Keyp(US:KEY)2025-08-05 19:50Financial Performance - Net interest income increased to $1,141 million for the three months ended June 30, 2025, compared to $887 million for the same period in 2024, reflecting a growth of 28.6%[270] - Net income for the three months ended June 30, 2025, was $425 million, up from $274 million in Q2 2024, representing a growth of 55.1%[274] - Net income for the six months ended June 30, 2025, was $830 million, compared to $493 million in 2024, representing a 68.3% increase[280] - Basic earnings per share for the six months ended June 30, 2025, was $0.69, up from $0.45 in 2024, indicating a 53.3% increase[289] - The net income for the second quarter of 2025 was reported at $830 million, compared to $425 million for the first quarter of 2025, indicating a significant increase of 95.3%[276] Asset and Liability Management - Total assets decreased to $185,499 million as of June 30, 2025, from $187,168 million at December 31, 2024, representing a decline of 0.9%[268] - Total liabilities decreased to $166,015 million as of June 30, 2025, from $168,992 million at December 31, 2024, a reduction of 1.2%[268] - As of June 30, 2025, total shareholders' equity increased to $19,484 million, up from $18,176 million at December 31, 2024, reflecting a growth of approximately 7.2%[276] - Retained earnings increased to $14,886 million as of June 30, 2025, from $14,584 million at December 31, 2024, reflecting a growth of 2.1%[268] Income and Expenses - Total interest income rose to $2,107 million in Q2 2025, up from $2,088 million in Q2 2024, marking an increase of 0.9%[270] - Noninterest income for the six months ended June 30, 2025, was $1,358 million, compared to $1,274 million in the same period of 2024, an increase of 6.6%[270] - The provision for credit losses increased to $138 million in Q2 2025, compared to $100 million in Q2 2024, indicating a rise of 38%[270] Shareholder Returns - Cash dividends declared for common shares were $456 million at a rate of $0.410 per share for the second quarter of 2025[276] - The company repurchased 1,961 thousand common shares during the second quarter of 2025, reflecting ongoing commitment to shareholder returns[276] Loan and Credit Quality - Total loans increased to $106,389 million as of June 30, 2025, up from $104,260 million at the end of 2024, reflecting a growth of 2.0%[291] - The allowance for loan and lease losses (ALLL) increased to $1,446 million as of June 30, 2025, from $1,429 million at the end of the previous quarter[299] - The total nonperforming loans outstanding represented 76% of their original contractual amount owed as of June 30, 2025[330] - Nonperforming loans reduced expected interest income by $27 million for the six months ended June 30, 2025[331] Economic Outlook - U.S. GDP is projected to grow at an annual rate of 1.2% for 2025 and 1.5% for 2026, indicating a slowing growth forecast[308] - The expected National Unemployment Rate is forecasted to peak at 4.6% in mid-2026, reflecting potential economic challenges ahead[308] - The geopolitical environment remains uncertain, posing potential downside risks to the economic outlook over the next two years[309] Derivative and Investment Management - The company has a notional amount of $151.0 billion in net derivatives as of June 30, 2025, with derivative assets of $270 million and liabilities of $683 million[387] - The total fair value of derivatives not designated as hedging instruments was $651 million in assets and $1.154 billion in liabilities as of June 30, 2025[387] - The company reported net gains from cash flow hedges of $122 million recognized in OCI for the three months ended June 30, 2025, compared to a loss of $(78) million for the same period in 2024[398] Tax and Regulatory Matters - The effective tax rate for the second quarter of 2025 was 21.4%, compared to 18.5% for the same period in 2024[438] - The company had $40 million in unrecognized tax benefits as of June 30, 2025[441] Other Comprehensive Income - The total other comprehensive income for the period ended June 30, 2025, was $969 million, improving from a balance of $(3,470) million at December 31, 2024[466] - The company recorded unrealized gains of $576 million on securities available for sale for the three months ended June 30, 2025[466]