KeyCorp (KEY) 8-K Keycorp Reports Second Quarter 2007 Earnings

Exhibit 99.1

CONTACTS:	Vernon L. Patterson	William C. Murschel
	Analyst	Media
	216.689.0520	216.828.7416
	Vernon_Patterson@KeyBank.com	William_C_Murschel@KeyBank.com

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

FOR IMMEDIATE RELEASE

KEYCORP REPORTS SECOND QUARTER 2007 EARNINGS

• Second quarter EPS from continuing operations of $0.85, up from $0.74 for the year-ago quarter

• Return on average equity from continuing operations of 17.66%, compared to 15.85% one year ago

          CLEVELAND, July 17, 2007 – KeyCorp (NYSE: KEY) today announced second quarter income from continuing operations of $337 million, or $0.85 per diluted common share. This compares to income from continuing operations of $303 million, or $0.74 per share, for the second quarter of 2006, and $358 million, or $0.89 per share, for the first quarter of 2007. Key’s income from continuing operations for the first six months of 2007 was $695 million, or $1.74 per diluted common share. This compares to income from continuing operations – before the cumulative effect of an accounting change – of $577 million, or $1.40 per share, for the first half of 2006.

          Net income totaled $334 million, or $0.84 per diluted common share, for the second quarter of 2007, compared to net income of $308 million, or $0.75 per share, for the second quarter of 2006 and $350 million, or $0.87 per share, for the first quarter of 2007. Key’s net income for the first half of 2007 was $684 million, or $1.71 per diluted common share, compared to $597 million, or $1.45 per share, for the same period last year.

          The following table shows Key’s continuing and discontinued operating results for comparative quarters and for the six months ended June 30, 2007 and 2006.

Results of Operations

	Three months ended								Six months ended
in millions, except per share amounts	6-30-07			3-31-07			6-30-06		6-30-07			6-30-06
Summary of operations
Income from continuing operations before cumulative effect of accounting change	$	337		$	358		$	303	$	695		$	577
Income (loss) from discontinued operations, net of taxes		(3	)		(8	)		5		(11	)		15
Cumulative effect of accounting change, net of taxes		—			—			—		—			5
Net income	$	334		$	350		$	308	$	684		$	597
Per common share — assuming dilution
Income from continuing operations before cumulative effect of accounting change	$	.85		$	.89		$	.74	$	1.74		$	1.40
Income (loss) from discontinued operations		(.01	)		(.02	)		.01		(.03	)		.04
Cumulative effect of accounting change		—			—			—		—			.01
Net income	$	.84		$	.87		$	.75	$	1.71		$	1.45

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 2

          As shown below, the comparability of Key’s income from continuing operations for comparative quarters is affected by several significant items, including the McDonald Investments branch network sold in February 2007.

Significant Items Affecting the Comparability of Earnings

	Second Quarter 2007						First Quarter 2007						Second Quarter 2006
	Pre-tax			After-tax			Pre-tax			After-tax			Pre-tax			After-tax
in millions, except per share amounts	Amount			Amount			Amount			Amount			Amount			Amount
Income from continuing operations — GAAP basis	$	467		$	337		$	505		$	358		$	428		$	303
Significant items:
McDonald Investments branch network		7			4			(159	)a		(99	)a		8			5
Gains related to MasterCard Incorporated shares		(40	)		(25	)		—			—			(9	)		(6	)
Litigation reserve		42			26			—			—			—			—
Gain from settlement of automobile residual value insurance litigation		—			—			(26	)		(17	)		—			—
Loss from repositioning of securities portfolio		—			—			49			31			—			—
Income from continuing operations — adjusted basis	$	476		$	342		$	369		$	273		$	427		$	302
Per common share — assuming dilution
Income from continuing operations — GAAP basis		N/M		$	.85			N/M		$	.89			N/M		$	.74
Income from continuing operations — adjusted basis		N/M			.86			N/M			.68			N/M			.74

(a)	Includes a $171 million ($107 million after-tax) gain resulting from the February 9, 2007, sale of the McDonald Investments branch network.
N/M = Not Meaningful
GAAP = U.S. generally accepted accounting principles

          “We are extremely pleased with the company’s results in light of continued competitive pressures experienced in a challenging interest rate environment,” said Chairman and Chief Executive Officer Henry L. Meyer III. “Growth in noninterest income and effective expense control drove Key’s strong second quarter results. Noninterest income rose by $104 million from the year-ago quarter, driven by the favorable performance of several of our fee-based businesses. Principal investing gains were $90 million during the current quarter, which was up $67 million from the year-ago period. While we don’t expect this level of principal investing gains to repeat in the second half of 2007, we expect to see strength in several of our fee-based businesses, and our overall outlook for the remainder of the year is positive.

          “Beyond our financial performance for the quarter, as we previously reported, the Comptroller of the Currency and the Federal Reserve Bank of Cleveland have removed the regulatory agreements. I am extremely appreciative of the commitment and level of effort put forth by our employees, and of the support provided by our Board of Directors as we strengthened our Anti-money Laundering and Bank Secrecy Act compliance programs.”

          The company expects earnings per share to be in the range of $1.50 to $1.60 for the second half of 2007.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 3

SUMMARY OF CONTINUING OPERATIONS

          Taxable-equivalent net interest income was $706 million for the second quarter of 2007, compared to $726 million for the year-ago quarter. Average earning assets grew by $2.6 billion, or 3%, while the net interest margin for the current quarter declined to 3.46% from 3.68% for the second quarter of 2006. The reduction in the net interest margin was due primarily to tighter interest rate spreads on both loans and deposits, reflecting the continuation of competitive pricing, and a shift from NOW and money market deposit accounts to higher-cost certificates of deposit. Additionally, as part of the February 2007 sale of the McDonald Investments branch network, Key transferred approximately $1.3 billion of NOW and money market deposit accounts to the buyer. McDonald Investments’ NOW and money market deposit accounts averaged $1.5 billion for the second quarter of 2006.

          Compared to the first quarter of 2007, taxable-equivalent net interest income grew by $6 million, and the net interest margin declined by 4 basis points. The improvement in net interest income was attributable to a $1.4 billion, or annualized 7%, increase in average earning assets.

Key’s noninterest income was $649 million for the second quarter of 2007, compared to $545 million for the year-ago quarter. The strong growth reflected increases of $67 million in net gains from principal investing, $23 million in net gains from loan securitizations and sales, and higher revenue from several other fee-based businesses. In addition, results for the current quarter include a $40 million gain related to the sale of MasterCard Incorporated shares, compared to a $9 million gain recorded in the year-ago quarter that resulted from the share redemption by MasterCard Incorporated as part of its initial public offering. Trust and investment services income decreased due to lower brokerage income resulting from the sale of the McDonald Investments branch network. The company experienced increases in both personal and institutional asset management income.

          Compared to the first quarter of 2007, noninterest income declined by $5 million. The company’s first quarter results included a $171 million gain from the sale of the McDonald Investments branch network and $19 million of fee income from the operation of that network. During the same quarter, Key recorded a $49 million loss in connection with the repositioning of the securities portfolio and a $26 million gain from the settlement of the automobile residual value insurance litigation.

          Key’s noninterest expense was $815 million for the second quarter of 2007, compared to $798 million for the same period last year. Included in results for the current quarter is a $42 million charge related to litigation. Personnel expense decreased by $16 million, due to lower incentive compensation accruals stemming from the sale of the McDonald Investments branch network. Excluding the litigation reserve, nonpersonnel expense was down $9 million, due primarily to reductions in professional fees and certain other costs associated with the McDonald Investments branch network.

          Compared to the first quarter of 2007, noninterest expense increased by $31 million as the litigation charge recorded in the second quarter more than offset reductions in both personnel and nonpersonnel expense associated with the McDonald Investments branch network. Additionally, Key recorded a $6 million provision for losses on lending-related commitments in the second quarter, compared to an $8 million credit in the first quarter.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 4

ASSET QUALITY

          Key’s provision for loan losses from continuing operations was $53 million for the second quarter of 2007, compared to $23 million for the year-ago quarter and $44 million for the first quarter of 2007.

          Net loan charge-offs for the quarter totaled $53 million, or 0.32% of average loans from continuing operations, compared to $34 million, or 0.22%, for the same period last year and $44 million, or 0.27%, for the previous quarter.

          At June 30, 2007, Key’s nonperforming loans totaled $276 million and represented 0.41% of period-end portfolio loans, compared to 0.39% at March 31, 2007, and 0.41% at June 30, 2006. At June 30, 2007, nonperforming assets totaled $378 million and represented 0.57% of portfolio loans, other real estate owned and other nonperforming assets, compared to 0.54% at March 31, 2007, and 0.46% at June 30, 2006.

          Key’s allowance for loan losses was $945 million, or 1.42% of loans outstanding, at June 30, 2007, compared to $944 million, or 1.44%, at March 31, 2007, and $956 million, or 1.42%, at June 30, 2006.

CAPITAL

          Key’s capital ratios continued to exceed all “well-capitalized” regulatory benchmarks at June 30, 2007. Key’s tangible equity to tangible assets ratio was 6.89% at quarter end, compared to 6.97% at March 31, 2007, and 6.68% at June 30, 2006.

          Key repurchased 6.0 million of its common shares and reissued .9 million shares under employee benefit plans during the second quarter of 2007. At June 30, 2007, Key had 16.0 million common shares remaining for repurchase under the current authorization.

          Share repurchases and other activities that caused the change in Key’s outstanding common shares over the past five quarters are summarized in the table below.

Summary of Changes in Common Shares Outstanding

in thousands	2Q07			1Q07			4Q06			3Q06			2Q06
Shares outstanding at beginning of period		394,483			399,153			402,748			402,672			405,273
Issuance of shares under employee benefit plans		879			3,330			1,405			2,576			1,399
Repurchase of common shares		(6,000	)		(8,000	)		(5,000	)		(2,500	)		(4,000	)
Shares outstanding at end of period		389,362			394,483			399,153			402,748			402,672

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 5

LINE OF BUSINESS RESULTS

          The following table shows the contribution made by each major business group to Key’s taxable-equivalent revenue and income from continuing operations for the periods presented. The specific lines of business that comprise each of the major business groups are described under the heading “Line of Business Descriptions.” For more detailed financial information pertaining to each business group and its respective lines of business, see the last two pages of this release.

Major Business Groups

									Percent change 2Q07 vs.
dollars in millions	2Q07		1Q07			2Q06			1Q07			2Q06
Revenue from continuing operations (TE)
Community Banking	$	624	$	799		$	672			(21.9	)%		(7.1	)%
National Banking		630		605			596			4.1			5.7
Other Segments		92		(20	)		21			N/M			338.1
Total Segments		1,346		1,384			1,289			(2.7	)		4.4
Reconciling Items		9		(30	)		(18	)		N/M			N/M
Total	$	1,355	$	1,354		$	1,271			.1	%		6.6	%
Income (loss) from continuing operations
Community Banking	$	97	$	197		$	100			(50.8	)%		(3.0	)%
National Banking		169		163			176			3.7			(4.0	)
Other Segments		49		(9	)		19			N/M			157.9
Total Segments		315		351			295			(10.3	)		6.8
Reconciling Items		22		7			8			214.3			175.0
Total	$	337	$	358		$	303			(5.9	)%		11.2	%

TE = Taxable Equivalent, N/M = Not Meaningful

Community Banking^a

										Percent change 2Q07 vs.
dollars in millions	2Q07			1Q07			2Q06			1Q07			2Q06
Summary of operations
Net interest income (TE)	$	420		$	418		$	436			.5	%		(3.7	)%
Noninterest income		204			381			236			(46.5	)		(13.6	)
Total revenue (TE)		624			799			672			(21.9	)		(7.1	)
Provision for loan losses		21			14			21			50.0			—
Noninterest expense		448			470			491			(4.7	)		(8.8	)
Income before income taxes (TE)		155			315			160			(50.8	)		(3.1	)
Allocated income taxes and TE adjustments		58			118			60			(50.8	)		(3.3	)
Net income	$	97		$	197		$	100			(50.8	)%		(3.0	)%
Percent of consolidated income from continuing operations		29	%		55	%		33	%		N/A			N/A
Average balances
Loans and leases	$	26,551		$	26,426		$	26,830			.5	%		(1.0	)%
Total assets		29,291			29,240			29,918			.2			(2.1	)
Deposits		46,171			46,581			46,675			(.9	)		(1.1	)

(a) See the table entitled “Significant Items Affecting the Comparability of Earnings” presented earlier in this release for the impact of the McDonald Investments branch network sold February 9, 2007.

TE = Taxable Equivalent, N/A = Not Applicable

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 6

Additional Community Banking Data

										Percent change 2Q07 vs.
dollars in millions	2Q07			1Q07			2Q06			1Q07			2Q06
Average deposits outstanding
NOW and money market deposit accounts	$	18,996		$	19,640		$	20,786			(3.3	)%		(8.6	)%
Savings deposits		1,619			1,617			1,737			.1			(6.8	)
Certificates of deposit ($100,000 or more)		4,709			4,576			4,010			2.9			17.4
Other time deposits		12,038			12,051			11,437			(.1	)		5.3
Deposits in foreign office		1,046			960			634			9.0			65.0
Noninterest-bearing deposits		7,763			7,737			8,071			.3			(3.8	)
Total deposits	$	46,171		$	46,581		$	46,675			(.9	)%		(1.1	)%
Home equity loans
Average balance	$	9,660		$	9,677		$	10,107
Weighted-average loan-to-value ratio		70	%		70	%		70	%
Percent first lien positions		58			59			60
Other data
On-line households / household penetration		711,254 / 54	%		687,263 / 53	%		639,444 / 52	%
Branches		954			950			946
Automated teller machines		1,450			1,447			2,120

Community Banking Summary of Operations

          Net income for Community Banking was $97 million for the second quarter of 2007, compared to $100 million for the year-ago quarter. Decreases in both net interest income and noninterest income were offset in part by a decline in noninterest expense. The provision for loan losses was essentially unchanged.

          Taxable-equivalent net interest income decreased by $16 million, or 4%, from the second quarter of 2006. The decrease was attributable to a reduction in, and a tighter interest rate spread on, average earning assets, along with a shift from NOW and money market deposit accounts to higher-cost certificates of deposit. Also, as part of the February 2007 sale of the McDonald Investments branch network, Key transferred approximately $1.3 billion of NOW and money market deposit accounts to the buyer. McDonald’s NOW and money market deposit accounts averaged $1.5 billion for the second quarter of 2006.

          Noninterest income decreased by $32 million, or 14%, from the year-ago quarter, due primarily to a reduction in brokerage income caused by the McDonald Investments sale. This reduction was partially offset by an increase in service charges on deposit accounts.

          Noninterest expense declined by $43 million, or 9%. Lower personnel costs and decreases in certain other costs associated with the McDonald Investments branch network accounted for most of the improvement.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 7

National Banking

										Percent change 2Q07 vs.
dollars in millions	2Q07			1Q07			2Q06			1Q07			2Q06
Summary of operations
Net interest income (TE)	$	348		$	340		$	349			2.4	%		(.3	)%
Noninterest income		282			265			247			6.4			14.2
Total revenue (TE)		630			605			596			4.1			5.7
Provision for loan losses		32			30			2			6.7			N/M
Noninterest expense		328			314			313			4.5			4.8
Income from continuing operations before income taxes (TE)		270			261			281			3.4			(3.9	)
Allocated income taxes and TE adjustments		101			98			105			3.1			(3.8	)
Income from continuing operations		169			163			176			3.7			(4.0	)
Income (loss) from discontinued operations, net of taxes		(3	)		(8	)		5			62.5			N/M
Net income	$	166		$	155		$	181			7.1	%		(8.3	)%
Percent of consolidated income from continuing operations		50	%		45	%		58	%		N/A			N/A
Average balances from continuing operations
Loans and leases	$	39,348		$	38,869		$	37,730			1.2	%		4.3	%
Loans held for sale		4,377			3,917			3,821			11.7			14.6
Total assets		49,639			48,480			47,682			2.4			4.1
Deposits		12,036			11,231			10,633			7.2			13.2

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

National Banking Summary of Continuing Operations

          Income from continuing operations for National Banking was $169 million for the second quarter of 2007, compared to $176 million for the same period last year. Increases in the provision for loan losses and noninterest expense accounted for the reduction, and more than offset an increase in noninterest income. Net interest income was essentially unchanged from the year-ago quarter.

          Taxable-equivalent net interest income decreased by less than $1 million from the second quarter of 2006. The adverse effect of a tighter interest rate spread on average earning assets was offset by the growth in average loans and deposits.

          The provision for loan losses rose by $30 million, reflecting a higher level of net loan charge-offs.

          Noninterest income was up $35 million, or 14%. The growth was attributable to a significant increase in net gains from loan securitizations and sales, along with higher income from operating leases, and trust and investment services.

          Noninterest expense grew by $15 million, or 5%, due primarily to higher costs associated with operating leases.

Other Segments

          Other segments consist of Corporate Treasury and Key’s Principal Investing unit. These segments generated net income of $49 million for the second quarter of 2007, up from $19 million for the same period last year.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 8

Line of Business Descriptions

Community Banking

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

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

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

National Banking

Real Estate Capitalprovides construction and interim lending, permanent debt placements and servicing, and equity and investment banking services to developers, brokers and owner-investors. This line of business deals exclusively with nonowner-occupied properties (i.e., generally properties in which at least 50% of the debt service is provided by rental income from nonaffiliated third parties).

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

Institutional and Capital Marketsprovides products and services to large corporations, middle-market companies, financial institutions, government entities and not-for-profit organizations. These products and services include commercial lending, treasury management, investment banking, derivatives and foreign exchange, equity and debt underwriting and trading, and syndicated finance.

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

Consumer Financeincludes Indirect Lending, Commercial Floor Plan Lending, Home Equity Services and Business Services.

Indirect Lending offers loans to consumers through dealers. This business unit also provides federal and private education loans to students and their parents, and processes payments on loans that private schools make to parents.

Commercial Floor Plan Lending finances inventory for automobile and marine dealers.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 9

Home Equity Services works with home improvement contractors to provide home equity and home improvement financing solutions.

Business Services provides payroll processing solutions for businesses of all sizes.

          Cleveland-based KeyCorp is one of the nation’s largest bank-based financial services companies, with assets of approximately $94 billion. Key companies provide investment management, retail and commercial banking, consumer finance, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally. The company’s businesses deliver their products and services through 954 branches and additional offices; a network of 1,450 ATMs; telephone banking centers (1.800.KEY2YOU); and a Web site,https://www.key.com/,^âthat provides account access and financial products 24 hours a day.

Notes to Editors:

A live Internet broadcast of KeyCorp’s conference call to discuss quarterly earnings and currently anticipated earnings trends and to answer analysts’ questions can be accessed through the Investor Relations section athttps://www.key.com/irat 9:00 a.m. ET, on Tuesday, July 17, 2007. An audio replay of the call will be available through July 24.

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

This news release contains forward-looking statements, including statements about our financial condition, results of operations, earnings outlook, asset quality trends and profitability. Forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to assumptions, risks and uncertainties. Although management believes that the expectations and forecasts reflected in these forward-looking statements are reasonable, actual results could differ materially due to a variety of factors including: (1) changes in interest rates; (2) changes in trade, monetary or fiscal policy; (3) changes in general economic conditions, or in the condition of the local economies or industries in which we have significant operations or assets, which could, among other things, materially impact credit quality trends and our ability to generate loans; (4) increased competitive pressure among financial services companies; (5) the inability to successfully execute strategic initiatives designed to grow revenues and/or manage expenses; (6) consummation of significant business combinations or divestitures; (7) operational or risk management failures due to technological or other factors; (8) heightened regulatory practices, requirements or expectations; (9) new legal obligations or liabilities or unfavorable resolution of litigation; (10) adverse capital markets conditions; (11) disruption in the economy and general business climate as a result of terrorist activities or military actions; and (12) changes in accounting or tax practices or requirements. Forward-looking statements are not guarantees of future performance and should not be relied upon as representing management’s views as of any subsequent date. We do not assume any obligation to update these forward-looking statements. For further information regarding KeyCorp, please read KeyCorp’s reports that are filed with the Securities and Exchange Commission and are available at www.sec.gov.

###

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 10

Financial Highlights
(dollars in millions, except per share amounts)

	Three months ended
	6-30-07			3-31-07			6-30-06
Summary of operations
Net interest income (TE)	$	706		$	700		$	726
Noninterest income		649			654			545
Total revenue (TE)		1,355			1,354			1,271
Provision for loan losses		53			44			23
Noninterest expense		815			784			798
Income from continuing operations before cumulative effect of accounting change		337			358			303
Income (loss) from discontinued operations, net of taxes		(3	)		(8	)		5
Net income		334			350			308
Per common share
Income from continuing operations before cumulative effect of accounting change	$	.86		$	.90		$	.75
Income from continuing operations before cumulative effect of accounting change — assuming dilution		.85			.89			.74
Income (loss) from discontinued operations		(.01	)		(.02	)		.01
Income (loss) from discontinued operations — assuming dilution		(.01	)		(.02	)		.01
Net income		.85			.88			.76
Net income — assuming dilution		.84			.87			.75
Cash dividends declared		.365			.365			.345
Book value at period end		19.78			19.57			19.21
Market price at period end		34.33			37.47			35.68
Performance ratios — from continuing operations
Return on average total assets		1.45	%		1.58	%		1.33	%
Return on average equity		17.66			19.06			15.85
Net interest margin (TE)		3.46			3.50			3.68
Performance ratios — from consolidated operations
Return on average total assets		1.43	%		1.54	%		1.32	%
Return on average equity		17.50			18.63			16.11
Net interest margin (TE)		3.46			3.51			3.69
Capital ratios at period end
Equity to assets		8.19	%		8.28	%		8.16	%
Tangible equity to tangible assets		6.89			6.97			6.68
Tier 1 risk-based capitala		8.10			8.15			7.90
Total risk-based capitala		12.08			12.20			12.08
Leveragea		9.12			9.17			8.82
Asset quality
Net loan charge-offs	$	53		$	44		$	34
Net loan charge-offs to average loans from continuing operations		.32	%		.27	%		.22	%
Allowance for loan losses	$	945		$	944		$	956
Allowance for loan losses to period-end loans		1.42	%		1.44	%		1.42	%
Allowance for loan losses to nonperforming loans		342.39			371.65			342.65
Nonperforming loans at period end	$	276		$	254		$	279
Nonperforming assets at period end		378			353			308
Nonperforming loans to period-end portfolio loans		.41	%		.39	%		.41	%
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets		.57			.54			.46
Trust and brokerage assets
Assets under management	$	85,592		$	82,388		$	80,349
Nonmanaged and brokerage assets b		33,485			32,838			57,682
Other data
Average full-time equivalent employees		18,888			19,801			19,931
Branches		954			950			946
Taxable-equivalent adjustment	$	20		$	21		$	22

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 11

Financial Highlights (continued)
(dollars in millions, except per share amounts)

	Six months ended
	6-30-07			6-30-06
Summary of operations
Net interest income (TE)	$	1,406		$	1,448
Noninterest income		1,303			1,026
Total revenue (TE)		2,709			2,474
Provision for loan losses		97			62
Noninterest expense		1,599			1,550
Income from continuing operations before cumulative effect of accounting change		695			577
Income (loss) from discontinued operations, net of taxes		(11	)		15
Net income		684			597
Per common share
Income from continuing operations before cumulative effect of accounting change	$	1.76		$	1.42
Income from continuing operations before cumulative effect of accounting change — assuming dilution		1.74			1.40
Income (loss) from discontinued operations		(.03	)		.04
Income (loss) from discontinued operations — assuming dilution		(.03	)		.04
Net income		1.73			1.47
Net income — assuming dilution		1.71			1.45
Cash dividends declared		.73			.69
Performance ratios — from continuing operations
Return on average total assets		1.51	%		1.29	%
Return on average equity		18.35			15.40
Net interest margin (TE)		3.48			3.70
Performance ratios — from consolidated operations
Return on average total assets		1.49	%		1.29	%
Return on average equity		18.06			15.80
Net interest margin (TE)		3.49			3.73
Asset quality
Net loan charge-offs	$	97		$	73
Net loan charge-offs to average loans from continuing operations		.30	%		.23	%
Other data
Average full-time equivalent employees		19,342			19,813
Taxable-equivalent adjustment	$	41		$	50

(a) 6-30-07 ratio is estimated.

(b) On February 9, 2007, Key sold the McDonald Investments branch network.

TE = Taxable Equivalent

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 12

Consolidated Balance Sheets
(dollars in millions)

	6-30-07			3-31-07			6-30-06
Assets
Loans	$	66,692		$	65,711		$	67,408
Loans held for sale		4,546			4,175			4,189
Investment securities		37			38			44
Securities available for sale		7,819			7,789			7,140
Short-term investments		1,632			2,084			1,577
Other investments		1,602			1,466			1,379
Total earning assets		82,328			81,263			81,737
Allowance for loan losses		(945	)		(944	)		(956	)
Cash and due from banks		1,818			2,052			2,814
Premises and equipment		600			590			557
Operating lease assets		1,110			1,074			1,043
Goodwill		1,202			1,202			1,372
Other intangible assets		110			115			132
Corporate-owned life insurance		2,822			2,805			2,732
Derivative assets		1,160			1,132			1,016
Accrued income and other assets		3,871			3,930			4,347
Total assets	$	94,076		$	93,219		$	94,794
Liabilities
Deposits in domestic offices:
NOW and money market deposit accounts	$	23,315		$	23,317		$	25,291
Savings deposits		1,613			1,654			1,751
Certificates of deposit ($100,000 or more)		6,197			6,094			5,224
Other time deposits		11,832			12,086			11,542
Total interest-bearing deposits		42,957			43,151			43,808
Noninterest-bearing deposits		14,199			13,473			13,268
Deposits in foreign office — interest-bearing		3,443			3,149			3,762
Total deposits		60,599			59,773			60,838
Federal funds purchased and securities sold under repurchase agreements		4,362			5,770			3,654
Bank notes and other short-term borrowings		2,631			1,108			2,360
Derivative liabilities		1,119			870			1,156
Accrued expense and other liabilities		5,083			4,918			4,999
Long-term debt		12,581			13,061			14,050
Total liabilities		86,375			85,500			87,057
Shareholders’ equity
Preferred stock		—			—			—
Common shares		492			492			492
Capital surplus		1,652			1,614			1,577
Retained earnings		8,720			8,528			8,199
Treasury stock, at cost		(2,994	)		(2,801	)		(2,411	)
Accumulated other comprehensive loss		(169	)		(114	)		(120	)
Total shareholders’ equity		7,701			7,719			7,737
Total liabilities and shareholders’ equity	$	94,076		$	93,219		$	94,794
Common shares outstanding (000)		389,362			394,483			402,672

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 13

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

	Three months ended								Six months ended
	6-30-07			3-31-07			6-30-06		6-30-07			6-30-06
Interest income
Loans	$	1,176		$	1,161		$	1,136	$	2,337		$	2,196
Loans held for sale		82			75			73		157			141
Investment securities		—			1			1		1			1
Securities available for sale		106			100			84		206			167
Short-term investments		16			18			16		34			31
Other investments		15			13			17		28			42
Total interest income		1,395			1,368			1,327		2,763			2,578
Interest expense
Deposits		447			433			378		880			708
Federal funds purchased and securities sold under repurchase agreements		59			49			20		108			40
Bank notes and other short-term borrowings		18			11			27		29			51
Long-term debt		185			196			198		381			381
Total interest expense		709			689			623		1,398			1,180
Net interest income		686			679			704		1,365			1,398
Provision for loan losses		53			44			23		97			62
Net interest income after provision for loan losses		633			635			681		1,268			1,336
Noninterest income
Trust and investment services income		115			125			139		240			274
Service charges on deposit accounts		84			75			77		159			149
Investment banking and capital markets income		52			44			57		96			117
Operating lease income		66			64			56		130			108
Letter of credit and loan fees		45			38			45		83			85
Corporate-owned life insurance income		32			25			26		57			51
Electronic banking fees		25			24			27		49			51
Net gains from loan securitizations and sales		33			9			10		42			20
Net securities gains (losses)		2			(47	)		4		(45	)		5
Gain on sale of McDonald Investments branch network		—			171			—		171			—
Other income		195			126			104		321			166
Total noninterest income		649			654			545		1,303			1,026
Noninterest expense
Personnel		411			428			427		839			827
Net occupancy		59			63			59		122			120
Computer processing		49			51			49		100			105
Operating lease expense		55			52			45		107			86
Professional fees		26			26			40		52			73
Equipment		24			25			26		49			52
Marketing		20			19			23		39			38
Other expense		171			120			129		291			249
Total noninterest expense		815			784			798		1,599			1,550
Income from continuing operations before income taxes and cumulative effect of accounting change		467			505			428		972			812
Income taxes		130			147			125		277			235
Income from continuing operations before cumulative effect of accounting change		337			358			303		695			577
Income (loss) from discontinued operations, net of taxes		(3	)		(8	)		5		(11	)		15
Income before cumulative effect of accounting change		334			350			308		684			592
Cumulative effect of change in accounting for forfeited stock-based awards, net of taxes		—			—			—		—			5
Net income	$	334		$	350		$	308	$	684		$	597
Per common share:
Income from continuing operations before cumulative effect of accounting change	$	.86		$	.90		$	.75	$	1.76		$	1.42
Income before cumulative effect of accounting change		.85			.88			.76		1.73			1.46
Net income		.85			.88			.76		1.73			1.47
Per common share — assuming dilution:
Income from continuing operations before cumulative effect of accounting change	$	.85		$	.89		$	.74	$	1.74		$	1.40
Income before cumulative effect of accounting change		.84			.87			.75		1.71			1.44
Net income		.84			.87			.75		1.71			1.45
Cash dividends declared per common share	$	.365		$	.365		$	.345	$	.73		$	.69
Weighted-average common shares outstanding (000)		392,045			397,875			404,528		394,944			405,949
Weighted-average common shares and potential common shares outstanding (000)		396,918			403,478			410,559		400,180			411,842

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 14

Consolidated Average Balance Sheets, Net Interest Income and Yields/Rates
From Continuing Operations
(dollars in millions)

	Second Quarter 2007								First Quarter 2007								Second Quarter 2006
	Average								Average								Average
	Balance			Interest		Yield/Rate			Balance			Interest		Yield/Rate			Balance			Interest		Yield/Rate
Assets
Loans:a,b
Commercial, financial and agricultural	$	21,856		$	401		7.36	%	$	21,562		$	392		7.38	%	$	21,970		$	390		7.12	%
Real estate — commercial mortgage		8,565			165		7.75			8,426			163		7.83			8,071			153		7.59
Real estate — construction		8,243			167		8.09			8,227			166		8.20			7,570			152		8.07
Commercial lease financing		10,096			142		5.62			10,094			146		5.78			9,764			148		6.05
Total commercial loans		48,760			875		7.19			48,309			867		7.26			47,375			843		7.13
Real estate — residential		1,472	��		24		6.57			1,444			24		6.60			1,430			24		6.54
Home equity		10,752			193		7.22			10,706			191		7.22			11,003			193		7.02
Consumer — direct		1,370			37		10.64			1,450			36		10.15			1,685			41		9.64
Consumer — indirect		3,961			67		6.76			3,760			64		6.79			3,503			57		6.66
Total consumer loans		17,555			321		7.33			17,360			315		7.32			17,621			315		7.16
Total loans		66,315			1,196		7.23			65,669			1,182		7.28			64,996			1,158		7.14
Loans held for sale		4,415			82		7.50			3,940			75		7.70			3,844			73		7.64
Investment securitiesa		39			—		6.72			39			1		7.21			46			1		8.01
Securities available for sale c		7,793			106		5.45			7,548			100		5.27			7,075			84		4.71
Short-term investments		1,484			16		4.19			1,607			18		4.55			1,678			16		3.89
Other investments c		1,541			15		3.68			1,400			13		3.65			1,398			17		4.60
Total earning assets		81,587			1,415		6.95			80,203			1,389		6.99			79,037			1,349		6.83
Allowance for loan losses		(942	)							(942	)							(958	)
Accrued income and other assets		12,767								12,835								13,137
Total assets	$	93,412							$	92,096							$	91,216
Liabilities
NOW and money market deposit accounts	$	22,953			179		3.14		$	23,424			177		3.06		$	25,347			173		2.75
Savings deposits		1,633			1		.19			1,629			1		.19			1,752			1		.20
Certificates of deposit ($100,000 or more)d		6,237			79		5.03			6,151			76		5.03			5,382			61		4.54
Other time deposits		12,047			141		4.70			12,063			138		4.64			11,456			115		4.02
Deposits in foreign office e		3,600			47		5.20			3,258			41		5.12			2,116			28		5.22
Total interest-bearing deposits		46,470			447		3.85			46,525			433		3.77			46,053			378		3.29
Federal funds purchased and securities sold under repurchase agreements e		4,748			59		5.04			3,903			49		5.04			1,692			20		4.76
Bank notes and other short-term borrowings		1,771			18		4.14			1,113			11		3.98			2,497			27		4.17
Long-term debt d,e		12,909			185		5.83			13,617			196		5.90			14,088			198		5.59
Total interest-bearing liabilities		65,898			709		4.33			65,158			689		4.29			64,330			623		3.87
Noninterest-bearing deposits		13,927								13,237								13,014
Accrued expense and other liabilities		5,933								6,083								6,205
Total liabilities		85,758								84,478								83,549
Shareholders’ equity		7,654								7,618								7,667
Total liabilities and shareholders’ equity	$	93,412							$	92,096							$	91,216
Interest rate spread (TE)							2.62	%							2.70	%							2.96	%
Net interest income (TE) and net interest margin (TE)					706		3.46	%					700		3.50	%					726		3.68	%
TE adjustmenta					20								21								22
Net interest income, GAAP basis				$	686							$	679							$	704

(a)	Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%.
(b)	For purposes of these computations, nonaccrual loans are included in average loan balances.
(c)	Yield is calculated on the basis of amortized cost.
(d)	Rate calculation excludes basis adjustments related to fair value hedges.
(e)	Results from continuing operations exclude the dollar amount of liabilities assumed necessary to support interest-earning assets held by the discontinued Champion Mortgage finance business. The interest expense related to these liabilities, which also is excluded from continuing operations, was calculated using a matched funds transfer pricing methodology.
TE =	Taxable Equivalent
GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 15

Consolidated Average Balance Sheets, Net Interest Income and Yields/Rates
From Continuing Operations
(dollars in millions)

	Six months ended June 30, 2007								Six months ended June 30, 2006
	Average								Average
	Balance			Interest		Yield/Rate			Balance			Interest		Yield/Rate
Assets
Loans:a,b
Commercial, financial and agricultural	$	21,710		$	793		7.37	%	$	21,846		$	747		6.89	%
Real estate — commercial mortgage		8,496			328		7.79			8,080			297		7.41
Real estate — construction		8,235			333		8.14			7,442			290		7.87
Commercial lease financing		10,095			288		5.70			9,672			291		6.02
Total commercial loans		48,536			1,742		7.23			47,040			1,625		6.96
Real estate — residential		1,458			48		6.58			1,440			47		6.43
Home equity		10,729			384		7.22			10,987			377		6.92
Consumer — direct		1,410			73		10.39			1,707			82		9.65
Consumer — indirect		3,861			131		6.77			3,436			114		6.66
Total consumer loans		17,458			636		7.33			17,570			620		7.09
Total loans		65,994			2,378		7.25			64,610			2,245		6.99
Loans held for sale		4,179			157		7.59			3,769			141		7.54
Investment securitiesa		39			1		6.96			54			2		7.11
Securities available for sale c		7,671			206		5.36			7,111			167		4.66
Short-term investments		1,545			34		4.37			1,711			31		3.65
Other investments c		1,471			28		3.66			1,367			42		5.84
Total earning assets		80,899			2,804		6.97			78,622			2,628		6.71
Allowance for loan losses		(942	)							(958	)
Accrued income and other assets		12,801								13,068
Total assets	$	92,758							$	90,732
Liabilities
NOW and money market deposit accounts	$	23,187			356		3.10		$	24,902			318		2.58
Savings deposits		1,631			2		.19			1,782			2		.26
Certificates of deposit ($100,000 or more)d		6,194			155		5.03			5,395			119		4.44
Other time deposits		12,055			279		4.67			11,369			219		3.88
Deposits in foreign office e		3,430			88		5.16			2,073			50		4.86
Total interest-bearing deposits		46,497			880		3.81			45,521			708		3.14
Federal funds purchased and securities sold under repurchase agreements e		4,328			108		5.04			1,858			40		4.34
Bank notes and other short-term borrowings		1,444			29		4.08			2,524			51		4.03
Long-term debt d,e		13,261			381		5.87			14,039			381		5.44
Total interest-bearing liabilities		65,530			1,398		4.31			63,942			1,180		3.71
Noninterest-bearing deposits		13,584								12,854
Accrued expense and other liabilities		6,008								6,316
Total liabilities		85,122								83,112
Shareholders’ equity		7,636								7,620
Total liabilities and shareholders’ equity	$	92,758							$	90,732
Interest rate spread (TE)							2.66	%							3.00	%
Net interest income (TE) and net interest margin (TE)					1,406		3.48	%					1,448		3.70	%
TE adjustmenta					41								50
Net interest income, GAAP basis				$	1,365							$	1,398

(a)	Interest income on tax-exempt securities and loans has been adjusted to a taxable-equivalent basis using the statutory federal income tax rate of 35%.
(b)	For purposes of these computations, nonaccrual loans are included in average loan balances.
(c)	Yield is calculated on the basis of amortized cost.
(d)	Rate calculation excludes basis adjustments related to fair value hedges.
(e)	Results from continuing operations exclude the dollar amount of liabilities assumed necessary to support interest-earning assets held by the discontinued Champion Mortgage finance business. The interest expense related to these liabilities, which also is excluded from continuing operations, was calculated using a matched funds transfer pricing methodology.
TE =	Taxable Equivalent
GAAP = U.S. generally accepted accounting principles

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 16

Noninterest Income
(in millions)

	Three months ended							Six months ended
	6-30-07		3-31-07			6-30-06		6-30-07			6-30-06
Trust and investment services incomea	$	115	$	125		$	139	$	240		$	274
Service charges on deposit accounts		84		75			77		159			149
Investment banking and capital markets incomea		52		44			57		96			117
Operating lease income		66		64			56		130			108
Letter of credit and loan fees		45		38			45		83			85
Corporate-owned life insurance income		32		25			26		57			51
Electronic banking fees		25		24			27		49			51
Net gains from loan securitizations and sales		33		9			10		42			20
Net securities gains (losses)		2		(47	)		4		(45	)		5
Gain on sale of McDonald Investments branch network		—		171			—		171			—
Other income:
Insurance income		15		14			17		29			31
Loan securitization servicing fees		6		5			5		11			10
Credit card fees		3		3			3		6			6
Net gains from principal investing		90		29			23		119			20
Miscellaneous income		81		75			56		156			99
Total other income		195		126			104		321			166
Total noninterest income	$	649	$	654		$	545	$	1,303		$	1,026

(a) Additional detail provided in tables below.

Trust and Investment Services Income
(in millions)

	Three months ended						Six months ended
	6-30-07		3-31-07		6-30-06		6-30-07		6-30-06
Brokerage commissions and fee income	$	28	$	40	$	59	$	68	$	121
Personal asset management and custody fees		41		40		38		81		77
Institutional asset management and custody fees		46		45		42		91		76
Total trust and investment services income	$	115	$	125	$	139	$	240	$	274

Investment Banking and Capital Markets Income
(in millions)

	Three months ended						Six months ended
	6-30-07		3-31-07		6-30-06		6-30-07		6-30-06
Investment banking income	$	22	$	21	$	26	$	43	$	48
Dealer trading and derivatives income		12		8		9		20		16
Income from other investments		6		5		11		11		32
Foreign exchange income		12		10		11		22		21
Total investment banking and capital markets income	$	52	$	44	$	57	$	96	$	117

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 17

Noninterest Expense
(dollars in millions)

	Three months ended							Six months ended
	6-30-07		3-31-07			6-30-06		6-30-07			6-30-06
Personnela	$	411	$	428		$	427	$	839		$	827
Net occupancy		59		63			59		122			120
Computer processing		49		51			49		100			105
Operating lease expense		55		52			45		107			86
Professional fees		26		26			40		52			73
Equipment		24		25			26		49			52
Marketing		20		19			23		39			38
Other expense:
Postage and delivery		11		12			12		23			25
Franchise and business taxes		8		9			10		17			20
Telecommunications		7		7			7		14			14
Provision (credit) for losses on lending-related commitments		6		(8	)		—		(2	)		—
Miscellaneous expense		139		100			100		239			190
Total other expense		171		120			129		291			249
Total noninterest expense	$	815	$	784		$	798	$	1,599		$	1,550
Average full-time equivalent employees		18,888		19,801			19,931		19,342			19,813

(a) Additional detail provided in table below.

Personnel Expense
(in millions)

	Three months ended						Six months ended
	6-30-07		3-31-07		6-30-06		6-30-07		6-30-06
Salaries	$	236	$	245	$	234	$	481	$	463
Incentive compensation		82		75		98		157		175
Employee benefits		73		82		75		155		155
Stock-based compensation		16		24		18		40		32
Severance		4		2		2		6		2
Total personnel expense	$	411	$	428	$	427	$	839	$	827

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 18

Loan Composition
(dollars in millions)

							Percent change 6-30-07 vs.
	6-30-07		3-31-07		6-30-06		3-31-07			6-30-06
Commercial, financial and agricultural	$	21,814	$	21,476	$	21,598		1.6	%		1.0	%
Commercial real estate:
Commercial mortgage		8,629		8,519		7,994		1.3			7.9
Construction		8,214		8,355		7,767		(1.7	)		5.8
Total commercial real estate loans		16,843		16,874		15,761		(.2	)		6.9
Commercial lease financing		10,138		10,036		9,909		1.0			2.3
Total commercial loans		48,795		48,386		47,268		.8			3.2
Real estate — residential mortgage		1,572		1,440		1,418		9.2			10.9
Home equity a		10,879		10,669		13,509		2.0			(19.5	)
Consumer — direct		1,366		1,375		1,670		(.7	)		(18.2	)
Consumer — indirect:
Marine		3,444		3,203		2,920		7.5			17.9
Other		636		638		623		(.3	)		2.1
Total consumer — indirect loans		4,080		3,841		3,543		6.2			15.2
Total consumer loans		17,897		17,325		20,140		3.3			(11.1	)
Total loans	$	66,692	$	65,711	$	67,408		1.5	%		(1.1	)%

(a) On August 1, 2006, Key transferred $2.5 billion of home equity loans from the loan portfolio to loans held for sale in connection with the November 2006 sale of the Champion Mortgage loan portfolio. Excluding the transfer, home equity loans were down $156 million, or 1%, from the second quarter of 2006.

Loans Held for Sale Composition
(dollars in millions)

							Percent change 6-30-07 vs.
	6-30-07		3-31-07		6-30-06		3-31-07			6-30-06
Commercial, financial and agricultural	$	76	$	68	$	45		11.8	%		68.9	%
Real estate — commercial mortgage		1,613		1,224		1,133		31.8			42.4
Real estate — construction		172		163		36		5.5			377.8
Commercial lease financing		22		1		—		N/M			N/M
Real estate — residential mortgage		39		26		27		50.0			44.4
Home equity		—		—		1		—			(100.0	)
Education		2,616		2,681		2,929		(2.4	)		(10.7	)
Automobile		8		12		18		(33.3	)		(55.6	)
Total loans held for sale	$	4,546	$	4,175	$	4,189		8.9	%		8.5	%

N/M = Not Meaningful

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 19

Summary of Loan Loss Experience
(dollars in millions)

	Three months ended									Six months ended
	6-30-07			3-31-07			6-30-06			6-30-07			6-30-06
Average loans outstanding from continuing operations	$	66,315		$	65,669		$	64,996		$	65,994		$	64,610
Allowance for loan losses at beginning of period	$	944		$	944		$	966		$	944		$	966
Loans charged off:
Commercial, financial and agricultural		30			17			20			47			44
Real estate — commercial mortgage		5			6			3			11			6
Real estate — construction		2			1			—			3			2
Total commercial real estate loans		7			7			3			14			8
Commercial lease financing		9			13			8			22			14
Total commercial loans		46			37			31			83			66
Real estate — residential mortgage		1			1			2			2			3
Home equity		8			8			8			16			16
Consumer — direct		8			7			9			15			19
Consumer — indirect		9			11			9			20			20
Total consumer loans		26			27			28			53			58
		72			64			59			136			124
Recoveries:
Commercial, financial and agricultural		6			7			7			13			19
Real estate — commercial mortgage		1			3			—			4			1
Commercial lease financing		4			3			9			7			14
Total commercial loans		11			13			16			24			34
Real estate — residential mortgage		1			—			1			1			1
Home equity		2			1			1			3			3
Consumer — direct		1			2			2			3			4
Consumer — indirect		4			4			5			8			9
Total consumer loans		8			7			9			15			17
		19			20			25			39			51
Net loan charge-offs		(53	)		(44	)		(34	)		(97	)		(73	)
Provision for loan losses from continuing operations		53			44			23			97			62
Provision for loan losses from discontinued operations		—			—			1			—			1
Foreign currency translation adjustment		1			—			—			1			—
Allowance for loan losses at end of period	$	945		$	944		$	956		$	945		$	956
Net loan charge-offs to average loans from continuing operations		.32	%		.27	%		.22	%		.30	%		.23	%
Allowance for loan losses to period-end loans		1.42			1.44			1.42			1.42			1.42
Allowance for loan losses to nonperforming loans		342.39			371.65			342.65			342.39			342.65

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 20

Changes in Liability for Credit Losses on Lending-Related Commitments
(in millions)

	Three months ended								Six months ended
	6-30-07			3-31-07			6-30-06		6-30-07			6-30-06
Balance at beginning of period	$	45		$	53		$	59	$	53		$	59
Provision (credit) for losses on lending-related commitments		6			(8	)		—		(2	)		—
Charge-offs		(1	)		—			—		(1	)		—
Balance at end of perioda	$	50		$	45		$	59	$	50		$	59

Summary of Nonperforming Assets and Past Due Loans
(dollars in millions)

	6-30-07			3-31-07			12-31-06			9-30-06			6-30-06
Commercial, financial and agricultural	$	83		$	70		$	38		$	42		$	76
Real estate — commercial mortgage		41			44			48			36			35
Real estate — construction		23			10			10			37			4
Total commercial real estate loans		64			54			58			73			39
Commercial lease financing		34			31			22			20			29
Total commercial loans		181			155			118			135			144
Real estate — residential mortgage		27			32			34			34			36
Home equityb		55			52			50			46			90
Consumer — direct		2			2			2			2			3
Consumer — indirect		11			13			11			6			6
Total consumer loans		95			99			97			88			135
Total nonperforming loans		276			254			215			223			279
Nonperforming loans held for saleb		4			3			3			56			1
OREO		27			42			57			52			26
Allowance for OREO losses		(2	)		(2	)		(3	)		(3	)		(1	)
OREO, net of allowance		25			40			54			49			25
Other nonperforming assets		73			56	c		1			1			3
Total nonperforming assets	$	378		$	353		$	273		$	329		$	308
Accruing loans past due 90 days or more	$	181		$	146		$	120		$	125		$	119
Accruing loans past due 30 through 89 days		623			626			644			715			600
Nonperforming loans to period-end portfolio loans		.41	%		.39	%		.33	%		.34	%		.41	%
Nonperforming assets to period-end portfolio loans plus OREO and other nonperforming assets		.57			.54			.41			.50			.46

Summary of Changes in Nonperforming Loans
(in millions)

	2Q07			1Q07			4Q06			3Q06			2Q06
Balance at beginning of period	$	254		$	215		$	223		$	279		$	295
Loans placed on nonaccrual status		130			129			115			134			98
Charge-offs		(72	)		(61	)		(74	)		(70	)		(59	)
Loans sold		(7	)		—			(5	)		(22	)		(6	)
Payments		(21	)		(7	)		(23	)		(43	)		(45	)
Transfer to held-for-sale portfoliob		—			—			—			(55	)		—
Transfers to OREO		—			(9	)		(12	)		—			(4	)
Loans returned to accrual status		(8	)		(13	)		(9	)		—			—
Balance at end of period	$	276		$	254		$	215		$	223		$	279

(a)	Included in “accrued expense and other liabilities” on the consolidated balance sheet.
(b)	On August 1, 2006, Key transferred approximately $55 million of home equity loans from nonperforming loans to nonperforming loans held for sale in connection with an expected sale of the Champion Mortgage finance business.
(c)	Primarily one investment of approximately $51 million held by the Private Equity unit within Key’s Real Estate Capital line of business.

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 21

Line of Business Results
(dollars in millions)

Community Banking

																Percent change 2Q07 vs.
	2Q07			1Q07			4Q06			3Q06			2Q06			1Q07			2Q06
Summary of operations
Total revenue (TE)	$	624		$	799		$	670		$	679		$	672			(21.9	)%		(7.1	)%
Provision for loan losses		21			14			23			22			21			50.0			—
Noninterest expense		448			470			492			486			491			(4.7	)		(8.8	)
Net income		97			197			97			107			100			(50.8	)		(3.0	)
Average loans and leases		26,551			26,426			26,667			26,767			26,830			.5			(1.0	)
Average deposits		46,171			46,581			47,383			46,976			46,675			(.9	)		(1.1	)
Net loan charge-offs		26			19			24			22			24			36.8			8.3
Return on average allocated equity		15.80	%		32.46	%		15.41	%		16.93	%		16.09	%		N/A			N/A
Average full-time equivalent employees		8,202			8,619			8,805			8,915			8,782			(4.8	)		(6.6	)
Supplementary information (lines of business)
Regional Banking
Total revenue (TE)	$	530		$	707		$	571		$	578		$	573			(25.0	)%		(7.5	)%
Provision for loan losses		19			18			19			19			19			5.6			—
Noninterest expense		400			421			444			436			439			(5.0	)		(8.9	)
Net income		69			167			68			77			72			(58.7	)		(4.2	)
Average loans and leases		18,433			18,453			18,648			18,796			18,854			(.1	)		(2.2	)
Average deposits		42,694			43,012			43,721			43,449			43,145			(.7	)		(1.0	)
Net loan charge-offs		19			18			19			19			21			5.6			(9.5	)
Return on average allocated equity		16.07	%		38.99	%		15.23	%		17.22	%		16.46	%		N/A			N/A
Average full-time equivalent employees		7,883			8,296			8,484			8,595			8,454			(5.0	)		(6.8	)
Commercial Banking
Total revenue (TE)	$	94		$	92		$	99		$	101		$	99			2.2	%		(5.1	)%
Provision for loan losses		2			(4	)		4			3			2			N/M			—
Noninterest expense		48			49			48			50			52			(2.0	)		(7.7	)
Net income		28			30			29			30			28			(6.7	)		—
Average loans and leases		8,118			7,973			8,019			7,971			7,976			1.8			1.8
Average deposits		3,477			3,569			3,662			3,527			3,530			(2.6	)		(1.5	)
Net loan charge-offs		7			1			5			3			3			600.0			133.3
Return on average allocated equity		15.16	%		16.80	%		15.85	%		16.24	%		15.22	%		N/A			N/A
Average full-time equivalent employees		319			323			321			320			328			(1.2	)		(2.7	)

KeyCorp Reports Second Quarter 2007 Earnings
July 17, 2007
Page 22

Line of Business Results (continued)
(dollars in millions)

National Banking

																Percent change 2Q07 vs.
	2Q07			1Q07			4Q06			3Q06			2Q06			1Q07			2Q06
Summary of operations
Total revenue (TE)	$	630		$	605		$	678		$	596		$	596			4.1	%		5.7	%
Provision for loan losses		32			30			30			13			2			6.7			N/M
Noninterest expense		328			314			330			305			313			4.5			4.8
Income from continuing operations		169			163			199			174			176			3.7			(4.0	)
Net income		166			155			34			181			181			7.1			(8.3	)
Average loans and leasesa		39,348			38,869			38,498			37,898			37,730			1.2			4.3
Average loans held for salea		4,377			3,917			4,521			4,553			3,821			11.7			14.6
Average depositsa		12,036			11,231			11,839			11,066			10,633			7.2			13.2
Net loan charge-offsa		27			25			30			21			10			8.0			170.0
Return on average allocated equitya		16.43	%		16.49	%		19.93	%		17.85	%		18.55	%		N/A			N/A
Return on average allocated equity		16.14			15.68			3.21			17.46			17.93			N/A			N/A
Average full-time equivalent employees		3,830			4,219			4,313			4,326			4,231			(9.2	)		(9.5	)
Supplementary information (lines of business)
Real Estate Capital
Total revenue (TE)	$	188		$	167		$	189		$	170		$	176			12.6	%		6.8	%
Provision for loan losses		8			1			18			7			—			700.0			N/M
Noninterest expense		78			72			70			70			72			8.3			8.3
Net income		64			59			63			58			65			8.5			(1.5	)
Average loans and leases		12,827			12,755			12,931			12,854			12,719			.6			.8
Average loans held for sale		1,241			1,145			1,125			1,022			692			8.4			79.3
Average deposits		4,865			4,297			4,096			3,598			3,467			13.2			40.3
Net loan charge-offs		3			1			8			—			2			200.0			50.0
Return on average allocated equity		19.55	%		19.28	%		20.40	%		19.03	%		21.80	%		N/A			N/A
Average full-time equivalent employees		991			971			957			970			980			2.1			1.1
Equipment Finance
Total revenue (TE)	$	155		$	135		$	146		$	137		$	136			14.8	%		14.0	%
Provision for loan losses		16			13			7			11			2			23.1			700.0
Noninterest expense		93			85			77			81			76			9.4			22.4
Net income		29			23			39			28			36			26.1			(19.4	)
Average loans and leases		10,609			10,479			10,222			10,100			9,871			1.2			7.5
Average loans held for sale		10			4			33			6			34			150.0			(70.6	)
Average deposits		16			13			15			19			14			23.1			14.3
Net loan charge-offs		16			13			14			11			3			23.1			433.3
Return on average allocated equity		13.08	%		10.55	%		17.72	%		12.78	%		17.15	%		N/A			N/A
Average full-time equivalent employees		971			952			938			927			915			2.0			6.1
Institutional and Capital Markets
Total revenue (TE)	$	189		$	182		$	223		$	190		$	192			3.8	%		(1.6	)%
Provision for loan losses		—			—			(4	)		4			(4	)		—			(100.0	)
Noninterest expense		116			115			137			111			117			.9			(.9	)
Net income		45			41			57			48			48			9.8			(6.3	)
Average loans and leases		7,454			7,436			7,521			7,390			7,601			.2			(1.9	)
Average loans held for sale		468			140			387			454			139			234.3			236.7
Average deposits		6,728			6,491			7,285			6,933			6,676			3.7			.8
Net loan charge-offs (recoveries)		—			1			(2	)		4			(2	)		(100.0	)		100.0
Return on average allocated equity		15.15	%		14.16	%		19.18	%		16.94	%		17.57	%		N/A			N/A
Average full-time equivalent employees		1,302			1,350			1,375			1,385			1,296			(3.6	)		.5
Consumer Finance
Total revenue (TE)	$	98		$	121		$	120		$	99		$	92			(19.0	)%		6.5	%
Provision for loan losses		8			16			9			(9	)		4			(50.0	)		100.0
Noninterest expense		41			42			46			43			48			(2.4	)		(14.6	)
Income from continuing operations		31			40			40			40			27			(22.5	)		14.8
Net income (loss)		28			32			(125	)		47			32			(12.5	)		(12.5	)
Average loans and leasesa		8,458			8,199			7,824			7,554			7,539			3.2			12.2
Average loans held for salea		2,658			2,628			2,976			3,071			2,956			1.1			(10.1	)
Average depositsa		427			430			443			516			476			(.7	)		(10.3	)
Net loan charge-offsa		8			10			10			6			7			(20.0	)		14.3
Return on average allocated equitya		16.99	%		22.82	%		23.20	%		23.83	%		16.14	%		N/A			N/A
Return on average allocated equity		15.34			18.25			(53.67	)		20.47			14.04			N/A			N/A
Average full-time equivalent employees		566			946			1,043			1,044			1,040			(40.2	)		(45.6	)

(a)	From continuing operations.
TE =	Taxable Equivalent
N/A =	Not Applicable
N/M =	Not Meaningful