Tomahawk, WI 7/24/2013 (Basicsmedia) –The slow economic activity has its toll on many regional banks; KeyCorp’s (NYSE:KEY) second quarter profit fell by 14% due to increase in its noninterest expense, loan loss provisions and due to high packages paid to laid-off employees. Unstable economic activity increased pressure on its loan loss provision, which increased to $28 million in the second quarter 2013 from $21 million previous year same quarter.  Commercial real estate loans, which turned sour in the financial crisis, are part of its loan portfolio.

Net income of KeyCorp declined 11.9% to $199 million in the second quarter 2013 from $226 million in the same quarter previous year.

The company reported a slight decrease in its Earnings per Share from $0.24 to $0.22. The total revenue of the company rose 1.4% to $1.2 billion. The company in its initiative to reduce cost spent $37 million, or 3 cents per share, included in the second quarter, 2013. Through this initiative, the bank is in plans to close 33 branches to improve efficiency.  The efficiency ratio of the bank at the end of June 30, 2013 was 69.06%, compared with 65.98% in the first quarter.

Growth in commercial, financial and agriculture loans contributed to an increase in Average total loans, which rose 6.6% YoY to $52.7 billion. Low interest rates showed its power in the net interest margin of the company, which was 3.07% versus 2.99% a year ago.

In its continuous efforts to improve future growth prospects of the bank, it will be servicing a $110.5 billion commercial loan portfolio from Bank of America Corp (BAC).  Net income available to common shareholders is $193 million compared with $221 million in the same quarter previous year.

Tax-equivalent net interest income (NII) climbed 7.7% to $586 million from $544 million in the same quarter previous year. This year the Federal Reserve approved the company’s plan of buying back shares, after which KeyCorp bought back shares worth $112 million in the second quarter.

Tier one common equity ratio of the company was 11.25% compared with 11.63% at the end of the prior-year quarter. Total assets of the company were $90.6 billion in the second quarter 2013, compared with the same quarter previous year. Average deposits went up to $64.9 billion up by 7.6% in the second quarter 2013, from $60.3 billion in the prior year quarter. On the other side, average loans of the company were at $52.7 billion an increase of 6.6% compared with $49.4 billion in the prior year quarter.

With market cap of $11.26 billion, the company’s share price increased by 55.87% in the past one year.  Institutional buyers own 84% shares of the company.

DISCLAIMER: This content is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a real licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.