KeyCorp (KEY1) Q3 2026 Earnings Report
MX:KEY1 Q3 2026 EPS Results
- Actual EPS
- MXN 9.63
- Consensus EPS
- MXN 8.76
- Beat/Miss
- Beat by +MXN 0.87
- One Year Ago EPS
- MXN 7.74
MX:KEY1 Q3 2026 Revenue Results
- Actual Revenue
- MXN 54.32B
- Expected Revenue
- MXN 38.67B
- Beat/Miss
- Beat by +MXN 15.65B
- YoY Revenue Growth
- +1.95%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/20/2026
- Time
- Before Open
- Conference Call
- Tuesday, October 20, 2026
KeyCorp's next earnings date is estimated for January 20, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was strongly positive, supported by record revenue and PPNR, 24% year-over-year EPS growth, 15.1% ROTCE, strong deposit and commercial loan growth, improving credit quality, higher guidance for loan growth and net interest income, and continued confidence in the 2027 return and margin targets. Management also highlighted ongoing investments in technology, AI, bankers, and fee-based businesses. The principal challenges were macroeconomic and geopolitical uncertainty, intense deposit competition, expected near-term moderation in earning-asset growth, depressed middle-market M&A and transactional real estate activity, and higher expenses. Overall, the positive operating momentum and improved guidance significantly outweighed the stated challenges.
KeyCorp tightened 2026 guidance to approximately 10% net interest income growth versus 9%-11% previously, average loan growth of approximately 5% versus 4%-5%, average commercial loan growth of approximately 10% versus 8%-10%, and full-year net charge-offs in the range of 37-39 basis points versus 40-45 basis points previously; it expects fourth-quarter 2026 net interest margin of approximately 3%, average earning asset growth of approximately $1.5 billion-$2 billion from the third quarter, full-year expense growth of 4%, commercial mortgage servicing fees of $50 million-$60 million, mid-single digit investment banking fee growth this year, loan growth for the remainder of 2026 to be fully client deposit funded, and incremental client deposit growth beyond the original $3 billion; it remains on pace for a $1.3 billion 2026 share repurchase target, expects a record revenue and record PPNR year in 2026, and expects another year of outsized revenue and earnings growth in 2027, with 15%+ ROTCE by year end 2027, 3.25%+ NIM for 4Q 2027, and a current long-term target between 16% and 19%; it expects beta in the rate hiking cycle to be roughly symmetrical to the rate easing cycle, reaching a mid-fifties cumulative beta over time, with low 40s beta in the fourth quarter and movement to mid-50s over the next probably first or second quarter of 2027, while post 2027 it could be managing to sort of 3% annual expense growth.
- Record Revenue and Strong Earnings GrowthThird-quarter earnings were $0.51 per share, up 24% year-over-year. Revenue exceeded $2 billion, a quarterly record and an 8% year-over-year increase. PPNR reached a record level, increased $60 million sequentially, and the company expects both record revenue and record PPNR for full-year 2026.
- Improving Returns and Long-Term TargetsReturn on average tangible common equity increased 260 basis points year-over-year to 15.1%, exceeding 15%. Management remains confident in achieving and sustaining 15% plus ROTCE by year-end 2027 and maintaining its long-term target range of 16% to 19%.
- Strong Deposit Growth and Funding PerformanceAverage total deposits grew $3.6 billion, or 2.4% sequentially, while client deposits increased $2.8 billion, or 1.9%, driven by commercial operating balances, deeper relationships with existing clients, and deposits from new-to-bank customers. Deposit costs increased only three basis points and total funding costs rose one basis point. Management now expects incremental client deposit growth beyond the original $3 billion second-half 2026 target and expects remaining 2026 loan growth to be fully client-deposit funded.
- Net Interest Margin ExpansionTax-equivalent net interest income increased 10% year-over-year and 4% sequentially. Net interest margin expanded six basis points sequentially to 2.95%, driven by commercial loan growth, strong client deposit growth and funding optimization, swaps and securities repricing at higher rates, and an additional day in the quarter.
- Broad-Based Commercial Loan GrowthAverage loans increased $1.5 billion sequentially, while average commercial and industrial loans grew 4%, or $2.3 billion. Period-end C&I loans increased $3.3 billion, or 5%, reflecting broad-based new-client acquisition and higher utilization. Of the $3.3 billion in period-end loan growth, $2 billion came from utilization, which increased 200 basis points to 33%, the highest level in more than three years.
- Client and Relationship GrowthCommercial clients increased 3% and relationship households increased 2% from the prior year. Management said the relationship-focused business model continues to differentiate Key and that client engagement remains healthy across its businesses.
- Strength in Fee-Based BusinessesInvestment banking, commercial payments, and wealth management collectively grew 12% year-over-year. Investment banking and debt placement fees increased 27% sequentially to $214 million, driven by M&A and syndication activity. Commercial payment fees increased 8% year-over-year, trust and investment services income grew 10%, and service charges on deposit accounts increased 5%.
- Elevated Investment Banking PipelineInvestment banking pipelines increased 5% sequentially and 20% year-over-year despite significant third-quarter pull-through. Pipelines remain at historically elevated levels and are supported by record M&A pipelines. Management remains confident in its expectation for mid-single-digit investment banking fee growth in 2026 and its goal of reaching $1 billion of annual investment banking revenue by 2028.
- Record Wealth Management Assets and Penetration OpportunityWealth management assets under management reached another record. Management identified significant opportunity because Key is less than 10% penetrated among its existing mass-affluent household base.
- Improving Credit QualityNet charge-offs were $89 million, or 32 basis points of average loans. The net charge-off ratio improved, non-performing assets decreased $191 million, or 19 basis points sequentially, to 55 basis points, the lowest level since late 2023, and the improvement was driven by broad-based portfolio resolutions. The criticized loan ratio remained stable at 4.9%.
- Reserve Release and Strong Credit OutlookProvision for credit losses was $61 million, including a $28 million reserve release. The release reflected improved portfolio performance, scenario impacts, and continued movement toward higher-credit-quality relationships, partly offset by qualitative builds related to economic and geopolitical uncertainty. Full-year net charge-offs are now expected to be 37-39 basis points, improved from the prior 40-45 basis-point guidance.
- Capital Generation and Share RepurchasesKey repurchased $320 million of common stock during the quarter and had repurchased more than $1 billion since the start of the year. The company remains on pace to complete its targeted $1.3 billion of 2026 share repurchases, with approximately $250 million remaining.
- Updated 2026 Growth GuidanceKey tightened its full-year net interest income growth outlook to approximately 10%, compared with the prior 9%-11% range. Average loan growth is now expected to be approximately 5%, compared with 4%-5% previously, and average commercial loan growth is expected to be approximately 10%, compared with 8%-10% previously.
- Visibility Into Future Margin ExpansionManagement continues to target a net interest margin of 3.25% or higher in the fourth quarter of 2027. Approximately $24 billion of securities, swaps, and residential mortgages are expected to reprice through the end of 2027, with a weighted-average yield pickup of about 165 basis points. Management said this repricing represents roughly 70% of the NIM expansion required to reach the target.
- Continued Investment in People and TechnologyKey continues to invest in frontline bankers, people, and technology. Its technology budget is $1 billion in 2026, up from $800 million and $900 million in prior years, and has supported new product and service capabilities.
- Enterprise AI DeploymentKey is embedding AI into four enterprise-wide domains: commercial onboarding and servicing, commercial originations, consumer servicing, and software engineering. The initiatives are intended to simplify processes, increase productivity, reduce fraud, improve issue resolution, accelerate credit and collateral processes, and improve technology speed, quality, resiliency, and efficiency. In commercial onboarding and servicing, management's goal is twice the throughput in half the time.
- Successful Banker Hiring and Clearwater IntegrationKey increased its number of bankers on the ground by approximately 10% last year, and 90% of the middle-market banker cohort hired last year brought in a piece of business in the first quarter. The company also closed the Clearwater acquisition during the quarter and continues to build capabilities by market and industry.
- Strong Capital Position and Basel III BenefitThe CET1 ratio was 11.1% and the marked CET1 ratio was 9% at quarter-end. Management said it feels good about the current capital position and expects potential Basel III changes to provide roughly 100 basis points of additional capital-ratio benefit, which would put the company squarely back into its targeted range.
- Disciplined Balance-Sheet and Interest-Rate ManagementKey continues to manage its balance sheet to be fairly neutral to interest-rate movements over a 12-month horizon. Management said the company is largely in maintenance mode with swaps, has replaced maturing swaps at higher levels, and has made some maintenance additions into 2028 and 2029.
- Consumer Portfolio Redeployment and Home-Equity InitiativeKey is intentionally running down its consumer loan book while redeploying capital from safe jumbo mortgages to the C&I portfolio, where management sees stronger relationship and revenue opportunities. Consumer loan runoff is currently about $400 million per quarter versus the previously expected $600 million. Key is also building a digital home-equity interface, with growth expected in 2027.
MX:KEY1 Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Jan 20, 2027 | 2026 (Q4) | 9.48- | 8.12 | ― | ― |
| Oct 20, 2026 | 2026 (Q3) | 8.769.63 | 7.74 | 24.39% (+1.89) | |
| Jul 21, 2026 | 2026 (Q2) | 7.978.31 | 6.61 | 25.71% (+1.70) | |
| Apr 16, 2026 | 2026 (Q1) | 7.828.31 | 6.23 | 33.33% (+2.08) | |
| Jan 20, 2026 | 2025 (Q4) | 7.318.12 | 7.18 | 13.16% (+0.94) | |
| Oct 16, 2025 | 2025 (Q3) | 7.197.74 | 5.66 | 36.67% (+2.08) | |
| Jul 22, 2025 | 2025 (Q2) | 6.536.61 | 4.72 | 40.00% (+1.89) | |
| Apr 17, 2025 | 2025 (Q1) | 6.006.23 | 4.15 | 50.00% (+2.08) | |
| Jan 21, 2025 | 2024 (Q4) | 6.217.18 | 4.72 | 52.00% (+2.45) | |
| Oct 17, 2024 | 2024 (Q3) | 5.295.66 | 5.48 | 3.45% (+0.19) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
