Florida-based activist hedge fund HoldCo Asset Management has turned its attention to KeyCorp, urging the regional bank to halt acquisitions, replace CEO Chris Gorman, and return excess capital to shareholders through buybacks, according to a report by Reuters.
The hedge fund owns approximately 7.5 million shares, valued at over $140m.
The campaign marks HoldCo’s latest push in the US regional banking sector following its successful activist effort at Comerica, which agreed to a $10.9bn sale to Fifth Third Bancorp in October. Since then, the fund has engaged with multiple regional lenders, seeking changes ranging from capital allocation to management reshuffles.
KeyCorp, which has a market capitalisation exceeding $20bn, said it is executing a strategy focused on “disciplined growth, strong profitability, and capital return” and believes it is well-positioned to deliver shareholder value.
Shares rose as much as 3.2% following the announcement.
HoldCo, managing around $2.6bn in assets and founded by Vik Ghei and Misha Zaitzef, is also reportedly weighing a near-term proxy contest. Analysts expect the fund to continue pressing for a sale to a larger rival or select Canadian banks, with investor attention set on Gorman’s upcoming commentary at the Goldman Sachs US Financial Services Conference.
This latest move underscores the continuing influence of activist hedge funds in the US regional banking space, where management teams face heightened scrutiny over strategic decisions and capital deployment.
