15 NEXT PAGE BACK TO CONTENTS SEARCH PREVIOUS PAGE provision for loan losses. Most of the reduction in noninterest expense came from a decrease in goodwill amortization following the adoption in 2002 of a new accounting standard. These positive results were offset in part by a $45 million, or 2%, decline in taxable-equivalent net interest income. In 2002, the increase in net income reflected the $24 million cumulative after-tax effect of the 2001 change in accounting for retained interests in securitized assets. Also contributing to the improvement was a $14 million, or 3%, increase in noninterest income, a $43 million, or 3%, reduction in noninterest expense and a $2 million decrease in the TE = Taxable Equivalent, N/A = Not Applicable a Results for 2001 include a one-time cumulative charge of $39 million ($24 million after tax) resulting from a prescribed change, applicable to all companies, in the accounting for retained interests in securitized assets. Year ended December 31, Change 2003 vs 2002 dollars in millions 2003 2002 2001 Amount Percent SUMMARY OF OPERATIONS Net interest income (TE) $1,856 $1,782 $1,827 $ 74 4.2% Noninterest income 495 497 483 (2) (.4) Total revenue (TE) 2,351 2,279 2,310 72 3.2 Provision for loan losses 280 300 302 (20) (6.7) Noninterest expense 1,391 1,342 1,385 49 3.7 Income before income taxes (TE) and cumulative effect of accounting change 680 637 623 43 6.8 Allocated income taxes and TE adjustments 255 238 248 17 7.1 Income before cumulative effect of accounting change 425 399 375 26 6.5 Cumulative effect of accounting change GLYPH<209> GLYPH<209> (24) a GLYPH<209> GLYPH<209> Net income $ 425 $ 399 $ 351 $ 26 6.5% Percent of consolidated net income 47% 41% 266% N/A N/A AVERAGE BALANCES Loans $28,905 $27,882 $27,751 $1,023 3.7% Total assets 31,309 30,218 30,368 1,091 3.6 Deposits 34,773 33,940 35,210 833 2.5 ADDITIONAL CONSUMER BANKING DATA FIGURE 3. CONSUMER BANKING MANAGEMENTGLYPH<213>S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION & RESULTS OF OPERATIONS KEYCORP AND SUBSIDIARIES Year ended December 31, Change 2003 vs 2002 dollars in millions 2003 2002 2001 Amount Percent AVERAGE DEPOSITS OUTSTANDING Noninterest-bearing $ 5,528 $ 5,137 $ 4,797 $ 391 7.6% Money market and other savings 15,242 13,052 12,827 2,190 16.8 Time 14,003 15,751 17,586 (1,748) (11.1) Total deposits $34,773 $33,940 $35,210 $ 833 2.5% HOME EQUITY LOANS Retail Banking and Small Business: Average balance $ 8,058 $ 6,921 Average loan-to-value ratio 72% 72% Percent GLYPH<222>rst lien positions 59 51 National Home Equity: Average balance $ 5,113 $ 4,906 Average loan-to-value ratio 74% 80% Percent GLYPH<222>rst lien positions 82 79 OTHER DATA On-line clients / household penetration 768,106 / 39% 575,894 / 32% KeyCenters 906 910 Automated teller machines 2,167 2,165