KeyCorp: Financial Winners & Losers

NEW YORK ( TheStreet) -- After another mediocre session for bank stocks in general, winners in the sector included KeyCorp ( KEY), which was up 3.5% to close at $8.91, after the company reported a solid fourth quarter.

After being featured back in November as one of TheStreet's 10 Banks with Real Earnings Improvement KeyCorp reported another significant increase in fee income. Like so many other large banks, Key benefitted from sharply reduced credit costs.

New York Community Bancorp ( NYB) was another winner, with shares up 2% for the session to $18.68, leading into an earnings announcement scheduled for Wednesday.

First Niagara Financial ( FNFG) also had a good day, with shares rising 2% to close at $14.05. The company is scheduled to release its fourth-quarter results on Thursday.

The KBW Bank Index was down slightly, closing at 52.98.

Losers for the session included Regions Financial ( RF), which closed at $7.02, down 4% on the day on heavy volume, following the company's report of a fourth-quarter profit.

During the conference call that followed the earnings release, CEO Grayson Hall said Regions would focus on patiently sustaining the company's profitability before repaying the government $3.5 billion in bailout funds received through the Troubled Assets Relief Program, or TARP, in October 2008.

During the fourth quarter, the $682 million that Regions added to its loan loss reserves equaled the amount of net loan charge-offs the company booked. When asked when the company would begin to release loan loss reserves, Grayson said Regions would remain disciplined, to avoid a premature release.

The largest four U.S. banks saw their fourth-quarter earnings boosted by large releases of loan loss reserves, including Citigroup ( C), which reported a net release of allowance for loan losses and unfunded lending commitments of $2.3 billion; Wells Fargo ( WFC), which released $850 million from reserves; JPMorgan Chase ( JPM), which saw a $1.9 billion decline in loan loss reserves; and Bank of America ( BAC), which reported a $1.7 billion decline in reserves during the fourth quarter.

Bank of America's shareholders had another difficult day, with shares down 2% to close at $13.63.

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-- Written by Philip van Doorn in Jupiter, Fla.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.

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