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

Exhibit 99.3 (1 of 2)

KeyCorp
Consolidated Balance Sheets
(dollars in millions)

	12-31-09			9-30-09			12-31-08
Assets
Loans	$	58,770		$	62,193		$	72,835
Loans held for sale		443			703			626
Securities available for sale		16,641			15,413			8,246
Held-to-maturity securities		24			24			25
Trading account assets		1,209			1,406			1,280
Short-term investments		1,743			2,986			5,221
Other investments		1,488			1,448			1,526
Total earning assets		80,318			84,173			89,759
Allowance for loan losses		(2,534	)		(2,485	)		(1,629	)
Cash and due from banks		471			725			1,245
Premises and equipment		880			863			840
Operating lease assets		716			775			990
Goodwill		917			917			1,113
Other intangible assets		50			54			116
Corporate-owned life insurance		3,071			3,041			2,970
Derivative assets		1,094			1,285			1,896
Accrued income and other assets		4,096			3,463			2,818
Discontinued assets		4,208			4,178			4,413
Total assets	$	93,287		$	96,989		$	104,531
Liabilities
Deposits in domestic offices:
NOW and money market deposit accounts	$	24,341		$	24,635		$	24,191
Savings deposits		1,807			1,783			1,712
Certificates of deposit ($100,000 or more)		10,954			12,216			11,991
Other time deposits		13,286			14,211			14,763
Total interest-bearing deposits		50,388			52,845			52,657
Noninterest-bearing deposits		14,415			13,631			11,352
Deposits in foreign office — interest-bearing		768			783			1,118
Total deposits		65,571			67,259			65,127
Federal funds purchased and securities sold under repurchase agreements		1,742			1,664			1,557
Bank notes and other short-term borrowings		340			471			8,477
Derivative liabilities		1,012			1,185			1,032
Accrued expense and other liabilities		2,007			2,236			2,481
Long-term debt		11,558			12,865			14,995
Discontinued liabilities		124			121			181
Total liabilities		82,354			85,801			93,850
Equity
Preferred stock, Series A		291			291			658
Preferred stock, Series B		2,430			2,426			2,414
Common shares		946			946			584
Common stock warrant		87			87			87
Capital surplus		3,734			3,726			2,553
Retained earnings		5,158			5,431			6,727
Treasury stock, at cost		(1,980	)		(1,983	)		(2,608	)
Accumulated other comprehensive income (loss)		(3	)		46			65
Key shareholders’ equity		10,663			10,970			10,480
Noncontrolling interests		270			218			201
Total equity		10,933			11,188			10,681
Total liabilities and equity	$	93,287		$	96,989		$	104,531
Common shares outstanding (000)		878,535			878,559			495,002

Exhibit 99.3 (2 of 2)

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

	Three months ended									Twelve months ended
	12-31-09			9-30-09			12-31-08			12-31-09			12-31-08
Interest income
Loans	$	749		$	786		$	940		$	3,194		$	3,732
Loans held for sale		6			7			14			29			76
Securities available for sale		150			121			101			460			404
Held-to-maturity securities		—			1			1			2			3
Trading account assets		12			9			17			47			56
Short-term investments		3			3			8			12			31
Other investments		13			13			13			51			51
Total interest income		933			940			1,094			3,795			4,353
Interest expense
Deposits		246			277			346			1,119			1,468
Federal funds purchased and securities sold under repurchase agreements		1			2			4			5			57
Bank notes and other short-term borrowings		3			3			30			16			130
Long-term debt		53			66			97			275			382
Total interest expense		303			348			477			1,415			2,037
Net interest income		630			592			617			2,380			2,316
Provision for loan losses		756			733			551			3,159			1,537
Net interest income (expense) after provision for loan losses		(126	)		(141	)		66			(779	)		779
Noninterest income
Trust and investment services income		117			113			131			459			509
Service charges on deposit accounts		82			83			90			330			365
Operating lease income		52			55			64			227			270
Letter of credit and loan fees		52			46			42			180			183
Corporate-owned life insurance income		36			26			33			114			117
Net securities gains (losses)(a)		1			1			(5	)		113			(2	)
Electronic banking fees		27			27			25			105			103
Gains on leased equipment		15			22			19			99			40
Insurance income		16			18			15			68			65
Investment banking and capital markets income (loss)		(47	)		(26	)		5			(42	)		68
Net gains (losses) from principal investing		80			(6	)		(37	)		(4	)		(54	)
Net gains (losses) from loan securitizations and sales		(5	)		—			4			(1	)		(82	)
Gain from sale/redemption of Visa Inc. shares		—			—			___			105			165
Gain (loss)��related to exchange of common shares for capital securities		—			(17	)		___			78			___
Other income		43			40			(3	)		204			100
Total noninterest income		469			382			383			2,035			1,847
Noninterest expense
Personnel		400			380			405			1,514			1,581
Net occupancy		67			63			66			259			259
Operating lease expense		50			46			55			195			224
Computer processing		49			48			51			192			187
Professional fees		63			41			50			184			138
FDIC assessment		37			40			3			177			10
OREO expense, net		25			51			6			97			16
Equipment		25			24			22			96			92
Marketing		22			19			25			72			87
Provision (credit) for losses on lending-related commitments		27			29			(5	)		67			(26	)
Intangible assets impairment		—			45			465			241			469
Other expense		106			115			121			460			439
Total noninterest expense		871			901			1,264			3,554			3,476
Loss from continuing operations before income taxes		(528	)		(660	)		(815	)		(2,298	)		(850	)
Income taxes		(347	)		(274	)		(318	)		(1,035	)		437
Loss from continuing operations		(181	)		(386	)		(497	)		(1,263	)		(1,287	)
Loss from discontinued operations, net of taxes		(7	)		(16	)		(30	)		(48	)		(173	)
Net loss		(188	)		(402	)		(527	)		(1,311	)		(1,460	)
Less: Net income (loss) attributable to noncontrolling interests		36			(5	)		(3	)		24			8
Net loss attributable to Key	$	(224	)	$	(397	)	$	(524	)	$	(1,335	)	$	(1,468	)
Loss from continuing operations attributable to Key common shareholders	$	(258	)	$	(422	)	$	(524	)	$	(1,581	)	$	(1,337	)
Net loss attributable to Key common shareholders		(265	)		(438	)		(554	)		(1,629	)		(1,510	)
Per common share
Loss from continuing operations attributable to Key common shareholders	$	(.30	)	$	(.50	)	$	(1.07	)	$	(2.27	)	$	(2.97	)
Loss from discontinued operations, net of taxes		(.01	)		(.02	)		(.06	)		(.07	)		(.38	)
Net loss attributable to Key common shareholders		(.30	)		(.52	)		(1.13	)		(2.34	)		(3.36	)
Per common share — assuming dilution
Loss from continuing operations attributable to Key common shareholders	$	(.30	)	$	(.50	)	$	(1.07	)	$	(2.27	)	$	(2.97	)
Loss from discontinued operations, net of taxes		(.01	)		(.02	)		(.06	)		(.07	)		(.38	)
Net loss attributable to Key common shareholders		(.30	)		(.52	)		(1.13	)		(2.34	)		(3.36	)
Cash dividends declared per common share	$	.01		$	.01		$	.0625		$	.0925		$	.625
Weighted-average common shares outstanding (000)		873,268			839,906			492,311			697,155			450,039
Weighted-average common shares and potential common shares outstanding (000)		873,268			839,906			492,311			697,155			450,039

(a) For the three months ended December 31, 2009, Key did not have impairment losses related to securities. Impairment losses and the portion of those losses recorded in equity as a component of accumulated other comprehensive income (loss) on the balance sheet totaled $4 million and $2 million, respectively, for the three months ended September 30, 2009, and $7 million and $1 million, respectively, for the three months ended June 30, 2009.