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KeyCorp Q4 Profit Down, Adj. EPS Meets Market View; Revenue Beats - Quick Facts

KeyCorp (KEY) reported Thursday that its fourth-quarter attributable net income from continuing operations fell 15 percent to $181 million from last year's $213 million. Earnings per share from continuing operations declined to $0.17 from $0.20 a year ago.

The latest fourth quarter results included a number of notable items resulting in a net impact of $0.19 per share. This included an estimated tax expense of $147 million or $0.16 per share following the recent passage of the Tax Cuts and Jobs Act on December 22.

Excluding items, earnings per share were $0.36 for the fourth quarter of 2017, compared to $0.31 in 2016.

On average, 27 analysts polled by Thomson Reuters also expected earnings of $0.36 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Total revenue grew 2.7 percent to $1.608 billion from last year's $1.566 billion. Analysts were looking for revenues of $1.59 billion.

Taxable-equivalent net interest income was $952 million, up 0.4 percent from prior year's $948 million. Net interest margin from continuing operations, meanwhile, dropped to 3.09% from 3.12% a year ago.

Noninterest income grew 6.1 percent from last year to $656 million.

Beth Mooney, Chairman and CEO, said, "Key's fourth quarter results were a solid finish to the year, with continued momentum in our core businesses. Revenue trends benefited from growth in our fee-based businesses, with investment banking and debt placement fees reaching new record levels for the fourth quarter and full year. … We expect the new tax law will benefit both Key and our clients, by strengthening the competitive position of U.S businesses and promoting stronger economic growth."

Beginning January 1, 2018, the new tax law will lower Key's marginal federal corporate income tax rate to 21% from 35%.

Key said it will be sharing the expected tax benefits with its employees by increasing its minimum wage and making the additional retirement plan contribution. These actions will benefit over 80% of our workforce.

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