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KeyCorp underperforms and turns to cost cutting

REGIONAL US bank KeyCorp fell to a worse-than-expected second-quarter loss of $390m, (&pound;237m) or $0.68 per share, yesterday.<br /><br />The figures represent a turnaround from the $1.13bn, or $2.70, lost in the same quarter of last year, but still underperformed an analysts&rsquo; consensus of a $0.41 per share loss.<br /><br />Chief executive Henry Meyer said the results were down to the &ldquo;weak economic environment and the aggressive steps we&rsquo;ve taken to address credit quality, strengthen our capital position and control costs&rdquo;.<br /><br />The bank hiked loan loss reserves to $2.5bn in the quarter, compared to $1.4bn the previous year and suffered continuing deterioration in the quality of its loans.<br /><br />Meyer said cost-cutting efforts, including 1,500 job cuts in five quarters, would help the bank save between $300m and $375m by 2012.<br />Keycorp finished up 7.05 per cent at $5.16.