/FIRST ADD -- CLTU003 -- KeyCorp Earnings/

Financial Highlights
(dollars in millions, except per share amounts)

Three months ended
12-31-07 9-30-07 12-31-06
Summary of operations
Net interest income (TE) $750 $712 $744
Noninterest income 488 438 558
Total revenue (TE) 1,238 1,150 1,302
Provision for loan losses 363 69 53
Noninterest expense 896 753 809
Income from continuing operations
before cumulative effect of
accounting change 22 224 311
Income (loss) from discontinued
operations, net of taxes (a) 3 (14) (165)
Net income 25 210 146

Per common share
Income from continuing operations
before cumulative effect of
accounting change $.06 $.58 $.77
Income from continuing operations
before cumulative effect of
accounting change
- assuming dilution .06 .57 .76
Income (loss) from discontinued
operations (a) .01 (.03) (.41)
Income (loss) from discontinued
operations - assuming dilution (a) .01 (.03) (.40)
Net income .06 .54 .36
Net income - assuming dilution .06 .54 .36
Cash dividends paid .365 .365 .345
Book value at period end 19.92 20.12 19.30
Market price at period end 23.45 32.33 38.03

Performance ratios - from continuing
operations
Return on average total assets .09 % .93 % 1.33 %
Return on average equity 1.11 11.50 15.63
Net interest margin (TE) 3.48 3.40 3.66

Performance ratios - from consolidated
operations
Return on average total assets .10 % .88 % .61 %
Return on average equity 1.26 10.79 7.34
Net interest margin (TE) 3.48 3.40 3.69

Capital ratios at period end
Equity to assets 7.75 % 8.03 % 8.34 %
Tangible equity to tangible assets 6.46 6.78 7.01
Tier 1 risk-based capital (b) 7.37 7.94 8.24
Total risk-based capital (b) 11.29 11.76 12.43
Leverage (b) 8.30 8.96 8.98

Asset quality
Net loan charge-offs $119 $59 $54
Net loan charge-offs to average loans
from continuing operations .67 % .35 % .33 %
Allowance for loan losses $1,200 $955 $944
Allowance for loan losses to period-
end loans 1.69 % 1.38 % 1.43 %
Allowance for loan losses to
nonperforming loans 174.67 191.77 439.07
Nonperforming loans at period end $687 $498 $215
Nonperforming assets at period end 764 570 273
Nonperforming loans to period-end
portfolio loans .97 % .72 % .33 %
Nonperforming assets to period-end
portfolio loans plus OREO and other
nonperforming assets 1.08 .83 .41

Trust and brokerage assets
Assets under management $85,442 $88,100 $84,699
Nonmanaged and brokerage assets (c) 33,918 33,273 56,292

Other data
Average full-time equivalent
employees 18,500 18,567 20,100
Branches 955 954 950

Taxable-equivalent adjustment $40 $18 $32

Financial Highlights (continued)
(dollars in millions, except per share amounts)

Twelve months ended
12-31-07 12-31-06
Summary of operations
Net interest income (TE) $2,868 $2,918
Noninterest income 2,229 2,127
Total revenue (TE) 5,097 5,045
Provision for loan losses 529 150
Noninterest expense 3,248 3,149
Income from continuing operations
before cumulative effect of
accounting change 941 1,193
Loss from discontinued operations,
net of taxes (a) (22) (143)
Net income 919 1,055

Per common share
Income from continuing operations
before cumulative effect of
accounting change $2.40 $2.95
Income from continuing operations
before cumulative effect of
accounting change
- assuming dilution 2.38 2.91
Loss from discontinued operations (a) (.06) (.35)
Loss from discontinued operations -
assuming dilution (a) (.05) (.35)
Net income 2.35 2.61
Net income - assuming dilution 2.32 2.57
Cash dividends paid 1.46 1.38

Performance ratios - from continuing
operations
Return on average total assets .99 % 1.30 %
Return on average equity 12.19 15.43
Net interest margin (TE) 3.46 3.67

Performance ratios - from consolidated
operations
Return on average total assets .97 % 1.12 %
Return on average equity 11.90 13.64
Net interest margin (TE) 3.46 3.69

Asset quality
Net loan charge-offs $275 $170
Net loan charge-offs to average loans
from continuing operations .41 % .26 %

Other data
Average full-time equivalent
employees 18,934 20,006

Taxable-equivalent adjustment $99 $103

(a) Key sold the subprime mortgage loan portfolio held by the Champion
Mortgage finance business in November 2006, and completed the sale of
Champion's origination platform in February 2007. As a result of
these actions, Key has accounted for this business as a discontinued
operation.

(b) 12-31-07 ratio is estimated.

(c) On February 9, 2007, Key sold the McDonald Investments branch
network.

TE = Taxable Equivalent

Consolidated Balance Sheets
(dollars in millions)

12-31-07 9-30-07 12-31-06
Assets
Loans $70,823 $68,999 $65,826
Loans held for sale 4,736 4,791 3,637
Securities available for sale 7,860 7,915 7,827
Held-to-maturity securities 28 36 41
Trading account assets 1,056 1,060 912
Short-term investments 800 663 495
Other investments 1,538 1,509 1,352
Total earning assets 86,841 84,973 80,090
Allowance for loan losses (1,200) (955) (944)
Cash and due from banks 1,814 2,016 2,264
Premises and equipment 681 631 595
Operating lease assets 1,128 1,135 1,124
Goodwill 1,252 1,202 1,202
Other intangible assets 123 105 120
Corporate-owned life insurance 2,872 2,845 2,782
Derivative assets 2,205 1,497 1,091
Accrued income and other assets 4,267 3,917 4,013
Total assets $99,983 $97,366 $92,337

Liabilities
Deposits in domestic offices:
NOW and money market deposit
accounts $27,635 $24,198 $24,340
Savings deposits 1,513 1,544 1,642
Certificates of deposit ($100,000
or more) 6,982 6,672 5,941
Other time deposits 11,615 11,403 11,956
Total interest-bearing
deposits 47,745 43,817 43,879
Noninterest-bearing deposits 11,028 14,003 13,553
Deposits in foreign office -
interest-bearing 4,326 5,894 1,684
Total deposits 63,099 63,714 59,116
Federal funds purchased and
securities sold under repurchase
agreements 3,927 5,398 3,643
Bank notes and other short-term
borrowings 6,453 2,743 1,192
Derivative liabilities 1,340 1,063 922
Accrued expense and other
liabilities 5,461 5,079 5,228
Long-term debt 11,957 11,549 14,533
Total liabilities 92,237 89,546 84,634

Shareholders' equity
Preferred stock - - -
Common shares 492 492 492
Capital surplus 1,623 1,617 1,602
Retained earnings 8,522 8,788 8,377
Treasury stock, at cost (3,021) (3,023) (2,584)
Accumulated other comprehensive
income (loss) 130 (54) (184)
Total shareholders' equity 7,746 7,820 7,703

Total liabilities and shareholders'
equity $99,983 $97,366 $92,337

Common shares outstanding (000) 388,793 388,708 399,153

Consolidated Statements of Income
(dollars in millions, except per share amounts)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Interest income
Loans $1,205 $1,209 $1,187 $4,751 $4,561
Loans held for sale 89 91 90 337 325
Securities available for
sale 115 106 96 427 347
Held-to-maturity securities 1 - - 2 2
Trading account assets 12 11 8 38 30
Short-term investments 13 5 8 37 33
Other investments 12 12 24 52 82
Total interest income 1,447 1,434 1,413 5,644 5,380

Interest expense
Deposits 483 482 440 1,845 1,576
Federal funds purchased and
securities sold
under repurchase
agreements 45 55 37 208 107
Bank notes and other short-
term borrowings 45 30 19 104 94
Long-term debt 164 173 205 718 788
Total interest expense 737 740 701 2,875 2,565

Net interest income 710 694 712 2,769 2,815
Provision for loan losses 363 69 53 529 150
Net interest income after
provision for loan losses 347 625 659 2,240 2,665

Noninterest income
Trust and investment
services income 131 119 142 490 553
Service charges on deposit
accounts 90 88 77 337 304
Investment banking and
capital markets income 12 9 69 117 230
Operating lease income 72 70 63 272 229
Letter of credit and loan
fees 58 51 55 192 188
Corporate-owned life
insurance income 37 27 31 121 105
Electronic banking fees 25 25 27 99 105
Net (losses) gains from
loan securitizations and
sales (6) (53) 42 (17) 76
Net securities gains
(losses) 6 4 3 (35) 1
Net gains from principal
investing 6 9 5 134 53
Gain from sale of McDonald
Investments branch network - - - 171 -
Other income 57 89 44 348 283
Total noninterest income 488 438 558 2,229 2,127

Noninterest expense
Personnel 399 383 447 1,621 1,692
Net occupancy 64 60 68 246 250
Computer processing 52 49 55 201 212
Operating lease expense 59 58 50 224 184
Professional fees 38 27 33 117 134
Equipment 25 22 24 96 102
Marketing 16 21 27 76 97
Other expense 243 133 105 667 478
Total noninterest expense 896 753 809 3,248 3,149
(Loss) income from
continuing operations
before income taxes
and cumulative effect of
accounting change (61) 310 408 1,221 1,643
Income taxes (83) 86 97 280 450
Income from continuing
operations before
cumulative
effect of accounting change 22 224 311 941 1,193
Income (loss) from
discontinued operations,
net of taxes 3 (14) (165) (22) (143)
Income before cumulative
effect of accounting change 25 210 146 919 1,050
Cumulative effect of change
in accounting for
forfeited stock-based awards,
net of taxes - - - - 5
Net income $25 $210 $146 $919 $1,055

Per common share:
Income from continuing
operations before
cumulative effect
of accounting change $.06 $.58 $.77 $2.40 $2.95
Income before cumulative
effect of accounting change .06 .54 .36 2.35 2.60
Net income .06 .54 .36 2.35 2.61

Per common share - assuming
dilution:
Income from continuing
operations before
cumulative effect
of accounting change $.06 $.57 $.76 $2.38 $2.91
Income before cumulative
effect of accounting change .06 .54 .36 2.32 2.56
Net income .06 .54 .36 2.32 2.57

Cash dividends declared per
common share $.74 $.365 $.345 $1.835 $1.38

Weighted-average common
shares outstanding (000) 388,841 389,319 402,329 391,988 404,490
Weighted-average common
shares and potential
common shares
outstanding (000) 389,911 393,164 407,828 395,823 410,222

Consolidated Average Balance Sheets, Net Interest Income and
Yields/Rates
From Continuing Operations
(dollars in millions)

Fourth Quarter 2007
Average
Balance Interest Yield/Rate
Assets
Loans: (a,b)
Commercial, financial and
agricultural $23,825 $419 6.98 %
Real estate - commercial
mortgage 9,351 175 7.42
Real estate - construction 8,192 153 7.42
Commercial lease financing 10,252 171 6.65
Total commercial loans 51,620 918 7.06
Real estate - residential 1,596 27 6.72
Home equity 10,917 192 7.02
Consumer - direct 1,308 35 10.73
Consumer - indirect 4,276 73 6.76
Total consumer loans 18,097 327 7.20
Total loans 69,717 1,245 7.10
Loans held for sale 4,748 89 7.53
Securities available for sale (c) 7,858 115 5.89
Held-to-maturity securities (a) 30 1 6.24
Trading account assets 1,042 12 4.40
Short-term investments 1,226 13 3.94
Other investments (c) 1,589 12 3.02
Total earning assets 86,210 1,487 6.86
Allowance for loan losses (966)
Accrued income and other assets 13,547
Total assets $98,791

Liabilities
NOW and money market deposit
accounts $25,687 197 3.05
Savings deposits 1,523 1 .19
Certificates of deposit
($100,000 or more) (d) 6,887 86 4.98
Other time deposits 11,455 135 4.68
Deposits in foreign office (e) 5,720 64 4.42
Total interest-bearing
deposits 51,272 483 3.74
Federal funds purchased and
securities sold under repurchase
agreements (e) 4,194 45 4.23
Bank notes and other short-term
borrowings 4,233 45 4.15
Long-term debt (d,e) 11,851 164 5.72
Total interest-bearing
liabilities 71,550 737 4.11
Noninterest-bearing deposits 12,948
Accrued expense and other
liabilities 6,405
Total liabilities 90,903

Shareholders' equity 7,888

Total liabilities and
shareholders' equity $98,791

Interest rate spread (TE) 2.75 %
Net interest income (TE) and net
interest margin (TE) 750 3.48 %
TE adjustment a 40
Net interest income, GAAP basis $710

Third Quarter 2007
Average
Balance Interest Yield/Rate
Assets
Loans: (a,b)
Commercial, financial and
agricultural $22,393 $410 7.25 %
Real estate - commercial
mortgage 8,855 172 7.69
Real estate - construction 8,285 167 8.01
Commercial lease financing 10,172 147 5.80
Total commercial loans 49,705 896 7.16
Real estate - residential 1,586 26 6.68
Home equity 10,883 199 7.22
Consumer - direct 1,342 36 10.66
Consumer - indirect 4,164 70 6.79
Total consumer loans 17,975 331 7.33
Total loans 67,680 1,227 7.20
Loans held for sale 4,731 91 7.59
Securities available for sale (c) 7,825 106 5.45
Held-to-maturity securities (a) 36 - 6.43
Trading account assets 1,055 11 4.39
Short-term investments 633 5 3.32
Other investments (c) 1,563 12 2.99
Total earning assets 83,523 1,452 6.92
Allowance for loan losses (942)
Accrued income and other assets 12,581
Total assets $95,162

Liabilities
NOW and money market deposit
accounts $24,190 209 3.41
Savings deposits 1,581 - .19
Certificates of deposit
($100,000 or more) (d) 6,274 80 5.06
Other time deposits 11,512 136 4.68
Deposits in foreign office (e) 4,540 57 5.00
Total interest-bearing
deposits 48,097 482 3.98
Federal funds purchased and
securities sold under repurchase
agreements (e) 4,470 55 4.85
Bank notes and other short-term
borrowings 2,539 30 4.70
Long-term debt (d,e) 11,801 173 5.89
Total interest-bearing
liabilities 66,907 740 4.40
Noninterest-bearing deposits 14,424
Accrued expense and other
liabilities 6,106
Total liabilities 87,437

Shareholders' equity 7,725

Total liabilities and
shareholders' equity $95,162

Interest rate spread (TE) 2.52 %
Net interest income (TE) and net
interest margin (TE) 712 3.40 %
TE adjustment a 18
Net interest income, GAAP basis $694

Fourth Quarter 2006
Average
Balance Interest Yield/Rate
Assets
Loans: (a,b)
Commercial, financial and
agricultural $21,384 $400 7.42 %
Real estate - commercial mortgage 8,399 167 7.86
Real estate - construction 8,347 174 8.25
Commercial lease financing 9,891 160 6.47
Total commercial loans 48,021 901 7.44
Real estate - residential 1,428 24 6.59
Home equity 10,896 197 7.22
Consumer - direct 1,557 34 8.63
Consumer - indirect 3,671 62 6.85
Total consumer loans 17,552 317 7.21
Total loans 65,573 1,218 7.38
Loans held for sale 4,547 90 7.86
Securities available for sale (c) 7,765 96 4.88
Held-to-maturity securities (a) 38 1 7.68
Trading account assets 883 8 3.70
Short-term investments 701 8 4.46
Other investments (c) 1,351 24 6.76
Total earning assets 80,858 1,445 7.09
Allowance for loan losses (941)
Accrued income and other assets 13,129
Total assets $93,046

Liabilities
NOW and money market deposit
accounts $25,136 198 3.13
Savings deposits 1,651 1 .19
Certificates of deposit ($100,000
or more) (d) 6,013 75 4.93
Other time deposits 11,921 136 4.50
Deposits in foreign office (e) 2,245 30 5.55
Total interest-bearing deposits 46,966 440 3.72
Federal funds purchased and
securities sold under repurchase
agreements (e) 2,816 37 5.21
Bank notes and other short-term
borrowings 1,814 19 4.17
Long-term debt (d,e) 14,092 205 5.80
Total interest-bearing
liabilities 65,688 701 4.24
Noninterest-bearing deposits 13,424
Accrued expense and other
liabilities 6,041
Total liabilities 85,153

Shareholders' equity 7,893

Total liabilities and
shareholders' equity $93,046

Interest rate spread (TE) 2.85 %
Net interest income (TE) and net
interest margin (TE) 744 3.66 %
TE adjustment a 32
Net interest income, GAAP basis $712

(a) Interest income on tax-exempt securities and loans has been adjusted
to taxable-equivalent basis using the statutory federal income tax
rate of 35%.

(b) For purposes of these computations, nonaccrual loans are included in
average loan balances.

(c) Yield is calculated on the basis of amortized cost.

(d) Rate calculation excludes basis adjustments related to fair value
hedges.

(e) Results from continuing operations exclude the dollar amount of
liabilities assumed necessary to support interest-earning assets held
by the discontinued Champion Mortgage finance business. The interest
expense related to these liabilities, which also is excluded from
continuing operations, was calculated using a matched funds transfer
pricing methodology.

TE = Taxable Equivalent

GAAP = U.S. generally accepted accounting principles

Consolidated Average Balance Sheets, Net Interest Income and
Yields/Rates
From Continuing Operations
(dollars in millions)

Twelve months ended December 31, 2007
Average
Balance Interest Yield/Rate
Assets
Loans: (a,b)
Commercial, financial and
agricultural $22,415 $1,622 7.23 %
Real estate - commercial mortgage 8,802 675 7.67
Real estate - construction 8,237 653 7.93
Commercial lease financing 10,154 606 5.97
Total commercial loans 49,608 3,556 7.17
Real estate - residential 1,525 101 6.64
Home equity 10,815 775 7.17
Consumer - direct 1,367 144 10.53
Consumer - indirect 4,042 274 6.77
Total consumer loans 17,749 1,294 7.29
Total loans 67,357 4,850 7.20
Loans held for sale 4,461 337 7.57
Securities available for sale (c) 7,757 427 5.52
Held-to-maturity securities (a) 36 2 6.68
Trading account assets 917 38 4.10
Short-term investments 846 37 4.34
Other investments (c) 1,524 52 3.33
Total earning assets 82,898 5,743 6.84
Allowance for loan losses (948)
Accrued income and other assets 12,934
Total assets $94,884

Liabilities
NOW and money market deposit accounts $24,070 762 3.17
Savings deposits 1,591 3 .19
Certificates of deposit ($100,000
or more) (d) 6,389 321 5.02
Other time deposits 11,767 550 4.68
Deposits in foreign office (e) 4,287 209 4.87
Total interest-bearing deposits 48,104 1,845 3.84
Federal funds purchased and securities
sold under repurchase agreements (e) 4,330 208 4.79
Bank notes and other short-term
borrowings 2,423 104 4.28
Long-term debt (d,e) 12,537 718 5.84
Total interest-bearing liabilities 67,394 2,875 4.28
Noninterest-bearing deposits 13,635
Accrued expense and other liabilities 6,133
Total liabilities 87,162

Shareholders' equity 7,722

Total liabilities and
shareholders' equity $94,884

Interest rate spread (TE) 2.56%
Net interest income (TE) and net
interest margin (TE) 2,868 3.46%
TE adjustment a 99
Net interest income, GAAP basis $2,769

Twelve months ended December 31, 2006
Average
Balance Interest Yield/Rate
Assets
Loans: (a,b)
Commercial, financial and
agricultural $21,679 $1,547 7.13 %

Real estate - commercial mortgage 8,167 628 7.68
Real estate - construction 7,802 635 8.14
Commercial lease financing 9,773 595 6.08
Total commercial loans 47,421 3,405 7.18
Real estate - residential 1,430 93 6.49
Home equity 10,971 775 7.07
Consumer - direct 1,639 152 9.26
Consumer - indirect 3,535 238 6.73
Total consumer loans 17,575 1,258 7.16
Total loans 64,996 4,663 7.17
Loans held for sale 4,168 325 7.80
Securities available for sale (c) 7,302 347 4.71
Held-to-maturity securities (a) 47 3 7.43
Trading account assets 857 30 3.51
Short-term investments 791 33 4.15
Other investments (c) 1,362 82 5.78
Total earning assets 79,523 5,483 6.88
Allowance for loan losses (952)
Accrued income and other assets 13,131
Total assets $91,702

Liabilities
NOW and money market deposit accounts $25,044 710 2.84
Savings deposits 1,728 4 .23
Certificates of deposit ($100,000 or
more) (d) 5,581 261 4.67
Other time deposits 11,592 481 4.14
Deposits in foreign office (e) 2,305 120 5.22
Total interest-bearing deposits 46,250 1,576 3.41
Federal funds purchased and securities
sold under repurchase agreements (e) 2,215 107 4.80
Bank notes and other short-term
borrowings 2,284 94 4.12
Long-term debt (d,e) 13,983 788 5.62
Total interest-bearing liabilities 64,732 2,565 3.96
Noninterest-bearing deposits 13,053
Accrued expense and other liabilities 6,183
Total liabilities 83,968

Shareholders' equity 7,734

Total liabilities and
shareholders' equity $91,702

Interest rate spread (TE) 2.92%
Net interest income (TE) and net
interest margin (TE) 2,918 3.67%
TE adjustment a 103
Net interest income, GAAP basis $2,815

(a) Interest income on tax-exempt securities and loans has been adjusted
to taxable-equivalent basis using the statutory federal income tax
rate of 35%.

(b) For purposes of these computations, nonaccrual loans are included in
average loan balances.

(c) Yield is calculated on the basis of amortized cost.

(d) Rate calculation excludes basis adjustments related to fair value
hedges.

(e) Results from continuing operations exclude the dollar amount of
liabilities assumed necessary to support interest-earning assets held
by the discontinued Champion Mortgage finance business. The interest
expense related to these liabilities, which also is excluded from
continuing operations, was calculated using a matched funds transfer
pricing methodology.

TE = Taxable Equivalent

GAAP = U.S. generally accepted accounting principles

Noninterest Income
(in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Trust and investment
services income (a) $131 $119 $142 $490 $553
Service charges on deposit
accounts 90 88 77 337 304
Investment banking and
capital markets income (a) 12 9 69 117 230
Operating lease income 72 70 63 272 229
Letter of credit and loan fees 58 51 55 192 188
Corporate-owned life insurance
income 37 27 31 121 105
Electronic banking fees 25 25 27 99 105
Net (losses) gains from loan
securitizations and sales (6) (53) 42 (17) 76
Net securities gains (losses) 6 4 3 (35) 1
Net gains from principal investing 6 9 5 134 53
Gain from sale of McDonald
Investments branch network - - - 171 -
Other income:
Insurance income 10 16 15 55 64
Loan securitization
servicing fees 5 5 5 21 20
Credit card fees 3 4 3 13 17
Gains related to MasterCard
Incorporated shares - 27 - 67 9
Litigation settlement -
automobile residual value
insurance - - - 26 -
Miscellaneous income 39 37 21 166 173
Total other income 57 89 44 348 283
Total noninterest
income $488 $438 $558 $2,229 $2,127

(a) Additional detail provided in tables below.

Trust and Investment Services Income
(in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Brokerage commissions and
fee income $31 $26 $58 $125 $235
Personal asset management
and custody fees 43 41 40 165 156
Institutional asset management
and custody fees 57 52 44 200 162
Total trust and investment
services income $131 $119 $142 $490 $553

Investment Banking and Capital Markets Income
(in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Investment banking income $21 $22 $43 $86 $112
(Loss) income from other
investments (23) (22) 6 (34) 43
Dealer trading and derivatives
(loss) income (1) (2) 10 17 33
Foreign exchange income 15 11 10 48 42
Total investment banking
and capital markets income $12 $9 $69 $117 $230

Noninterest Expense
(dollars in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Personnel (a) $399 $383 $447 $1,621 $1,692
Net occupancy 64 60 68 246 250
Computer processing 52 49 55 201 212
Operating lease expense 59 58 50 224 184
Professional fees 38 27 33 117 134
Equipment 25 22 24 96 102
Marketing 16 21 27 76 97
Other expense:
Postage and delivery 13 11 12 47 50
Franchise and business taxes 7 8 (7) 32 22
Telecommunications 7 7 7 28 28
Provision (credit) for losses
on lending-related
commitments 25 5 (6) 28 (6)
Liability to Visa 64 - - 64 -
Miscellaneous expense 127 102 99 468 384
Total other expense 243 133 105 667 478
Total noninterest
expense $896 $753 $809 $3,248 $3,149

Average full-time equivalent
employees (b) 18,500 18,567 20,100 18,934 20,006

(a) Additional detail provided in table below.

(b) The number of average full-time equivalent employees has not been
adjusted for discontinued operations.

Personnel Expense
(in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Salaries $255 $240 $238 $976 $940
Incentive compensation 52 55 120 264 388
Employee benefits 65 67 64 287 287
Stock-based compensation 3 17 17 60 64
Severance 24 4 8 34 13
Total personnel expense $399 $383 $447 $1,621 $1,692

Loan Composition
(dollars in millions)
Percent change
12-31-07 vs.
12-31-07 9-30-07 12-31-06 9-30-07 12-31-06
Commercial, financial and
agricultural $24,797 $23,192 $21,412 6.9 % 15.8 %
Commercial real estate:
Commercial mortgage 9,630 9,272 8,426 3.9 14.3
Construction 8,102 8,214 8,209 (1.4) (1.3)
Total commercial real
estate loans 17,732 17,486 16,635 1.4 6.6
Commercial lease financing 10,176 10,309 10,259 (1.3) (.8)
Total commercial loans 52,705 50,987 48,306 3.4 9.1
Real estate - residential
mortgage 1,594 1,583 1,442 .7 10.5
Home equity 10,917 10,904 10,826 .1 .8
Consumer - direct 1,298 1,308 1,536 (.8) (15.5)
Consumer - indirect:
Marine 3,637 3,549 3,077 2.5 18.2
Other 672 668 639 .6 5.2
Total consumer -
indirect loans 4,309 4,217 3,716 2.2 16.0
Total consumer loans 18,118 18,012 17,520 .6 3.4
Total loans $70,823 $68,999 $65,826 2.6 % 7.6 %

Loans Held for Sale Composition
(dollars in millions)
Percent change
12-31-07 vs.
12-31-07 9-30-07 12-31-06 9-30-07 12-31-06
Commercial, financial and
agricultural $250 $67 $47 273.1 % 431.9 %
Real estate - commercial
mortgage 1,219 1,560 946 (21.9) 28.9
Real estate - construction 35 237 36 (85.2) (2.8)
Commercial lease financing 1 5 3 (80.0) (66.7)
Real estate - residential
mortgage 47 36 21 30.6 123.8
Home equity 1 1 180 - (99.4)
Education 3,176 2,877 2,390 10.4 32.9
Automobile 7 8 14 (12.5) (50.0)
Total loans held for sale $4,736 $4,791 $3,637 (1.1)% 30.2 %

Summary of Loan Loss Experience
(dollars in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06

Average loans outstanding
from continuing operations $69,717 $67,680 $65,573 $67,357 $64,996

Allowance for loan losses at
beginning of period $955 $945 $944 $944 $ 966
Loans charged off:
Commercial, financial and
agricultural 48 33 18 128 92

Real estate - commercial
mortgage 3 2 15 16 24
Real estate - construction 44 7 1 54 4
Total commercial real
estate loans 47 9 16 70 28
Commercial lease financing 18 11 13 51 40
Total commercial loans 113 53 47 249 160
Real estate - residential
mortgage 3 1 2 6 7
Home equity 12 9 8 37 30
Consumer - direct 8 8 7 31 33
Consumer - indirect 16 11 10 47 38
Total consumer loans 39 29 27 121 108
152 82 74 370 268
Recoveries:
Commercial, financial and
agricultural 13 11 7 37 34

Real estate - commercial
mortgage 2 - 2 6 5
Real estate - construction - 1 - 1 1
Total commercial real estate
loans 2 1 2 7 6
Commercial lease financing 12 3 4 22 27
Total commercial loans 27 15 13 66 67
Real estate - residential
mortgage - - - 1 1
Home equity - 1 2 4 7
Consumer - direct 2 3 2 8 7
Consumer - indirect 4 4 3 16 16
Total consumer loans 6 8 7 29 31
33 23 20 95 98
Net loan charge-offs (119) (59) (54) (275) (170)
Provision for loan losses
from continuing operations 363 69 53 529 150
Credit for loan losses from
discontinued operations - - - - (3)
Foreign currency translation
adjustment 1 - 1 2 1
Allowance for loan losses
at end of period $1,200 $955 $944 $1,200 $ 944

Net loan charge-offs to
average loans from
continuing operations .67% .35% .33% .41% .26%
Allowance for loan losses
to period-end loans 1.69 1.38 1.43 1.69 1.43
Allowance for loan losses
to nonperforming loans 174.67 191.77 439.07 174.67 439.07

Changes in Liability for Credit Losses on Lending-Related Commitments
(in millions)

Three months ended Twelve months ended
12-31-07 9-30-07 12-31-06 12-31-07 12-31-06
Balance at beginning of
period $55 $50 $59 $53 $59
Provision (credit) for
losses on lending-
related commitments 25 5 (6) 28 (6)
Charge-offs - - - (1) -
Balance at end of period (a) $80 $55 $53 $80 $53

Summary of Nonperforming Assets and Past Due Loans
(dollars in millions)

12-31-07 9-30-07 6-30-07 3-31-07 12-31-06
Commercial, financial and
agricultural $84 $94 $83 $70 $38

Real estate - commercial
mortgage 41 41 41 44 48
Real estate - construction 415 228 23 10 10
Total commercial real
estate loans 456 269 64 54 58
Commercial lease financing 28 30 34 31 22
Total commercial loans 568 393 181 155 118
Real estate - residential
mortgage 28 29 27 32 34
Home equity 66 61 55 52 50
Consumer - direct 2 2 2 2 2
Consumer - indirect 23 13 11 13 11
Total consumer loans 119 105 95 99 97
Total nonperforming loans 687 498 276 254 215

Nonperforming loans held for sale 25 6 4 3 3

OREO 21 21 27 42 57
Allowance for OREO losses (2) (1) (2) (2) (3)
OREO, net of allowance 19 20 25 40 54

Other nonperforming assets (b) 33 46 73 56 1
Total nonperforming assets $764 $570 $378 $353 $273

Accruing loans past due 90 days
or more $231 $190 $181 $146 $120
Accruing loans past due 30
through 89 days 843 717 623 626 644
Nonperforming loans to
period-end portfolio loans .97% .72% .41% .39% .33%
Nonperforming assets to
period-end portfolio loans
plus OREO and other
nonperforming assets 1.08 .83 .57 .54 .41

Summary of Changes in Nonperforming Loans
(in millions)

4Q07 3Q07 2Q07 1Q07 4Q06
Balance at beginning of period $498 $276 $254 $215 $223
Loans placed on nonaccrual
status 378 337 130 129 115
Charge-offs (147) (81) (72) (61) (74)
Loans sold (13) (6) (7) - (5)
Payments (17) (13) (21) (7) (23)
Transfers to OREO (5) (12) - (9) (12)
Loans returned to accrual
status (7) (3) (8) (13) (9)
Balance at end of period $687 $498 $276 $254 $215

(a) Included in "accrued expense and other liabilities" on the
consolidated balance sheet.

(b) Primarily investments held by the Private Equity unit within Key's
Real Estate Capital line of business.

Line of Business Results
(dollars in millions)

Community Banking
4Q07 3Q07 2Q07 1Q07 4Q06
Summary of operations
Total revenue (TE) $651 $626 $629 $805 $677
Provision for loan
losses 36 1 21 14 23
Noninterest expense 441 418 449 471 493
Net income 109 130 99 200 101
Average loans and
leases 27,236 26,947 26,576 26,456 26,697
Average deposits 47,253 46,727 46,124 46,521 47,348
Net loan charge-offs 31 20 26 19 24
Return on average
allocated equity 17.14% 20.60% 16.12% 32.93% 16.03%
Average full-time
equivalent employees 8,464 8,632 9,028 9,478 9,683

Supplementary information
(lines of business)
Regional Banking
Total revenue (TE) $553 $531 $535 $713 $579
Provision for loan losses 26 12 19 18 19
Noninterest expense 389 371 401 422 445
Net income 86 93 72 170 72
Average loans and leases 18,768 18,661 18,459 18,483 18,677
Average deposits 43,692 43,229 42,712 43,039 43,749
Net loan charge-offs 26 18 19 18 19
Return on average
allocated equity 19.61% 21.13% 16.70% 39.53% 16.07%
Average full-time
equivalent employees 8,162 8,322 8,709 9,155 9,362

Commercial Banking
Total revenue (TE) $98 $95 $94 $92 $98
Provision for loan losses 10 (11) 2 (4) 4
Noninterest expense 52 47 48 49 48
Net income 23 37 27 30 29
Average loans and leases 8,468 8,286 8,117 7,973 8,020
Average deposits 3,561 3,498 3,412 3,482 3,599
Net loan charge-offs 5 2 7 1 5
Return on average
allocated equity 11.65% 19.37% 14.73% 16.92% 15.94%
Average full-time
equivalent employees 302 310 319 323 321

Percent change 4Q07 vs.
3Q07 4Q06
Summary of operations
Total revenue (TE) 4.0% (3.8)%
Provision for loan losses N/M 56.5
Noninterest expense 5.5 (10.5)
Net income (16.2) 7.9
Average loans and leases 1.1 2.0
Average deposits 1.1 (.2)
Net loan charge-offs 55.0 29.2
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees (1.9) (12.6)

Supplementary information (lines of
business)
Regional Banking
Total revenue (TE) 4.1% (4.5)%
Provision for loan losses 116.7 36.8
Noninterest expense 4.9 (12.6)
Net income (7.5) 19.4
Average loans and leases .6 .5
Average deposits 1.1 (.1)
Net loan charge-offs 44.4 36.8
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees (1.9) (12.8)

Commercial Banking
Total revenue (TE) 3.2% -
Provision for loan losses N/M 150.0%
Noninterest expense 10.6 8.3
Net income (37.8) (20.7)
Average loans and leases 2.2 5.6
Average deposits 1.8 (1.1)
Net loan charge-offs 150.0 -
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees (2.6) (5.9)

Line of Business Results (continued)
(dollars in millions)

National Banking
4Q07 3Q07 2Q07 1Q07 4Q06
Summary of operations
Total revenue (TE) $614 $511 $617 $600 $670
Provision for loan losses 327 68 32 30 30
Noninterest expense 388 328 327 314 328
Loss (income) continuing
operations (65) 73 162 160 195
Net (loss) income (62) 59 159 152 30
Average loans and
leases (a) 42,037 40,277 39,323 38,839 38,469
Average loans held
for sale (a) 4,709 4,692 4,377 3,917 4,521
Average deposits (a) 12,630 12,633 12,085 11,294 11,876
Net loan charge-offs (a) 88 39 27 25 30
Return on average
allocated equity (a) (5.78)% 6.93% 15.65% 16.07% 19.38%
Return on average
allocated equity (5.52) 5.60 15.36 15.26 2.81
Average full-time
equivalent employees 3,996 3,841 3,820 4,207 4,293

Supplementary information
(lines of business)
Real Estate Capital
Total revenue (TE) $127 $104 $187 $167 $189
Provision for loan losses 270 43 8 1 18
Noninterest expense 105 76 78 71 69
Net (loss) income (155) (9) 63 59 63
Average loans and
leases 13,847 13,187 12,827 12,755 12,931
Average loans held
for sale 1,257 1,584 1,241 1,145 1,125
Average deposits 5,273 5,559 4,864 4,293 4,091
Net loan charge-offs 45 7 3 1 8
Return on average
allocated equity (43.09)% (2.67)% 19.27% 19.30% 20.42%
Average full-time
equivalent employees 1,014 1,007 991 971 957

Equipment Finance
Total revenue (TE) $184 $139 $153 $134 $146
Provision for loan
losses 23 16 16 13 7
Noninterest expense 95 93 92 85 77
Net income 41 18 28 23 39
Average loans and
leases 10,729 10,681 10,609 10,479 10,222
Average loans held
for sale 15 6 10 4 33
Average deposits 17 16 16 13 15
Net loan charge-offs 18 16 16 13 14
Return on average
allocated equity 17.68% 7.92% 12.69% 10.65% 17.99%
Average full-time
equivalent employees 1,009 985 971 952 938

Institutional and
Capital Markets
Total revenue (TE) $203 $182 $189 $184 $223
Provision for loan
losses 15 (3) - - (5)
Noninterest expense 132 121 116 117 137
Net income 36 41 46 42 58
Average loans and
leases 8,381 7,693 7,454 7,435 7,521
Average loans held
for sale 394 373 468 140 387
Average deposits 6,796 6,633 6,815 6,600 7,372
Net loan charge-
offs (recoveries) 6 5 - 1 (2)
Return on average
allocated equity 11.61% 14.29% 15.92% 14.90% 19.99%
Average full-time
equivalent employees 1,281 1,320 1,302 1,350 1,375

Consumer Finance
Total revenue (TE) $100 $86 $88 $115 $112
Provision for loan
losses 19 12 8 16 10
Noninterest expense 56 38 41 41 45
Income from
continuing operations 13 23 25 36 35
Net income (loss) 16 9 22 28 (130)
Average loans and
leases (a) 9,080 8,716 8,433 8,170 7,795
Average loans held
for sale (a) 3,043 2,729 2,658 2,628 2,976
Average deposits (a) 544 425 390 388 398
Net loan charge-offs (a) 19 11 8 10 10
Return on average
allocated equity (a) 5.85% 11.38% 12.60% 18.72% 18.34%
Return on average
allocated equity 7.20 4.45 11.09 14.56 (51.78)
Average full-time
equivalent employees 692 529 556 934 1,023

Percent change 4Q07 vs.
3Q07 4Q06
Summary of operations
Total revenue (TE) 20.2% (8.4)%
Provision for loan losses 380.9 990.0
Noninterest expense 18.3 18.3
Loss (income) continuing
operations N/M N/M
Net (loss) income N/M N/M
Average loans and leases (a) 4.4 9.3
Average loans held for sale (a) .4 4.2
Average deposits (a) - 6.3
Net loan charge-offs (a) 125.6 193.3
Return on average allocated
equity (a) N/A N/A
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees 4.0 (6.9)

Supplementary information (lines of
business)
Real Estate Capital
Total revenue (TE) 22.1% (32.8)%
Provision for loan losses 527.9 N/M
Noninterest expense 38.2 52.2
Net (loss) income N/M N/M
Average loans and leases 5.0 7.1
Average loans held for sale (20.6) 11.7
Average deposits (5.1) 28.9
Net loan charge-offs 542.9 462.5
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees .7 6.0

Equipment Finance
Total revenue (TE) 32.4% 26.0%
Provision for loan losses 43.8 228.6
Noninterest expense 2.2 23.4
Net income 127.8 5.1
Average loans and leases .4 5.0
Average loans held for sale 150.0 (54.5)
Average deposits 6.3 13.3
Net loan charge-offs 12.5 28.6
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees 2.4 7.6

Institutional and Capital Markets
Total revenue (TE) 11.5% (9.0)%
Provision for loan losses N/M N/M
Noninterest expense 9.1 (3.6)
Net income (12.2) (37.9)
Average loans and leases 8.9 11.4
Average loans held for sale 5.6 1.8
Average deposits 2.5 (7.8)
Net loan charge-offs
(recoveries) 20.0 N/M
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees (3.0) (6.8)

Consumer Finance
Total revenue (TE) 16.3% (10.7)%
Provision for loan losses 58.3 90.0
Noninterest expense 47.4 24.4
Income from continuing
operations (43.5) (62.9)
Net income (loss) 77.8 N/M
Average loans and leases (a) 4.2 16.5
Average loans held for sale (a) 11.5 2.3
Average deposits (a) 28.0 36.7
Net loan charge-offs (a) 72.7 90.0
Return on average allocated
equity (a) N/A N/A
Return on average allocated
equity N/A N/A
Average full-time equivalent
employees 30.8 (32.4)

(a) From continuing operations.

TE = Taxable Equivalent
N/A = Not Applicable
N/M = Not Meaningful

SOURCE KeyCorp