Activist hedge fund HoldCo Asset Management has stepped back from planned proxy contests at KeyCorp and Eastern Bancshares after both regional lenders agreed to a series of governance and capital allocation changes sought by the investor, according to a report by Reuters.
In a presentation released on Monday, HoldCo said it no longer intends to pursue proxy battles at the banks’ 2026 annual meetings, citing recent actions taken by management and their boards. KeyCorp has a market capitalisation of around $26bn, while Eastern Bancshares is valued at approximately $5.2bn.
HoldCo, which focuses primarily on US banking stocks, launched activist campaigns at five regional lenders last year and has now concluded all of them after securing concessions across the portfolio.
At KeyCorp, the hedge fund had pressed the board to halt further bank acquisitions, return excess capital to shareholders through buybacks, and refresh board leadership. The lender subsequently said it had no plans to pursue further acquisitions, announced a $300 million share repurchase programme for the first quarter with similar levels expected later in the year, and appointed a new lead independent director alongside two new board nominees.
Following these moves, HoldCo said KeyCorp chief executive Chris Gorman – whom the firm had previously criticised – was now “the right leader for the institution going forward”.
At Eastern Bancshares, HoldCo had called for a public commitment to avoid acquisitions, tighter capital targets and increased capital returns. The bank said in January that it would focus on organic growth, manage towards a common equity Tier 1 ratio of around 12%, and return excess capital to shareholders.
HoldCo portfolio managers Vik Ghei and Misha Zaitzeff praised the changes, signalling their support for the bank’s leadership.
The firm drew significant attention last year when it sought to push Comerica toward a sale following prolonged underperformance, before broadening its activist push across the US regional banking sector. Similar campaigns at First Interstate BancSystem and Columbia Banking System also ended after those banks agreed to HoldCo’s demands.
