | 79 | 103 | ||||||
Payments | (45) | (217) | ||||||
Charge-offs | (18) | (29) | ||||||
Balance at end of period | $ | 236 | $ | 220 | ||||
December 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
Number of Loans | Pre-modification Outstanding Recorded Investment | Post-modification Outstanding Recorded Investment | Number of Loans | Pre-modification Outstanding Recorded Investment | Post-modification Outstanding Recorded Investment | ||||||||||||||||||
Dollars in millions | |||||||||||||||||||||||
LOAN TYPE | |||||||||||||||||||||||
Nonperforming: | |||||||||||||||||||||||
Commercial and industrial | 27 | $ | 60 | $ | 45 | 36 | $ | 30 | $ | 14 | |||||||||||||
Commercial real estate: | |||||||||||||||||||||||
Real estate — commercial mortgage | 4 | 50 | 13 | 3 | 50 | 25 | |||||||||||||||||
Total commercial real estate loans | 4 | 50 | 13 | 3 | 50 | 25 | |||||||||||||||||
Total commercial loans | 31 | 110 | 58 | 39 | 80 | 39 | |||||||||||||||||
Real estate — residential mortgage | 238 | 30 | 27 | 220 | 26 | 24 | |||||||||||||||||
Home equity loans | 468 | 32 | 28 | 531 | 36 | 31 | |||||||||||||||||
Consumer direct loans | 156 | 2 | 2 | 207 | 3 | 2 | |||||||||||||||||
Credit cards | 331 | 2 | 2 | 360 | 2 | 2 | |||||||||||||||||
Consumer indirect loans | 16 | 2 | 1 | 23 | 1 | 1 | |||||||||||||||||
Total consumer loans | 1,209 | 68 | 60 | 1,341 | 68 | 60 | |||||||||||||||||
Total nonperforming TDRs | 1,240 | 178 | 118 | 1,380 | 148 | 99 | |||||||||||||||||
Prior-year accruing: (a) | |||||||||||||||||||||||
Commercial and industrial | 19 | — | — | 11 | — | — | |||||||||||||||||
Commercial real estate: | |||||||||||||||||||||||
Real estate — commercial mortgage | — | — | — | 1 | — | — | |||||||||||||||||
Total commercial loans | 19 | — | — | 12 | — | — | |||||||||||||||||
Real estate — residential mortgage | 425 | 41 | 35 | 455 | 39 | 33 | |||||||||||||||||
Home equity loans | 1,547 | 96 | 73 | 1,628 | 97 | 75 | |||||||||||||||||
Consumer direct loans | 272 | 4 | 3 | 236 | 5 | 3 | |||||||||||||||||
Credit cards | 607 | 4 | 2 | 579 | 4 | 2 | |||||||||||||||||
Consumer indirect loans | 95 | 11 | 5 | 139 | 15 | 8 | |||||||||||||||||
Total consumer loans | 2,946 | 156 | 118 | 3,037 | 160 | 121 | |||||||||||||||||
Total prior-year accruing TDRs | 2,965 | 156 | 118 | 3,049 | 160 | 121 | |||||||||||||||||
Total TDRs | 4,205 | $ | 334 | $ | 236 | 4,429 | $ | 308 | $ | 220 | |||||||||||||
Twelve Months Ended December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Balance at beginning of period | $ | 160 | $ | 197 | ||||
Provision (credit) for losses on off balance sheet exposures | 65 | (37) | ||||||
Balance at end of period | $ | 225 | $ | 160 | ||||
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Securities (includes trading account assets securities available for sale, and U.S. Treasury Bills classified as short-term investments) | Fair value of level 1 securities is determined by: • Quoted market prices available in an active market for identical securities. This includes exchange-traded equity securities. Fair value of level 2 securities is determined by: • Pricing models (either by a third party pricing service or internally). Inputs include: yields, benchmark securities, bids, offers, actual trade data (i.e., spreads, credit ratings, and interest rates) for comparable assets, spread tables, matrices, high-grade scales, and option-adjusted spreads. • Observable market prices of similar securities. Fair value of level 3 securities is determined by: • Internally developed valuation techniques, principally discounted cash flow methods (income approach). • Revenue multiples of comparable public companies (market approach). For level 3 securities, increases (decreases) in the discount rate and marketability discount used in the discounted cash flow models would have resulted in lower (higher) fair value measurements. Higher volatility factors would have further magnified changes in fair value. The valuations provided by the third-party pricing service are based on observable market inputs, which include benchmark yields, reported trades, issuer spreads, benchmark securities, bids, offers, and reference data obtained from market research publications. Inputs used by the third-party pricing service in valuing CMOs and other mortgage-backed securities also include new issue data, monthly payment information, whole loan collateral performance, and “To Be Announced” prices. In valuations of securities issued by state and political subdivisions, inputs used by the third-party pricing service also include material event notices. We regularly validate the pricing methodologies of valuations derived from a third-party pricing service to ensure the fair value determination is consistent with applicable accounting guidance and that our assets are properly classified in the fair value hierarchy. To perform this validation, we: •review documentation received from our third-party pricing service regarding the inputs used in its valuations and determine a level assessment for each category of securities; •substantiate actual inputs used for a sample of securities by comparing the actual inputs used by our third-party pricing service to comparable inputs for similar securities; and •substantiate the fair values determined for a sample of securities by comparing the fair values provided by our third-party pricing service to prices from other independent sources for the same and similar securities. We analyze variances and conduct additional research with our third-party pricing service and take appropriate steps based on our findings. | Level 1, 2, and 3 (primarily Level 2) | ||||||
Commercial loans (trading account assets) | Fair value is based on: • Observable market price spreads for similar loans. Valuations reflect prices within the bid-ask spread that are most representative of fair value. | Level 2 | ||||||
Principal investments (direct) | Direct principal investments consist of equity and debt instruments of private companies made by our principal investing entities. Fair value is determined using: • Operating performance and market multiples of comparable businesses • Other unique facts and circumstances related to each individual investment Direct principal investments are accounted for as investment companies in accordance with the applicable accounting guidance, whereby each investment is adjusted to fair value with any net realized or unrealized gain/loss recorded in the current period’s earnings. We are in the process of winding down our direct principal investment portfolio. As of December 31, 2022, the balance is less than $1 million. | Level 3 |
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Principal investments (indirect) | Indirect principal investments include primary and secondary investments in private equity funds engaged mainly in venture- and growth-oriented investing. These investments do not have readily determinable fair values and qualify for the practical expedient to estimate fair value based upon net asset value per share (or its equivalent, such as member units or an ownership interest in partners’ capital to which a proportionate share of net assets is attributed). Indirect principal investments are also accounted for as investment companies, whereby each investment is adjusted to fair value with any net realized or unrealized gain/loss recorded in the current period’s earnings. Under the provisions of the Volcker Rule, we are required to dispose or conform our indirect investments to the requirements of the statute by no later than July 21, 2023. As of December 31, 2022, we have not committed to a plan to sell these investments. Therefore, these investments continue to be valued using the net asset value per share methodology. | NAV |
Financial support provided | ||||||||||||||||||||||||||||||||||||||
Year ended December 31, | ||||||||||||||||||||||||||||||||||||||
December 31, 2022 | 2022 | 2021 | ||||||||||||||||||||||||||||||||||||
Dollars in millions | Fair Value | Unfunded Commitments | Funded Commitments | Funded Other | Funded Commitments | Funded Other | ||||||||||||||||||||||||||||||||
INVESTMENT TYPE | ||||||||||||||||||||||||||||||||||||||
Direct investments | $ | 1 | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||
Indirect investments (a) | 34 | 9 | — | — | 4 | — | ||||||||||||||||||||||||||||||||
Total | $ | 35 | $ | 9 | $ | — | $ | — | $ | 4 | $ | — | ||||||||||||||||||||||||||
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Other direct equity investments | Fair value is determined using: • Discounted cash flows • Operating performance and market/exit multiples of comparable businesses • Other unique facts and circumstances related to each individual investment For level 3 securities, increases in the discount rate applied in the discounted cash flow models would negatively affect the fair value. Increases in valuation multiples of comparable companies would positively affect the fair value. Level 1 investments reflect the quoted market prices of the investments available in an active market. | Level 1 and 3 | ||||||
Other direct and indirect equity investments (NAV) | Certain direct and indirect investments do not have readily determinable fair values and qualify for the practical expedient in the accounting guidance that allows us to estimate fair value based upon net asset value per share. | NAV | ||||||
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Loans held for sale and held for investment (residential) | Residential mortgage loans held for sale are accounted for at fair value. Fair values are based on: • Quoted market prices, where available • Prices for other traded mortgage loans with similar characteristics • Purchase commitments and bid information received from market participants Prices are adjusted as necessary to include: • The embedded servicing value in the loans • The specific characteristics of certain loans that are priced based on the pricing of similar loans. (These adjustments represent unobservable inputs to the valuation but are not considered significant given the relative insensitivity of the value to changes in these inputs to the fair value of the loans.) Residential loans held for investment: Certain residential loans held for sale contain salability exceptions that make them unable to be sold into the performing loan sales market. Loans in this category are transferred to the held to maturity loan portfolio and are included in “Loans, net of unearned income” on the balance sheet. This type of loan is classified as level 3 in the valuation hierarchy as transaction details regarding sales of this type of loan are often unavailable. Fair value is based upon: • Unobservable bid information from brokers and investors Higher (lower) unobservable bid information would have resulted in higher (lower) fair value measurements. | Level 1, 2 and 3 (primarily level 2) | ||||||
Derivatives | Exchange-traded derivatives are valued using quoted prices in active markets and, therefore, are classified as Level 1 instruments. The majority of our derivative positions are Level 2 and are valued using internally developed models based on market convention and observable market inputs. These derivative contracts include interest rate swaps, certain options, floors, cross currency swaps, credit default swaps, and forward mortgage loan sale commitments. Significant inputs used in the valuation models include: • LIBOR, SOFR and Overnight Index Swap (OIS) curves, index pricing curves, foreign currency curves • Volatility surfaces (a three-dimensional graph of implied volatility against strike price and maturity) We have customized derivative instruments and risk participations that are classified as Level 3 instruments. These derivative positions are valued using internally developed models, with inputs consisting of available market data, including: • Credit spreads and interest rates The unobservable internally derived assumptions include: • Loss given default • Internal risk assessments of customers The fair value represents an estimate of the amount that the risk participation counterparty would need to pay/receive as of the measurement date based on the probability of customer default on the swap transaction and the fair value of the underlying customer swap. Therefore, for sold risk participation agreements, a higher loss probability and a lower credit rating would negatively affect the fair value of the risk participations and a lower loss probability and higher credit rating would positively affect the fair value of the risk participations. (For purchased risk participation agreements, higher loss probabilities and lower credit ratings would positively affect the fair value.) | Level 1, 2, and 3 (primarily level 2) |
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Derivatives (continued) | We use interest rate lock commitments for our residential mortgage business, which are classified as Level 3 instruments. The significant components of the valuation model include: • Interest rates observable in the market • Investor supplied prices for similar loans and securities • The probability of the loan closing (i.e. the "pull-through" amount, a significant unobservable input). Increases (decreases) in the probability of the loan closing would have resulted in higher (lower) fair value measurements. Valuation of residential mortgage forward sale commitments utilizes observable market prices of comparable commitments and mortgage securities (Level 2). The fair values of our derivatives include a credit valuation adjustment related to both counterparty and our own creditworthiness. The credit component considers master netting and collateral agreements and is determined by the individual counterparty based on potential future exposures, expected recovery rates, and market-implied probabilities of default. | Level 1, 2, and 3 (primarily level 2) | ||||||
Liability for short positions | This includes fixed income securities held by our broker dealer in its trading inventory. Fair value of level 1 securities is determined by: • Quoted market prices available in an active market for identical securities Fair value of level 2 securities is determined by: • Observable market prices of similar securities • Market activity, spreads, credit ratings and interest rates for each security type | Level 1 and 2 |
Dollars in millions | Beginning of Period Balance | Gains (Losses) included in comprehensive income | Gains (Losses) Included in Earnings | Purchases | Sales | Settlements | Transfers Other | Transfers into Level 3 | Transfers out of Level 3 | End of Period Balance | Unrealized Gains (Losses) Included in Earnings | ||||||||||||||||||||||||||||||||||||
Year ended December 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Securities available for sale | |||||||||||||||||||||||||||||||||||||||||||||||
Other securities | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||
Other investments | |||||||||||||||||||||||||||||||||||||||||||||||
Principal investments | |||||||||||||||||||||||||||||||||||||||||||||||
Direct | 1 | — | — | — | — | — | — | — | — | 1 | — | ||||||||||||||||||||||||||||||||||||
Equity investments | |||||||||||||||||||||||||||||||||||||||||||||||
Direct | 9 | — | (3) | (c) | — | (4) | — | — | — | — | 2 | (3) | |||||||||||||||||||||||||||||||||||
Loans held for sale (residential) | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Loans held for investment (residential) | 11 | — | (3) | — | (1) | — | 2 | — | — | 9 | — | ||||||||||||||||||||||||||||||||||||
Derivative instruments (b) | |||||||||||||||||||||||||||||||||||||||||||||||
Interest rate | 33 | — | (72) | (d) | 2 | (2) | — | — | 33 | (e) | 8 | (e) | 2 | — | |||||||||||||||||||||||||||||||||
Credit | (6) | — | 4 | (d) | — | — | — | — | — | — | (2) | — | |||||||||||||||||||||||||||||||||||
Other (a) | 5 | — | — | — | — | — | (5) | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Dollars in millions | Beginning of Period Balance | Gains (Losses) included in comprehensive income | Gains (Losses) Included in Earnings | Purchases | Sales | Settlements | Transfers Other | Transfers into Level 3 | Transfers out of Level 3 | End of Period Balance | Unrealized Gains (Losses) Included in Earnings | |||||||||||||||||||||||||||||||||
Year ended December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||
Securities available for sale | ||||||||||||||||||||||||||||||||||||||||||||
Other securities | $ | 13 | $ | 9 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (22) | $ | — | $ | — | ||||||||||||||||||||||
Other investments | ||||||||||||||||||||||||||||||||||||||||||||
Principal investments | ||||||||||||||||||||||||||||||||||||||||||||
Direct | 1 | — | — | — | — | — | — | — | — | 1 | — | |||||||||||||||||||||||||||||||||
Equity investments | ||||||||||||||||||||||||||||||||||||||||||||
Direct | 13 | (1) | (c) | — | — | (3) | 9 | (1) | ||||||||||||||||||||||||||||||||||||
Loans held for sale (residential) | — | — | — | — | (1) | — | 1 | — | — | — | — | |||||||||||||||||||||||||||||||||
Loans held for investment (residential) | 11 | — | — | — | (3) | — | 1 | — | — | 11 | — | |||||||||||||||||||||||||||||||||
Derivative instruments (b) | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate | 56 | (24) | (d) | 3 | (12) | — | 28 | (e) | (17) | (e) | 33 | |||||||||||||||||||||||||||||||||
Credit | (10) | — | 3 | (d) | 1 | — | $ | — | — | — | (6) | — | ||||||||||||||||||||||||||||||||
Other (a) | 32 | — | (3) | — | — | — | (24) | — | — | 5 | — | |||||||||||||||||||||||||||||||||
December 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||
Dollars in millions | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||
ASSETS MEASURED ON A NONRECURRING BASIS | ||||||||||||||||||||||||||
Collateral-dependent loans | $ | — | $ | — | $ | 17 | $ | 17 | $ | — | $ | — | $ | 28 | $ | 28 | ||||||||||
Accrued income and other assets | — | — | 14 | 14 | — | — | 80 | 80 | ||||||||||||||||||
Total assets on a nonrecurring basis at fair value | $ | — | $ | — | $ | 31 | $ | 31 | $ | — | $ | — | $ | 108 | $ | 108 | ||||||||||
Asset/liability class | Valuation technique | Valuation hierarchy classification(s) | ||||||
Collateral-dependent loans | When a loan is collateral-dependent, the fair value of the loan is determined based on the fair value of the underlying collateral. | Level 3 | ||||||
Commercial loans and student loans held for sale | Through a quarterly analysis of our loan portfolios held for sale, which include both performing and nonperforming commercial loans and student loans, we determine any adjustments necessary to record the portfolios at the lower of cost or fair value in accordance with GAAP. Valuation inputs include: • Non-binding bids for the respective loans or similar loans • Recent sales transactions • Internal models that emulate recent securitizations | Level 2 and 3 | ||||||
Direct financing leases and operating lease assets held for sale | Valuations of direct financing leases and operating lease assets held for sale are performed using an internal model that relies on market data, including: • Swap rates and bond ratings • Our own assumptions about the exit market for the leases • Details about the individual leases in the portfolio Leases for which we receive a current nonbinding bid, and for which the sale is considered probable, may be classified as Level 2. Valuations of lease and operating lease assets held for sale that employ our own assumptions are classified as Level 3 assets. The inputs based on our own assumptions include changes in the value of leased items and internal credit ratings. | Level 2 and 3 | ||||||
OREO, other repossessed personal properties, and right-of-use assets(a) | OREO, other repossessed properties, and right-of-use assets are valued based on: • Appraisals and third-party price opinions, less estimated selling costs Generally, we classify these assets as Level 3, but OREO and other repossessed properties for which we receive binding purchase agreements are classified as Level 2. Returned lease inventory is valued based on market data for similar assets and is classified as Level 2. | Level 2 and 3 | ||||||
LIHTC, HTC, and NMTC investments(a) | Valuation of LIHTC, HTC and NMTC involves measuring the present value of future tax benefits and comparing that value against the current carrying value of the investment. Expected future tax benefits are discounted to their present value using discounted cash flow modeling that incorporates an appropriate risk premium. LIHTC and HTC investments are impaired when it is more likely than not that the carrying amount of the investment will not be realized. | Level 3 | ||||||
Other equity investments | We have other investments in equity securities that do not have readily determinable fair values and do not qualify for the practical expedient to measure the investment using a net asset value per share. We have elected to measure these securities at cost less impairment plus or minus adjustments due to observable orderly transactions. Impairment is recorded when there is evidence that the expected fair value of the investment has declined to below the recorded cost. At each reporting period, we assess if these investments continue to qualify for this measurement alternative. At December 31, 2022, and December 31, 2021, the carrying amount of equity investments recorded under this method was $249 million and $173 million, respectively. No impairment was recorded for the year ended December 31, 2022. | Level 3 | ||||||
Mortgage Servicing Rights(a) | Refer to Note 9 (“Mortgage Servicing Assets”). | Level 3 |
Level 3 Asset (Liability) | Valuation Technique | Significant Unobservable Input | Range (Weighted-Average) (b), (c) | |||||||||||||||||
Dollars in millions | December 31, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | ||||||||||||||||
Recurring | ||||||||||||||||||||
Loans, net of unearned income (residential) | $ | 9 | $ | 11 | Market comparable pricing | Comparability factor | 61.00%-86.58% (72.21%) | 64.50 - 97.30% (94.24%) | ||||||||||||
Derivative instruments: | ||||||||||||||||||||
Interest rate | 2 | 33 | Discounted cash flows | Probability of default | .02 - 100% (8.00%) | .02 - 100% (8.88%) | ||||||||||||||
Loss given default | 0 - 1 (.49) | 0 - 1 (.50) | ||||||||||||||||||
Insignificant level 3 assets, net of liabilities(d) | 1 | 9 | ||||||||||||||||||
Nonrecurring | ||||||||||||||||||||
Collateral dependent loans | 17 | 28 | Fair value of underlying collateral | Discount Rate | 0 - 85.00% (34.00%) | 0 - 10.00% (8.00%) | ||||||||||||||
Accrued income and other assets:(e) | ||||||||||||||||||||
OREO and other assets | 14 | 13 | Appraised value | Appraised value | N/M | N/M |
December 31, 2022 | ||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||
Dollars in millions | Carrying Amount | Level 1 | Level 2 | Level 3 | Measured at NAV | Netting Adjustment | Total | |||||||||||||||||||
ASSETS (by measurement category) | ||||||||||||||||||||||||||
Fair value - net income | ||||||||||||||||||||||||||
Trading account assets (b) | $ | 829 | $ | — | $ | 829 | $ | — | $ | — | $ | — | $ | 829 | ||||||||||||
Other investments (b) | 1,308 | 4 | — | 1,234 | 70 | — | 1,308 | |||||||||||||||||||
Loans, net of unearned income (residential) (d) | 9 | — | — | 9 | — | — | 9 | |||||||||||||||||||
Loans held for sale (residential) (b) | 24 | — | 24 | — | — | — | 24 | |||||||||||||||||||
Derivative assets - trading (b) | 927 | 112 | 1,552 | 3 | — | (740) | (f) | 927 | ||||||||||||||||||
Fair value - OCI | ||||||||||||||||||||||||||
Securities available for sale (b) | 39,117 | — | 39,117 | — | — | — | 39,117 | |||||||||||||||||||
Derivative assets - hedging (b) (g) | 97 | — | 114 | — | — | (17) | (f) | 97 | ||||||||||||||||||
Amortized cost | ||||||||||||||||||||||||||
Held-to-maturity securities (c) | 8,710 | — | 8,113 | — | — | — | 8,113 | |||||||||||||||||||
Loans, net of unearned income (d) | 118,048 | — | — | 112,590 | — | — | 112,590 | |||||||||||||||||||
Loans held for sale (b) | 939 | — | — | 939 | — | — | 939 | |||||||||||||||||||
Other | ||||||||||||||||||||||||||
Cash and short-term investments (a) | 3,319 | 3,319 | — | — | — | — | 3,319 | |||||||||||||||||||
LIABILITIES (by measurement category) | ||||||||||||||||||||||||||
Fair value - net income | ||||||||||||||||||||||||||
Derivative liabilities - trading (b) | $ | 1,485 | $ | 107 | $ | 2,637 | $ | 3 | $ | — | $ | (1,262) | (f) | $ | 1,485 | |||||||||||
Fair value - OCI | ||||||||||||||||||||||||||
Derivative liabilities - hedging (b) (g) | 3 | — | 3 | — | — | — | (f) | 3 | ||||||||||||||||||
Amortized cost | ||||||||||||||||||||||||||
Time deposits (e) | 7,373 | — | 7,392 | — | — | — | 7,392 | |||||||||||||||||||
Short-term borrowings (a) | 9,463 | 126 | 9,337 | — | — | — | 9,463 | |||||||||||||||||||
Long-term debt (e) | 19,307 | 12,196 | 6,685 | — | — | — | 18,881 | |||||||||||||||||||
Other | ||||||||||||||||||||||||||
Deposits with no stated maturity (a) | 135,222 | — | 135,222 | — | — | — | 135,222 |
December 31, 2021 | ||||||||||||||||||||||||||
Fair Value | ||||||||||||||||||||||||||
Dollars in millions | Carrying Amount | Level 1 | Level 2 | Level 3 | Measured at NAV | Netting Adjustment | Total | |||||||||||||||||||
ASSETS (by measurement category) | ||||||||||||||||||||||||||
Fair value - net income | ||||||||||||||||||||||||||
Trading account assets (b) | $ | 701 | $ | — | $ | 701 | $ | — | $ | — | $ | — | $ | 701 | ||||||||||||
Other investments (b) | 639 | 24 | — | 543 | 72 | — | 639 | |||||||||||||||||||
Loans, net of unearned income (residential) (d) | 11 | — | — | 11 | — | — | 11 | |||||||||||||||||||
Loans held for sale (residential) (b) | 281 | — | 281 | — | — | — | 281 | |||||||||||||||||||
Derivative assets - trading (b) | 1,887 | 71 | 2,096 | 40 | — | (320) | (f) | 1,887 | ||||||||||||||||||
Fair value - OCI | ||||||||||||||||||||||||||
Securities available for sale (b) | 45,364 | — | 45,364 | — | — | — | 45,364 | |||||||||||||||||||
Derivative assets - hedging (b) (g) | 75 | — | 39 | — | — | 36 | (f) | 75 | ||||||||||||||||||
Amortized cost | ||||||||||||||||||||||||||
Held-to-maturity securities (c) | 7,539 | — | 7,665 | — | — | — | 7,665 | |||||||||||||||||||
Loans, net of unearned income (d) | 100,782 | — | — | 100,428 | — | — | 100,428 | |||||||||||||||||||
Loans held for sale (b) | 2,448 | — | — | 2,448 | — | — | 2,448 | |||||||||||||||||||
Other | ||||||||||||||||||||||||||
Cash and short-term investments (a) | 11,923 | 11,923 | — | — | — | — | 11,923 | |||||||||||||||||||
LIABILITIES (by measurement category) | ||||||||||||||||||||||||||
Fair value - net income | ||||||||||||||||||||||||||
Derivative liabilities - trading (b) | $ | 157 | $ | 66 | $ | 1,610 | $ | 7 | $ | — | $ | (1,526) | (f) | $ | 157 | |||||||||||
Fair value - OCI | ||||||||||||||||||||||||||
Derivative liabilities - hedging (b) (g) | 4 | — | 4 | — | — | — | (f) | 4 | ||||||||||||||||||
Amortized cost | ||||||||||||||||||||||||||
Time deposits (e) | 3,858 | — | 3,866 | — | — | — | 3,866 | |||||||||||||||||||
Short-term borrowings (a) | 761 | 75 | 686 | — | — | — | 761 | |||||||||||||||||||
Long-term debt (e) | 12,042 | 11,813 | $ | 705 | — | — | — | 12,518 | ||||||||||||||||||
Other | ||||||||||||||||||||||||||
Deposits with no stated maturity (a) | 148,714 | — | 148,714 | — | — | — | 148,714 |
2022 | 2021 | ||||||||||||||||||||||||||||
December 31, Dollars in millions | Amortized Cost (a) | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | Amortized Cost(a) | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||||||||||
SECURITIES AVAILABLE FOR SALE | |||||||||||||||||||||||||||||
U.S. Treasury, agencies, and corporations | $ | 10,044 | $ | — | $ | 629 | $ | 9,415 | $ | 9,573 | $ | — | $ | 101 | $ | 9,472 | |||||||||||||
Agency residential collateralized mortgage obligations | 20,180 | — | 3,747 | 16,433 | 21,430 | 99 | 410 | 21,119 | |||||||||||||||||||||
Agency residential mortgage-backed securities | 4,616 | — | 696 | 3,920 | 5,137 | 37 | 52 | 5,122 | |||||||||||||||||||||
Agency commercial mortgage-backed securities | 10,712 | 2 | 1,365 | 9,349 | 9,753 | 188 | 290 | 9,651 | |||||||||||||||||||||
Other securities | — | — | — | — | — | — | — | — | |||||||||||||||||||||
Total securities available for sale | $ | 45,552 | $ | 2 | $ | 6,437 | $ | 39,117 | $ | 45,893 | $ | 324 | $ | 853 | $ | 45,364 | |||||||||||||
HELD-TO-MATURITY SECURITIES | |||||||||||||||||||||||||||||
Agency residential collateralized mortgage obligations | $ | 4,586 | $ | 5 | $ | 283 | $ | 4,308 | $ | 2,196 | $ | 33 | $ | — | $ | 2,229 | |||||||||||||
Agency residential mortgage-backed securities | 181 | — | 16 | 165 | 164 | 6 | — | 170 | |||||||||||||||||||||
Agency commercial mortgage-backed securities | 2,522 | 1 | 208 | 2,315 | 2,678 | 118 | — | 2,796 | |||||||||||||||||||||
Asset-backed securities(b) | 1,407 | — | 96 | 1,311 | 2,485 | — | 31 | 2,454 | |||||||||||||||||||||
Other securities | 14 | — | — | 14 | 16 | — | — | 16 | |||||||||||||||||||||
Total held-to-maturity securities | $ | 8,710 | $ | 6 | $ | 603 | $ | 8,113 | $ | 7,539 | $ | 157 | $ | 31 | $ | 7,665 | |||||||||||||
Duration of Unrealized Loss Position | ||||||||||||||||||||||||||
Less than 12 Months | 12 Months or Longer | Total | ||||||||||||||||||||||||
Dollars in millions | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | ||||||||||||||||||||
December 31, 2022 | ||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||
U.S. Treasury, agencies, and corporations | $ | 494 | $ | 48 | $ | 8,920 | $ | 581 | $ | 9,414 | $ | 629 | ||||||||||||||
Agency residential collateralized mortgage obligations | 3,114 | 377 | 13,317 | 3,370 | 16,431 | 3,747 | ||||||||||||||||||||
Agency residential mortgage-backed securities | 579 | 31 | 3,338 | 665 | 3,917 | 696 | ||||||||||||||||||||
Agency commercial mortgage-backed securities | 4,511 | 282 | 4,791 | 1,083 | 9,302 | 1,365 | ||||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||
Agency residential collateralized mortgage obligations | 2,659 | 178 | 726 | 105 | 3,385 | 283 | ||||||||||||||||||||
Agency residential mortgage-backed securities | 165 | 16 | — | — | 165 | 16 | ||||||||||||||||||||
Agency commercial mortgage-backed securities | 2,243 | 208 | — | — | 2,243 | 208 | ||||||||||||||||||||
Asset-backed securities | 1 | — | 1,309 | 96 | 1,310 | 96 | ||||||||||||||||||||
Other securities | 10 | — | (a) | 4 | — | 14 | — | |||||||||||||||||||
Total securities in an unrealized loss position | $ | 13,776 | $ | 1,140 | $ | 32,405 | $ | 5,900 | $ | 46,181 | $ | 7,040 | ||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||
Securities available for sale: | ||||||||||||||||||||||||||
U.S. Treasury, agencies, and corporations | $ | 9,078 | $ | 98 | $ | 243 | $ | 3 | $ | 9,321 | $ | 101 | ||||||||||||||
Agency residential collateralized mortgage obligations | 12,603 | 315 | 1,255 | 95 | 13,858 | 410 | ||||||||||||||||||||
Agency residential mortgage-backed securities | 3,793 | 49 | 178 | 3 | 3,971 | 52 | ||||||||||||||||||||
Agency commercial mortgage-backed securities | 1,645 | 75 | 3,834 | 215 | 5,479 | 290 | ||||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||
Agency residential collateralized mortgage obligations | 96 | — | (b) | — | — | 96 | — | |||||||||||||||||||
Asset-backed securities | 2,450 | 31 | 1 | — | (b) | 2,451 | 31 | |||||||||||||||||||
Other securities | 15 | — | (b) | — | — | 15 | — | |||||||||||||||||||
Total securities in an unrealized loss position | $ | 29,680 | $ | 568 | $ | 5,511 | $ | 316 | $ | 35,191 | $ | 884 | ||||||||||||||
Securities Available for Sale | Held-to-Maturity Securities | ||||||||||||||||||||||
December 31, 2022 | Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||||||||
Dollars in millions | |||||||||||||||||||||||
Due in one year or less | $ | 1,259 | $ | 1,215 | $ | 20 | $ | 21 | |||||||||||||||
Due after one through five years | 16,044 | 14,780 | 4,834 | 4,517 | |||||||||||||||||||
Due after five through ten years | 21,682 | 17,970 | 3,004 | 2,775 | |||||||||||||||||||
Due after ten years | 6,567 | 5,152 | 852 | 800 | |||||||||||||||||||
Total | $ | 45,552 | $ | 39,117 | $ | 8,710 | $ | 8,113 | |||||||||||||||
December 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
Fair Value (a) | Fair Value (a) | ||||||||||||||||||||||
Dollars in millions | Notional Amount | Derivative Assets | Derivative Liabilities | Notional Amount | Derivative Assets | Derivative Liabilities | |||||||||||||||||
Derivatives designated as hedging instruments: | |||||||||||||||||||||||
Interest rate | $ | 41,200 | $ | 114 | $ | 3 | $ | 38,654 | $ | 39 | $ | 4 | |||||||||||
Derivatives not designated as hedging instruments: | |||||||||||||||||||||||
Interest rate | 80,772 | 189 | 1,304 | 72,088 | 768 | 249 | |||||||||||||||||
Foreign exchange | 9,507 | 136 | 131 | 9,073 | 81 | 76 | |||||||||||||||||
Commodity | 16,176 | 1,328 | 1,304 | 14,151 | 1,330 | 1,335 | |||||||||||||||||
Credit | 95 | 1 | 3 | 465 | 1 | 12 | |||||||||||||||||
Other (b) | 940 | 13 | 5 | 3,330 | 27 | 11 | |||||||||||||||||
Total derivatives not designated as hedging instruments: | 107,490 | 1,667 | 2,747 | 99,107 | 2,207 | 1,683 | |||||||||||||||||
Total | 148,690 | 1,781 | 2,750 | 137,761 | 2,246 | 1,687 | |||||||||||||||||
Netting adjustments (c) | — | (757) | (1,262) | — | (284) | (1,526) | |||||||||||||||||
Net derivatives in the balance sheet | 148,690 | 1,024 | 1,488 | 137,761 | 1,962 | 161 | |||||||||||||||||
Other collateral (d) | — | — | (5) | — | (1) | — | |||||||||||||||||
Net derivative amounts | $ | 148,690 | $ | 1,024 | $ | 1,483 | $ | 137,761 | $ | 1,961 | $ | 161 | |||||||||||
December 31, 2022 | |||||||||||
Dollars in millions | Balance sheet line item in which the hedge item is included | Carrying amount of hedged item(a) | Hedge accounting basis adjustment | ||||||||
Interest rate contracts | Long-term debt(b) | $ | 10,411 | $ | (552) | ||||||
Interest rate contracts | Securities available for sale(c) | 405 | 48 | ||||||||
December 31, 2021 | |||||||||||
Dollars in millions | Balance sheet line item in which the hedge item is included | Carrying amount of hedged item (a) | Hedge accounting basis adjustment | ||||||||
Interest rate contracts | Long-term debt(b) | $ | 7,553 | $ | 138 | ||||||
Interest rate contracts | Securities available for sale(c) | 6,280 | 134 | ||||||||
Location and amount of net gains (losses) recognized in income on fair value and cash flow hedging relationships | ||||||||||||||
Dollars in millions | Interest expense – long-term debt | Interest income – loans | Interest Income - securities | Investment banking and debt placement fees | ||||||||||
Twelve Months Ended December 31, 2022 | ||||||||||||||
Total amounts presented in the consolidated statement of income | $ | (475) | $ | 4,241 | $ | 752 | $ | 638 | ||||||
Net gains (losses) on fair value hedging relationships | ||||||||||||||
Interest contracts | ||||||||||||||
Recognized on hedged items | 690 | — | (339) | — | ||||||||||
Recognized on derivatives designated as hedging instruments | (697) | — | 350 | — | ||||||||||
Net income (expense) recognized on fair value hedges | $ | (7) | $ | — | $ | 11 | $ | — | ||||||
Net gain (loss) on cash flow hedging relationships | ||||||||||||||
Realized gains (losses) (pre-tax) reclassified from AOCI into net income | ||||||||||||||
Interest contracts | $ | (3) | $ | (146) | $ | — | $ | 9 | ||||||
Net income (expense) recognized on cash flow hedges | $ | (3) | $ | (146) | $ | — | $ | 9 | ||||||
Twelve Months Ended December 31, 2021 | ||||||||||||||
Total amounts presented in the consolidated statement of income | $ | (221) | $ | 3,532 | $ | 546 | $ | 937 | ||||||
Net gains (losses) on fair value hedging relationships | ||||||||||||||
Interest contracts | ||||||||||||||
Recognized on hedged items | 276 | — | (113) | — | ||||||||||
Recognized on derivatives designated as hedging instruments | (150) | — | 113 | — | ||||||||||
Net income (expense) recognized on fair value hedges | $ | 126 | $ | — | $ | — | $ | — | ||||||
Net gain (loss) on cash flow hedging relationships | ||||||||||||||
Realized gains (losses) (pre-tax) reclassified from AOCI into net income | ||||||||||||||
Interest contracts | $ | (4) | $ | 329 | $ | — | $ | 4 | ||||||
Net income (expense) recognized on cash flow hedges | $ | (4) | $ | 329 | $ | — | $ | — | ||||||
Twelve Months Ended December 31, 2020 | ||||||||||||||
Total amounts presented in the consolidated statement of income | $ | (286) | $ | 3,866 | $ | 484 | $ | 661 | ||||||
Net gains (losses) on fair value hedging relationships | ||||||||||||||
Interest contracts | ||||||||||||||
Recognized on hedged items | (177) | — | — | — | ||||||||||
Recognized on derivatives designated as hedging instruments | 305 | — | — | — | ||||||||||
Net income (expense) recognized on fair value hedges | $ | 128 | $ | — | $ | — | $ | — | ||||||
Net gain (loss) on cash flow hedging relationships | ||||||||||||||
Realized gains (losses) (pre-tax) reclassified from AOCI into net income | ||||||||||||||
Interest contracts | $ | (4) | $ | 319 | $ | — | $ | — | ||||||
Net income (expense) recognized on cash flow hedges | $ | (4) | $ | 319 | $ | — | $ | — | ||||||
Dollars in millions | Net Gains (Losses) Recognized in OCI | Income Statement Location of Net Gains (Losses) Reclassified From OCI Into Income | Net Gains (Losses) Reclassified From OCI Into Income | Net Gains (Losses) Recognized in Other Income | ||||||||||
Twelve Months Ended December 31, 2022 | ||||||||||||||
Cash Flow Hedges | ||||||||||||||
Interest rate | $ | (1,660) | Interest income — Loans | $ | (146) | $ | — | |||||||
Interest rate | 7 | Interest expense — Long-term debt | (3) | — | ||||||||||
Interest rate | 11 | Investment banking and debt placement fees | 9 | — | ||||||||||
Total | $ | (1,642) | $ | (140) | $ | — | ||||||||
Twelve Months Ended December 31, 2021 | ||||||||||||||
Cash Flow Hedges | ||||||||||||||
Interest rate | $ | (307) | Interest income — Loans | $ | 329 | $ | — | |||||||
Interest rate | 2 | Interest expense — Long-term debt | (4) | — | ||||||||||
Interest rate | 10 | Investment banking and debt placement fees | 4 | — | ||||||||||
Total | $ | (295) | $ | 329 | $ | — | ||||||||
Twelve Months Ended December 31, 2020 | ||||||||||||||
Cash Flow Hedges | ||||||||||||||
Interest rate | $ | 628 | Interest income — Loans | $ | 319 | $ | — | |||||||
Interest rate | (5) | Interest expense — Long-term debt | (4) | — | ||||||||||
Interest rate | (9) | Investment banking and debt placement fees | — | — | ||||||||||
Total | $ | 614 | $ | 315 | $ | — | ||||||||
2022 | 2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, Dollars in millions | Corporate services income | Consumer mortgage income | Other income | Total | Corporate services income | Consumer mortgage income | Other income | Total | Corporate services income | Consumer mortgage income | Other income | Total | ||||||||||||||||||||||||||||||||
NET GAINS (LOSSES) | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate | $ | 57 | $ | — | $ | 6 | $ | 63 | $ | 30 | $ | — | $ | 2 | $ | 32 | $ | 32 | $ | — | $ | (10) | $ | 22 | ||||||||||||||||||||
Foreign exchange | 52 | — | — | 52 | 47 | — | — | 47 | 41 | — | — | 41 | ||||||||||||||||||||||||||||||||
Commodity | 23 | — | — | 23 | 14 | — | — | 14 | 19 | — | — | 19 | ||||||||||||||||||||||||||||||||
Credit | (1) | — | (39) | (40) | 4 | — | (36) | (32) | (4) | — | (29) | (33) | ||||||||||||||||||||||||||||||||
Other | — | 4 | (2) | 2 | — | 13 | (7) | 6 | — | 19 | 19 | 38 | ||||||||||||||||||||||||||||||||
Total net gains (losses) | $ | 131 | $ | 4 | $ | (35) | $ | 100 | $ | 95 | $ | 13 | $ | (41) | $ | 67 | $ | 88 | $ | 19 | $ | (20) | $ | 87 | ||||||||||||||||||||
December 31, Dollars in millions | 2022 | 2021 | ||||||
Interest rate | $ | 136 | $ | 696 | ||||
Foreign exchange | 67 | 31 | ||||||
Commodity | 820 | 1,108 | ||||||
Credit | — | — | ||||||
Other | 11 | 27 | ||||||
Derivative assets before collateral | 1,034 | 1,862 | ||||||
Plus (Less): Related collateral | (10) | 100 | ||||||
Total derivative assets | $ | 1,024 | $ | 1,962 | ||||
2022 | 2021 | ||||||||||||||||||||||
December 31, Dollars in millions | Notional Amount | Average Term (Years) | Payment / Performance Risk | Notional Amount | Average Term (Years) | Payment / Performance Risk | |||||||||||||||||
Other | $ | 1 | 15.17 | 5.10 | % | $ | 149 | 13.86 | 3.15 | % | |||||||||||||
Total credit derivatives sold | $ | 1 | — | — | $ | 149 | — | — | |||||||||||||||
December 31, Dollars in millions | 2022 | 2021 | |||||||||||||||
Moody’s | S&P | Moody’s | S&P | ||||||||||||||
KeyBank’s long-term senior unsecured credit ratings | A3 | A- | A3 | A- | |||||||||||||
One rating downgrade | $ | 1 | $ | 1 | $ | 3 | $ | 3 | |||||||||
Two rating downgrades | 1 | 1 | 3 | 3 | |||||||||||||
Three rating downgrades | 1 | 1 | 3 | 3 |
Year ended December 31, Dollars in millions | 2022 | 2021 | ||||||
Balance at beginning of period | $ | 634 | $ | 578 | ||||
Servicing retained from loan sales | 106 | 128 | ||||||
Purchases | 38 | 29 | ||||||
Amortization | (125) | (120) | ||||||
Temporary recoveries (impairments) | — | 19 | ||||||
Balance at end of period | $ | 653 | $ | 634 | ||||
Fair value at end of period | $ | 997 | $ | 789 | ||||
dollars in millions | December 31, 2022 | December 31, 2021 | |||||||||||||||||||||
Valuation Technique | Significant Unobservable Input | Range | Weighted-Average | Range | Weighted-Average | ||||||||||||||||||
Discounted cash flow | Expected defaults | 0.97 | % | 2.00 | % | 1.07 | % | 1.00 | % | 2.00 | % | 1.13 | % | ||||||||||
Residual cash flows discount rate | 8.54 | % | 10.02 | % | 9.48 | % | 7.92 | % | 10.49 | % | 9.44 | % | |||||||||||
Escrow earn rate | 5.09 | % | 5.21 | % | 5.17 | % | 1.34 | % | 1.74 | % | 1.34 | % | |||||||||||
Loan assumption rate | — | % | 1.41 | % | 1.12 | % | — | % | 1.69 | % | 1.37 | % | |||||||||||
Dollars in millions | 2022 | 2021 | ||||||
Balance at beginning of period | $ | 93 | $ | 58 | ||||
Servicing retained from loan sales | 23 | 43 | ||||||
Purchases | — | — | ||||||
Amortization | (11) | (18) | ||||||
Temporary recoveries (impairments) | 1 | 10 | ||||||
Balance at end of period | $ | 106 | $ | 93 | ||||
Fair value at end of period | $ | 130 | $ | 97 | ||||
Dollars in millions | December 31, 2022 | December 31, 2021 | ||||||
Operating lease cost | $ | 128 | $ | 133 | ||||
Finance lease cost: | ||||||||
Amortization of right-of-use assets | 1 | 2 | ||||||
Interest on lease liabilities | — | — | ||||||
Variable lease cost | 24 | 22 | ||||||
Total lease cost (a) | $ | 153 | $ | 157 | ||||
Dollars in millions | December 31, 2022 | December 31, 2021 | ||||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
Operating cash flows from operating leases | $ | 139 | $ | 141 | ||||
Financing cash flows from finance leases | 1 | 2 | ||||||
Right-of-use assets obtained in exchange for lease obligations: (a) | ||||||||
Operating leases | $ | 46 | $ | 85 | ||||
December 31, 2022 | December 31, 2021 | |||||||
Weighted-average remaining lease term: | ||||||||
Operating leases | 6.1 | 6.56 | ||||||
Finance leases | 4.53 | 5.33 | ||||||
Weighted-average discount rate: | ||||||||
Operating leases | 2.78 | % | 2.78 | % | ||||
Finance leases | 4.54 | % | 4.50 | % | ||||
Dollars in millions | Operating Leases | Finance Leases | Total | ||||||||
2023 | $ | 134 | $ | 2 | $ | 136 | |||||
2024 | 123 | 2 | 125 | ||||||||
2025 | 104 | 1 | 105 | ||||||||
2026 | 87 | — | 87 | ||||||||
2027 | 72 | — | 72 | ||||||||
Thereafter | 137 | 2 | 139 | ||||||||
Total lease payments | $ | 657 | $ | 7 | $ | 664 | |||||
Less imputed interest | 56 | 1 | 57 | ||||||||
Total | $ | 601 | $ | 6 | $ | 607 | |||||
Dollars in millions | December 31, 2022 | December 31, 2021 | ||||||
Sales-type and direct financing leases | ||||||||
Interest income on lease receivable | $ | 64 | $ | 75 | ||||
Interest income related to accretion of unguaranteed residual asset | 15 | 16 | ||||||
Total sales-type and direct financing lease income | 79 | 91 | ||||||
Operating leases | ||||||||
Operating lease income related to lease payments | 105 | 127 | ||||||
Other operating leasing gains and (losses) | (2) | 21 | ||||||
Total operating lease income and other leasing gains | 103 | 148 | ||||||
Total lease income | $ | 182 | $ | 239 | ||||
Dollars in millions | December 31, 2022 | December 31, 2021 | ||||||
Lease receivables | $ | 3,170 | $ | 3,205 | ||||
Unearned income | (253) | (193) | ||||||
Unguaranteed residual value | 472 | 450 | ||||||
Deferred fees and costs | 5 | 14 | ||||||
Net investment in sales-type and direct financing leases | $ | 3,394 | $ | 3,476 | ||||
Dollars in millions | Sales-type and direct financing lease payments | ||||
2023 | $ | 902 | |||
2024 | 689 | ||||
2025 | 486 | ||||
2026 | 388 | ||||
2027 | 246 | ||||
Thereafter | 499 | ||||
Total lease payments | $ | 3,211 | |||
Dollars in millions | Operating lease payments | ||||
2023 | $ | 80 | |||
2024 | 67 | ||||
2025 | 55 | ||||
2026 | 39 | ||||
2027 | 26 | ||||
Thereafter | 50 | ||||
Total lease payments | $ | 318 | |||
December 31, | |||||||||||
Dollars in millions | Useful life (in years) | 2022 | 2021 | ||||||||
Land | Indefinite | $ | 114 | $ | 118 | ||||||
Buildings and improvements | 15-40 | 696 | 680 | ||||||||
Leasehold improvements | 1-15 | 615 | 616 | ||||||||
Furniture and equipment | 2-15 | 824 | 814 | ||||||||
Capitalized building leases | 1-14 (a) | 18 | 19 | ||||||||
Construction in process | N/A | 41 | 70 | ||||||||
Total premises and equipment | 2,308 | 2,317 | |||||||||
Less: Accumulated depreciation and amortization | (1,672) | (1,636) | |||||||||
Premises and equipment, net | $ | 636 | $ | 681 | |||||||
Dollars in millions | Consumer Bank | Commercial Bank | Total | ||||||||
BALANCE AT DECEMBER 31, 2020 | $ | 1,752 | $ | 912 | $ | 2,664 | |||||
AQN Strategies acquisition | 9 | — | 9 | ||||||||
XUP acquisition measurement period adjustment | — | 20 | 20 | ||||||||
BALANCE AT DECEMBER 31, 2021 | 1,761 | 932 | 2,693 | ||||||||
XUP acquisition measurement period adjustment | — | 1 | 1 | ||||||||
GradFin acquisition | 58 | — | 58 | ||||||||
BALANCE AT DECEMBER 31, 2022 | $ | 1,819 | $ | 933 | $ | 2,752 | |||||
2022 | 2021 | ||||||||||||||||
December 31, Dollars in millions | Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | |||||||||||||
Intangible assets subject to amortization: | |||||||||||||||||
Core deposit intangibles | $ | 355 | $ | 303 | $ | 355 | $ | 275 | |||||||||
PCCR intangibles | 16 | 14 | 16 | 13 | |||||||||||||
Other intangible assets | 84 | 44 | 82 | 35 | |||||||||||||
Total | $ | 455 | $ | 361 | $ | 453 | $ | 323 | |||||||||
Estimated | |||||||||||||||||
Dollars in millions | 2023 | 2024 | 2025 | 2026 | 2027 | ||||||||||||
Intangible asset amortization expense | $ | 39 | $ | 28 | $ | 19 | $ | 7 | $ | 1 |
Unconsolidated VIEs | |||||||||||
Dollars in millions | Total Assets | Total Liabilities | Maximum Exposure to Loss | ||||||||
December 31, 2022 | |||||||||||
LIHTC investments | $ | 8,227 | $ | 3,091 | $ | 2,370 | |||||
December 31, 2021 | |||||||||||
LIHTC investments | $ | 7,839 | $ | 3,252 | $ | 1,985 |
Unconsolidated VIEs | |||||||||||
Dollars in millions | Total Assets | Total Liabilities | Maximum Exposure to Loss | ||||||||
December 31, 2022 | |||||||||||
Indirect investments | $ | 6,636 | $ | 90 | $ | 43 | |||||
December 31, 2021 | |||||||||||
Indirect investments | $ | 8,437 | $ | 178 | $ | 57 |
Other unconsolidated VIEs | ||||||||
Dollars in millions | Total Assets | Total Liabilities | ||||||
December 31, 2022 | ||||||||
Other unconsolidated VIEs | $ | 1,798 | $ | 1 | ||||
December 31, 2021 | ||||||||
Other unconsolidated VIEs | $ | 2,827 | $ | 1 |
Year ended December 31, Dollars in millions | 2022 | 2021 | 2020 | ||||||||
Currently payable: | |||||||||||
Federal | $ | 368 | $ | 423 | $ | 336 | |||||
State | 80 | 73 | 83 | ||||||||
Total currently payable | $ | 448 | $ | 496 | $ | 419 | |||||
Deferred: | |||||||||||
Federal | $ | (14) | $ | 119 | $ | (156) | |||||
State | (12) | 27 | (36) | ||||||||
Total deferred | (26) | 146 | (192) | ||||||||
Total income tax (benefit) expense (a) | $ | 422 | $ | 642 | $ | 227 | |||||
December 31, Dollars in millions | 2022 | 2021 | ||||||
Allowance for loan and lease losses | $ | 380 | $ | 296 | ||||
Employee benefits | 187 | 203 | ||||||
Net unrealized securities losses | 1,959 | 102 | ||||||
Federal net operating losses and credits | 4 | 6 | ||||||
Non-tax accruals | 61 | 73 | ||||||
Operating lease liabilities(a) | 149 | 165 | ||||||
State net operating losses and credits | 1 | 1 | ||||||
Partnership investments | 90 | 82 | ||||||
Other | 164 | 184 | ||||||
Gross deferred tax assets | 2,995 | 1,112 | ||||||
Less: Valuation Allowance | 11 | 12 | ||||||
Total deferred tax assets | $ | 2,984 | $ | 1,100 | ||||
Leasing transactions | $ | 521 | $ | 521 | ||||
State taxes | 86 | 28 | ||||||
Operating lease right-of-use assets (a) | 130 | 145 | ||||||
Goodwill | 139 | 121 | ||||||
Other | 86 | 96 | ||||||
Total deferred tax liabilities | 962 | 911 | ||||||
Net deferred tax assets (liabilities) (b) | $ | 2,022 | $ | 189 | ||||
Year ended December 31, Dollars in millions | 2022 | 2021 | 2020 | |||||||||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | |||||||||||||||||||||
Income (loss) before income taxes times 21% statutory federal tax rate | $ | 490 | 21.0 | % | $ | 683 | 21.0 | % | $ | 327 | 21.0 | % | ||||||||||||||
Amortization of tax-advantaged investments | 149 | 6.4 | 151 | 4.6 | 150 | 9.7 | ||||||||||||||||||||
Tax-exempt interest income | (28) | (1.2) | (26) | (.8) | (28) | (1.8) | ||||||||||||||||||||
Corporate-owned life insurance income | (28) | (1.2) | (27) | (.8) | (29) | (1.9) | ||||||||||||||||||||
State income tax, net of federal tax benefit | 53 | 2.3 | 79 | 2.4 | 37 | 2.4 | ||||||||||||||||||||
Tax credits | (204) | (8.8) | (218) | (6.7) | (218) | (14.0) | ||||||||||||||||||||
Other | (10) | (.4) | — | — | (12) | (.8) | ||||||||||||||||||||
Total income tax expense (benefit) | $ | 422 | 18.1 | % | $ | 642 | 19.7 | % | $ | 227 | 14.6 | % | ||||||||||||||
Year ended December 31, Dollars in millions | 2022 | 2021 | ||||||
Balance at beginning of year | $ | 50 | $ | 58 | ||||
Increase for other tax positions of prior years | 4 | — | ||||||
Decrease for payments and settlements | — | — | ||||||
Decrease related to tax positions taken in prior years | (14) | (8) | ||||||
Balance at end of year | $ | 40 | $ | 50 | ||||
December 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||||||
Dollars in millions | Gross Amount Presented in Balance Sheet | Netting Adjustments (a) | Collateral (b) | Net Amounts | Gross Amount Presented in Balance Sheet | Netting Adjustments (a) | Collateral (b) | Net Amounts | |||||||||||||||||||||
Offsetting of financial assets: | |||||||||||||||||||||||||||||
Reverse repurchase agreements | $ | 8 | $ | (8) | $ | — | $ | — | $ | 11 | $ | (6) | $ | (5) | $ | — | |||||||||||||
Securities borrowed | — | — | — | — | 500 | — | (500) | — | |||||||||||||||||||||
Total | $ | 8 | $ | (8) | $ | — | $ | — | $ | 511 | $ | (6) | $ | (505) | $ | — | |||||||||||||
Offsetting of financial liabilities: | |||||||||||||||||||||||||||||
Repurchase agreements (c) | $ | 71 | $ | (8) | $ | (63) | $ | — | $ | 173 | $ | (6) | $ | (167) | $ | — | |||||||||||||
Total | $ | 71 | $ | (8) | $ | (63) | $ | — | $ | 173 | $ | (6) | $ | (167) | $ | — | |||||||||||||
Year ended December 31, | 2022 | 2021 | 2020 | ||||||||
Average option life | 6.5 years | 6.6 years | 6.5 years | ||||||||
Future dividend yield | 3.01 | % | 3.88 | % | 3.90 | % | |||||
Historical share price volatility | .341 | .335 | .267 | ||||||||
Weighted-average risk-free interest rate | 2.0 | % | 0.8 | % | 1.3 | % |
Number of Options | Weighted-Average Exercise Price Per Option | Weighted-Average Remaining Life (in years) | Aggregate Intrinsic Value(a) | |||||||||||
Outstanding at December 31, 2021 | 4,587,632 | $ | 16.23 | 5.1 | $ | 32 | ||||||||
Granted | 408,297 | 28.50 | ||||||||||||
Exercised | (484,521) | 12.83 | ||||||||||||
Lapsed or canceled | (15,076) | 15.65 | ||||||||||||
Outstanding at December 31, 2022 | 4,496,332 | $ | 17.71 | 4.8 | $ | 8 | ||||||||
Expected to vest | 1,184,816 | 22.46 | 7.7 | — | ||||||||||
Exercisable at December 31, 2022 | 3,246,175 | $ | 15.84 | 3.7 | $ | 8 |
Vesting Contingent on Service Conditions | Vesting Contingent on Performance and Service Conditions - Payable in Stock | Vesting Contingent on Performance and Service Conditions - Payable in Cash | ||||||||||||||||||||||||
Number of Nonvested Shares | Weighted- Average Grant-Date Fair Value | Number of Nonvested Shares | Weighted- Average Grant-Date Fair Value | Number of Nonvested Shares | Weighted- Average Grant-Date Fair Value | |||||||||||||||||||||
Outstanding at December 31, 2021 | 12,000,384 | $ | 19.00 | 88,386 | $ | 18.47 | 5,080,523 | $ | 23.18 | |||||||||||||||||
Granted | 5,087,882 | 25.91 | — | — | 2,100,203 | 17.30 | ||||||||||||||||||||
Vested | (4,635,749) | 19.13 | (30,055) | 17.37 | (2,224,127) | 24.64 | ||||||||||||||||||||
Forfeited | (527,732) | 22.44 | — | — | (48,803) | 19.29 | ||||||||||||||||||||
Outstanding at December 31, 2022 | 11,924,785 | $ | 21.56 | 58,331 | $ | 19.02 | 4,907,796 | $ | 17.42 | |||||||||||||||||
Number of Nonvested Shares | Weighted-Average Grant-Date Fair Value | |||||||
Outstanding at December 31, 2021 | 2,948,957 | $ | 18.65 | |||||
Granted | 1,255,209 | 20.11 | ||||||
Vested | (1,128,325) | 18.57 | ||||||
Forfeited | (52,870) | 16.96 | ||||||
Outstanding at December 31, 2022 | 3,022,971 | $ | 18.82 | |||||
Year ended December 31, Dollars in millions | 2022 | 2021 | 2020 | ||||||||
Interest cost on PBO | $ | 27 | $ | 25 | $ | 34 | |||||
Expected return on plan assets | (27) | (28) | (38) | ||||||||
Amortization of losses | 15 | 18 | 17 | ||||||||
Settlement loss | 12 | 9 | 9 | ||||||||
Net pension cost | $ | 27 | $ | 24 | $ | 22 | |||||
Other changes in plan assets and benefit obligations recognized in OCI: | |||||||||||
Net (gain) loss | $ | 31 | $ | (19) | $ | (18) | |||||
Amortization of gains | (27) | (27) | (26) | ||||||||
Total recognized in comprehensive income | $ | 4 | $ | (46) | $ | (44) | |||||
Total recognized in net pension cost and comprehensive income | $ | 31 | $ | (22) | $ | (22) | |||||
Year ended December 31, Dollars in millions | 2022 | 2021 | ||||||
PBO at beginning of year | $ | 1,156 | $ | 1,248 | ||||
Interest cost | 27 | 25 | ||||||
Actuarial losses (gains) | (133) | (31) | ||||||
Benefit payments | (85) | (86) | ||||||
PBO at end of year | $ | 965 | $ | 1,156 | ||||
Year ended December 31, Dollars in millions | 2022 | 2021 | ||||||
FVA at beginning of year | $ | 1,096 | $ | 1,153 | ||||
Actual return on plan assets | (138) | 16 | ||||||
Employer contributions | 13 | 13 | ||||||
Benefit payments | (85) | (86) | ||||||
FVA at end of year | $ | 886 | $ | 1,096 | ||||
December 31, Dollars in millions | 2022 | 2021 | ||||||
Funded status (a) | $ | (78) | $ | (60) | ||||
Net prepaid pension cost recognized consists of: | ||||||||
Noncurrent assets | $ | 58 | $ | 106 | ||||
Current liabilities | (13) | (14) | ||||||
Noncurrent liabilities | (123) | (152) | ||||||
Net prepaid pension cost recognized (b) | $ | (78) | $ | (60) | ||||
December 31, | 2022 | 2021 | ||||||||||||
Dollars in millions | Cash Balance Pension Plan | Other Defined Benefit Plans | Cash Balance Pension Plan | Other Defined Benefit Plans | ||||||||||
PBO | $ | 828 | $ | 137 | $ | 991 | $ | 166 | ||||||
ABO | 828 | 137 | 991 | 166 | ||||||||||
Fair value of plan assets | 886 | — | 1,096 | — |
December 31, | 2022 | 2021 | ||||||
Discount rate | 4.85 | % | 2.43 | % | ||||
Compensation increase rate | N/A | N/A | ||||||
Weighted-average interest crediting rate | 3.97 | % | 1.90 | % |
Year ended December 31, | 2022 | 2021 | 2020 | ||||||||
Discount rate | 2.43 | % | 2.05 | % | 2.89 | % | |||||
Compensation increase rate | N/A | N/A | N/A | ||||||||
Expected return on plan assets | 2.75 | % | 2.75 | % | 3.75 | % |
December 31, 2022 | ||||||||||||||
Dollars in millions | Level 1 | Level 2 | Level 3 | Total | ||||||||||
ASSET CLASS | ||||||||||||||
Mutual funds: | ||||||||||||||
Fixed income — U.S. | $ | — | $ | 359 | $ | — | $ | 359 | ||||||
Collective investment funds (measured at NAV) (a) | — | — | — | 507 | ||||||||||
Insurance investment contracts and pooled separate accounts (measured at NAV) (a) | — | — | — | 20 | ||||||||||
Other assets (measured at NAV) (a) | — | — | — | — | ||||||||||
Total net assets at fair value | $ | — | $ | 359 | $ | — | $ | 886 | ||||||
December 31, 2021 | ||||||||||||||
Dollars in millions | Level 1 | Level 2 | Level 3 | Total | ||||||||||
ASSET CLASS | ||||||||||||||
Mutual funds: | ||||||||||||||
Fixed income — U.S. | $ | — | $ | 454 | $ | — | $ | 454 | ||||||
Collective investment funds (measured at NAV) (a) | — | — | — | 622 | ||||||||||
Insurance investment contracts and pooled separate accounts (measured at NAV) (a) | — | — | — | 19 | ||||||||||
Other assets (measured at NAV) (a) | — | — | — | 1 | ||||||||||
Total net assets at fair value | $ | — | $ | 454 | $ | — | $ | 1,096 | ||||||
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Net unrecognized losses (gains) | $ | (9) | $ | (9) | ||||
Net unrecognized prior service credit | (12) | (14) | ||||||
Total unrecognized AOCI | $ | (21) | $ | (23) | ||||
December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
Interest cost on APBO | $ | 2 | $ | 2 | $ | 2 | |||||
Expected return on plan assets | (2) | (2) | (2) | ||||||||
Amortization of prior service credit | (1) | (1) | (1) | ||||||||
Amortization of gains | (1) | (1) | — | ||||||||
Net postretirement benefit | $ | (2) | $ | (2) | $ | (1) | |||||
Other changes in plan assets and benefit obligations recognized in OCI: | |||||||||||
Net (gain) loss | $ | 1 | $ | 1 | $ | 1 | |||||
Amortization of prior service credit | 1 | 1 | — | ||||||||
Total recognized in comprehensive income | $ | 2 | $ | 2 | $ | 1 | |||||
Total recognized in net postretirement benefit cost and comprehensive income | $ | — | $ | — | $ | — | |||||
Year ended December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
APBO at beginning of year | $ | 57 | $ | 52 | ||||
Service cost | — | — | ||||||
Interest cost | 2 | 2 | ||||||
Plan participants’ contributions | 1 | 2 | ||||||
Actuarial losses (gains) | (5) | 11 | ||||||
Benefit payments | (15) | (10) | ||||||
Plan amendments | — | — | ||||||
APBO at end of year | $ | 40 | $ | 57 | ||||
Year ended December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
FVA at beginning of year | $ | 57 | $ | 52 | ||||
Employer contributions | — | — | ||||||
Plan participants’ contributions | 1 | 2 | ||||||
Benefit payments | (15) | (10) | ||||||
Actual return on plan assets | (3) | 13 | ||||||
FVA at end of year | $ | 40 | $ | 57 | ||||
Year ended December 31, | 2022 | 2021 | 2020 | ||||||||
Discount rate | 4.50 | % | 4.50 | % | 4.50 | % | |||||
Expected return on plan assets | 4.50 | 4.50 | 4.50 |
Target Allocation | |||||
Asset Class | 2022 | ||||
U.S. equity securities | 64 | % | |||
International equity securities | 16 | ||||
Fixed income securities | 20 | ||||
Total | 100 | % | |||
December 31, 2022 | ||||||||||||||
Dollars in millions | Level 1 | Level 2 | Level 3 | Total | ||||||||||
ASSET CLASS | ||||||||||||||
Mutual funds: | ||||||||||||||
Equity — U.S. | $ | 24 | $ | — | $ | — | $ | 24 | ||||||
Equity — International | 7 | — | — | 7 | ||||||||||
Fixed income — U.S. | 8 | — | — | 8 | ||||||||||
Collective investment funds: | ||||||||||||||
Equity — U.S.(a) | — | — | — | — | ||||||||||
Other assets (measured at NAV)(a) | — | — | — | 1 | ||||||||||
Total net assets at fair value | $ | 39 | $ | — | $ | — | $ | 40 | ||||||
December 31, 2021 | ||||||||||||||
Dollars in millions | Level 1 | Level 2 | Level 3 | Total | ||||||||||
ASSET CLASS | ||||||||||||||
Mutual funds: | ||||||||||||||
Equity — U.S. | $ | 21 | $ | — | $ | — | $ | 21 | ||||||
Equity — International | 10 | — | — | 10 | ||||||||||
Fixed income — U.S. | 7 | — | — | 7 | ||||||||||
Fixed income — International | — | — | — | 1 | ||||||||||
Collective investment funds: | ||||||||||||||
Equity — U.S. (a) | — | — | — | 17 | ||||||||||
Other assets (measured at NAV) | — | — | — | 1 | ||||||||||
Total net assets at fair value | $ | 38 | $ | — | $ | — | $ | 57 | ||||||
December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
FEDERAL FUNDS PURCHASED | |||||||||||
Balance at year end | $ | 4,006 | $ | — | $ | — | |||||
Average during the year | 1,490 | — | 455 | ||||||||
Maximum month-end balance | 5,872 | — | 2,285 | ||||||||
Weighted-average rate during the year (a) | 2.04 | % | — | % | 1.24 | % | |||||
Weighted-average rate at December 31 (a) | 4.18 | — | — | ||||||||
SECURITIES SOLD UNDER REPURCHASE AGREEMENTS | |||||||||||
Balance at year end | $ | 71 | $ | 173 | $ | 220 | |||||
Average during the year | 617 | 239 | 215 | ||||||||
Maximum month-end balance | 1,090 | 281 | 267 | ||||||||
Weighted-average rate during the year (a) | 1.66 | % | .02 | % | .11 | % | |||||
Weighted-average rate at December 31 (a) | 3.74 | .01 | .04 | ||||||||
OTHER SHORT-TERM BORROWINGS | |||||||||||
Balance at year end | $ | 5,386 | $ | 588 | $ | 759 | |||||
Average during the year | 2,963 | 770 | 1,452 | ||||||||
Maximum month-end balance | 11,372 | 897 | 4,606 | ||||||||
Weighted-average rate during the year (a) | 1.82 | % | 1.08 | % | 0.85 | % | |||||
Weighted-average rate at December 31 (a) | .50 | 1.97 | .60 |
December 31, | ||||||||
Dollars in millions | 2022 | 2021 | ||||||
Senior medium-term notes due through 2033 (a) | $ | 3,789 | $ | 2,820 | ||||
3.017% Subordinated notes due 2028 (b) | 162 | 162 | ||||||
6.875% Subordinated notes due 2029 (b) | 99 | 107 | ||||||
7.75% Subordinated notes due 2029 (b) | 112 | 139 | ||||||
Other subordinated notes (b)(d) | 77 | 75 | ||||||
Total parent company | 4,239 | 3,303 | ||||||
Senior medium-term notes due through 2039 (e) | 6,411 | 6,582 | ||||||
4.39% Senior remarketable notes due 2027 (f) | 191 | 242 | ||||||
3.40% Subordinated notes due 2026 (g) | 555 | 602 | ||||||
6.95% Subordinated notes due 2028 (g) | 281 | 299 | ||||||
3.90% Subordinated notes due 2029 (g) | 327 | 376 | ||||||
4.90% Subordinated notes due 2032 (g) | 685 | — | ||||||
Secured borrowing due through 2025 (h) | 6 | 13 | ||||||
Federal Home Loan Bank advances due through 2038 (i) | 6,594 | 604 | ||||||
Investment Fund Financing due through 2052 (j) | 10 | 10 | ||||||
Key Govt Finance, Inc. Other Long Term Debt-ASR | 2 | 3 | ||||||
Obligations under Capital Leases due through 2032 (k) | 6 | 8 | ||||||
Total subsidiaries | 15,068 | 8,739 | ||||||
Total long-term debt | $ | 19,307 | $ | 12,042 | ||||
Dollars in millions | Parent | Subsidiaries | Total | ||||||||
2023 | $ | — | $ | 3,958 | $ | 3,958 | |||||
2024 | — | 6,035 | 6,035 | ||||||||
2025 | 581 | 1,943 | 2,524 | ||||||||
2026 | 485 | 566 | 1,051 | ||||||||
2027 | 695 | 1,199 | 1,894 | ||||||||
All subsequent years | 2,478 | 1,367 | 3,845 |
Dollars in millions | Trust Preferred Securities, Net of Discount (a) | Common Stock | Principal Amount of Debentures, Net of Discount (b) | Interest Rate of Trust Preferred Securities and Debentures (c) | Maturity of Trust Preferred Securities and Debentures | ||||||||||||
December 31, 2022 | |||||||||||||||||
KeyCorp Capital I | $ | 156 | $ | 6 | $ | 162 | 3.017 | % | 2028 | ||||||||
KeyCorp Capital II | 95 | 4 | 99 | 6.875 | 2029 | ||||||||||||
KeyCorp Capital III | 108 | 4 | 112 | 7.750 | 2029 | ||||||||||||
HNC Statutory Trust III | 20 | 1 | 21 | 4.380 | 2035 | ||||||||||||
Willow Grove Statutory Trust I | 20 | 1 | 21 | 4.062 | 2036 | ||||||||||||
HNC Statutory Trust IV | 18 | 1 | 19 | 4.603 | 2037 | ||||||||||||
Westbank Capital Trust II | 8 | — | 8 | 5.717 | 2034 | ||||||||||||
Westbank Capital Trust III | 8 | — | 8 | 5.717 | 2034 | ||||||||||||
Total | $ | 433 | $ | 17 | $ | 450 | 5.321 | % | — | ||||||||
December 31, 2021 | $ | 466 | $ | 17 | $ | 483 | 4.271 | % | — | ||||||||
December 31, Dollars in millions | 2022 | 2021 | ||||||
Loan commitments: | ||||||||
Commercial and other | $ | 58,269 | $ | 54,614 | ||||
Commercial real estate and construction | 4,037 | 3,180 | ||||||
Home equity | 9,346 | 8,888 | ||||||
Credit cards | 7,424 | 7,217 | ||||||
Total loan commitments | 79,076 | 73,899 | ||||||
Commercial letters of credit | 86 | 79 | ||||||
Purchase card commitments | 875 | 771 | ||||||
Principal investing commitments | 9 | 12 | ||||||
Tax credit investment commitments | 958 | 679 | ||||||
Total loan and other commitments | $ | 81,004 | $ | 75,440 | ||||
December 31, 2022 | Maximum Potential Undiscounted Future Payments | Liability Recorded | ||||||
Dollars in millions | ||||||||
Financial guarantees: | ||||||||
Standby letters of credit | $ | 4,960 | $ | 92 | ||||
Recourse agreement with FNMA | 6,774 | 28 | ||||||
Residential mortgage reserve | 3,302 | 13 | ||||||
Written put options (a) | 3,695 | 243 | ||||||
Total | $ | 18,731 | $ | 376 | ||||
Dollars in millions | Unrealized gains (losses) on securities available for sale | Unrealized gains (losses) on derivative financial instruments | Foreign currency translation adjustment | Net pension and postretirement benefit costs | Total | ||||||||||||
Balance at December 31, 2020 | $ | 567 | $ | 476 | $ | — | $ | (305) | $ | 738 | |||||||
Other comprehensive income before reclassification, net of income taxes | (965) | (137) | — | 14 | (1,088) | ||||||||||||
Amounts reclassified from accumulated other comprehensive income, net of income taxes (a) | (5) | (251) | — | 20 | (236) | ||||||||||||
Net current-period other comprehensive income, net of income taxes | (970) | (388) | — | 34 | (1,324) | ||||||||||||
Balance at December 31, 2021 | $ | (403) | $ | 88 | $ | — | $ | (271) | $ | (586) | |||||||
Other comprehensive income before reclassification, net of income taxes | (4,492) | (1,319) | — | (25) | (5,836) | ||||||||||||
Amounts reclassified from accumulated other comprehensive income, net of income taxes (a) | — | 107 | — | 20 | 127 | ||||||||||||
Net current-period other comprehensive income, net of income taxes | (4,492) | (1,212) | — | (5) | (5,709) | ||||||||||||
Balance at December 31, 2022 | $ | (4,895) | $ | (1,124) | $ | — | $ | (276) | $ | (6,295) | |||||||
Twelve Months Ended December 31, | Affected Line Item in the Consolidated Statement of Income | ||||||||||
Dollars in millions | 2022 | 2021 | |||||||||
Unrealized gains (losses) on available for sale securities | |||||||||||
Realized gains | $ | — | $ | 7 | Other income | ||||||
— | 7 | Income (loss) from continuing operations before income taxes | |||||||||
— | 2 | Income taxes | |||||||||
$ | — | $ | 5 | Income (loss) from continuing operations | |||||||
Unrealized gains (losses) on derivative financial instruments | |||||||||||
Interest rate | $ | (146) | $ | 329 | Interest income — Loans | ||||||
Interest rate | (3) | (4) | Interest expense — Long-term debt | ||||||||
Interest rate | 9 | 4 | Investment banking and debt placement fees | ||||||||
(140) | 329 | Income (loss) from continuing operations before income taxes | |||||||||
(33) | 78 | Income taxes | |||||||||
$ | (107) | $ | 251 | Income (loss) from continuing operations | |||||||
Net pension and postretirement benefit costs | |||||||||||
Amortization of losses | $ | (15) | $ | (18) | Other expense | ||||||
Settlement loss | (12) | (9) | Other expense | ||||||||
Amortization of prior service credit | 1 | 1 | Other expense | ||||||||
(26) | (26) | Income (loss) from continuing operations before income taxes | |||||||||
(6) | (6) | Income taxes | |||||||||
$ | (20) | $ | (20) | Income (loss) from continuing operations | |||||||
Preferred stock series | Amount outstanding (in millions) | Shares authorized and outstanding | Par value | Liquidation preference | Ownership interest per depositary share | Liquidation preference per depositary share | 2022 dividends paid per depositary share | ||||||||||||||||
Fixed-to-Floating Rate Perpetual Noncumulative Series D | $ | 525 | 21,000 | $ | 1 | $ | 25,000 | 1/25th | $ | 1,000 | $ | 50.00 | |||||||||||
Fixed-to-Floating Rate Perpetual Noncumulative Series E | 500 | 500,000 | 1 | 1,000 | 1/40th | 25 | 1.531252 | ||||||||||||||||
Fixed Rate Perpetual Noncumulative Series F | 425 | 425,000 | 1 | 1,000 | 1/40th | 25 | 1.412500 | ||||||||||||||||
Fixed Rate Perpetual Noncumulative Series G | 450 | 450,000 | 1 | 1,000 | 1/40th | 25 | 1.406252 | ||||||||||||||||
Fixed Rate Perpetual Noncumulative Series H | 600 | 600,000 | 1 | 1,000 | 1/40th | 25 | 0.477917 |
Year ended December 31, | Consumer Bank | Commercial Bank | |||||||||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | 2022 | 2021 | 2020 | |||||||||||||||||
SUMMARY OF OPERATIONS | |||||||||||||||||||||||
Net interest income (TE) | $ | 2,419 | $ | 2,359 | $ | 2,403 | $ | 1,867 | $ | 1,650 | $ | 1,725 | |||||||||||
Noninterest income | 995 | 1,067 | 999 | 1,600 | 1,990 | 1,524 | |||||||||||||||||
Total revenue (TE) (a) | 3,414 | 3,426 | 3,402 | 3,467 | 3,640 | 3,249 | |||||||||||||||||
Provision for credit losses | 193 | (118) | 284 | 317 | (279) | 741 | |||||||||||||||||
Depreciation and amortization expense | 87 | 84 | 77 | 113 | 134 | 144 | |||||||||||||||||
Other noninterest expense | 2,618 | 2,307 | 2,185 | 1,621 | 1,731 | 1,606 | |||||||||||||||||
Income (loss) from continuing operations before income taxes (TE) | 516 | 1,153 | 856 | 1,416 | 2,054 | 758 | |||||||||||||||||
Allocated income taxes (benefit) and TE adjustments | 124 | 277 | 203 | 270 | 412 | 107 | |||||||||||||||||
Income (loss) from continuing operations | 392 | 876 | 653 | 1,146 | 1,642 | 651 | |||||||||||||||||
Income (loss) from discontinued operations, net of taxes | — | — | — | — | — | — | |||||||||||||||||
Net income (loss) | 392 | 876 | 653 | 1,146 | 1,642 | 651 | |||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||
Net income (loss) attributable to Key | $ | 392 | $ | 876 | $ | 653 | $ | 1,146 | $ | 1,642 | $ | 651 | |||||||||||
AVERAGE BALANCES (b) | |||||||||||||||||||||||
Loans and leases | $ | 41,315 | $ | 39,422 | $ | 37,842 | $ | 69,549 | $ | 60,486 | $ | 64,543 | |||||||||||
Total assets (a) | 44,395 | 42,637 | 41,152 | 80,068 | 70,051 | 74,225 | |||||||||||||||||
Deposits | 90,008 | 88,352 | 79,528 | 54,672 | 55,598 | 47,145 | |||||||||||||||||
OTHER FINANCIAL DATA | |||||||||||||||||||||||
Expenditures for additions to long-lived assets (a), (b) | $ | 52 | $ | 39 | $ | 40 | $ | 4 | $ | 12 | $ | 1 | |||||||||||
Net loan charge-offs (b) | 83 | 126 | 135 | 84 | 81 | 308 | |||||||||||||||||
Return on average allocated equity (b) | 11.13 | % | 24.54 | % | 18.97 | % | 12.59 | % | 19.22 | % | 12.99 | % | |||||||||||
Return on average allocated equity | 11.13 | 24.54 | 18.97 | 12.59 | 19.22 | 12.99 | |||||||||||||||||
Average full-time equivalent employees (c) | 8,041 | 8,000 | 8,186 | 2,454 | 2,370 | 2,291 |
Year ended December 31, | Other | Key | |||||||||||||||||||||
Dollars in millions | 2022 | 2021 | 2020 | 2022 | 2021 | 2020 | |||||||||||||||||
SUMMARY OF OPERATIONS | |||||||||||||||||||||||
Net interest income (TE) | $ | 268 | $ | 89 | $ | (65) | $ | 4,554 | $ | 4,098 | $ | 4,063 | |||||||||||
Noninterest income | 123 | 137 | 129 | 2,718 | 3,194 | 2,652 | |||||||||||||||||
Total revenue (TE) (a) | 391 | 226 | 64 | 7,272 | 7,292 | 6,715 | |||||||||||||||||
Provision for credit losses | (8) | (21) | (4) | 502 | (418) | 1,021 | |||||||||||||||||
Depreciation and amortization expense | 71 | 80 | 82 | 271 | 298 | 303 | |||||||||||||||||
Other noninterest expense | (100) | 93 | 15 | 4,139 | 4,131 | 3,806 | |||||||||||||||||
Income (loss) from continuing operations before income taxes (TE) | 428 | 74 | (29) | 2,360 | 3,281 | 1,585 | |||||||||||||||||
Allocated income taxes (benefit) and TE adjustments | 55 | (20) | (54) | 449 | 669 | 256 | |||||||||||||||||
Income (loss) from continuing operations | 373 | 94 | 25 | 1,911 | 2,612 | 1,329 | |||||||||||||||||
Income (loss) from discontinued operations, net of taxes | 6 | 13 | 14 | 6 | 13 | 14 | |||||||||||||||||
Net income (loss) | 379 | 107 | 39 | 1,917 | 2,625 | 1,343 | |||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||
Net income (loss) attributable to Key | $ | 379 | $ | 107 | $ | 39 | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||||||||
AVERAGE BALANCES (b) | |||||||||||||||||||||||
Loans and leases | $ | 438 | $ | 361 | $ | 304 | $ | 111,302 | $ | 100,269 | $ | 102,689 | |||||||||||
Total assets (a) | 61,423 | 66,231 | 46,678 | 185,886 | 178,919 | 162,055 | |||||||||||||||||
Deposits | 2,182 | 1,085 | 613 | 146,862 | 145,035 | 127,286 | |||||||||||||||||
OTHER FINANCIAL DATA | |||||||||||||||||||||||
Expenditures for additions to long-lived assets (a), (b) | $ | 198 | $ | 63 | $ | 120 | $ | 254 | $ | 114 | $ | 161 | |||||||||||
Net loan charge-offs (b) | (6) | (23) | 1 | 161 | 184 | 444 | |||||||||||||||||
Return on average allocated equity (b) | 17.74 | % | 1.69 | % | .27 | % | 12.97 | % | 14.79 | % | 7.54 | % | |||||||||||
Return on average allocated equity | 18.02 | 1.93 | .42 | 13.01 | 14.86 | 7.62 | |||||||||||||||||
Average full-time equivalent employees (c) | 7,165 | 6,604 | 6,349 | 17,660 | 16,974 | 16,826 |
December 31, Dollars in millions | 2022 | 2021 | ||||||
ASSETS | ||||||||
Cash and due from banks | $ | 3,146 | $ | 2,293 | ||||
Short-term investments | 15 | 24 | ||||||
Securities available for sale | — | — | ||||||
Other investments | 78 | 77 | ||||||
Loans to: | ||||||||
Banks | 250 | 50 | ||||||
Nonbank subsidiaries | 16 | 16 | ||||||
Total loans | 266 | 66 | ||||||
Investment in subsidiaries: | ||||||||
Banks | 13,033 | 17,019 | ||||||
Nonbank subsidiaries | 928 | 1,015 | ||||||
Total investment in subsidiaries | 13,961 | 18,034 | ||||||
Goodwill | 167 | 167 | ||||||
Corporate-owned life insurance | 209 | 212 | ||||||
Derivative assets | 111 | 76 | ||||||
Accrued income and other assets | 248 | 309 | ||||||
Total assets | $ | 18,201 | $ | 21,258 | ||||
LIABILITIES | ||||||||
Accrued expense and other liabilities | $ | 508 | $ | 532 | ||||
Long-term debt due to: | ||||||||
Subsidiaries | 450 | 483 | ||||||
Unaffiliated companies | 3,789 | 2,820 | ||||||
Total long-term debt | 4,239 | 3,303 | ||||||
Total liabilities | 4,747 | 3,835 | ||||||
SHAREHOLDERS’ EQUITY (a) | 13,454 | 17,423 | ||||||
Total liabilities and shareholders’ equity | $ | 18,201 | $ | 21,258 | ||||
Year ended December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
INCOME | |||||||||||
Dividends from subsidiaries: | |||||||||||
Bank subsidiaries | $ | 475 | $ | 1,925 | $ | 1,250 | |||||
Nonbank subsidiaries | 100 | 50 | — | ||||||||
Interest income from subsidiaries | 4 | 1 | 4 | ||||||||
Other income | 7 | 36 | 8 | ||||||||
Total income | 586 | 2,012 | 1,262 | ||||||||
EXPENSE | |||||||||||
Interest on long-term debt with subsidiary trusts | 19 | 13 | 18 | ||||||||
Interest on other borrowed funds | 130 | 65 | 114 | ||||||||
Personnel and other expense | 101 | 101 | 63 | ||||||||
Total expense | 250 | 179 | 195 | ||||||||
Income (loss) before income taxes and equity in net income (loss) less dividends from subsidiaries | 336 | 1,833 | 1,067 | ||||||||
Income tax (expense) benefit | 60 | 38 | 38 | ||||||||
Income (loss) before equity in net income (loss) less dividends from subsidiaries | 396 | 1,871 | 1,105 | ||||||||
Equity in net income (loss) less dividends from subsidiaries | 1,521 | 754 | 238 | ||||||||
NET INCOME (LOSS) | 1,917 | 2,625 | 1,343 | ||||||||
Less: Net income attributable to noncontrolling interests | — | — | — | ||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO KEY | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||
Year ended December 31, | |||||||||||
Dollars in millions | 2022 | 2021 | 2020 | ||||||||
OPERATING ACTIVITIES | |||||||||||
Net income (loss) attributable to Key | $ | 1,917 | $ | 2,625 | $ | 1,343 | |||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||
Deferred income taxes (benefit) | 6 | (22) | 2 | ||||||||
Stock-based compensation expense | 117 | 9 | 11 | ||||||||
Equity in net (income) loss less dividends from subsidiaries | (1,521) | (754) | (238) | ||||||||
Net (increase) decrease in other assets | 23 | 13 | (66) | ||||||||
Net increase (decrease) in other liabilities | (24) | 48 | 12 | ||||||||
Other operating activities, net | (480) | (414) | 131 | ||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 38 | 1,505 | 1,195 | ||||||||
INVESTING ACTIVITIES | |||||||||||
Net (increase) decrease in securities available for sale and in short-term and other investments | (26) | (15) | (7) | ||||||||
Proceeds from sales, prepayments and maturities of securities available for sale | — | — | — | ||||||||
Net (increase) decrease in loans to subsidiaries | (200) | — | — | ||||||||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | (226) | (15) | (7) | ||||||||
FINANCING ACTIVITIES | |||||||||||
Net proceeds from issuance of long-term debt | 1,350 | — | 800 | ||||||||
Payments on long-term debt | — | (997) | (1,003) | ||||||||
Repurchase of Treasury Shares | (44) | (1,176) | (170) | ||||||||
Net cash from the issuance (redemption) of Common Shares and preferred stock | 590 | — | — | ||||||||
Cash dividends paid | (855) | (823) | (829) | ||||||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 1,041 | (2,996) | (1,202) | ||||||||
NET INCREASE (DECREASE) IN CASH AND DUE FROM BANKS | 853 | (1,506) | (14) | ||||||||
CASH AND DUE FROM BANKS AT BEGINNING OF YEAR | 2,293 | 3,799 | 3,813 | ||||||||
CASH AND DUE FROM BANKS AT END OF YEAR | $ | 3,146 | $ | 2,293 | $ | 3,799 | |||||
Year ended December 31, | 2022 | 2021 | |||||||||||||||||||||
Dollars in millions | Consumer Bank | Commercial Bank | Total Contract Revenue | Consumer Bank | Commercial Bank | Total Contract Revenue | |||||||||||||||||
NONINTEREST INCOME | |||||||||||||||||||||||
Trust and investment services income | $ | 403 | $ | 69 | $ | 472 | $ | 417 | $ | 67 | $ | 484 | |||||||||||
Investment banking and debt placement fees | — | 430 | 430 | — | 586 | 586 | |||||||||||||||||
Services charges on deposit accounts | 211 | 139 | 350 | 201 | 136 | 337 | |||||||||||||||||
Cards and payments income | 177 | 154 | 331 | 181 | 226 | 407 | |||||||||||||||||
Other noninterest income | 11 | — | 11 | 7 | 2 | 9 | |||||||||||||||||
Total revenue from contracts with customers | $ | 802 | $ | 792 | $ | 1,594 | $ | 806 | $ | 1,017 | $ | 1,823 | |||||||||||
Other noninterest income (a) | $ | 1,001 | $ | 1,234 | |||||||||||||||||||
Noninterest income from other segments (b) | 123 | 137 | |||||||||||||||||||||
Total noninterest income | $ | 2,718 | $ | 3,194 | |||||||||||||||||||
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101 | The following materials from KeyCorp’s Form 10-K Report for the year ended December 31, 2022, formatted in inline XBRL: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income and Consolidated Statements of Comprehensive Income; (iii) the Consolidated Statements of Changes in Equity; (iv) the Consolidated Statements of Cash Flows; and (v) the Notes to Consolidated Financial Statements. | |||||||
104 | The cover page from KeyCorp’s Form 10-K for the year ended December 31, 2022, formatted in inline XBRL (contained in Exhibit 101). | |||||||
KEYCORP | ||
/s/ Donald R. Kimble | ||
Donald R. Kimble | ||
Chief Financial Officer (Principal Financial Officer) | ||
February 22, 2023 | ||
/s/ Douglas M. Schosser | ||
Douglas M. Schosser | ||
Chief Accounting Officer (Principal Accounting Officer) | ||
February 22, 2023 |
Signature | Title | |||||||
*Christopher M. Gorman | Chairman, Chief Executive Officer and President (Principal Executive Officer), and Director | |||||||
*Donald R. Kimble | Chief Financial Officer (Principal Financial Officer) | |||||||
*Douglas M. Schosser | Chief Accounting Officer (Principal Accounting Officer) | |||||||
*Alexander M. Cutler | Director | |||||||
*H. James Dallas | Director | |||||||
*Elizabeth R. Gile | Director | |||||||
*Ruth Ann M. Gillis | Director | |||||||
*Robin N. Hayes | Director | |||||||
*Carlton L. Highsmith | Director | |||||||
*Richard J. Hipple | Director | |||||||
*Devina A. Rankin | Director | |||||||
*Barbara R. Snyder | Director | |||||||
*Richard J. Tobin | Director | |||||||
*Todd J. Vasos | Director | |||||||
*David K. Wilson | Director |
/s/ James L. Waters | ||
* By James L. Waters, attorney-in-fact | ||
February 22, 2023 |
Depositary Share | Trading Symbol | ||||
Depositary Shares each representing a 1/40th interest in a share of Series E Preferred Stock | KEY Prl | ||||
Depositary Shares each representing a 1/40th interest in a share of Series F Preferred Stock | KEY PrJ | ||||
Depositary Shares each representing a 1/40th interest in a share of Series G Preferred Stock | KEY PrK | ||||
Depositary Shares each representing a 1/40th interest in a share of Series H Preferred Stock | Key PrL |
Series | Dividend Rate | Dividend Commencement Date | ||||||
Series D Preferred Stock | 5.000% per annum to but excluding September 15, 2026 and thereafter at a floating rate per annum equal to three-month LIBOR, reset quarterly, plus 3.606%. | December 15, 2016 | ||||||
Series E Preferred Stock | 6.125% per annum to but excluding December 15, 2026 and thereafter at a floating rate per annum equal to three-month LIBOR, reset quarterly, plus 3.892%. | March 15, 2017 | ||||||
Series F Preferred Stock | 5.650% per annum. | December 15, 2018 | ||||||
Series G Preferred Stock | 5.625% per annum. | September 15, 2019 | ||||||
Series H Preferred Stock | 6.200% per annum to but excluding December 15, 2027 and thereafter, during each reset period, at a rate per annum equal to the five-year treasury rate as of the most recent reset date, plus 3.132%. “Reset date” means December 15, 2027 and each date falling on the fifth anniversary of the preceding reset date. | December 15, 2022 |
Series | Date | ||||
Series D Preferred Stock | September 15, 2026 | ||||
Series E Preferred Stock | December 15, 2026 | ||||
Series F Preferred Stock | December 15, 2023 | ||||
Series G Preferred Stock | September 15, 2024 | ||||
Series H Preferred Stock | December 15, 2027 |
Name of Participant: | [●] | ||||
Target Number of Performance Shares: | [●] | ||||
Date of Grant: | [●] | ||||
Vesting Date: | February 17, 2026, subject to approval of the Compensation and Organization Committee of the Board of Directors, and subject to your continued employment on this date and the achievement of the Performance Goals set forth below (except as otherwise provided in this Award Agreement) | ||||
Performance Period: | January 1, 2023 through December 31, 2025 | ||||
Performance Goal: | The Participant may vest in between 0% and 150% of the target number of Performance Shares subject to this Award based on the weighted level of achievement of the following “Performance Goals” during the Performance Period: |
Performance Goals | Other Factors (Vesting Reduction Only) | |||||||||||||||||||
Performance Metric | Weight | Threshold | Target | Maximum | ||||||||||||||||
50% Weighted Vesting | 100% Weighted Vesting | 150% Weighted Vesting | ||||||||||||||||||
Adjusted Return on Tangible Common Equity v. Peers | 50% | 25% ile | 50% ile | 75% ile | ERM Dashboard | |||||||||||||||
Adjusted Cumulative Earnings Per Share | 50% | 75% of EPS at Plan* | 100% of EPS at Plan* | 125% of EPS at Plan* | Execution of Strategic Priorities | |||||||||||||||
Multiplier: Total Shareholder Return vs. Peer | Modifier | <25% ile -15% | ≥25% ile to ≤75% ile No Impact | >75% ile +15% | Other factors, as appropriate |
EPS at Plan: | The Cumulative Earnings Per Share as set forth in the KeyCorp 2023-2025 Long Term Incentive Compensation Plan, which excludes any impact to Cumulative Earnings Per Share based on changes to interest rates. EPS at Plan may be adjusted by KeyCorp, in its discretion, to correspond to changes in interest rates. | ||||
Total Shareholder Return vs. Peers: | KeyCorp’s percentile ranking among the companies in the Peer Group (as defined below) for total shareholder return for the Performance Period, calculated based on the average closing share price over the last 20 trading days in 2022 compared to the average closing share price over the last 20 days in 2025 plus investment of dividends paid during the Performance Period. | ||||
Adjusted Return on Tangible Common Equity vs. Peers: | KeyCorp’s percentile ranking among the companies in the Peer Group (as defined below) for average annual return on tangible common equity during the three fiscal years of (or ending during) the Performance Period, with return on tangible common equity calculated as net income from continuing operations attributable to common shareholders divided by average tangible common equity from continuing operations, adjusted to remove the impact of changes in allowance for loan losses in consideration of CECL. | ||||
Adjusted Cumulative Earnings Per Share vs. Peers: | The sum of KeyCorp’s annual earnings per share for the three fiscal years in the Performance Period, as reported in the Form 10-Ks filed by KeyCorp for such fiscal years, adjusted to remove the impact of changes in allowance for loan losses in consideration of CECL. | ||||
Peer Group: | KeyCorp’s peer group, as determined annually by the Compensation and Organization Committee of the Board of Directors and identified in KeyCorp’s proxy statement. |
Subsidiaries(a) | Jurisdiction of Incorporation or Organization | Parent Company | ||||||||||||
KeyBank National Association | United States | KeyCorp | ||||||||||||
Subsidiary Issuer | Guaranteed Securities | ||||
KeyCorp Capital I | KeyCorp Capital I Floating Rate Capital Securities | ||||
KeyCorp Capital II | KeyCorp Capital II 6 7/8% Capital Securities | ||||
KeyCorp Capital III | KeyCorp Capital III 7 3/4% Capital Securities |
/s/ Christopher M. Gorman | /s/ Donald R. Kimble | |||||||
Christopher M. Gorman Chairman and Chief Executive Officer, and Director (Principal Executive Officer) | Donald R. Kimble Chief Financial Officer (Principal Financial Officer) | |||||||
/s/ Douglas M. Schosser | /s/ Alexander M. Cutler | |||||||
Douglas M. Schosser Chief Accounting Officer (Principal Accounting Officer) | Alexander M. Cutler, Director | |||||||
/s/ H. James Dallas | /s/ Elizabeth R. Gile | |||||||
H. James Dallas, Director | Elizabeth R. Gile, Director | |||||||
/s/ Ruth Ann M. Gillis | /s/ Robin N. Hayes | |||||||
Ruth Ann M. Gillis, Director | Robin N. Hayes, Director | |||||||
/s/ Carlton L. Highsmith | /s/ Richard J. Hipple | |||||||
Carlton L. Highsmith, Director | Richard J. Hipple, Director | |||||||
/s/ Devina A. Rankin | /s/ Barbara R. Snyder | |||||||
Devina A. Rankin, Director | Barbara R. Snyder, Director | |||||||
/s/ Richard J. Tobin | /s/ Todd J. Vasos | |||||||
Richard J. Tobin, Director | Todd J. Vasos, Director | |||||||
/s/ David K. Wilson | ||||||||
David K. Wilson, Director | ||||||||
Date: February 22, 2023 | |||||
Christopher M. Gorman | |||||
Chairman, Chief Executive Officer and President |
Date: February 22, 2023 | |||||
Donald R. Kimble | |||||
Chief Financial Officer |
Date: February 22, 2023 | |||||
Christopher M. Gorman | |||||
Chairman, Chief Executive Officer and President |
Date: February 22, 2023 | |||||
Donald R. Kimble | |||||
Chief Financial Officer |