KeyCorp (NYSE:KEY) reported first-quarter 2026 results on Thursday that came in ahead of analyst expectations, though its shares edged lower in pre-market trading.
The stock fell 0.88% following the release.
The Cleveland-based lender posted adjusted earnings per share of $0.44, beating the consensus forecast of $0.42.
Revenue totaled $1.95 billion, up 10% year on year and slightly above analyst expectations of $1.94 billion. Net income attributable to common shareholders reached $486 million, or $0.44 per diluted share, compared with $0.33 per share in the same quarter last year.
Net interest income rose 11% to $1.23 billion, while net interest margin expanded by 29 basis points to 2.87%.
This improvement was supported by lower deposit costs and a shift toward higher-yielding commercial and industrial lending.
Noninterest income increased 8% year on year to $723 million, with investment banking and debt placement fees contributing an additional $22 million.
“Our strong first quarter performance demonstrates disciplined execution and significant momentum as we continue to deliver on our commitments,” said Chairman and CEO Chris Gorman. “Revenue grew 10% year-over-year, growing at more than double the rate of expenses.”
Loans at the end of the period rose by $2.6 billion quarter on quarter to $109.2 billion, with commercial lending increasing by $3.3 billion, or 4%. Average deposits declined 0.8% year on year to $147.3 billion, reflecting a planned reduction in brokered certificates of deposit.
Asset quality remained solid, with net charge-offs at 0.38% of average loans and nonperforming assets at 0.63% of total portfolio loans. The bank recorded a provision for credit losses of $106 million.
During the quarter, KeyCorp repurchased $389 million of its common stock. Its Common Equity Tier 1 ratio was estimated at 11.4%, down from 11.8% in the previous quarter.