Shareholders Foundation, Inc.

KeyCorp (NYSE:KEY) Investor Alert: Lawsuit Alleges Securities Laws Violations

A lawsuit was filed on behalf of investors in KeyCorp (NYSE:KEY) shares over alleged securities laws violations.


San Diego, CA -- (SBWIRE) -- 08/23/2023 -- An investor, who purchased shares of KeyCorp (NYSE: KEY), filed a lawsuit over alleged violations of Federal Securities Laws by KeyCorp in connection with certain allegedly false and misleading statements.

Investors who purchased shares of KeyCorp (NYSE: KEY) have certain options and for certain investors are short and strict deadlines running. Deadline: October 3, 2023. NYSE: KEY investors should contact the Shareholders Foundation at or call +1(858) 779 - 1554.

Cleveland, OH based KeyCorp operates as the holding company for KeyBank National Association, which provides various retail and commercial banking products and services in the U.S. One of the Company's principal sources of revenue is net interest income ("NII"), which is calculated as the difference between interest income received on earning assets (such as loans and securities) and loan-related fee income, and interest expense paid on deposits and borrowings.

The plaintiff alleges that KeyCorp has repeatedly downplayed concerns regarding its liquidity while touting the effectiveness of its long-term liquidity strategy. For example, KeyCorp has repeatedly assured investors that its strong core deposit base, in conjunction other funds, supports the Company's liquidity risk management strategy, and that the Company's liquid asset portfolio, inter alia, exceeds the estimated amount needed to manage through an adverse liquidity event.

On March 6, 2023, KeyCorp filed its presentation slides for the 2023 RBC Capital Markets Financial Institutions Conference as an exhibit to a Securities and Exchange Commission filing, wherein the Company disclosed that it had downwardly revised its FY 2023 guidance for NII, stating that it expects FY 2023 NII to rise by 1% to 4% (assuming a cumulative beta in the mid- to high 30s) compared to FY 2022, representing a significant reduction from the Company's prior guidance that FY 2023 NII would rise 6% to 9% compared to FY 2022. The Company attributed this negatively revised guidance to "Deposit Beta and Funding Costs", explaining that "[m]arginal funding costs are increasing with rising market interest rates, and are expected to weigh on [NII.]"

On March 13, 2023, following the collapse of Silvergate Bank on March 8, 2023, Silicon Valley Bank on March 10, 2023, and Signature Bank on March 12, 2023, investors grew increasingly concerned about KeyCorp's own liquidity. That same day, Odeon Capital Group LLC downgraded the Company's stock to hold from buy and BofA Global Research cut its price target on the Company's stock to $17 from $20.

On June 12, 2023, at the Morgan Stanley US Financials, Payments, & CRE Conference, Key's Chief Financial Officer, Clark H. I. Khayat, disclosed that the Company anticipated Q2 2023 NII to be softer than earlier expected, "based on funding mix and deposit cost pressures." At the same conference, Key's Chairman and Chief Executive Officer, Christopher M. Gorman, disclosed that clients are demanding higher interest rates on their deposits, and that banks of Key's size are likely facing higher capital and liquidity requirements by regulators.

Shares of KeyCorp (NYSE: KEY) declined to $9.10 per share on July 06, 2023.

The plaintiff claims that between February 27, 2020 and June 9, 2023, the Defendants made false and/or misleading statements and/or failed to disclose that KeyCorp downplayed concerns with its liquidity while overstating the effectiveness of its long-term liquidity strategy, that KeyCorp overstated its projected NII for the second quarter ("Q2") and full year ("FY") of 2023, as well as related positive NII drivers, while downplaying negative NII drivers, that as a result, KeyCorp was likely to negatively revise its previously issued NII guidance, that all the foregoing, once revealed, was likely to negatively impact KeyCorp 's business, financial results, and reputation, and that as a result, Defendants' public statements were materially false and/or misleading at all relevant times.

Those who purchased shares of KeyCorp (NYSE: KEY) have certain options and should contact the Shareholders Foundation.

Shareholders Foundation, Inc.
Michael Daniels
3111 Camino Del Rio North - Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739

About The Shareholders Foundation
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, , which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigation, and/or settlements are not filed/reached and/or related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.