CLEVELAND -- Keycorp chairman and chief executive officer Victor Riley Jr. said the company is comfortable _with the low end of analysts' 1994 earnings per share estimates of $3.60 to $3.70.
"The investment analysts believe us capable of earning between $3.60 and $3,70 per common share in 1994," Mr. Riley told shareholders at the company's first annual meeting since the merger of Society Corp. and Keycorp.
"We are somewhat of a conservative group, therefore we feel a little more comfortable with the lower end of that range," he added.
12% to 15% Gain
Mr. Riley said even at the lower end, that would put earnings 12% to 15% better than 1993's earnings, excluding the impact of the restructuring charge in 1993.
He said the company plans to reduce expenses by $50 million this year and another $50 million in the first half of next year.
"I can very happily tell you we are right on target" in reducing expenses, Mr. Riley said.
Noninterest expense for Keycorp and Society, which merged on March 1, totaled $2.39 billion in 1993. while interest expense was $1.53 billion.
In a news conference, Mr. Riley said Keycorp will cut close to 300 positions in mortgage production as a result of a slump in mortgage loans after a rise in interest rates. Keycorp has 30,000 employees after the merger.
From November 1993 through mid-January 1994, he said, the company was writing about $1 billion a month in mortgages.
"All of a sudden it was like somebody slammed the barn door," Mr. Riley said. "It fell right off to practically nothing starting in the latter part of January, into February, and continuing today."
Robert Gillespie, president and chief operating officer, said a dropoff in mortgage lending from 1993 levels had been expected.
But "I guess it was a huge surprise to everybody what point the long-term rate had to reach before refinancing mortgages just stopped, and we hit that point right around the end of 1993," Mr. Gillespie added.
Meanwhile, Mr. Riley told shareholders that the company is eyeing expansion in New England, Wisconsin, Minnesota, and the Rocky Mountain region. Keycorp has 1,300 offices in 22 states.