Earnings Per Common Share

9 Months Ended

Sep. 30, 2013

Earnings Per Share [Abstract]

Earnings Per Common Share

2. Earnings Per Common Share

Basic earnings per share is the amount of earnings (adjusted for dividends declared on our preferred stock) available to each common share outstanding during the reporting periods. Diluted earnings per share is the amount of earnings available to each common share outstanding during the reporting periods adjusted to include the effects of potentially dilutive common shares. Potentially dilutive common shares include incremental shares issued for the conversion of our convertible Series A Preferred Stock, stock options, and other stock-based awards. Potentially dilutive common shares are excluded from the computation of diluted earnings per share in the periods where the effect would be antidilutive. For diluted earnings per share, net income available to common shareholders can be affected by the conversion of our convertible Series A Preferred Stock. Where the effect of this conversion would be dilutive, net income available to common shareholders is adjusted by the amount of preferred dividends associated with our Series A Preferred Stock. For the three months ended September 30, 2013, weighted-average common shares and potential common shares outstanding included 20.6 million shares associated with the conversion of our Series A Preferred Stock and 6.4 million shares associated with common share options and other stock awards.

Our basic and diluted earnings per Common Share are calculated as follows:

	Three months ended September 30,					Nine months ended September 30,
dollars in millions, except per share amounts	2013			2012		2013		2012
EARNINGS
Income (loss) from continuing operations	$	234		$	218	$	635	$	646
Less: Net income (loss) attributable to noncontrolling interests		(1	)		2		—		7
Income (loss) from continuing operations attributable to Key		235			216		635		639
Less: Dividends on Series A Preferred Stock		6			5		17		16
Income (loss) from continuing operations attributable to Key common shareholders		229			211		618		623
Income (loss) from discontinued operations, net of taxes (a)		37			3		45		16
Net income (loss) attributable to Key common shareholders	$	266		$	214	$	663	$	639
WEIGHTED-AVERAGE COMMON SHARES
Weighted-average common shares outstanding (000)		901,904			936,223		911,918		943,378
Effect of dilutive convertible preferred stock, common share options and other stock awards (000)		26,950			4,541		5,661		4,204
Weighted-average common shares and potential common shares outstanding (000)		928,854			940,764		917,579		947,582
EARNINGS PER COMMON SHARE
Income (loss) from continuing operations attributable to Key common shareholders	$	.25		$	.23	$	.68	$	.66
Income (loss) from discontinued operations, net of taxes (a)		.04			—		.05		.02
Net income (loss) attributable to Key common shareholders (b)		.29			.23		.73		.68
Income (loss) from continuing operations attributable to Key common shareholders — assuming dilution	$	.25		$	.22	$	.67	$	.66
Income (loss) from discontinued operations, net of taxes (a)		.04			—		.05		.02
Net income (loss) attributable to Key common shareholders — assuming dilution (b)		.29			.23		.72		.67

(a) In April 2009, we decided to wind down the operations of Austin, a subsidiary that specialized in managing hedge fund investments for institutional customers. In September 2009, we decided to discontinue the education lending business conducted through Key Education Resources, the education payment and financing unit of KeyBank. In February 2013, we decided to sell Victory to a private equity fund. As a result of these decisions, we have accounted for these businesses as discontinued operations. For further discussion regarding the income (loss) from discontinued operations see Note 11 (“Acquisitions and Discontinued Operations”).

(b) EPS may not foot due to rounding.