Business Owners Name Boise the Region's "Cinderella City" DENVER, Dec. 14 /PRNewswire-FirstCall/ -- The 2007 economic outlook for the Rocky Mountain Region is bright, according to a new study of 300 business owners and executives in the region conducted by KeyBank. The "2007 Rocky Mountain Region Privately Held Companies Forecast," issued today by KeyBank, reflects the sentiments of 300 owners and senior executives of privately held businesses in Colorado, Utah, Idaho, Wyoming and Montana, who were interviewed on a variety of topics ranging from regional and national issues to major business challenges and expansion plans. Respondents to the survey were interviewed between Oct. 20 and Nov. 13 of this year and represent companies with annual revenues of $100,000 to $250 million. Major findings of the survey indicate: - More than half of the survey respondents (52%) think the region's economy will improve in the coming year, compared to one in 10 (9%) who feel it will worsen. - A strong majority (82%) of the business leaders also forecast that overall employment levels in their state will increase, and more than half (56%) plan to increase employment levels at their own companies. - Seven in ten (70%) of the respondents expect their business to undergo some type of expansion in 2007, including one in four who expect to open a new plant or make a significant equipment purchase. "We are pleased to see Rocky Mountain businesses forecasting continued growth and expansion in the region. Business owners and executives at privately held companies can be an important bellwether of the economy, due to the important role that they play in making hiring and capital expenditures decisions," said Michael Hobbs, Denver-based president of KeyBank's Rocky Mountain Region. "We also see this optimism reflected in the conversations we at KeyBank have with our business banking and middle-market clients in the region." While Rocky Mountain respondents were largely optimistic, they did cite a number of obstacles to unimpeded growth in the region - specifically, labor force availability, government regulation and healthcare costs, said Hobbs. Among other important findings from the KeyBank Forecast: - Healthcare costs outpace security and economy as nation's top issue - 39% of business owners surveyed named healthcare costs as the top issue affecting the United States today, outpacing "terrorism/national security" by a two-to-one margin (17%). Rounding out the list of top five concerns were a "slow economy" (12%), "Social Security" (6%) and "interest rates" (5%). - Profit margins cited as top challenge region's businesses will face next year - When asked to name the top challenges that businesses will face in the region in 2007, the top five responses were: * Profit margins * Government regulations * Stability of customer relationships * Competition for quality talent * Competition from larger organizations - Cash flow cited as top challenge region's businesses faced in 2006 - 17% of the respondents cited "cash flow" as the biggest financial challenge they faced over the past year, followed by "healthcare and other benefit costs" (14%), the "cost of raw materials" (12%), and the "ability to grow sales" (11%). - Healthcare costs top list of personal financial concerns - In addition to asking questions regarding top business issues, the KeyBank study asked respondents which issue concerned them most from the standpoint of their personal finances. Healthcare costs dominated personal finance concerns, with six in ten (61%) respondents concerned about not having enough money to pay for adequate healthcare. Two other top concerns included the inability to maintain a "reasonable standard of living" (53%) and "investments not doing as well as expected (49%)." - Region's firms enjoy access to capital - When compared to 2005, one in four (24%) said that access to capital was easier, while 10% said it was harder and almost two thirds (64%) said that it was the same. Of the 45% of companies that had used any type of financing in the past year, most turned to bank loans and lines of credit, although more than half (56%) also had financed business growth through the use of credit cards. - Regional real estate climate - When asked how they would describe the local housing market, 26% of the executives described it as "heating up," while 48% said "slowing down," and 24% said it was "remaining the same." - Regional appeals - Respondents cited the most appealing reasons for living and doing business in the Rocky Mountain states as: * Recreational activities * Local economic climate * Eco-friendly environment * Quality school systems - Cinderella Cities - When asked, via an open-ended question, to name the city in the five-state region that has the "greatest potential for growth in the next five years," the largest percentage of respondents (13%) named Boise, Idaho, followed by Denver (12%), Salt Lake City (10%) and Colorado Springs (6%). In addition to an advantageous business climate, the business owners cited cost of living, quality of life, education, population and land availability as reasons for their selection. About the Survey The KeyBank survey was conducted by the research firm Mathew Greenwald & Associates, which interviewed lead decision-makers at 300 privately held Rocky Mountain Region firms. Three out of four of the respondents were the owner, president or CEO of the company they work for, and 82% own equity in the business. The margin of error at the 95% confidence level is +/- 6 percentage points. Respondents mirror the national business population, in that 68% reported annual revenues of $1.9 million or less, while 32% of the respondents were from larger organizations. About Greenwald & Associates Greenwald & Associates is a public opinion and market research company that has conducted customized research for more than 200 organizations, including many of the nation's largest corporations, trade associations and non-profit organizations. The firm has particular expertise in research for the financial services industry and other related disciplines. About Key KeyBank operates 115 bank branches and employs more than 1,500 professionals in the Rocky Mountain Region. KeyBank is part of Cleveland-based KeyCorp, one of the nation's largest bank-based financial services companies, with assets of approximately $96 billion. Key companies provide investment management, retail and commercial banking, consumer finance, and investment banking products and services to individuals and companies throughout the United States and, for certain businesses, internationally. DATASOURCE: KeyCorp CONTACT: Jack Sparks of KeyBank, +1-720-904-4554, or ; or David Gautschy of Bliss, +1-212-840-1661, or Web site: http://www.key.com/ http://www.key.com/newsroom

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