KeyCorp in Cleveland posted lower profit after merger-related costs cut into its bottom line.
The $136 billion-asset company said Tuesday that its third quarter earnings fell 22% from a year earlier to $166 million. The results included $207 million in expenses tied to Key's $4 billion acquisition of First Niagara Financial Group in Buffalo, N.Y., which closed in July.
Net interest income rose nearly 32% to $788 million. Total average loans increased 31% to $77.7 billion as other consumer loans soared more than 75% to $9.3 billion and commercial, financial and agricultural loans rose almost 23% to $37.3 billion. Excluding First Niagara, total average loans increased by roughly 5% to $62.3 billion.
Net interest income, excluding merger-related charges and the impact of First Niagara, increased more than 3% to $619 million.
Noninterest income rose almost 17%, to $549 million, as investment banking and debt placement fees jumped roughly 43% to $156 million and service charges on deposit accounts rose 25% to $85 million, Excluding First Niagara, fee income increased by 8% to $508 million.
Noninterest expense rose more than 49% to $1.1 billion, mainly reflecting merger-related charges. Excluding that, expenses increased 4% to $753 million.