Key Financial Results and Metrics

1Strategic Updates and Business Highlights

Capital Return:: Initiated a more aggressive capital return strategy, repurchasing $200 million in common stock in Q4 2025, with plans for at least $300 million in Q1 2026.

Loan Growth:: Strong performance in commercial loans, particularly in C&I, which grew 9%. The overall loan growth is expected to be around 1-2% in 2026.

Investment Banking:: Positive outlook with a strong pipeline, expecting middle market M&A activity to improve.

Wealth Management:: Assets under management reached a record $70 billion, with significant growth in the mass affluent segment.

Technology Investments:: Continued investment in technology, with $1 billion planned for 2026, focusing on enhancing customer-facing capabilities and operational efficiencies.

2Forward Guidance and Outlook

2026 Revenue Growth:: Expected to be up about 7%, with NII growth of 8-10% and non-interest income growth of 3-4%.

Expense Growth:: Anticipated to be 3-4%, indicating substantial operating leverage.

Return on Tangible Common Equity (RoTCE):: Aiming for 15%+ by the end of 2027, with potential to reach 16-19% in the longer term.

Loan Growth Projections:: Commercial loans expected to grow at about 5%, with a focus on maintaining prudent underwriting standards.

3Challenges and Points of Concern

Market Uncertainty:: Ongoing macroeconomic uncertainties could impact growth and credit quality.

Consumer Loan Runoff:: Anticipated continued runoff of lower-yielding consumer loans, which may affect overall loan growth.

Investment Banking Visibility:: Limited visibility beyond Q1 2026 for investment banking activities, with concerns about sustaining momentum in M&A activity.

Expense Management:: While expenses are controlled, there is pressure to manage costs effectively amidst ongoing investments in technology and talent.

4Notable Q&A Insights

Capital Strategy:: CEO Chris Gorman emphasized a focus on organic growth in key areas such as middle market, payments, and investment banking, while maintaining a disciplined approach to capital allocation.

Hiring Impact:: The company has made significant banker hires, with expectations that these will drive revenue growth, albeit with a typical 12-18 month ramp-up period.

Credit Quality Monitoring:: The Chief Risk Officer highlighted a strong credit environment but noted areas of caution, including consumer discretionary and healthcare sectors.

Investment Banking Fees:: CFO Clark Khayat indicated a conservative outlook for investment banking fees, reflecting uncertainty in the market despite a strong Q4 2025 performance. Overall, KeyCorp's Q4 2025 results reflect strong financial performance, strategic investments, and a positive outlook for 2026, albeit with some caution regarding market conditions and credit quality.