KeyBank , KeyCorp's principal subsidiary, is a regional bank headquartered in Cleveland, Ohio, and is the only major bank based in Cleveland. KeyBank is on the list of the largest banks in the United States.
The main customer base includes retail clients, small businesses, companies, and investments. KeyBank manages 1,197 branches and 1,572 ATMs, located in Alaska, Colorado, Connecticut, Indiana, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Ohio, Oregon, Pennsylvania , Rhode Island, Texas, Utah, Vermont, Virginia, Washington, DC and Washington. KeyCorp manages business offices in 39 states.
Key is ranked 479 on the Fortune 500 list.
Video KeyBank
History
KeyBank is a key subsidiary of KeyCorp , formed in 1994 through the merger of Society Corporation from Cleveland ("Society Bank") and KeyCorp ("Old KeyCorp ") from Albany, New York. The merger briefly made Key the 10th US the largest bank. The roots are traced back to Commercial Bank of Albany, New York in 1825 and Cleveland's Society for Savings, founded in 1849.
Society Society (Society National Bank)
The Society For Savings originated in 1849 as a joint savings bank, founded by Samuel H. Mather. In 1867, a simple but growing bank built the first skyscraper in Cleveland, the 10-story Public Rescue Society in Public Square. Despite establishing the highest structure between New York and Chicago at the time, the bank remained very conservative. That aspect is highlighted by the fact that when celebrating its 100th anniversary in 1949, it still has only one office despite having more than $ 200 million in deposits. This conservatism helps banks avoid a lot of pressure and financial panic. In 1958, the Society shifted from the company to a public company, allowing it to grow rapidly by acquiring 12 community banks between 1958 and 1978 under the banner of the National Bank Community. It passed through other growth spurts from 1979 to 1989, having acquired dozens of small banks and completed four mergers worth a billion dollars, mainly based in Cleveland in 1986. In 1987, the Society's CEO Gordon E. Heffern retired and succeeded as Robert W. "Bob" Gillespie, who, although only 42, is the main character and part of the office chair for more than 5 years. Gillespie was also appointed chairman. Gillespie started as a teller with the Society to earn money as he completed his graduate studies.
Society Corporation acquired Toledo, Ohio-based Trustcorp in 1990 and Cleveland Trust , the main bank of CleveTrust Corporation holding company, in September 1991, a respected Cleveland bank and bank the largest in Ohio. during the 1940s until the late 1970s. The Cleveland Trust Agreement established the Society as a large regional bank. The Cleveland Trust gem is a strong personal and corporate trust business. However, his footing became shaky due to bad real estate loans, forcing the resignation of Cleveland Trust chairman Jerry V. Jarrett in 1990. In addition, Gillespie was able to defeat the rival Greater Society, National City Corp., which also bid Cleveland Trust.
KeyBank
In 1825, New York Governor DeWitt Clinton signed a bill chartering the Commercial Bank of Albany. In 1865, Commercial Bank was reorganized under the National Banking Act of 1864, and renamed the National Commercial Bank of Albany. More than a hundred years passed before National Commercial joined First Trust and Deposit to become First Commercial Banks in 1971, still a state bank of New York with 89 offices. Victor J. Riley, Jr. became president and CEO in 1973. First Commercial changed its name to Key Bank Inc. in 1979.
Riley embarked on a plan to grow Key through acquisition. From the mid-1970s to early 1980s, it made many acquisitions throughout northern New York. Beginning in the 1980s, Riley appeared outside of New York, expanding Key's trail with acquisitions in Maine, and eventually adding branches in Massachusetts and Vermont. However, in the mid-1980s, state banking regulators in New England began to look for suspicions in New York-based banks that controlled their capital. That, coupled with increased competition for acquisition targets, caused Riley to essentially leave the Northeast. Instead, he started looking for prey in the Pacific Northwest. Riley finds a rich neighborhood targeted in rural and underserved areas. He took small banks in Wyoming, Idaho, Utah, Washington, and Oregon. He even went so far as to buy two banks in Alaska, where he was flogged in the media and in banking circles. In addition to unorthodox strategies, Riley duplicated Key's assets from $ 3 billion to $ 15 billion in just four years between 1985 and 1990.
When the early 1990s recession shook many banks, Key had plenty of capital. It bought two failed assets from the government: Savings and Federal Federal Loans and Goldome Savings Bank. In March 1992, it acquired the $ 807.2 million Tacon-based Puget Sound Bancorp to strengthen its presence in Washington. Also in 1992, Key acquired Home Federal Savings of Fort Collins, his first move to Colorado. Key immediately collected nearly 700 banking offices.
In 1993, a rural strategy with local management and minimal technology made Key a very profitable bank. However, it is increasingly difficult for Riley and CFO William Dougherty to maintain a 15% return on equity targets and investors cooling on Key stock after years of high growth. The key began testing the Vision 2001 computer system, which accelerated and improved lending processes through faster credit scoring, loan servicing and collection capabilities.
Community Merge and Key (1994)
Although Gillespie has built the Community into a regional powerhouse in the Midwest, he wants to make the bank a big bank. He concluded Key, a bank with similar ambitions, was a suitable partner. Society and Key held talks in 1990 over Gillespie's push, but Riley decided to keep making smaller and more profitable acquisitions with clear synergies. However, news reports circled that the possibility of merging work in the fall of 1993. Key is the 29th largest US bank with assets of $ 26 billion, while the Society is the 25th largest with $ 32 billion in assets. Both require mergers to improve their prospects. For its part, Key needed a succession plan for lack of a clear successor to the 62-year-old Riley. In a week in June 1993, the bench became barren - Chief Banking Officer James Waterston, hired a year earlier, quit and publicly declared that he was frustrated with his pace of achieving his goal of running a major bank. KeyBank's head of Washington, Hans Harjo, was pushed out of a real dispute to move his headquarters from Seattle to Tacoma. It also became clear that Key had to upgrade technology infrastructure to connect its remote offices. Meanwhile, the Society is looking for higher growth and wants to expand its presence beyond the so-called rust belts of the states of Ohio, Michigan, and Indiana.
The merger was announced in early October 1993. This time Riley made the first move. Riley, recovering at Albany's home after breaking his hip in a horse-riding accident in Wyoming, called Gillespie directly. Both quickly sketched the deal. The banks are about the same size in assets and have very little geographical overlap, so it's touted as a merger outside the market where some branches need to be sold. This creates a $ 58 billion banking giant with traces that stretch from Portland, Maine to Portland, Oregon. Furthermore, the agreement pinned many perceived holes for both partners. Gillespie has a soft voice just 49 and the Society has cultivated a deep lieutenant bench. More importantly, the Society has a computer system and technological expertise to combine the two banks, along with Chief Information Officer Allen J. Gula. Riley also deplored the modest Albany International Airport, which lost service from some major airlines in the 1980s and a complicated air travel for key executives. Ohio also has a lower state tax than New York. Finally, the Society recently built the Lock Tower, the 947-foot central tower, which is more commensurate with large banks than the simple buildings used in Albany. These issues make Cleveland a better location for the new headquarters. Instead, the Key brand is more recognizable.
The Agreement is structured as an equal merger. While the joint bank takes KeyCorp's name, the Society is a nominal victim; the merged bank is headquartered in Cleveland. The name of the Society Bank continued to be used in the former Site Society Company for an additional two more years before retiring in June 1996 and all branches of the Society Bank were converted to KeyBank names and bank charter merged.
Riley became chairman and CEO of KeyCorp and Gillespie became president and chief operating officer. Despite assurances from Riley and Gillespie, the city of Albany and then Governor Mario Cuomo publicly dismayed that the incorporation would adversely affect state capital because Key and its subsidiaries own or lease more than 10% of Albany's commercial office space. By 2014, only about 225 non-branch employees are still based in Albany in the KeyCorp Tower.
Community and Key completed the merger on March 1, 1994, after regulatory approval. Though it is mentioned as an equal merger, the Key and Society are a strange couple. The key is a decentralized community bank consisting of two banking networks - the eastern network in New England and northern New York and the west in the Rockies and the Pacific Northwest - in a single corporate structure. The community is a large commercial bank-a classical city with a centralized structure that is largely concentrated in three states.
Riley planned to retire as CEO at the end of 1995. He decided to accelerate it by four months, but instead of resigning on September 1, 1995. Gillespie took over as CEO and then chairman, allowing his protege Henry Meyer to become COO and then president.
Further transform
While still integrating Society and Key, Gillespie seeks to turn Key into a financial services company. Between 1995 and 2001, Gillespie started nine significant acquisitions and 6 divestments.
In late 1998, Key bought a Cleveland-based brokerage firm, McDonald & amp; Co. worth $ 653 million. The acquisition of McDonald is the largest non-banking deal in size and impact on Key. McDonald was sold to UBS AG's US investment arm in 2007 with approximately $ 280 million. As a result, Key started processing all securities transactions under the name of the new broker-dealer, "KeyBanc Capital Markets Inc.", in April 2007.
However, investors are wary of all Gillespie-era transactions. Some believe that Gillespie made all the moves to cover up a bad performance, although behind that seems far from the truth. The concept was dubbed "burning furniture," implying that Key would sell assets to obscure income. For example, Key sold its residential mortgage service to Countrywide Financial (now Bank of America Home Loans) in 1995, shareholder services in 1996, various bank parts in 1997-1999 (ie Wyoming, Florida, and Long Island), and credit card operations to The Associates in 2000 (which was soon after it was acquired by Citigroup).
But Gillespie is trying to increase its cost revenues by acquiring high-growth companies, including McDonald's financing companies and Leastec equipment, and reducing exposure to the shrinking bank population base in its main footprint, the so-called rust-belt state of Ohio, Michigan. , and Indiana. Gillespie resigned from the position of CEO on February 1, 2001, and then as chairman at the annual meeting on May 17 and replaced with Henry Meyer.
2002-present
In October 2008, Key received approximately $ 2.5 billion in investment from the Troubled Asset Relief Program. In March 2011, Key was one of the last major banks to repay TARP funds.
In May 2011, Key made history by naming Beth E. Mooney, formerly president of the bank, as the first female Chief and CEO of the top 20 banks.
In January 2012, Key acquired 37 branches of HSBC US Bank in Upstate New York from First Niagara for $ 110 million.
In May 2013, the company acquired mortgage rights from Bank of America.
In January 2015, KeyBank participated in a syndicated debt financing construction behind the Balko Wind Project purchased from Apex Clean Energy by D.E. Shaw Renewable Investment.
On July 29, 2016, KeyCorp acquired First Niagara Bank for $ 4.1 billion in cash and stock. The deal strengthens Key's position in Upstate New York and New England, as well as entering Pennsylvania for the first time with presence in Philadelphia and Pittsburgh. The deal made Key one of Pittsburgh's biggest banks, and gave it branches that were once part of crosstown rivals National City Corp., which Key tries to acquire from PNC Financial Services after the National City acquisition by PNC in 2008 before being defeated by First Niagara. As part of the transaction, 18 First Niagara branches in Erie and Niagara Counties in New York are sold to Northwest Savings Bank for antitrust reasons.
Maps KeyBank
Name rights
KeyCorp holds naming rights for KeyBank Center in Buffalo, New York. Key earned naming rights as part of a First Niagara purchase. Arena is home to Buffalo Sabers of the National Hockey League. The First Waterfall purchase also acquired Key right to KeyBank Pavilion near Pittsburgh.
The company no longer has naming rights for KeyArena in Seattle, Washington, though the facility continues to use the name. On April 11, 1995, the city of Seattle sold naming rights to KeyCorp for $ 15.1 million, renamed Coliseum as KeyArena. In March 2009, City and KeyCorp signed a new agreement for a two-year period ending December 31, 2010, with an annual fee of $ 300,000. The company did not renew the naming rights.
Controversy
Failure to cancel student loan from a deceased
According to HuffPost , KeyBank is "one of many private agencies without a clear policy on cancellation of student lending debts from individuals who have died." KeyBank drew criticism over student loans Christopher Bryski, a Rutgers University scholar who died of a traumatic brain injury in 2006. Christopher owes KeyBank about $ 50,000 at the time of his death, and KeyBank demanded his parents, the cosigners of his debt, continue to make payments after he died. Brother Christopher Ryan launched a petition signed by more than 78,000 people in the first week, asking KeyBank to forgive the debt. KeyBank agreed to forgive the debt a few days later.
References
External links
Source of the article : Wikipedia
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