Derivatives and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2011

Derivatives and Hedging Activities (Tables) [Abstract]

Fair values, Volume of activity and gain/loss information related to derivative instruments

		June 30, 2011								December 31, 2010								June 30, 2010
				Fair Value								Fair Value								Fair Value
	Notional		Derivative			Derivative			Notional		Derivative			Derivative			Notional		Derivative			Derivative
in millions	Amount		Assets			Liabilities			Amount		Assets			Liabilities			Amount		Assets			Liabilities
Derivatives designated as hedging instruments:
Interest rate	$	9,713	$	459		$	1		$	10,586	$	458		$	17		$	14,168	$	601		$	4
Foreign exchange		1,188		—			150			1,093		—			240			1,383		14			334
Total		10,901		459			151			11,679		458			257			15,551		615			338
Derivatives not designated as hedging instruments:
Interest rate		46,355		1,149			1,180			48,344		1,308			1,319			65,173		1,624			1,611
Foreign exchange		6,001		178			169			5,946		180			164			7,617		183			163
Energy and commodity		1,896		295			303			1,827		318			335			2,031		344			364
Credit		2,934		34			31			3,375		39			31			3,640		47			37
Equity		32		4			4			20		1			1			18		1			1
Total		57,218		1,660			1,687			59,512		1,846			1,850			78,479		2,199			2,176
Netting adjustments (a)		—		(1,219	)		(847	)		—		(1,298	)		(965	)		N/A		(1,661	)		(1,193	)
Total derivatives	$	68,119	$	900		$	991		$	71,191	$	1,006		$	1,142		$	94,030	$	1,153		$	1,321

(a) Netting adjustments represent the amounts recorded to convert our derivative assets and liabilities from a gross basis to a net basis in accordance with the applicable accounting guidance. The net basis takes into account the impact of bilateral collateral and master netting agreements that allow us to settle all derivative contracts with a single counterparty on a net basis and to offset the net derivative position with the related collateral.

Pre-tax net gains (losses) on fair value hedges

	Six months ended June 30, 2011
		Net Gains					Net Gains
	Income Statement Location of	(Losses) on				Income Statement Location of	(Losses) on
in millions	Net Gains (Losses) on Derivative	Derivative			Hedged Item	Net Gains (Losses) on Hedged Item	Hedged Item
Interest rate	Other income	$	(12	)	Long-term debt	Other income	$	8	(a)
Interest rate	Interest expense – Long-term debt		112
Foreign exchange	Other income		90		Long-term debt	Other income		(95)	(a)
Foreign exchange	Interest expense – Long-term debt		5		Long-term debt	Interest expense – Long-term debt		(8)	(b)
Total		$	195				$	(95)
	Six months ended June 30, 2010
		Net Gains					Net Gains
	Income Statement Location of	(Losses) on				Income Statement Location of	(Losses) on
in millions	Net Gains (Losses) on Derivative	Derivative			Hedged Item	Net Gains (Losses) on Hedged Item	Hedged Item
Interest rate	Other income	$	184		Long-term debt	Other income	$	(176)	(a)
Interest rate	Interest expense — Long-term debt		109
Foreign exchange	Other income		(264	)	Long-term debt	Other income		258	(a)
Foreign exchange	Interest expense – Long-term debt		3		Long-term debt	Interest expense – Long-term debt		(7)	(b)
Total		$	32				$	75

(a)	Net gains (losses) on hedged items represent the change in fair value caused by fluctuations in interest rates.
(b)	Net gains (losses) on hedged items represent the change in fair value caused by fluctuations in foreign currency exchange rates.

Pre-tax net gains (losses) on cash value hedges

	Six months ended June 30, 2011
					Net Gains			Income Statement Location	Net Gains
	Net Gains (Losses)				(Losses) Reclassified			of Net Gains (Losses)	(Losses) Recognized
	Recognized in OCI			Income Statement Location of Net Gains (Losses)	From OCI Into Income			Recognized in Income	in Income
in millions	(Effective Portion)			Reclassified From OCI Into Income (Effective Portion)	(Effective Portion)			(Ineffective Portion)	(Ineffective Portion)
Interest rate	$	42		Interest income – Loans	$	27		Other income		—
Interest rate		(9	)	Interest expense – Long-term debt		(5	)	Other income		—
Interest rate		—		Net gains (losses) from loan sales		—		Other income		—
Total	$	33			$	22				—
	Six months ended June 30, 2010
					Net Gains			Income Statement Location	Net Gains
	Net Gains (Losses)				(Losses) Reclassified			of Net Gains (Losses)	(Losses) Recognized
	Recognized in OCI			Income Statement Location of Net Gains (Losses)	From OCI Into Income			Recognized in Income	in Income
in millions	(Effective Portion)			Reclassified From OCI Into Income (Effective Portion)	(Effective Portion)			(Ineffective Portion)	(Ineffective Portion)
Interest rate	$	42		Interest income – Loans	$	134		Other income		—
Interest rate		(22	)	Interest expense – Long-term debt		(10	)	Other income		—
Interest rate		—		Net gains (losses) from loan sales		—		Other income		—
Total	$	20			$	124				—

After-tax change in AOCI resulting from cash flow hedges

					Reclassification
	December 31,		2011		of Gains to		June 30,
in millions	2010		Hedging Activity		Net Income		2011
AOCI resulting from cash flow hedges	$	8	$	21	$	(14)	$	15

Pre-tax net gains (losses) on derivatives not designated as hedging instruments

	Six months ended June 30,
in millions	2011			2010
NET GAINS (LOSSES) (a)
Interest rate	$	6		$	7
Foreign exchange		20			20
Energy and commodity		2			4
Credit		(10	)		(9	)
Total net gains (losses)	$	18		$	22

(a) Recorded in “investment banking and capital markets income (loss)” on the income statement.

Largest exposure to an individual counterparty

	June 30,		December 31,		June 30,
in millions	2011		2010		2010
Largest gross exposure (derivative asset) to an individual counterparty	$	147	$	168	$	219
Collateral posted by this counterparty		33		25		33
Derivative liability with this counterparty		250		275		320
Collateral pledged to this counterparty		137		141		154
Net exposure after netting adjustments and collateral		2		9		20

Fair value of derivative assets by type

	June 30,		December 31,		June 30,
in millions	2011		2010		2010
Interest rate	$	1,026	$	1,134	$	1,434
Foreign exchange		110		104		94
Energy and commodity		105		84		74
Credit		10		14		19
Equity		3		1		1
Derivative assets before collateral		1,254		1,337		1,622
Less: Related collateral		354		331		469
Total derivative assets	$	900	$	1,006	$	1,153

Fair value of credit derivatives purchased and sold

	June 30, 2011								December 31, 2010							June 30, 2010
in millions	Purchased			Sold		Net			Purchased			Sold		Net		Purchased		Sold			Net
Single name credit default swaps	$	(10	)	$	9	$	(1	)	$	(8	)	$	9	$	1	$	12	$	(4	)	$	8
Traded credit default swap indices		—			2		2			—			2		2		1		(2	)		(1	)
Other		3			—		3			5			—		5		5		(2	)		3
Total credit derivatives	$	(7	)	$	11	$	4		$	(3	)	$	11	$	8	$	18	$	(8	)	$	10

Credit derivatives sold and held

	June 30, 2011							December 31, 2010							June 30, 2010
			Average		Payment /					Average		Payment /					Average		Payment /
	Notional		Term		Performance			Notional		Term		Performance			Notional		Term		Performance
dollars in millions	Amount		(Years)		Risk			Amount		(Years)		Risk			Amount		(Years)		Risk
Single name credit default swaps	$	844		2.40		4.45	%	$	942		2.42		3.93	%	$	1,102		2.45		4.10	%
Traded credit default swap indices		318		3.88		3.47			369		3.86		6.68			344		4.00		8.08
Other		17		5.56		9.04			48		2.00		Low	(a)		46		3.09		7.70
Total credit derivatives sold	$	1,179		—		—		$	1,359		—		—		$	1,492		—		—

(a) The other credit derivatives were not referenced to an entity’s debt obligation. We determined the payment/performance risk based on the probability that we could be required to pay the maximum amount under the credit derivatives. We have determined that the payment/performance risk associated with the other credit derivatives was low (i.e., less than or equal to 30% probability of payment).

Credit Risk Contingent Feature

	June 30, 2011				December 31, 2010				June 30, 2010
in millions	Moody’s		S&P		Moody’s		S&P		Moody’s		S&P
KeyBank’s long-term senior unsecured credit ratings		A3		A-		A3		A-		A2		A-
One rating downgrade	$	11	$	11	$	16	$	16	$	28	$	22
Two rating downgrades		16		16		27		27		51		25
Three rating downgrades		16		16		32		32		59		30