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Trust Preferred Securities Issued by Unconsolidated Subsidiaries | 12 Months Ended
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Dec. 31, 2019
Banking and Thrift [Abstract] |
Trust Preferred Securities Issued by Unconsolidated Subsidiaries | 21. Trust Preferred Securities Issued by Unconsolidated Subsidiaries We own the outstanding common stock of business trusts formed by us that issued corporation-obligated mandatorily redeemable trust preferred securities. The trusts used the proceeds from the issuance of their trust preferred securities and common stock to buy debentures issued by KeyCorp. These debentures are the trusts’ only assets; the interest payments from the debentures finance the distributions paid on the mandatorily redeemable trust preferred securities. The outstanding common stock of these business trusts is recorded in “other investments” on our balance sheet. We unconditionally guarantee the following payments or distributions on behalf of the trusts:
• | required distributions on the trust preferred securities;
• | the redemption price when a capital security is redeemed; and
• | the amounts due if a trust is liquidated or terminated.
The Regulatory Capital Rules require us to treat our mandatorily redeemable trust preferred securities as Tier 2 capital. The trust preferred securities, common stock, and related debentures are summarized as follows:
dollars in millions | Trust Preferred Securities, Net of Discount (a) | Common Stock | Principal Amount of Debentures, Net of Discount (b) | Interest Rate of Trust Preferred Securities and Debentures (c) | Maturity of Trust Preferred Securities and Debentures
December 31, 2019 |  |  |  |  |
KeyCorp Capital I | $ | 156 |  | $ | 6 |  | $ | 162 |  | 2.649 | % | 2028 |
KeyCorp Capital II | 105 |  | 4 |  | 109 |  | 6.875 |  | 2029 |
KeyCorp Capital III | 137 |  | 4 |  | 141 |  | 7.750 |  | 2029 |
HNC Statutory Trust III | 19 |  | 1 |  | 20 |  | 3.310 |  | 2035 |
Willow Grove Statutory Trust I | 19 |  | 1 |  | 20 |  | 3.204 |  | 2036 |
HNC Statutory Trust IV | 16 |  | 1 |  | 17 |  | 3.216 |  | 2037 |
Westbank Capital Trust II | 7 |  | — |  | 7 |  | 4.098 |  | 2034 |
Westbank Capital Trust III | 7 |  | — |  | 7 |  | 4.098 |  | 2034 |
Total | $ | 466 |  | $ | 17 |  | $ | 483 |  | 5.214 | % | — |
December 31, 2018 | $ | 454 |  | $ | 17 |  | $ | 471 |  | 5.447 | % | — |
(a) | The trust preferred securities must be redeemed when the related debentures mature, or earlier if provided in the governing indenture. Each issue of trust preferred securities carries an interest rate identical to that of the related debenture. Certain trust preferred securities include debt issuance costs and basis adjustments related to fair value hedges totaling $57 million at December 31, 2019, and $46 million at December 31, 2018. See Note 8 (“Derivatives and Hedging Activities”) for an explanation of fair value hedges.
(b) | We have the right to redeem these debentures. If the debentures purchased by KeyCorp Capital I, HNC Statutory Trust III, Willow Grove Statutory Trust I, HNC Statutory Trust IV, Westbank Capital Trust II, or Westbank Capital Trust III are redeemed before they mature, the redemption price will be the principal amount, plus any accrued but unpaid interest. If the debentures purchased by KeyCorp Capital II or KeyCorp Capital III are redeemed before they mature, the redemption price will be the greater of: (i) the principal amount, plus any accrued but unpaid interest, or (ii) the sum of the present values of principal and interest payments discounted at the Treasury Rate (as defined in the applicable indenture), plus 20 basis points for KeyCorp Capital II or 25 basis points for KeyCorp Capital III or 50 basis points in the case of redemption upon either a tax or a capital treatment event for either KeyCorp Capital II or KeyCorp Capital III, plus any accrued but unpaid interest. The principal amount of certain debentures includes debt issuance costs and basis adjustments related to fair value hedges totaling $57 million at December 31, 2019, and $46 million at December 31, 2018. See Note 8 for an explanation of fair value hedges. The principal amount of debentures, net of discounts, is included in “long-term debt” on the balance sheet.
(c) The interest rates for the trust preferred securities issued by KeyCorp Capital II and KeyCorp Capital III are fixed. The trust preferred securities issued by KeyCorp Capital I have a floating interest rate, equal to three-month LIBOR plus 74 basis points, that reprices quarterly. The trust preferred securities issued by HNC Statutory Trust III have a floating interest rate, equal to three-month LIBOR plus 140 basis points, that reprices quarterly. The trust preferred securities issued by Willow Grove Statutory Trust I have a floating interest rate, equal to three-month LIBOR plus 131 basis points, that reprices quarterly. The trust preferred securities issued by HNC Statutory Trust IV have a floating interest rate, equal to three-month LIBOR plus 128 basis points, that reprices quarterly. The trust preferred securities issued by Westbank Capital Trust II and Westbank Capital Trust III each have a floating interest rate, equal to three-month LIBOR plus 219 basis points, that reprices quarterly. The total interest rates are weighted-average rates.

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- Definition A description of the business trusts that issued corporation-obligated mandatorily redeemable preferred capital securities and related activity for the year-to-date period. Also includes a tabular disclosure of the carrying amount of the capital securities and common stock issued by the trusts, the principal amount of related debentures issued by KeyCorp and purchased by the trusts, and the interest rates and maturities of the capital securities and debentures as of the balance sheet date. + References No definition available. + Details
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- References No definition available. + Details
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