...Negative Outlook Given FNFG Acquisition: Fitch Ratings affirmed and placed KeyCorp's (KEY) ratings on Negative Outlook after it announced plans to acquire First Niagara Financial Group (FNFG). Fitch believes that integration and execution risks are high given KEY's limited experience with an acquisition of this size. Nonetheless, Fitch believes KEY is on-track with its integration process with limited issues thus far. Improved New York Market Position: Fitch's affirmation is supported by our view that the deal should improve KEY's upstate New York market position given that FNFG adds a strong retail deposit base, which is currently undervalued in this low rate environment. Pro Forma Capital Solid: Post-acquisition, KEY's pro forma CET1 of 9.5% is considered appropriate given the risk profile of the combined entity. Nonetheless, Fitch believes capital levels will likely trend on the higher end of peers. Sustainable Performance: Results have benefited mostly from the improvement in credit...
