KeyCorp (KEY) 8-K Keycorp Reports Third Quarter 2009 Results

Exhibit 99.3 (1 of 2)

KeyCorp
Consolidated Balance Sheets
(dollars in millions)

	9-30-09			6-30-09			9-30-08
Assets
Loans	$	62,193		$	67,167		$	72,994
Loans held for sale		703			761			1,252
Securities available for sale		15,413			11,988			8,196
Held-to-maturity securities		24			25			28
Trading account assets		1,406			771			1,449
Short-term investments		2,986			3,487			653
Other investments		1,448			1,450			1,556
Total earning assets		84,173			85,649			86,128
Allowance for loan losses		(2,485	)		(2,339	)		(1,390	)
Cash and due from banks		744			723			1,937
Premises and equipment		863			858			801
Operating lease assets		775			842			1,030
Goodwill		917			917			1,595
Other intangible assets		55			106			135
Corporate-owned life insurance		3,041			3,016			2,940
Derivative assets		1,285			1,182			951
Accrued income and other assets		3,473			2,782			2,899
Discontinued assets — education lending business		4,148			4,056			4,264
Total assets	$	96,989		$	97,792		$	101,290
Liabilities
Deposits in domestic offices:
NOW and money market deposit accounts	$	24,635		$	23,939		$	25,789
Savings deposits		1,783			1,795			1,731
Certificates of deposit ($100,000 or more)		12,216			13,486			10,316
Other time deposits		14,211			15,055			13,929
Total interest-bearing deposits		52,845			54,275			51,765
Noninterest-bearing deposits		13,631			12,873			11,011
Deposits in foreign office — interest-bearing		783			632			1,791
Total deposits		67,259			67,780			64,567
Federal funds purchased and securities sold under repurchase agreements		1,664			1,530			1,799
Bank notes and other short-term borrowings		471			1,710			5,352
Derivative liabilities		1,185			528			581
Accrued expense and other liabilities		2,242			1,603			4,392
Long-term debt		12,865			13,462			15,597
Discontinued liabilities — education lending business		115			119			144
Total liabilities		85,801			86,732			92,432
Equity
Preferred stock, Series A		291			291			658
Preferred stock, Series B		2,426			2,422			___
Common shares		946			865			584
Common stock warrant		87			87			___
Capital surplus		3,726			3,292			2,552
Retained earnings		5,431			5,878			7,320
Treasury stock, at cost		(1,983	)		(1,984	)		(2,616	)
Accumulated other comprehensive income		46			___			153
Key shareholders’ equity		10,970			10,851			8,651
Noncontrolling interests		218			209			207
Total equity		11,188			11,060			8,858
Total liabilities and equity	$	96,989		$	97,792		$	101,290
Common shares outstanding (000)		878,559			797,246			494,765

Exhibit 99.3 (2 of 2)

KeyCorp
Consolidated Statements of Income
(dollars in millions, except per share amounts)

	Three months ended									Nine months ended
	9-30-09			6-30-09			9-30-08			9-30-09			9-30-08
Interest income
Loans	$	786		$	819		$	1,012		$	2,445		$	2,792
Loans held for sale		7			8			19			23			62
Securities available for sale		121			89			101			310			303
Held-to-maturity securities		1			—			1			2			2
Trading account assets		9			13			16			35			39
Short-term investments		3			3			6			9			23
Other investments		13			13			12			38			38
Total interest income		940			945			1,167			2,862			3,259
Interest expense
Deposits		277			296			347			873			1,122
Federal funds purchased and securities sold under repurchase agreements		2			1			10			4			53
Bank notes and other short-term borrowings		3			4			34			13			100
Long-term debt		66			75			98			222			285
Total interest expense		348			376			489			1,112			1,560
Net interest income		592			569			678			1,750			1,699
Provision for loan losses		733			823			336			2,403			986
Net interest income (expense) after provision for loan losses		(141	)		(254	)		342			(653	)		713
Noninterest income
Trust and investment services income		113			119			125			342			378
Service charges on deposit accounts		83			83			94			248			275
Operating lease income		55			59			69			175			206
Letter of credit and loan fees		46			44			53			128			141
Corporate-owned life insurance income		26			25			28			78			84
Electronic banking fees		27			27			27			78			78
Insurance income		18			16			15			52			50
Investment banking and capital markets income (loss)		(26	)		14			(26	)		5			63
Net securities gains(a)		1			125			1			112			3
Net losses from principal investing		(6	)		(6	)		(14	)		(84	)		(17	)
Net gains (losses) from loan securitizations and sales		—			(3	)		(29	)		4			(86	)
Gain (loss) related to exchange of common shares for capital securities		(17	)		95			—			78			—
Gain from sale/redemption of Visa Inc. shares		—			—			—			105			165
Other income		62			108			47			245			124
Total noninterest income		382			706			390			1,566			1,464
Noninterest expense
Personnel		380			375			374			1,114			1,176
Net occupancy		63			63			65			192			193
Operating lease expense		46			49			56			145			169
Computer processing		48			48			46			143			136
Professional fees		41			46			34			121			88
FDIC assessment		40			70			3			140			7
Equipment		24			25			23			71			70
Marketing		19			17			27			50			62
Intangible assets impairment		45			—			4			241			4
Other expense		195			162			108			466			307
Total noninterest expense		901			855			740			2,683			2,212
Loss from continuing operations before income taxes		(660	)		(403	)		(8	)		(1,770	)		(35	)
Income taxes		(274	)		(176	)		(22	)		(688	)		755
Income (loss) from continuing operations		(386	)		(227	)		14			(1,082	)		(790	)
Income (loss) from discontinued operations, net of taxes		(16	)		4			(39	)		(41	)		(143	)
Net loss		(402	)		(223	)		(25	)		(1,123	)		(933	)
Less: Net income (loss) attributable to noncontrolling interests		(5	)		3			11			(12	)		11
Net loss attributable to Key	$	(397	)	$	(226	)	$	(36	)	$	(1,111	)	$	(944	)
Loss from continuing operations attributable to Key common shareholders	$	(422	)	$	(394	)	$	(9	)	$	(1,323	)	$	(813	)
Net loss attributable to Key common shareholders		(438	)		(390	)		(48	)		(1,364	)		(956	)
Per common share
Loss from continuing operations attributable to Key common shareholders	$	(.50	)	$	(.68	)	$	(.02	)	$	(2.07	)	$	(1.87	)
Income (loss) from discontinued operations, net of taxes		(.02	)		.01			(.08	)		(.06	)		(.33	)
Net loss attributable to Key common shareholders		(.52	)		(.68	)		(.10	)		(2.14	)		(2.19	)
Per common share — assuming dilution
Loss from continuing operations attributable to Key common shareholders	$	(.50	)	$	(.68	)	$	(.02	)	$	(2.07	)	$	(1.87	)
Income (loss) from discontinued operations, net of taxes		(.02	)		.01			(.08	)		(.06	)		(.33	)
Net loss attributable to Key common shareholders		(.52	)		(.68	)		(.10	)		(2.14	)		(2.19	)
Cash dividends declared per common share	$	.01		$	.01		$	.1875		$	.0825		$	.9375
Weighted-average common shares outstanding (000)		839,906			576,883			491,179			637,805			435,846
Weighted-average common shares and potential common shares outstanding (000)		839,906			576,883			491,179			637,805			435,846

(a) For the three months ended September 30, 2009, impairment losses totaled $4 million, of which $2 million was recognized in equity as a component of accumulated other comprehensive income on the balance sheet. Impairment losses totaled $7 million for the three months ended June 30, 2009, of which $1 million was recognized in equity as a component of accumulated other comprehensive income.