Moody's Investors Service, a rating arm of
), recently completed the rating review of
) and its subsidiaries. The rating agency maintained the
long-term ratings of KeyCorp and projected its outlook as
BANKUNITED INC (BKU): Free Stock Analysis
KEYCORP NEW (KEY): Free Stock Analysis Report
MOODYS CORP (MCO): Free Stock Analysis Report
WELLS FARGO-NEW (WFC): Free Stock Analysis
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While KeyCorp was reaffirmed at Baa1, the company's bank
subsidiary - KeyBank National Association - remains at A3 for
long-term deposits and Prime-2 for short-term obligations.
Further, KeyBank National Association has a standalone bank
financial strength rating of C and the baseline credit assessment
The rating agency reaffirmed its rating based on KeyCorp's
strength in asset quality, capital position and liquidity, offset
by rising expenses and persistent pressure on net interest margin
In second-quarter 2013, KeyCorp's nonperforming assets, as a
percentage of period-end portfolio loans, OREO assets and other
nonperforming assets were 1.30%, falling 21 basis points (bps)
year over year. Moreover, net charge-offs, as a percentage of
average loans, decreased 29 bps year over year to 0.34%.
However, the company's non-interest expense inched up 2.6% from
the prior-year quarter to $711 million. Though NIM increased 7
bps year over year to 3.13%, the pace of improvement remains
Further, KeyCorp has been working hard to lower its risk profile.
Though the company's commercial real estate (CRE) concentration
has declined from what it was before the financial crisis, it
still remains a matter of concern.
KeyCorp, currently carries a Zacks Rank #3 (Hold). Some
better-performing banks include
Wells Fargo & Company
). While BankUnited carries a Zacks Rank #1 (Strong Buy), Wells
Fargo has a Zacks Rank #2 (Buy).