127 PUBLIC SQUARE

CLEVELAND, OHIO 44114

April 5, 2019

BETH E. MOONEY

Chairman of the Board and

Chief Executive Officer

Message to

the Shareholders

Dear Shareholder,

I am pleased to share that 2018 marked another successful year for Key, as we continued to grow the company, invest for our future and deliver on our financial commitments. We once again improved our operating performance, while maintaining strong discipline around credit quality and capital management. We achieved our sixth consecutive year of positive operating leverage, with continued momentum in our businesses. We reached a record level of revenue and continued our strong focus on expense management, all while continuing to invest for growth across our franchise. Our efforts drove meaningful improvement in both efficiency and returns for you, our shareholders, and we believe we are well-positioned moving forward.

On behalf of your Board of Directors, we are pleased to invite you to KeyCorp’s 2019 Annual Meeting of Shareholders on Thursday, May 23, 2019. The meeting will be held at One Cleveland Center, 1375 East Ninth Street, Cleveland, Ohio 44114, beginning at 8:30 a.m., local time.

We encourage you to carefully review this year’s notice and proxy statement, which contain important information about proxy voting and the business to be conducted at the meeting, as well as highlights of Key’s 2018 performance. We hope you will attend the meeting, but even if you plan to attend, we encourage you to vote your shares in advance of the meeting by telephone, online, or by returning your completed proxy card to us.

Every shareholder vote is important and we want to ensure your shares are represented at the meeting. Please vote your shares as promptly as possible.

Thank you for your continued support of KeyCorp. We look forward to seeing you at the meeting.

Sincerely,

Beth E. Mooney

Date and Time:

Thursday, May 23, 2019, at 8:30 a.m., local time

One Cleveland Center

1375 East Ninth Street

Cleveland, Ohio 44114

Proposal

Page

Board
 Recommendation 

1.  Election of Directors

You are being asked to elect 14 directors. Each of the nominees is standing for election to hold office until the 2020 Annual Meeting of Shareholders.

each nominee

2.  Auditor Ratification

You are being asked to ratify the Audit Committee’s appointment of Ernst & Young LLP as our independent auditor for fiscal year 2019. One or more representatives of Ernst & Young LLP will be present at the meeting to respond to appropriate questions from shareholders.

3.  Say-on-Pay

You are being asked to give advisory approval of compensation paid to KeyCorp’s Named Executive Officers (as defined on page 24 of this proxy statement). This advisory vote is held on an annual basis.

4.  KeyCorp’s 2019 Equity Compensation Plan

You are being asked to approve KeyCorp’s 2019 Equity Compensation Plan for KeyCorp’s employees and nonemployee directors. A copy of the 2019 Equity Compensation Plan is attached to this proxy statement as Appendix A.

5.  Increase Number of Authorized Common Shares

You are being asked to approve an amendment to KeyCorp’s Articles of Incorporation to increase the number of authorized common shares.

6.  Authorize Board of Directors to Make Future Amendments to the Regulations

You are being asked to approve an amendment to KeyCorp’s Regulations which would allow KeyCorp’s Board of Directors to make future amendments to KeyCorp’s Regulations.

Name

Age

Director
Since

Independent

Bruce D. Broussard

56

2015

Yes

✓

Charles P. Cooley

63

2011

Yes

Chair

✓

✓

Gary M. Crosby

64

2016

No

Alexander M. Cutler (1)

67

2000

Yes

✓

Chair

H. James Dallas

60

2005

Yes

✓

Elizabeth R. Gile

63

2010

Yes

✓

Chair

Ruth Ann M. Gillis

64

2009

Yes

✓

William G. Gisel, Jr.

66

2011

Yes

Chair

✓

Carlton L. Highsmith

67

2016

Yes

✓

✓

Richard J. Hipple

66

2012

Yes

✓

Kristen L. Manos

59

2009

Yes

✓

✓

Beth E. Mooney

64

2010

No

Chair

Barbara R. Snyder

63

2010

Yes

✓

✓

David K. Wilson

64

2014

Yes

✓

Serves as KeyCorp’s independent Lead Director.

Shareholders of record as of the close of business on March 29, 2019.

Registered holders can go to www.envisionreports.com/key and follow the instructions. If you hold your shares in street name, please follow the instructions found on your voting instruction form.

Follow the instructions in the Notice of Internet Availability of Proxy Materials
or on your proxy card.

Complete, sign, and date the proxy card and return it in the envelope that was provided in the proxy statement mailing package.

•   6^th consecutive year of positive operating leverage

•   Record full-year revenue of $6.4 billion

•   All-time highs in several fee-based businesses, including investment banking and debt placement fees ($650 million in fiscal year 2018)

•   Loan and deposit growth reflect execution of relationship-based business model within moderate risk profile

•   Well-managed expenses reflect focus on efficiency and investments for growth

•   Growth in both consumer and commercial relationships across the franchise

•   Significant progress on long-term financial targets

•   More than 300 basis point improvement in cash efficiency and return on average tangible common equity ratios⁽¹⁾

•   Progress on $200 million cost savings initiative announced in October 2018

•   Steadfast commitment to maintaining moderate risk profile and strong underwriting standards

•   Net charge-offs to average loans of 0.26%; portfolios continued to perform well

•   Maintained strong capital position

•   Common share dividend increased 62% ($0.105 to $0.17 per common share) in 2018

•   $1.1 billion in common share repurchases in 2018

Non-GAAP financial measures. Please see the section entitled “GAAP to Non-GAAP Reconciliations” beginning on page 80 of our 2018 Annual Report on Form 10-K for more information on these non-GAAP measures and reconciliations to the most comparable GAAP measures.

Make pay decisions based on performance of the Company, the business unit, and the individual;

Deliver pay in a way that reinforces focus on balancing short- and long-term financial performance objectives; and

Support sustainable performance with policies that are focused on prudent risk-taking and the balance between risk and reward.

✓ Impose robust stock ownership guidelines

✓ Subject shares to post-vesting holding period

✓ “Double trigger” change of control agreements

✓ Use tally sheets

✓ Review share utilization

✓ Retain an independent compensation consultant

✓ Subject all incentives to risk adjustment and clawback

×   No employment agreements for executive officers

×   No tax gross-ups

×   No active SERPs

×   No hedging or pledging of KeyCorp securities

×   No “timing” of equity grants

×   No repricing of stock options

•   The KeyCorp 2018 Annual Incentive Plan performed at 105% based on the achievement of our short-term financial goals, although we opted to limit awards to Named Executive Officers to 100% of funding.

•   The 2016-2018 Long-Term Incentive Plan (performance awards) performed at 98.1% of target as our Return on Assets was above the 50th percentile of our Peer Group and Cumulative Earnings per Share exceeded our three-year financial plan, although results were offset by our total shareholder return, which fell short of the 50th percentile of our peer group.

•   The payout under the 2016-2018 Long-Term Incentive Plan (performance awards) also reflected significant share price appreciation from 2016-2018 (grant date share price of $10.49 and settlement date share price of $17.51.)

•   2018 compensation of our Chief Executive Officer included a $2.50 million annual incentive paid for 2018 and a $6.38 million long-term incentive granted in 2019.

Director

Elections

•    Annual elections for all directors (page 1)

•    Majority voting in uncontested elections (page 3)

Board

Independence

•    All director nominees, other than Ms. Mooney and Mr. Crosby, are independent under the New York Stock Exchange’s and KeyCorp’s standards of independence (page 16)

•    Our standing Board committees (Audit, Compensation and Organization, Nominating and Corporate Governance, and Risk) consist solely of independent directors (page 11)

•    Independent Lead Director—Alexander M. Cutler—with extensive responsibilities (page 11)

•    Annual Lead Director evaluation and review of Board leadership structure by independent directors (pages 11 and 12)

•    Prior approval from the Lead Director of the Board agenda, schedule, and materials (page 11)

•   Audit Committee

14 meetings in 2018

(page 13)

•   Compensation and Organization Committee

7 meetings in 2018

(page 14)

•   Nominating and Corporate Governance Committee

6 meetings in 2018

(page 13)

•   Risk Committee

8 meetings in 2018

(page 14)

Practices

and Policies

•    Experienced, diverse Board membership

•    Commitment to Board refreshment, with an average tenure of approximately seven years and three new directors added since 2015 (page 11)

•    Independent and non-management members of the Board met in executive session at every regular 2018 Board meeting (page 12)

•    Approximately 96% average attendance by directors at Board and committee meetings (page 12)

•    Annual self-assessments conducted by the Board, each committee, and each director

•    Strong Board leadership in the oversight of enterprise risk (pages 15 and 16)

•    Annual disclosure of KeyCorp political spending (page 19)

•    Strong director education program (page 18)

Shareholder Engagement

•    Active shareholder engagement program (pages 17 and 18)

•    Directors are available to meet with our shareholders

demonstrated breadth and depth of management and/or leadership experience, preferably in a senior leadership role with a large or recognized organization (private sector (profit or nonprofit), governmental, or educational);

a high level of professional or business expertise relevant to KeyCorp (including, among others, information technology, marketing, finance, banking or the financial industry, or risk management);

in the case of non-employee directors, satisfaction of the “independence” criteria set forth in KeyCorp’s Standards for Determining Independence of Directors;

service as a director for not more than (i) two other public companies if he or she is a senior executive officer of a public company, or (ii) three other public companies if he or she is not a senior executive officer of a public company; and

the ability to think and act independently, as well as the ability to work constructively in the overall Board process.

the skills and business experience currently needed for the Board by using a comprehensive skills matrix;

the current and anticipated composition of the Board in light of the business activities and strategic direction of KeyCorp and the diverse communities and geographies served by KeyCorp; and

the interplay of the candidate’s expertise and professional/business background in relation to the expertise and professional/business background of current Board members, as well as such other factors (including diversity) as the committee deems appropriate.

The Board of Directors unanimously recommends that shareholders vote “FOR”

each of the following director nominees.

Bruce D. Broussard

Age: 56

Director Since: 2015

KeyCorp Committee(s):

•  Compensation and Organization

Biography:

Mr. Broussard is President and Chief Executive Officer and a director of Humana, Inc., a publicly-held health and well-being company. Prior to his election as Humana’s Chief Executive Officer in 2013 and as President in 2011, Mr. Broussard held numerous senior executive and senior financial roles with McKesson Corporation, a health care services company, and its predecessor U.S. Oncology. Mr. Broussard also previously served as a director of U.S. Physical Therapy, Inc. from 1999 to 2011. Mr. Broussard is a member of The Business Council and the World Economic Forum Health Governors Board.

Select Qualifications and Experience:

• Significant executive leadership experiences in the highly-regulated healthcare and insurance industries, including Chief Executive and Chief Financial Officer roles with Humana, McKesson Corporation, Harbor Dental, Inc., Sun Healthcare Group, Inc., and Regency Health Services, Inc.

• Extensive financial and accounting background with healthcare and health insurance companies and major global accounting firms.

Other Public Directorships:

•   Humana, Inc. (since 2013)

Charles P. Cooley

Age: 63

Director Since: 2011

KeyCorp Committee(s):

•  Audit (Chair)

•  Nominating and Corporate Governance

•  Executive

Biography:

Mr. Cooley was Chief Financial Officer of The Lubrizol Corporation, a manufacturer of specialty chemicals and technologies in the global transportation, industrial, and consumer markets, from 1998 until his retirement in 2011. Mr. Cooley had global responsibility for The Lubrizol Corporation’s finance function and its corporate development and strategic planning activities. Mr. Cooley is Chair of the board of trustees of Hawken School in Cleveland and a trustee of the Cleveland Institute of Music. He is also a member of the board of directors of KeyBank National Association.

Select Qualifications and Experience:

•    Former Chief Financial Officer of The Lubrizol Corporation, where he was responsible for finance, accounting, and capital planning. Held finance positions of increasing responsibility at Atlantic Richfield Company for over fifteen years, including treasury, capital markets, corporate development, financial reporting, and operating segment financial management. Mr. Cooley qualifies as an “audit committee financial expert” as defined by the Securities and Exchange Commission.

•    As Chief Financial Officer of The Lubrizol Corporation, had significant responsibility for financial risk management of a global publicly-traded enterprise.

Other Public Directorships:

•   Modine Manufacturing Company (since 2006)

Gary M. Crosby

Age: 64

Director Since: 2016

Biography:

Mr. Crosby joined the Board in August 2016 in connection with the First Niagara merger. Mr. Crosby served as President and Chief Executive Officer and as a director of First Niagara from 2013 through the consummation of the merger. He joined First Niagara as Chief Administrative Officer in 2009 and served as Chief Operating Officer from 2010-2013. In 2004, Mr. Crosby was asked to help the Buffalo City School District as Chief Financial Officer and Chief Operating Officer and provided his service to the district by spearheading its financial management reform until 2009. Mr. Crosby also was a venture capital partner with Seed Capital Partners and a founding shareholder of ClientLogic Corporation, serving as Chief Financial and Chief Operating Officer. He has also held senior financial leadership positions in banking and manufacturing and was a CPA with KPMG Peat Marwick. Mr. Crosby is President of the board of First Niagara Foundation, director of the Buffalo Public Schools Foundation, Trustee Emeritus of the YMCA Buffalo Niagara, director of the Community Foundation for Greater Buffalo, a director of AAA Western and Central New York, and a director of Kaleida Health.

Select Qualifications and Experience:

•    As former Chief Executive Officer of First Niagara, brings extensive knowledge of the First Niagara businesses and the geographic markets in which First Niagara operated as well as leadership experience in the banking industry.

•    Significant experience in financial management, accounting, operations, risk management, mergers and acquisitions, and integration of acquired companies from a distinguished career as Chief Financial Officer, Chief Operating Officer, and Chief Executive Officer across a wide variety of industries and public companies.

Alexander M. Cutler

Age: 67

Director Since: 2000

KeyCorp Committee(s):

•  Nominating and Corporate Governance (Chair)

•  Compensation and Organization

•  Executive

Biography:

Mr. Cutler is KeyCorp’s independent Lead Director. From 2000 through May of 2016, he was Chairman and Chief Executive Officer of Eaton Corporation plc, a publicly-held, global diversified power management company with approximately 96,000 employees that sells products to customers in more than 175 countries. He is a member of the board of directors of the United Way of Greater Cleveland and the Musical Arts Association.

Select Qualifications and Experience:

•    Experience across a wide range of senior management and executive roles with Eaton Corporation plc and certain of its predecessor companies. Significant corporate governance experience and public company board experience through his role as Chairman of Eaton Corporation plc, his service on the DowDuPont Inc. board, and as a former member of the Executive Committee of the Business Roundtable.

•    Extensive experience negotiating and completing acquisitions and divestitures and integrating acquired companies gained through leadership positions with Eaton Corporation plc.

Other Public Directorships:

•   DowDuPont Inc. (since 2008)

•   Eaton Corporation plc (2000–2016)

H. James Dallas

Age: 60

Director Since: 2005

KeyCorp Committee(s):

• Audit

Biography:

In 2013, Mr. Dallas retired as Senior Vice President of Quality and Operations at Medtronic Inc., a global medical technology company. Mr. Dallas, who joined Medtronic Inc. in 2006, had previously served as Senior Vice President and Chief Information Officer at Medtronic Inc. Mr. Dallas’s responsibilities included executing cross-business initiatives to maximize the company’s global operating leveraging. Mr. Dallas also served as a member of Medtronic Inc.’s executive management team. Mr. Dallas is an independent consultant focusing on change management, information technology strategy, and risk. He also serves as Chairman of the Atlanta Community Food Bank and a director of Grady Memorial Hospital Corporation.

Select Qualifications and Experience:

•    Significant experience with information technology, information technology security, and data privacy, including prior service as the Chief Information Officer of Medtronic Inc. and, prior to that, as Chief Information Officer of Georgia-Pacific Corporation.

•    As Chief Information Officer for major public corporations, had primary responsibility for risks related to information technology and security. As Senior Vice President of Quality and Operations with Medtronic Inc., held significant responsibility for operational risk management.

Other Public Directorships:

•   WellCare Health Plans, Inc. (since 2016)

•   Strategic Education, Inc. (formerly Cappella Education Company) (since 2015)

Elizabeth R. Gile

Age: 63

Director Since: 2010

KeyCorp Committee(s):

•  Risk (Chair)

•  Nominating and Corporate Governance

Biography:

In 2005, Ms. Gile retired from Deutsche Bank AG where she was Managing Director and the Global Head of the Loan Exposure Management Group since 2003. From 2007 to 2009, Ms. Gile was Managing Director and Senior Strategic Advisor to BlueMountain Capital Management, a hedge fund management company. Ms. Gile has been a director of Deutsche Bank Trust Corporation and Deutsche Bank Trust Company Americas since 2005 and a director of Watford Re Ltd. since 2017. Ms. Gile is a trustee and Secretary of the board of the Brooklyn Botanic Garden.

Select Qualifications and Experience:

•    A distinguished career in the banking, finance, and capital markets industries with leading global financial institutions. Significant roles with J.P. Morgan, Deutsche Bank AG, and Toronto Dominion Securities managing loan portfolios, capital markets, derivatives and corporate lending transactions, and credit research.

•    As Global Head of the Loan Exposure Management Group for Deutsche Bank AG, had global responsibility for managing the credit risk of loans and lending-related commitments, giving her experience in identifying, assessing, and managing risk exposures of a large, complex financial firm.

Ruth Ann M. Gillis

Age: 64

Director Since: 2009

KeyCorp Committee(s):

• Risk

Biography:

From 2008 until her retirement in 2014, Ms. Gillis served as Executive Vice President and Chief Administrative Officer of Exelon Corporation, a publicly-held electric utility company. Ms. Gillis also served as President of Exelon Business Services Company, a subsidiary of Exelon Corporation. She served as a member of Exelon Corporation’s executive committee, pension investment committee, and the corporate risk management committee, and was a member of the Exelon Foundation Board. Prior to those roles, she served as Executive Vice President of Commonwealth Edison Company and as Chief Financial Officer of Exelon Corporation. Ms. Gillis is an honorary trustee of the University of Chicago Cancer Research Foundation, serves on the board of directors of the Lyric Opera of Chicago, and is a life trustee of the Goodman Theatre.

Select Qualifications and Experience:

•    Extensive finance, management, operational and risk management expertise and history of accomplishment and executive ability as Chief Administrative Officer and Chief Financial Officer of Exelon Corporation.

•    Significant experience leading complex organizations in highly-regulated industries such as banking, healthcare, and utilities.

Other Public Directorships:

•   Voya Financial Inc. (since 2015)

•   Snap-on Incorporated (since 2014)

•   Potlatch Corporation (2003–2013)

William G. Gisel, Jr.

Age: 66

Director Since: 2011

KeyCorp Committee(s):

•  Compensation and Organization (Chair)

•  Nominating and Corporate Governance

Biography:

Mr. Gisel is Chief Executive Officer of Rich Products Corporation, a global manufacturer and supplier of frozen foods with annual sales of approximately $3.5 billion. Rich Products Corporation is a leading supplier to the consumer products, food service, and bakery segment of the food industry internationally. Prior to becoming Chief Executive Officer in 2006, Mr. Gisel began his career at Rich Products Corporation as General Counsel and also spent four years at Philips, Lytle, LLC. Mr. Gisel is a member of the board of directors of the Grocery Manufacturers Association and Director and Chairman of the John R. Oishei Foundation.

Select Qualifications and Experience:

•    In various capacities with Rich Products Corporation, led the company’s expansion into foreign markets, including Asia, Africa, Europe, and Latin America. As President of Rich Products Corporation’s Food Group and its Chief Operating Officer, managed the international expansion of Rich Products Corporation through acquisitions and organic growth.

•    As Chief Executive Officer of Rich Products Corporation, responsible for directing the company’s overall strategy and its worldwide business operations. Has held positions of increasing responsibility with Rich Products Corporation, including as Chief Operating Officer and President of the company’s Food Group and Executive Vice President for International and Strategic Planning.

Other Public Directorships:

•   Moog Inc. (since 2012)

•   MOD-PAC CORP. (2002–2013)

Carlton L. Highsmith

Age: 67

Director Since: 2016

KeyCorp Committee(s):

•  Nominating and Corporate Governance

•  Risk

Biography:

Mr. Highsmith joined the Board in August 2016 in connection with the First Niagara merger. He was a member of the board of First Niagara since 2011, serving on the Governance/Nominating Committee and the Audit Committee. He previously served on the board of NewAlliance Bancshares from 2006 until it was acquired by First Niagara in 2011. He founded The Specialized Packaging Group (“SPG”) based in Hamden, Connecticut in 1983, and served as its President and Chief Executive Officer from 1983 to 2009. Mr. Highsmith is Vice Chairman of the board of trustees of Quinnipiac University, Chairman of the Connecticut Center for Arts & Technology, Treasurer of the National Center for Arts & Technology, a trustee of the Yale-New Haven Hospital System, and a trustee and Chairman of the Investment Committee of the Community Foundation for Greater New Haven. He previously served on the Federal Reserve Bank of Boston Community Development Advisory Council of New England.

Select Qualifications and Experience:

•    Successful corporate executive and entrepreneur with significant bank board experience, having served on the board of directors of both NewAlliance and First Niagara.

•    Under Mr. Highsmith’s leadership, SPG grew to become the largest minority owned, and 7^th largest overall, manufacturer of paperboard packaging in North America before it merged with PaperWorks Industries in 2009.

Richard J. Hipple

Age: 66

Director Since: 2012

KeyCorp Committee(s):

• Audit

Biography:

Mr. Hipple retired as Executive Chairman of Materion Corporation, a publicly-held manufacturer of highly engineered advanced materials and related services, in December 2017. Mr. Hipple previously served as Chairman of the Board and Chief Executive Officer of Materion Corporation from 2006 to 2017 and President from 2005 to 2017. Prior to that, Mr. Hipple served in the steel industry for 26 years in a number of capacities, including project engineer, strategic planning, supply chain management, operations, sales and marketing, and executive management. Mr. Hipple is Chairman of the board of trustees of the Cleveland Institute of Music.

Select Qualifications and Experience:

•    Extensive exposure to global commerce as former Chief Executive Officer of Materion Corporation, which serves customers in more than 50 countries and employs 2,500 people worldwide. Additionally, experience as a director at Ferro Corporation, Barnes Group Inc., and Luxfer Holdings PLC which represent manufacturing companies with leading technologies, broad international footprints, and market diversity. With significant experience in the oversight and management of financial risks, Mr. Hipple qualifies as an “audit committee financial expert” as defined by the Securities and Exchange Commission.

•    Significant corporate governance and executive-level management experience, including as the Executive Chairman and President and Chief Executive Officer of Materion Corporation and as Chairman of the compensation committee of both Ferro Corporation and Luxfer Holdings PLC.

Other Public Directorships:

•   Luxfer Holdings PLC (since 2018)

•   Barnes Group Inc. (since 2017)

•   Ferro Corporation (2007–2018)

•   Materion Corporation (2006–2017)

Kristen L. Manos

Age: 59

Director Since: 2009

KeyCorp Committee(s):

• Audit

• Executive

Biography:

Ms. Manos is a partner with Sanderson Berry, a business strategy and advisory services firm. In 2014, Ms. Manos retired as President, Americas of Wilsonart LLC, the leading producer of high pressure decorative laminate products in North America. From 2004 to 2009, Ms. Manos served as President of Herman Miller North American Office and Executive Vice President of Herman Miller Inc., a global manufacturer and distributor of furnishings for a wide variety of professional and residential environments. Ms. Manos serves on the boards of two employee-owned companies, Columbia Forest Products, Inc. and Dexter Apache Holdings, Inc., and two private-equity-backed companies, C.H.I. Overhead Doors, LLC and Innovative Ergonomic Solutions LLC. She previously served on the board of International Relief and Development, where she also served as Interim Chief Executive Officer for four months in 2014. Ms. Manos is currently a director of the board of Kickstart International.

Select Qualifications and Experience:

•    As President, Americas, of Wilsonart LLC, responsible for the direction and operation of a $600 million organization, and led the company through its sale to a private equity firm. In prior roles as Executive Vice President and President of Herman Miller North American Office Environments, was responsible for the direction and operation of a $1.5 billion organization. Participated in corporate risk evaluation, risk management, and scenario planning for both Wilsonart and Herman Miller, as well as for Herman Miller clients related to their facilities.

•    During her tenure with Herman Miller, Inc., held responsibility for marketing and development where she established a branding strategy and a vertical selling strategy in education and healthcare. Responsible for high-level business strategy, development, and assessment as a partner with Sanderson Berry.

Other Public Directorships:

•   American Capital, Ltd. (2015–2017)

Beth E. Mooney

Age: 64

Director Since: 2010

KeyCorp Committee(s):

• Executive (Chair)

Biography:

Ms. Mooney has been KeyCorp’s Chairman and Chief Executive Officer since May 1, 2011. She was elected President and Chief Operating Officer on November 18, 2010, and served in that role until she became Chairman and Chief Executive Officer. Ms. Mooney joined KeyCorp in 2006 as Vice Chair and head of Key Community Bank. Prior to joining KeyCorp, Ms. Mooney served in a number of executive and senior finance roles with banks and bank holding companies including AmSouth Bancorp (where she served as Chief Financial Officer), Bank One Corporation, Citicorp Real Estate, Inc., Hall Financial Group, and Republic Bank of Texas/First Republic. Ms. Mooney is a member of The Clearing House, The Business Council, and the Bank Policy Institute, a board member of the Greater Cleveland Partnership, Catalyst, and the United Way of Greater Cleveland, a trustee and Treasurer of the board of the Musical Arts Association, and Vice Chair and a trustee of the Cleveland Clinic Foundation. On January 1, 2019, Ms. Mooney was appointed to a third one-year term as the Fourth Federal Reserve District’s representative on the Federal Advisory Council.

Select Qualifications and Experience:

•    Over 30 years of financial services experience in retail banking, commercial lending, and real estate financing with KeyCorp and other significant banking organizations across the United States. Significant executive and leadership experience in prior roles such as Chief Operating Officer of KeyCorp and Chief Financial Officer of AmSouth Bancorp.

•    As Chief Executive Officer and former Chief Operating Officer of KeyCorp, leads the operations of one of the largest financial service companies in the United States with nearly 20,000 employees. Provides critical insight on KeyCorp’s business and operations to the Board of Directors.

Other Public Directorships:

•   AT&T (since 2013)

Barbara R. Snyder

Age: 63

Director Since: 2010

KeyCorp Committee(s):

•  Compensation and Organization

• Executive

Biography:

Ms. Snyder has been President of Case Western Reserve University, a private research university located in Cleveland, Ohio, since 2007. Prior to joining Case Western Reserve University, Ms. Snyder served as Executive Vice President and Provost of The Ohio State University (“OSU”). She served as a faculty member of OSU’s Moritz College of Law from 1998 to 2007. From 2000 to 2007, she held the Joanne W. Murphy/Classes of 1965 and 1973 Professorship at OSU. Ms. Snyder serves on the boards of several nonprofit organizations including the Greater Cleveland Partnership, the Ohio Business Roundtable, and Internet 2, a consortium of research organizations to develop networking and advanced technologies for research and education. She was Chair of the board and is currently a director of the Business-Higher Education Forum, an organization of senior business and higher education leaders dedicated to strengthening America’s competitiveness by partnering on workforce solutions, and is Chair of the board of the American Council on Education, which represents 1,800 colleges and universities.

Select Qualifications and Experience:

•    President of Case Western Reserve University, one of the nation’s leading universities and a major private research institution with significant focus on science, engineering, and technology. Since 2007, Case Western Reserve University has tripled undergraduate admissions applications, become twice as selective, and dramatically increased the academic quality of the entering class.

•    Under Ms. Snyder’s leadership, Case Western Reserve University has experienced unprecedented fundraising success, setting new records for annual attainment and reaching a $1.5 billion capital campaign goal one and a half years ahead of schedule, with a final attainment of $1.82 billion.

Other Public Directorships:

•   Progressive Insurance Corporation (since 2014)

David K. Wilson

Age: 64

Director Since: 2014

KeyCorp Committee(s):

• Risk

Biography:

Until his retirement in January 2014, Mr. Wilson served in a variety of positions with the Office of the Comptroller of the Currency (“OCC”) over the course of a 32-year career, including as Examiner-In-Charge (“EIC”) of two global banks and in a number of policy focused roles. In 2009, Mr. Wilson transitioned from Large Bank EIC into policy work, initially as Senior National Bank Examiner and co-chair of the OCC’s National Risk Committee. In 2010, he was appointed Deputy Comptroller for Credit and Market Risk. He then briefly served as Senior Deputy Comptroller and Chief National Bank Examiner before returning to the field as an EIC. Mr. Wilson is an independent consultant focusing on bank regulatory and risk strategy matters. He is also a member of the board of directors of KeyBank National Association.

Select Qualifications and Experience:

• Significant bank regulatory and risk strategy expertise, including providing advice and counsel to the Comptroller of the Currency, testifying before Congress, developing policy, and regulatory rulemaking following the Dodd-Frank Act.

• Extensive experience and understanding of the financial services regulatory climate, including participating in the Financial Stability Oversight Council (“FSOC”), serving as the OCC representative on FSOC’s Systemic Risk Committee, and chairing the Federal Financial Institutions Examination Council Task Force on Supervision.

presides at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent and non-management directors held after each regularly scheduled Board meeting;

serves as liaison between the Chairman and the independent and non-management directors;

approves Board meeting schedules as well as meeting materials and agendas for each full Board meeting and executive sessions of independent and non-management directors;

has the authority to call meetings of the independent and non-management directors or the full Board at any time;

participates in discussions with major shareholders regarding governance matters as part of KeyCorp’s proactive shareholder engagement;

is in frequent contact with the Chairman with respect to major issues and strategic opportunities before KeyCorp, and any significant actions contemplated by KeyCorp are discussed with the Lead Director at an early stage;

advises on the retention of independent consultants to the Board;

interviews all candidates for election to the Board;

oversees changes to the composition of Board committees;

assists the Board and management in assuring compliance with applicable securities laws and fiduciary duties to shareholders;

oversees initiatives to implement enhancements to KeyCorp’s governance policies and the Corporate Governance Guidelines;

serves as a focal point for independent Committee Chairs, providing guidance, coordination, and advice for the committees;

together with the Chair of the Compensation and Organization Committee, facilitates the evaluation of the performance of KeyCorp’s Chief Executive Officer; and

is available for additional duties as they may arise.

Chair:

Charles P. Cooley

Other Members:

H. James Dallas

Richard J. Hipple

Kristen L. Manos

Number of

Meetings in 2018: 14

Primary Responsibilities

•    Oversees the development of, and reviews, the financial information provided to KeyCorp’s shareholders

•    Is directly responsible for the appointment, compensation, retention, and oversight of our independent auditor, oversees the audit fees negotiations with our independent auditor, and has sole authority to approve audit fees

•    Has responsibility over all KeyCorp internal audit and credit risk review functions, financial reporting, legal matters, and fraud risk

•    Oversees any material examinations of KeyCorp and its affiliates conducted by federal, state, or other authorities, and may supervise and direct any other special projects or investigations the committee deems necessary

•    Together with the Risk Committee, oversees and reviews our allowance for loan and lease losses methodology and monitors operational risk, and

•    Serves as the audit committee for KeyCorp’s subsidiary, KeyBank National Association.

Independence

The Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (the “Exchange Act”). The Board has determined that all members of the Audit Committee are “independent” as that term is defined in Section 303A.02 of the New York Stock Exchange’s listing standards.

Audit Committee Financial Experts

The Board of Directors has determined that Mr. Cooley and Mr. Hipple each qualify as an “audit committee financial expert,” as defined in Item 407(d)(5) of Regulation S-K.

Chair:

Alexander M. Cutler

Other Members:

Charles P. Cooley

Elizabeth R. Gile

William G. Gisel, Jr.

Carlton L. Highsmith

Number of

Meetings in 2018: 6

Primary Responsibilities

•    Recommends to the Board nominees to stand for election as directors

•    Oversees the annual Board self-assessment process (including individual director self-assessments and the evaluation of the Lead Director), as well as KeyCorp’s policies and practices on significant issues of corporate social responsibility

•    Oversees corporate governance matters generally

•    Oversees and reviews KeyCorp’s directors’ and officers’ liability insurance program

•    Supports the Compensation and Risk Committees by facilitating a meeting of all independent Board committee Chairs to discuss the linkage between enterprise risk and compensation at KeyCorp, and

•    With the aid of market data, annually reviews and recommends to the Board a director compensation program that may include equity-based incentive compensation (no executive officer of KeyCorp has any role in determining the amount of director compensation, although the committee may seek assistance from our executive officers in designing equity compensation programs for directors).

Chair:

William G. Gisel, Jr.

Other Members:

Bruce D. Broussard

Alexander M. Cutler

Barbara R. Snyder

Number of

Meetings in 2018: 7

Primary Responsibilities

•    Supports KeyCorp’s efforts to attract, retain, develop, and reward talent so that we can achieve our business objectives

•    Is responsible for overseeing the compensation of our senior executives, certain of our compensation programs, and our talent management and organizational development processes

•    Evaluates the competitiveness of our compensation programs and assesses the effectiveness of our leadership development and strategic hiring objectives

•   Oversees the process for developing, implementing, and administering succession planning for the Chairman and Chief Executive Officer and assesses succession planning for key executives

•    Approves the performance goals, performance objectives, and the compensation of our Chief Executive Officer and other senior executives and evaluates their performance relative to those goals and objectives

•    Establishes our overall compensation philosophy and oversees the implementation of this philosophy as it relates to our incentive compensation arrangements, including through approval of our incentive compensation policy

•    Is responsible for enforcing the compensation clawback policy

•    Appoints, directs, and oversees its independent advisors and performs additional duties described in its Charter, and

•    May delegate its authority to a subcommittee of its members and may allow limited delegations to management.

Independence

The Board of Directors has determined that all members of the Compensation Committee are “independent” as that term is defined in Section 303A.02 of the New York Stock Exchange’s listing standards.

Further discussion of the Compensation Committee can be found beginning on page 24 of this proxy statement under the heading “Compensation Discussion and Analysis.”

Chair:

Elizabeth R. Gile

Other Members:

Ruth Ann M. Gillis

Carlton L. Highsmith

David K. Wilson

Number of

Meetings in 2018: 8

Primary Responsibilities

•    Is responsible for assisting the Board with strategies, policies, procedures, and practices relating to the assessment and management of KeyCorp’s enterprise-wide risks, including credit risk, market risk, liquidity risk, compliance risk, operational risk, and other risks

•    Plays a crucial role in overseeing KeyCorp’s capital adequacy and compliance with regulatory capital requirements

•    Reviews and approves KeyCorp’s capital plan and recommends share repurchase authorizations to the Board consistent with approved capital plans

•    May exercise such authority as the Board delegates in connection with the authorization, sale, and issuance by KeyCorp of debt and other equity securities, and

•    Together with the Audit Committee, oversees and reviews our allowance for loan and lease losses methodology.

The Risk Committee has primary oversight responsibility for enterprise-wide risk at KeyCorp, including credit risk, market risk, liquidity risk, compliance risk, operational risk (including cybersecurity), as well as reputational and strategic risks, and oversight of the actions taken to mitigate these risks.

The Audit Committee has primary oversight responsibility for internal audit, financial reporting, legal matters, and fraud risk.

The Compensation Committee has primary oversight responsibility for risks related to KeyCorp’s compensation policies and practices.

The Nominating and Corporate Governance Committee has primary oversight responsibility for significant issues of corporate social responsibility.

the identification of employees who have the ability to influence or control material risk;

the use of risk-balancing mechanisms across all incentive plans that take into account the primary risks associated with employee roles;

the deferral of incentive compensation to balance risk and align an employee’s individual interests with KeyCorp’s future success and safety and soundness;

the development of clawback policies and procedures to recoup certain incentive compensation paid to employees in the event of certain risk-based events; and

the annual assessment of risk-balancing features, the degree to which selective plan design features affect risk-taking, the alignment of incentive metrics with business objectives, the overall competitiveness of the pay opportunity, the participation of control functions, and the effectiveness of monitoring and administration of the plans.

whether the transaction conforms to KeyCorp’s Code of Ethics and Corporate Governance Guidelines and is in KeyCorp’s best interests;

whether the transaction is entered into in the ordinary course of KeyCorp’s business;

whether the terms of the transaction are comparable to terms that could be obtained in arms’ length dealings with an unrelated third party;

whether the transaction must be disclosed under Item 404 of Regulation S-K under the Exchange Act; and

whether the transaction could call into question the independence of any of KeyCorp’s non-employee directors.

the amount of credit extended does not exceed individual and aggregate lending limits, depending upon the identity of the borrower and the nature of the loan; and

any extension of credit in excess of $500,000 be approved by the Board of Directors of KeyBank.

intend to amend the Regulations to adopt a meaningful proxy access right for shareholders reflecting terms described in Proposal Six of this proxy statement (subject to the approval by our shareholders of Proposal Six);

formalized additional responsibilities for the independent Lead Director and added disclosure about the Lead Director’s activities (see page 11 of this proxy statement);

formalized an annual evaluation of the Lead Director and incorporated the evaluation process in our Corporate Governance Guidelines;

increased our website disclosure with respect to our political spending and activity;

enhanced our public disclosures about employee diversity and pay equity;

provided additional disclosure about the Audit Committee’s oversight and engagement of the independent auditor in the Audit Committee Report at page 55 in this proxy statement; and

created a robust summary (at pages i to iv in this proxy statement) and enhanced our Compensation Discussion and Analysis that begins at page 24 in this proxy statement.

Name

Common

Shares

Options

(1)

Deferred

Shares

(2)(3)(4)

Total

Beneficial

Ownership
(5)

Total

Beneficial

Ownership

as a % of

Outstanding    

Common

Shares
(6)

Other

Deferred

Shares

Owned

(2)(3)(4)

Combined
Beneficial
Ownership
and Other
Deferred
Shares
Owned

(5)

Bruce D. Broussard

Charles P. Cooley

Gary M. Crosby

Alexander M. Cutler

H. James Dallas

Elizabeth R. Gile

Ruth Ann M. Gillis

William G. Gisel, Jr.

Christopher M. Gorman

Carlton L. Highsmith

Richard J. Hipple

Donald R. Kimble

Kristen L. Manos

Mark W. Midkiff

Beth E. Mooney

Andrew J. “Randy” Paine III

Barbara R. Snyder

David K. Wilson

All directors and executive
officers as a group
(29 persons)

The Vanguard Group (7)

BlackRock, Inc. (8)

J.P. Morgan Chase & Co. (9)

This column includes options (including in-the-money and out-of-the-money options) to acquire KeyCorp common shares exercisable on or within 60 days of March 29, 2019.

Deferred shares issued under the prior KeyCorp Directors’ Deferred Share Plan or the current Directors’ Deferred Share Sub-Plan to the KeyCorp 2013 Equity Compensation Plan (the “Directors’ Deferred Share Sub-Plan”) are payable three years from their award date, one-half in cash and one-half in common shares, or immediately if a director separates from the Board for any reason prior to the third anniversary of the award. A director may elect to defer the payment of all or some of his or her deferred shares beyond the third anniversary of the award date (“Further Deferred Shares”). In that case, the Further Deferred Shares will be distributed entirely in

The column “Deferred Shares” includes deferred shares, performance units, and restricted stock units held by executive officers that will be payable in KeyCorp common shares on or within 60 days of March 29, 2019. Deferred shares, performance units, and restricted stock units payable in common shares to executive officers, but not on or within 60 days of March 29, 2019, are reported in the column “Other Deferred Shares Owned.” Performance units are subject to vesting based on the achievement of certain performance goals, as discussed in the Compensation Discussion and Analysis beginning on page 24 of this proxy statement. The number of performance units set forth in these columns reflects a “target” amount of performance units determined for each executive officer on the grant date. The number of performance units that ultimately vest as common shares for each executive officer may be higher or lower depending upon actual performance relative to the performance goals at the end of the measurement period.

Deferred shares, performance units, and restricted stock units payable in common shares do not have common share voting rights or investment power until the shares or units have been distributed as common shares in accordance with the plan or agreement under which they were granted or awarded.

Totals may not foot due to rounding.

No director or executive officer beneficially owns (and collectively all 29 directors and executive officers do not beneficially own) common shares, and options, deferred shares, performance units, and restricted stock units payable in common shares on or within 60 days of March 29, 2019, totaling more than 1% of the outstanding common shares of KeyCorp. The percentages set forth in this column for the holders of more than 5% of our common shares appear as reported by each such holder to the Securities and Exchange Commission on Schedules 13G, as discussed below.

Based solely upon information contained in the Schedule 13G/A filed by The Vanguard Group, Inc. (“Vanguard”) with the Securities and Exchange Commission on February 11, 2019. Vanguard reported that it owned beneficially 115,800,986 common shares, held sole voting power over 1,213,586 common shares, held sole power to dispose or to direct the disposition of 114,385,762 common shares, held shared voting power over 214,068 common shares, and held shared power to dispose or to direct the disposition of 1,415,224 common shares. Vanguard Fiduciary Trust Company, a wholly-owned subsidiary of Vanguard, is the beneficial owner of 892,452 common shares as a result of its serving as investment manager of collective trust accounts. Vanguard Investments Australia, Ltd., a wholly-owned subsidiary of Vanguard, is the beneficial owner of 830,497 common shares as a result of its serving as investment manager of Australian investment offerings. The reported address of Vanguard is 100 Vanguard Blvd., Malvern, PA 19355.

Based solely upon information contained in the Schedule 13G/A filed by BlackRock, Inc. (“BlackRock”), for itself and on behalf of various subsidiaries identified therein, with the Securities and Exchange Commission on February 6, 2019. BlackRock reported that it owned beneficially 69,532,636 common shares, held sole power to dispose or to direct the disposition of 69,532,636 common shares, and held sole power to vote or direct the voting power over 60,842,357 common shares. Each of the following entities has been identified by BlackRock as a direct or indirect subsidiary that beneficially owns KeyCorp common shares: BlackRock Life Limited; BlackRock International Limited; BlackRock Advisors, LLC; BlackRock (Netherlands) B.V.; BlackRock Institutional Trust Company, National Association; BlackRock Asset Management Ireland Limited; BlackRock Financial Management, Inc.; BlackRock Japan Co., Ltd.; BlackRock Asset Management Schweiz AG; BlackRock Investment Management, LLC; BlackRock Investment Management (UK) Limited; BlackRock Asset Management Canada Limited; BlackRock (Luxembourg) S.A.; BlackRock Investment Management (Australia) Limited; BlackRock Advisors (UK) Limited; BlackRock Fund Advisors; BlackRock Asset Management North Asia Limited; BlackRock (Singapore) Limited; and BlackRock Fund Managers Ltd. The reported address of BlackRock is 55 East 52nd Street, New York, NY 10055.

Based solely upon information contained in the Schedule 13G filed by J.P. Morgan Chase & Co. (“JP Morgan”), for itself and on behalf of various subsidiaries identified therein, with the Securities and Exchange Commission on February 13, 2019. JP Morgan reported that it owned beneficially 52,334,060 common shares, held sole power to dispose or to direct the disposition of 51,580,509 common shares, held sole power to vote or direct the voting power over 42,803,288 common shares, held shared voting power over 472,453 common shares, and held shared power to dispose or to direct the disposition of 743,670 common shares. Each of the following entities has been identified by JP Morgan as a direct or indirect subsidiary that beneficially owns KeyCorp common shares: J.P. Morgan Investment Management Inc.; JPMorgan Chase Bank, National Association; JPMorgan Asset Management (UK) Limited; J.P. Morgan International Bank Limited; J.P. Morgan (Suisse) SA; J.P. Morgan Trust Company of Delaware; J.P. Morgan Securities LLC; and J.P. Morgan Private Investments Inc. The reported address of JP Morgan is 270 Park Avenue, New York, NY 10017.

(a)

(b)

(c)

Plan Category

Securities to
be issued
upon exercise
of outstanding
options,
warrants and
rights

(#)

Weighted-
average
exercise
price of
outstanding
options,
warrants
and rights

($)

Securities
remaining available
for future issuance
under equity
compensation
plans (excluding
securities reflected
in column (a))

(#)(2)

Equity compensation plans approved by security holders (1)

Equity compensation plans not approved by security holders (3)

Total

The table does not include 17,107,661 unvested shares of time-lapsed and performance-based restricted stock awarded under the 2013 Plan, the 2010 Plan, and the 2004 Plan, and 286,561 unvested shares of time-lapsed restricted stock grants assumed in connection with the First Niagara merger in 2016. These unvested restricted shares were issued when awarded and consequently are included in KeyCorp’s common shares outstanding.

The Compensation Committee of the Board has determined that KeyCorp may not grant options to purchase KeyCorp common shares, shares of restricted stock, or other share grants under its long-term compensation plans in an amount that exceeds six percent of KeyCorp’s outstanding common shares in any rolling three-year period.

The table does not include outstanding options to purchase 95,833 common shares assumed in connection with the First Niagara merger in 2016. At December 31, 2018, these assumed options had a weighted-average exercise price of $13.60 per share. No additional options may be granted under the plan that governs these options.

Beth E. Mooney

Chairman and Chief Executive Officer

Donald R. Kimble

Chief Financial Officer and Vice Chairman

Christopher M. Gorman

President of Banking and Vice Chairman

The sixth consecutive year of positive operating leverage, driven by record full year revenue and all-time high revenue in several fee-based businesses, including investment banking and debt placement.

Achievement of a meaningful increase in earnings per share (“EPS”) compared to 2017.

Reduction in our cash efficiency ratio to approach our long-term targeted range.

Meaningful improvement from the prior year in our return on tangible common equity ratio.

Pay decisions are based on Key’s performance, business unit performance, and individual performance—as assessed by our Chairman and Chief Executive Officer and the relevant committee of our Board (or, in the case of our Chairman and Chief Executive Officer, by the Compensation Committee with input from the full Board);

We emphasize variable and performance-based compensation: Only 14% of the average pay opportunity for our Named Executive Officers is delivered as base salary.

We require executive officers to satisfy robust levels of deferral: While we manage to “total pay” opportunity (i.e., the sum of base salary and incentives) when making pay decisions, we require that at least 60% of the annual “total incentive” (the sum of the annual incentive paid and the value of long-term incentives granted in a particular year) of the Chairman and Chief Executive Officer (and at least 50% for the other Named Executive Officers) be deferred over a multi-year period and subject to risk-adjustment, as described in more detail below.

We balance compensation risk and reward through a robust governance process overseen by the Compensation Committee: We design our compensation programs to appropriately balance risk and reward and regularly monitor these programs to determine whether they create incentives that encourage risk-taking outside of our risk tolerances. The Compensation Committee:

•    May decrease funding for our performance-based incentive plans by as much as 100% based on our Enterprise Risk Management dashboard or the occurrence of any risk event that warrants such an adjustment.

•    Considers each Named Executive Officer’s scorecard performance—including individual risk performance—before approving any performance-based incentive award.

•    May forfeit, offset, reduce, or claw back any Named Executive Officer’s deferred incentives based on the actual risk-related outcomes of each executive’s performance on which the award is based.