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Credit Crunch Crushes KeyCorp

It misses the third quarter by 14 cents a share and guides lower.

KeyCorp (KEY) - Get Report said third-quarter earnings dropped 27% from a year ago as the summer's credit crunch slammed the Cleveland-based bank's trading results.

Earnings from continuing operations for the quarter ended Sept. 30 dropped to $224 million, or 57 cents a share, from the year-ago $305 million, or 85 cents a share. Analysts surveyed by Thomson Financial were looking for a profit of 71 cents a share.

"The fixed-income market volatility had an adverse impact on our third-quarter results," said CEO Henry L. Meyer III. "While the fixed-income markets continue to remain under some pressure as we head into the fourth quarter, we believe most of the financial impact on our held-for-sale portfolios is behind us and we expect to see improved results from these portfolios over the remainder of the year.

Key also guided lower for the fourth quarter, saying it expects to make 68 to 74 cents a share, against a 75-cent Thomson Financial estimate.

Also posting mixed results Tuesday were

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