KeyCorp to Layoff 11% by End of 2000

Nov. 23, 10:48 A.M. -- KeyCorp said Tuesday it would fire up to 11% of its workforce, or 3,000 employees, by the end of next year and put its credit card operations on the auction block in a bid to improve earnings.

The $83 billion-asset Cleveland-based banking company said it will take a $180 million charge in the fourth quarter 1999, which would be offset by a $190 million gain during the period on the sale of the company's retail operations in Long Island, N.Y., to Dime Bancorp in New York.

The restructuring aims at $170 million in annual cost improvements, the bank said in a statement. Key Corp said the program would also include closing offices "at the corporate level and in certain businesses," discontinuing the use of certain software applications, and outsourcing certain technology functions.

Robert W. Gillespie, chairman and chief executive officer, said the cost savings would "enable us to capitalize on the opportunities created by passage of long-awaited financial modernization legislation."

KeyCorp did not attach a value to its credit card business, but said in the statement that a sale would be "consistent with the company's strategy to exit low-growth businesses in order to invest in higher-growth businesses."

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