I would like to turn the call over to the Chairman the Chief Executive Officer, Mr. Henry Meyer. Mr. Meyer, please go ahead sir.

Good morning and welcome to KeyCorp’s First Quarter Earnings Conference Call. Joining me for today’s presentation is our CFO Jeff Weeden. Also joining me for the Q&A portion of the call are our business executives, Tom Bunn and Beth Mooney and our Chief Risk Officer, Chuck Hyle. Slide Two is our forward-looking disclosure statement; it covers both our presentation and the Q&A portion that follows. Now if you turn to slide three, I will comment briefly on our first quarter results for Jeffrey he is going to give more detail. Overall, I was pleased with the quarter, given the degree of continued market volatility and rising credit costs impacting our industry including Key. My team and I are very focused on the increase in non-performing assets and the elevated level of net charge offs we experienced. However, I believe the actions we took in the fourth quarter to address the homebuilder portfolio and the additional reserves we recorded in the current quarter will help us through this challenging environment. Chuck Hyle and Tom Bunn will be available to address your questions regarding credit after our formal comments. As you will recall in February, we announced that the secondary markets for commercial real estate loans and specifically commercial mortgage bank securities remain restricted with pre dispense at historic wide levels. These wide levels continued into March with conditions worsening somewhat from the mid February levels. We took action to hedge our remaining exposure to changes in interest rates and credit spreads in our commercial real estate held for sale loans during the first quarter. And, we believe the worst is now behind us in this portfolio. In addition, we move $3.3 billion of our student loans held for sale to our loan portfolio in March due to the continued disruption in…

I will begin with the financial summary shown on slide four. As in the past my comments today will be with respect to Key’s results from continuing operations. In some cases I will comment on comparisons to both the first quarter of 2007 and the fourth quarter of 2007. There were certainly a number of items impacting our first quarter results, ranging from realized and unrealized loses on held for sale portfolios, higher provision expense, leverage leasing accounting adjustments, and the gain we realized in connection with the Visa IPO. Our earnings per share for the first quarter of 2008 was $0.54 from continuing operations compared to $0.89 per share for the same period one year ago, and $0.06 in the fourth quarter of 2007. In our first quarter earnings release today, we provided an overview of the few of the significant items which have impacted earnings for the period shown. I will comment further on these items in our first quarter result as we review the remaining slides in our presentation. Turning to slide five; the company’s taxable-equivalent net interest income for the first quarter of 2008 was $704 million, up $4 million from the same period one year ago. For the first quarter of 2008 our net interest margin was 3.14%, down from 3.50% we reported from the same period a year ago, and 3.48% we reported from the fourth quarter of 2007. As we discussed in our earnings release today, our margin for the first quarter was impacted by the lease accounting adjustment we incurred to increase our reserves associated with tax benefits on certain lease-in, lease-out transaction. This adjustment reduced our taxable-equivalent net interest income by $34 million, and reduced our reported net interest margin by approximately 15 basis points. On an adjustment basis our margin…

(Operator Instructions) First question goes to Gerard Cassidy at RBC Capital Markets, please go ahead.

Can you tell us what your views are unrealized gain is for the shares that you still own but all the owners are limited on their ability to sell them over the near term.

I think it is a little bit difficult to determine exactly what the unrealized gain would be based on the restrictions that are out there. I think for the most part, what was redeemed plausible was put in to the as per balances would represent what we have remaining of about 47%, 48% of the original amount.

This is Henry; I have been told that the phone is going in and out but it is not just a bad connection wherever you are that we maybe having a little trouble online. We apologized for that but we are aware of it.

The other question I have is I may have missed it but on the transfer of the student loan into the held to maturity portfolio, what was the laws that you took on that transfer?

We transfer those loans over at our cost and then also increased our reserve allocation associated with those loans at the end of the quarter.

Out of the $3.3 billion or so was that $0.98 from the dollars that you transfer, price that you transfer after the reserves?

We have transferred at par and then a reserve was established. Our transfer to the 100 at par but because we added to our loans our formula we also added to the reserve specifically because of the addition of that $3.3 billion.

And, how much was that reserve?

You can see it from the line of business reporting within the National consumer business there was additional provision that was taken roll about the net charge offs for the quarter. We will have to give you a specific number instead of – in the $50 million range.

And, then finally; you had good commercial loan growth in the quarter and high single digits but you are still guiding for the full year to be low single to mid digits; can you maybe give us some color why you think you may actually see a slow down in the rate of growth in commercial lending this year?

I think Tom Bunn may comment on this in just a second but in terms of how we also look at it part of it is we have slowed down our origination associated with commercial real estate and we expect that that will continue into the second, third, fourth quarters of this year. We may also of course look at those should having those balances trim down as we look at specific perhaps long sales year on in the course of current year.

Certainly you have the USB numbers which exude first quarter a little bit. We have about $550 million in real estate loans that came over from the USB acquisitions which was excluding number on the average $30 million per quarter. We are also seeing a reduction but slowly and growing on the institutional side commitments. And so therefore as we look at the economy we just know that there is going to be as much dimension as there was due to the market conditions in the fourth quarter and into the first.

Our next question goes to Michael Mayo of Deutsche Bank, please go ahead.

Can you just comment more on the NPA increase, where it is coming from and charge offs are flat and NPA’s are going up do you expect that to continue? Just more color on credit quality please.

I think it is fair to say that the majority of the increase in the NPA category is coming from commercial real estate specifically and the residential part of the continuation from what we saw in fourth quarter. I would characterized by saying that we continue to see some additional degradation in the portfolio Key clientele in California and we get updated appraisable with regularity and so we have seen some continuing decline. The other phenomenon we seen as a bitter of the AGIA graphic migration again entirely attributable to the residential part of the commercial real estate portfolio and we seen it migrate to a couple of other markets particularly Arizona and Nevada although we are considerably less involved there. So I would say that the California decline and a bit of migration would account for the vast majority of the increase in the NPL. We have a little bit of increase in the recent portfolio and we have seen a modest increase and a deal of core plan in the NPL categories and that really accounts virtually all of it.

Okay so when you say commercial real estate that is residential related, how would you define that; are we talking home builders, are we talking loans for condos or land; what would you include on that list?

All of the above, but it is primarily focused in Southern California and single family construction land AND Florida portfolio which is the other hot spot would be more condo. Again as we said before we feel that our condo portfolio while some of it is NPL we still see lost content and that portfolio is still relatively modest. The single family part is really the part where we see the lost content but that is how we would want it. We would include single family and condo and land associated with residential.

So if you add up your total exposure to commercial real estate that is somehow residential related home single family, condo, etc., how large is that portfolio now?

That would be about $3.4 billion come down modestly from fourth quarter of last year. That is massed a little bit by an increase of about $200 million from the USB acquisition but went down to lower $100 million so the generic sized portfolios come down about $300 million from the fourth quarter, across all geography

Of the $3.4 billion how much would be in the higher risk market like California, Florida, Arizona, and Nevada.

Florida would be about $588 million; California would be about $670 million. And, I might add if you look at the NPL numbers about $677 million of our NPL’s are in this commercial real estate residential category. And, of that number 63% are in Florida and California—California being the largest. The next two states would be Nevada and Arizona at 13%, so three quarters 76% of those NPL are on those four states. The rest of it will be over a range 13, 14 states; many of the states are outside of our footprint.

And do you disclose how much you have reserved for that $3.4 billion?

No we do not.

Where do you think NPA would go? I guess you increase your guidance for charge offs by 20 basis points in the high end, do you expect NPA’s to go up the similar percentage or how should we think about that?

Well visibility is pretty difficult but I would say that we do expect NPA’s to go up in the second quarter maybe within the little end of the third quarter. We are going to this loans loan-by-loan, we think we have a very good handle on what is going on out there but with the economy, where it is and a lot of uncertainty out there, it is a little bit difficult to predict. I guess what I would say is that the addition for the NPL – towards the end of the quarter charge and LFS station game or about a false gone or whether it is going to be a continuation. But February was a horrible month in this business. But we are seeing some – happen particularly towards the end of March and into the early part of April. So we are beginning to see a little bit of activity. Some say old and a little bit of normality beginning to come back into it. Again I would say that the increase in NPA should be accelerated in the second quarter but these are very, very hard things to predict.

And then lastly, where all these are leading to; the problem is spreading. So far it has been a lot of housing related, into what degree are you expecting the problem to spread, you mentioned some dealer of floor plan, I guess that is newer.

Yes and I think that is another thing so it is hard to comment particularly the auto sale side of the industry but again we see very little lost content there. I would say that, let me go back to the real estate for a second, we are seeing virtually no leakage to the rest of our commercial real estate portfolio outside of the residential piece I just talked about. And, even within that part being the geographically which has been relatively modest. So we are still quite satisfied with the remainder of our commercial real estate portfolio. Towards the broader portfolios concern, we have seen some migration again in line with the economy but other than the sectors I mentioned earlier, the other core plan, there is nothing particularly material there at all.

Our next question goes to Matthew O'Connor of UBS, please go ahead. Matthew O'Connor – UBS: Henry your company seems to be in a position or strength versus some of your peers and obviously you are being mentioned quite a bit in the papers regarding some potential acquisitions specifically on National City. I know it is always difficult to comment on these things but what can you tell us on your interest bubble for end market consolidation and anything you would care to say specifically on National City?

Actually Matt, it is not just difficult it is probably inappropriate for me to comment on any specific merger acquisitions. I have said it before and I continue with that and others to look at end market opportunities specially in some of the markets where we would admit that we do not have the optimal market share to be as competitive and to maximize our profit generation. So I think we are going to be well positioned here if some companies come to the decision that they could do a better job for their shareholders and their communities and their clients as part of a stronger company and has been consistent for quite a while. Matthew O'Connor – UBS: Related question but a little bit easier to answer hopefully, now obviously there is some dislocation going on, there is a capital raise, National City is trying to raise capital or do something; now what are you seeing in terms of both commercial customers and consumer customers in terms of potentially picking up some additional market share?

Let me ask that to Mooney is she can comment on that because there are disruptions in a number of areas on the West Coast in Ohio and a couple of markets and we all agree those are opportunities and we are strategically trying to do some things there. Beth would you like to comment?

I would tell you that on the first quarter we did see strong loans, deposit growth across most of our region and anecdotally we did see some nice pickups in our great white regions around deposits and small business customers. So I would tell you that our pipelines are strong and our business is strong and of course our franchise and then we did see some stronger both in the great white and see improvements in this quarter. Matthew O'Connor – UBS: Lastly, the question is for both Jeff and Henry as well, on the capital side, your capital ratios are probably a little bit above a lot of your peers but does it makes sense to raise some additional capital here for some opportunities that might come around and obviously the windows open and close and it feels like at least for a day the window is open.

We constantly look at various forms of capital; in the forms of capital we look at would be more trust preferred type of market. We continue to look at that, senior debts, sub debts to provide bank funding and additional capacity. That is just the normal course of our operation both of the holding company as well as at the bank level, but nothing specific beyond that.

Our next question is from Tim Sablenya at OSS Capital, please go ahead. Tim Sablenya – OSS Capital: My question is on student loans, should the ABS market open up for student loans securitization? Would you consider the student loans securitization the strategy or is this something, you know moving your portfolio to help the maturity? Is this something that signals the shift in strategy of student loan?

I think what we would look at, with respect to new originations, if we sense that the market would be changing we may again look at new originations and stuff, putting into a healthier sale or a particular status of building, but with respect to the others and the decision that we are putting it into help for the majority classification and we have no immediate plans to change that. So, that is really a decision that made based on the fact that we do not believe that the market will be as fluid in the near term as what it was, obviously prior to about July of last year.

(Operator instructions) We will go next to Ed Timmons at Stifel Nicolaus. Ed Timmons – Stifel Nicolaus: Good morning guys. The margin was a little bit weaker than we expected. Can you just talk briefly about your balance sheet position as it stands now? How exchange, throughout the quarter and how you are looking at it going forward through the rest of the year?

I think our balance sheet what we have really done, we tried to continue to reduce risk in the balance sheet in the first quarter by again growing through and edging the remaining positions that we have are commercial real estate help for sale, book of business, and again, moving the student loan portfolio to or from maturity position. So, the activities that we have coming up and looking at the deposited throughout the second quarter here, that should help generate the new deposit flow and activity. I think our position and our capital gives us the ability to compete in the market place and the fact is that we get their spreads at this particular point. Because of our position and change that could have happened in the market place. I think customers are finally recognizing the fact that having availability, capital is important and they know the cost of that has gone up. Ed Timmons – Stifel Nicolaus: With the rates coming down, have you seen any slowing in the migration towards time deposits from your customers?

Yes, if you can see in our first quarter financials, a mixed shift towards certificates of deposit, you have a clear consumer customer preference and a declining rate environment with those CDCC net required rate cycles and then you add to it that if the competitive landscape of that has been attractively priced instrument in the market. So, we continue to see high demand and competitive pricing and pressure around certificates of deposit. But as just was mentioned also in the second quarter we are launching a series of consumer-deposit campaign for an addition to certificates of deposit to continue to garner strong transaction accounts. Ed Timmons – Stifel Nicolaus: Okay, and I guess lastly, what kind of demand are you seeing out in the market for distressed assets and did you guys sell anything this quarter and do you have any expectations for second quarter or third quarter?

We have not seen a lot of activity. As I said earlier, February seemed to be locked down. Nothing was really trading at all. A little bit of an improvement in March, but we know a lot of money is out there but we have not seen a lot of transactions. We still have very modest amounts in the first quarter and hopefully the expectation is that it would quickly improve over the second quarter, those numbers would go up.

We will go next to a follow up by Mike Mayo of Deutsche Bank, please go ahead. Michael Mayo – Deutsche Bank Securities: Yes, just the other question about the margin because you guys are liability sensitive and the margin went down. And I am just really trying to understand the industry dynamics taking effect here. Is it simply, the level rates are going so low that you have less pricing power in the downside or just a little bit color.

I think, if you look at some of the fourth quarter of last year, we basically had an “I” in basis points, lease accounting adjustment to the positive. This quarter, we got a 15 basis point adjustment to the negatives. That had a dramatic impact obviously on the margins, about 24 basis point over the overall decline. Also its rates continue to decline, if you play a little bit of catch-up on your consumer deposit so you are adjusting each leg a little bit on the way down. Also now, as we go into the second part of this year, these last three quarters of the year, we will start getting more benefit associated with our received six paid variable swap position and that is identified. You can go the annual report on page 48. You can see in there, there are a number of forward stocks that we put in place last year that we are to come on board this year as part of our overall AL strategy of management approach that the treasury and the team knew that there was more of a bias going into last year or coming into this year. The rates will be declining. So to protect ourselves on a declining rate environment, we did a number of those swaps. Those start to benefit us as we go through the next three quarters. Michael Mayo – Deutsche Bank Securities: Okay, and then separately, I am still looking at the commercial segment of the industry and I see the line of credit fees were down quite a bit. Can you comment more on what you are seeing among your commercial clients? Also, have line utilization levels increased. In other words, are you seeing signs that your commercial customers are getting weaker?

I think in terms of the loan fees that you see, fourth quarter we had very high levels of loan communication activities and first quarter we particularly go into the seasonal slow time. I mean this is historical, you see this year end throughout. But I think we had much higher activity in the fourth quarter than in the first quarter. So it had an impact on that particular area. We are seeing additional utilization of lines and as a percentage, and that should be normal because new originations, particularly on commercial real estate side are down dramatically. And so, you have prior commitments that are out there that are being drawn. If you are seeing that come up while the prior commitments on commercial real estate are obviously are coming, continue to decline, new activity is out there but it is not as strong as what it was a year ago at this particular point in time. Michael Mayo – Deutsche Bank Securities: When you say prior commitments are drawn down, is that more than what you saw last quarter?

No, I think it is just a matter of without putting new commitments in place, like, you just have existing commitments that are being drawn specifically on commercial real estate, projects are coming to completion of being built out. And these are projects other than the Home Builder residential property section. We spent a lot of time on early and the call on.

The other thing that I would add to Jeff’s comment is that as long as we continue to have the market dislocation whether it is Capital Markets or the Private Place Market, you are going to see more demands coming in out of out of our commercial clients and our educational clients outside of real estate. Now, I will tell you we are teaming with Chuck’s team being very selective about new clients and new commitments because we know that quite honestly, demand will continue to grow and I think we can afford the activity to support our incumbent client base and to be really strong new clients but I do not think that the dynamics of the capital market is really different than it was in the fourth quarter. Michael Mayo – Deutsche Bank Securities: Tom, as an intermediary again, the traditional bank function, do you think that six longer term or capital markets recover in that business goes back out.

Mike, if I had that crystal ball, I would probably be doing something else. Michael Mayo – Deutsche Bank Securities: Are you trying to say, you would not be talking to me?

I do think that we do not anticipate a return to normalcy in the capital market as we work it out. I think if you believe normalcy returns then you start doing things that would require you to take in your account market as Geoff has said earlier, we assume that the securitization market, the CMBS market and other capital markets will remain challenging and so that is why we are very selective at how to use our capital.

We will go next now to Terry Mcevoy of Oppenheimer & Co. Terry Mcevoy – Oppenheimer & Co.: Just one question if I could. Did $1.9 billion of Home Builder and condo exposure loan, put into a special asset management group in the fourth quarter, were those loans that contributed to the $340 million increase in commercial non-performing loans or non-performing assets or was it possibly the remaining $1.5 billion if I use that total value or total number of $3.4 billion.

I would say that the vast majority of it came from that grouping that we moved in the special assets again. A piece of it would be further deterioration from California and some of this migration but I think the theme here is that our program, smaller residential builders is really the epicenter of this topic.

And we will go next to John Boland at Maple Capital Management John Boland – Maple Capital Management: If I could just get some clarity on your thoughts on two issues, one is, what would be the criteria that you might be looking at should you be doing acquisitions, I mean, what kind of metrics are we looking at there. And the second would be, the following up on the controlling expenses, are there any benchmarks or any metrics that you might be trying to get down to or any kind of guns you could shoot there would be appreciated.

I will take the expense one first. Obviously, we are trying to control expenses. Our guidance has been low single-digit growth in expenses. We are continuing to make an investment in our community bank. You saw the investments that we are making with respective branch modernization. New teller platform, new technology and first the amortization associated with that will go through the expense side of the income statement. So, we are controlling expenses, we have to set a specific target for any of those particular line items. As far as criteria on M&A, I think it really has varied. And I think that from the sense that obviously in today’s market, Capital is going to be an important criterion, any type of transaction that we will look at. And so capital and then returns that we can get going forward. And I think returned thresh holds and hurdles probably had gone up as a result of the price of what we will look at for Capital of today’s market environment.

John, I would just tell you that we do not look just to acquisitions to get bigger. It very hard with its urges for any sizable acquisition to be accretive in that year but it would be hard for me to imagine that I would not be accretive to our existing shareholders in a very short period of time, meaning outside of that first fiscal year where charges to get things done and to the degree of how strategic it is to build in a low share higher growth market and we participate in some of those, mostly in the Rockies and the Northwest. We view that differently and we would wind in our smaller growth market places. So there is no algorithm that we plug things in and say it is “go or no go” and there are some decisions or it is a long play that involves our judgments.

We will go next to David Pringle at Fells Point Research. Please go ahead. David Pringle – Fells Point Research: There were four major sorts of charges and gains in the quarter, there was $165 million on visa, $34 million effect from leasing, $101 million on the loan sales and $27 million on the credit or the reversal of the revision in the expense line for those before?

Those are four, they are also included in some of the other categories such as the investment banking, capital markets, and other negative items as you look at the specifics within that category and there is a detailed portion of income statement of the press release that will provide the particular level of help. In essence you have got the major line items.

Mr. Myer that does conclude the question and answer period for today. I would like to turn the call back to you for any closing comments.

Again, we want to thank all of you for taking time, for your schedule to participate in our call today. If you have any follow-up questions on any of what we have discussed, please do not hesitate to call Vernon Paterson in our Investor Relations department. Vernon’s number is 216-690520. And with that we conclude our call.

Thank you. We do appreciate your participation. At this time you may disconnect. Thank you.