KeyCorp Ups Interchange Revenue Hit
NEW YORK (
) --
KeyCorp
(KEY) - Get Report
announced that the Durbin Amendment could significantly cut into the bank's revenue, by as much as $100 million annually.
"We now estimate approximately $100 million in
annual debit interchange revenue could be impacted by the proposal," the bank said in a
Securities and Exchange Commission filing Tuesday.
KeyCorp had previously estimated that $75 million in revenue would be impacted by the debit interchange fees. The extra $25 million is based on an update of the inclusion of PIN authorized debit card transactions under the proposal.
"Until the regulations are finalized by the Federal Reserve Board, it is premature to assess the impact on this combined revenue stream of the proposal, but it is possible that the effect could be significant to the revenue we derive from these activities," the SEC filing said.
The
Federal Reserve Board
released proposed rules governing interchange fees that merchants pay to banks when consumers make purchases with their debit cards on December 16. The Fed expects implementation of the proposed interchange fee standards by July 21, 2011.
KeyCorp is also
awaiting the results
of the second stress test before repaying the $2.5 billion it recieved from the U.S. Treasury Department's Troubled Asset Relief Program (TARP).
--Written by Maria Woehr in New York.
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