First Niagara Bank
Encyclopedia
First Niagara Bank is a Federal Deposit Insurance Corporation
-insured regional banking corporation headquartered in the historic Larkin Terminal Warehouse
in Buffalo, New York.
until the 1990s when it spread to nearby Buffalo, New York
and its surrounding Erie County
. Part of this growth could be attributed to the collapse of the Buffalo-centric banks Goldome and Empire of America. Most of this growth was from the recruitment of new customers, as opposed to the purchase of other firms' assets. Although, in 1998 the bank did purchase the regional insurance brokerage firm Warren-Hoffman & Associates Inc. as a means of entering the insurance business.
In September, 2007 it was announced that First Niagara was to purchase Great Lakes Bancorp, parent company of Greater Buffalo Savings Bank. The price to purchase the 16 branch bank was $153 million. With the nearly $900 million of assets of the Great Lakes Bancorp, First Niagara became the fourth largest bank in the Buffalo-Niagara region http://www.buffalonews.com/258/story/159549.html http://www.snl.com/irweblinkx/file.aspx?IID=4004398&FID=4778753. In April 2009 First Niagara acquired 57 of the 61 of National City branches in Erie and Pittsburgh, PA. They were rebranded on Labor Day weekend in 2009.
In April 2010, First Niagara Financial Group acquired Pennsylvania-based Harleysville National. As a result of the acquisition, First Niagara Financial through its wholly owned subsidiary, First Niagara Bank, have approximately $19.7bn in assets, 254 branches and approximately $13.7bn in deposits.
In August 2010, First Niagara announced its acquisition of NewAlliance Bank
of Connecticut. The stock holders approved the merger in December 2010 and The transaction closed on April 15, 2011. This provides First Niagara with over 340 Branches and 500 ATMs.
On July 31, 2011, First Niagara announced that they had bought all of HSBC
's upstate New York branches for $1 billion.. On August 25, 2011, First Niagara bought the naming rights for HSBC Arena in Buffalo, renaming it the First Niagara Center. First Niagara bought the naming rights for a concert pavillon in Pittsburgh, PA during Feb. 2010 it is callled First Niagara Pavilon.
branches in Western Pennsylvania
from PNC Financial Services
and officially took over those branches on September 8 after the signs were changed over from National City during Labor Day Weekend
.
PNC, which had acquired National City in late 2008 with money from the $700 billion bailout plan
after National City suffered losses in the subprime mortgage crisis
, was required by the United States Department of Justice
to sell 50 National City branches in the Pittsburgh area and 11 more branches in and around Erie
to competitors, since the two banks had significant overlap in Western Pennsylvania
--PNC and National City were number 1 and 2 in market share, respectively--and had potential antitrust
issues in the area. (Even after the sale was completed, PNC retained a market-leading 46% share in the Pittsburgh market, with Citizens Financial Group
in a distant second at 13%.) A dark horse
candidate, the sale to First Niagara was considered a surprise, considering that PNC was also in negotiations with much larger banks such as JPMorgan Chase, Wells Fargo
, Fifth Third Bank
, KeyBank, Huntington Bancshares
, and FNB Corporation
for the branches. Fifth Third, Huntington, & FNB had existing branches in the market, while JPMorgan Chase's retail banking division
& Key were in adjacent territories, and Wells Fargo was in the process of expanding its Eastern U.S.
operations by way of its acquisition of Wachovia
. Before the deal was announced, First Niagara was thought to be interested only in the Erie-area National City branches.
First Niagara, which had been eyeing at expanding into Pittsburgh for some time, was immediately ranked third in market share at 8%, ahead of the longer-established Dollar Bank
and First Commonwealth Bank
at six and five percent, respectively. First Niagara retained all National City employees at the acquired branches in the Pittsburgh and Erie
areas, and established a regional office in Downtown Pittsburgh's 11 Stanwix Street
tower.
First Niagara was outbid for the four branches in Crawford County, Pennsylvania
that PNC had to divest. Of those four, one branch in Titusville
was sold to Emclaire Financial Group while the other three (one in Conneaut Lake
, the other two in Meadville
, including the branch inside Wal-Mart
) were sold to Marquette Savings Bank.
On August 4, 2009, First Niagara agreed to take over the automatic teller machines (ATMs) at 95 Sheetz
locations throughout Western Pennsylvania
, replacing M&T Bank
, which doesn't have any bank branches in the region. The ATMs, which officially become First Niagara ATMs at the same time First Niagara took over the former National City branches, will be surcharge-free
from First Niagara itself, though people using the ATMs may still be charged a foreign ATM fee from their primary financial institution if they charge such fees.
First Niagara has stated that it does have some "holes" in the Pittsburgh metropolitan area, with PNC still retaining 110 National City branches in the area and is completely absent from Beaver
& Lawrence County
. (Aside from the aforementioned Sheetz ATM deal, First Niagara didn't buy any National City branches in those areas since PNC was able to keep the National City branches as there were no existing PNC branches in the two counties.) First Niagara is looking at acquiring some former National City branches PNC will close due to close proximity to an existing PNC branch, since First Niagara does have the right of first refusal
to buy any shuttered National City branches. First Niagara may also buy out a smaller local bank.
financial services company in an all-stock transaction valued at approximately $237 million or $5.50 per share. The deal will provide First Niagara with $5.6 billion in assets including, $3.6 billion in loans and $4.1 billion in deposits in 83 bank branches in nine Eastern Pennsylvania counties. The parent company of Harleysville National Bank also operates East Penn Bank, Millennium Wealth Management and Cornerstone Companies.
First Niagara intends to maintain all Harleysville National and East Penn branches, and the Pennsylvania company's growing commercial banking and wealth-management business. Harleysville has over 1,100 employees.
nearly half of its HSBC Bank USA
branch network, including 195 branches for a price of US$1 billion. Of these, 183 branches are in upstate New York, six in New York City suburbs and six in Connecticut; most of these branches had been part of Buffalo-based Marine Midland Bank
before being re-branded to HSBC Bank USA in the late 1990s. The deal included US$15 billion in deposits, US$2.8 billion in loans and US$4.3 billion in assets under management. The deal also nearly doubled First Niagara's branch network to about 450 branches, US$38 billion in assets and US$30 billion in deposits. Pending regulatory approval, the deal will close in early 2012. Investors had complained that HSBC had spread itself too thinly, with roughly 95 million customers and 300,000 employees in 87 markets.
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...
-insured regional banking corporation headquartered in the historic Larkin Terminal Warehouse
Larkin Terminal Warehouse
The Larkin Terminal Warehouse is located at 726 Exchange Street, Buffalo, New York in a neighborhood known as the "Hydraulics". The neighborhood was one of Buffalo's earliest industrial districts and it derived its name from the construction of a small hydraulic canal...
in Buffalo, New York.
History
It was founded in 1870 as Farmers and Mechanics' Savings Bank and was then re-branded as Lockport Savings Bank in 1967. The bank was based in its former home county, NiagaraNiagara County, New York
Niagara County is a county located in the U.S. state of New York. As of the 2010 census, the population was 216,469. The county seat is Lockport. The county name is from the Iroquois word Onguiaahra; meaning the strait or thunder of waters. It is the location of Niagara Falls and Fort Niagara, and...
until the 1990s when it spread to nearby Buffalo, New York
Buffalo, New York
Buffalo is the second most populous city in the state of New York, after New York City. Located in Western New York on the eastern shores of Lake Erie and at the head of the Niagara River across from Fort Erie, Ontario, Buffalo is the seat of Erie County and the principal city of the...
and its surrounding Erie County
Erie County, New York
Erie County is a county located in the U.S. state of New York. As of the 2010 census, the population was 919,040. The county seat is Buffalo. The county's name comes from Lake Erie, which in turn comes from the Erie tribe of American Indians who lived south and east of the lake before 1654.Erie...
. Part of this growth could be attributed to the collapse of the Buffalo-centric banks Goldome and Empire of America. Most of this growth was from the recruitment of new customers, as opposed to the purchase of other firms' assets. Although, in 1998 the bank did purchase the regional insurance brokerage firm Warren-Hoffman & Associates Inc. as a means of entering the insurance business.
In September, 2007 it was announced that First Niagara was to purchase Great Lakes Bancorp, parent company of Greater Buffalo Savings Bank. The price to purchase the 16 branch bank was $153 million. With the nearly $900 million of assets of the Great Lakes Bancorp, First Niagara became the fourth largest bank in the Buffalo-Niagara region http://www.buffalonews.com/258/story/159549.html http://www.snl.com/irweblinkx/file.aspx?IID=4004398&FID=4778753. In April 2009 First Niagara acquired 57 of the 61 of National City branches in Erie and Pittsburgh, PA. They were rebranded on Labor Day weekend in 2009.
In April 2010, First Niagara Financial Group acquired Pennsylvania-based Harleysville National. As a result of the acquisition, First Niagara Financial through its wholly owned subsidiary, First Niagara Bank, have approximately $19.7bn in assets, 254 branches and approximately $13.7bn in deposits.
In August 2010, First Niagara announced its acquisition of NewAlliance Bank
NewAlliance Bank
NewAlliance Bancshares , doing business as NewAlliance Bank, was the second largest Connecticut-based savings bank. It was formed in 2004 through the union of The Savings Bank of Manchester, New Haven Savings Bank, and Tolland Bank....
of Connecticut. The stock holders approved the merger in December 2010 and The transaction closed on April 15, 2011. This provides First Niagara with over 340 Branches and 500 ATMs.
On July 31, 2011, First Niagara announced that they had bought all of HSBC
HSBC Bank USA
HSBC Bank USA, National Association, the American subsidiary of UK-based HSBC Holdings plc, is a bank with its operational head office in New York City and its nominal head office in McLean, Virginia . HSBC Bank USA, N.A...
's upstate New York branches for $1 billion.. On August 25, 2011, First Niagara bought the naming rights for HSBC Arena in Buffalo, renaming it the First Niagara Center. First Niagara bought the naming rights for a concert pavillon in Pittsburgh, PA during Feb. 2010 it is callled First Niagara Pavilon.
National City
On April 7, 2009, First Niagara agreed to buy 57 National CityNational City Corp.
National City Corporation was a regional bank holding company based in Cleveland, Ohio, USA, founded in 1845; it was once one of the ten largest banks in America in terms of deposits, mortgages and home equity lines of credit. Subsidiary National City Mortgage is credited for doing the first...
branches in Western Pennsylvania
Western Pennsylvania
Western Pennsylvania consists of the western third of the state of Pennsylvania in the United States. Pittsburgh is the largest city in the region, with a metropolitan area population of about 2.4 million people, and serves as its economic and cultural center. Erie, Altoona, and Johnstown are its...
from PNC Financial Services
PNC Financial Services
PNC Financial Services Group, Inc. is a U.S.-based financial services corporation, with assets of approximately $264.3 billion...
and officially took over those branches on September 8 after the signs were changed over from National City during Labor Day Weekend
Labor Day
Labor Day is a United States federal holiday observed on the first Monday in September that celebrates the economic and social contributions of workers.-History:...
.
PNC, which had acquired National City in late 2008 with money from the $700 billion bailout plan
Emergency Economic Stabilization Act of 2008
The Emergency Economic Stabilization Act of 2008 The Emergency Economic Stabilization Act of 2008 The Emergency Economic Stabilization Act of 2008 (Division A of , commonly referred to as a bailout of the U.S. financial system, is a law enacted in response to the subprime mortgage crisis...
after National City suffered losses in the subprime mortgage crisis
Subprime mortgage crisis
The U.S. subprime mortgage crisis was one of the first indicators of the late-2000s financial crisis, characterized by a rise in subprime mortgage delinquencies and foreclosures, and the resulting decline of securities backed by said mortgages....
, was required by the United States Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
to sell 50 National City branches in the Pittsburgh area and 11 more branches in and around Erie
Erie, Pennsylvania
Erie is a city located in northwestern Pennsylvania in the United States. Named for the lake and the Native American tribe that resided along its southern shore, Erie is the state's fourth-largest city , with a population of 102,000...
to competitors, since the two banks had significant overlap in Western Pennsylvania
Western Pennsylvania
Western Pennsylvania consists of the western third of the state of Pennsylvania in the United States. Pittsburgh is the largest city in the region, with a metropolitan area population of about 2.4 million people, and serves as its economic and cultural center. Erie, Altoona, and Johnstown are its...
--PNC and National City were number 1 and 2 in market share, respectively--and had potential antitrust
Antitrust
The United States antitrust law is a body of laws that prohibits anti-competitive behavior and unfair business practices. Antitrust laws are intended to encourage competition in the marketplace. These competition laws make illegal certain practices deemed to hurt businesses or consumers or both,...
issues in the area. (Even after the sale was completed, PNC retained a market-leading 46% share in the Pittsburgh market, with Citizens Financial Group
Citizens Financial Group
Citizens Financial Group, Inc. is an American bank headquartered in Providence, Rhode Island, which operates in the states of Connecticut, Delaware, Illinois, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island and Vermont. Citizens is a wholly owned...
in a distant second at 13%.) A dark horse
Dark horse
Dark horse is a term used to describe a little-known person or thing that emerges to prominence, especially in a competition of some sort.-Origin:The term began as horse racing parlance...
candidate, the sale to First Niagara was considered a surprise, considering that PNC was also in negotiations with much larger banks such as JPMorgan Chase, Wells Fargo
Wells Fargo
Wells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
, Fifth Third Bank
Fifth Third Bank
Fifth Third Bank is a U.S. regional banking corporation, headquartered in Cincinnati, Ohio and is the principal subsidiary of holding company Fifth Third Bancorp ....
, KeyBank, Huntington Bancshares
Huntington Bancshares
Huntington Bancshares, Inc., is a US$53 billion Midwestern bank holding company headquartered in Columbus, Ohio. It is the 24th largest American bank. As of October 22, 2008, it was listed on the S&P 500...
, and FNB Corporation
FNB Corporation
FNB Corporation is a financial services corporation based in Hermitage, Pennsylvania, which operates banks under the name First National Bank in Ohio and Pennsylvania....
for the branches. Fifth Third, Huntington, & FNB had existing branches in the market, while JPMorgan Chase's retail banking division
Chase (bank)
JPMorgan Chase Bank, N.A., doing business as Chase, is a national bank that constitutes the consumer and commercial banking subsidiary of financial services firm JPMorgan Chase. The bank was known as Chase Manhattan Bank until it merged with J.P. Morgan & Co. in 2000...
& Key were in adjacent territories, and Wells Fargo was in the process of expanding its Eastern U.S.
Eastern United States
The Eastern United States, the American East, or simply the East is traditionally defined as the states east of the Mississippi River. The first two tiers of states west of the Mississippi have traditionally been considered part of the West, but can be included in the East today; usually in...
operations by way of its acquisition of Wachovia
Wachovia
Wachovia was a diversified financial services company based in Charlotte, North Carolina. Before its acquisition by Wells Fargo in 2008, Wachovia was the fourth-largest bank holding company in the United States based on total assets...
. Before the deal was announced, First Niagara was thought to be interested only in the Erie-area National City branches.
First Niagara, which had been eyeing at expanding into Pittsburgh for some time, was immediately ranked third in market share at 8%, ahead of the longer-established Dollar Bank
Dollar Bank
Dollar Bank is a full service, regional bank serving both individuals and business customers, operating more than 50 branch offices and loan centers throughout the southwestern Pennsylvania and northeastern Ohio metropolitan areas. The bank’s Pennsylvania headquarters is located in downtown...
and First Commonwealth Bank
First Commonwealth Bank
First Commonwealth Financial Corporation is a financial services company based in Indiana, Pennsylvania, primarily serving the Western and the Central Pennsylvania regions....
at six and five percent, respectively. First Niagara retained all National City employees at the acquired branches in the Pittsburgh and Erie
Erie, Pennsylvania
Erie is a city located in northwestern Pennsylvania in the United States. Named for the lake and the Native American tribe that resided along its southern shore, Erie is the state's fourth-largest city , with a population of 102,000...
areas, and established a regional office in Downtown Pittsburgh's 11 Stanwix Street
11 Stanwix Street
11 Stanwix Street, formerly known as and still frequently referred to as the Westinghouse Tower, is one of the major distinctive and recognizable features of Downtown Pittsburgh, Pennsylvania...
tower.
First Niagara was outbid for the four branches in Crawford County, Pennsylvania
Crawford County, Pennsylvania
Crawford County is a county located in the U.S. state of Pennsylvania. As of 2010, the population was 88,765.Crawford County was created on March 12, 1800, from part of Allegheny County and named for Colonel William Crawford...
that PNC had to divest. Of those four, one branch in Titusville
Titusville, Pennsylvania
Titusville is a city in Crawford County, Pennsylvania, United States. The population was 6,146 at the 2000 census. In 1859, oil was successfully drilled in Titusville, resulting in the birth of the modern oil industry.-History:...
was sold to Emclaire Financial Group while the other three (one in Conneaut Lake
Conneaut Lake, Pennsylvania
Conneaut Lake is a borough in Crawford County, Pennsylvania at the southern end of a lake with the same name. The population was 708 at the 2000 census.-History:...
, the other two in Meadville
Meadville, Pennsylvania
Meadville is a city in and the county seat of Crawford County, Pennsylvania, United States. The city is generally considered part of the Pittsburgh Tri-State and is within 40 miles of Erie, Pennsylvania. It was the first permanent settlement in northwest Pennsylvania...
, including the branch inside Wal-Mart
Wal-Mart
Wal-Mart Stores, Inc. , branded as Walmart since 2008 and Wal-Mart before then, is an American public multinational corporation that runs chains of large discount department stores and warehouse stores. The company is the world's 18th largest public corporation, according to the Forbes Global 2000...
) were sold to Marquette Savings Bank.
On August 4, 2009, First Niagara agreed to take over the automatic teller machines (ATMs) at 95 Sheetz
Sheetz
Sheetz, Inc. is a chain of gas stations/convenience stores owned by the Sheetz family. Stores are located in Maryland, North Carolina, Ohio, Pennsylvania, Virginia, and West Virginia....
locations throughout Western Pennsylvania
Western Pennsylvania
Western Pennsylvania consists of the western third of the state of Pennsylvania in the United States. Pittsburgh is the largest city in the region, with a metropolitan area population of about 2.4 million people, and serves as its economic and cultural center. Erie, Altoona, and Johnstown are its...
, replacing M&T Bank
M&T Bank
M&T Bank is an American commercial bank that was founded in 1856 in western New York, and today remains headquartered in Buffalo at One M & T Plaza...
, which doesn't have any bank branches in the region. The ATMs, which officially become First Niagara ATMs at the same time First Niagara took over the former National City branches, will be surcharge-free
ATM usage fees
ATM usage fees are the fees that many banks and interbank networks charge for the use of their Automated Teller Machines . In some cases, these fees are assessed solely for non-members of the bank; in other cases, they apply to all users...
from First Niagara itself, though people using the ATMs may still be charged a foreign ATM fee from their primary financial institution if they charge such fees.
First Niagara has stated that it does have some "holes" in the Pittsburgh metropolitan area, with PNC still retaining 110 National City branches in the area and is completely absent from Beaver
Beaver County, Pennsylvania
-Demographics:As of the census of 2000, there were 181,412 people, 72,576 households, and 50,512 families residing in the county. The population density was 418 people per square mile . There were 77,765 housing units at an average density of 179 per square mile...
& Lawrence County
Lawrence County, Pennsylvania
Lawrence County is a county located in the U.S. state of Pennsylvania. In 2010, its population was 91,108. The county was added to the Pittsburgh Metropolitan Statistical Area in 2003. The county seat is New Castle....
. (Aside from the aforementioned Sheetz ATM deal, First Niagara didn't buy any National City branches in those areas since PNC was able to keep the National City branches as there were no existing PNC branches in the two counties.) First Niagara is looking at acquiring some former National City branches PNC will close due to close proximity to an existing PNC branch, since First Niagara does have the right of first refusal
Right of first refusal
Right of first refusal is a contractual right that gives its holder the option to enter a business transaction with the owner of something, according to specified terms, before the owner is entitled to enter into that transaction with a third party...
to buy any shuttered National City branches. First Niagara may also buy out a smaller local bank.
Harleysville National
On July 27, 2009, First Niagara agreed to acquire the Philadelphia-area-based Harleysville National CorporationHarleysville National Corporation
Harleysville National Corporation was a regional banking corporation insured by the united States Federal Deposit Insurance Corporation. It was headquartered in Harleysville, Pennsylvania in eastern Pennsylvania. It offered consumer and commercial banking, and wealth management services...
financial services company in an all-stock transaction valued at approximately $237 million or $5.50 per share. The deal will provide First Niagara with $5.6 billion in assets including, $3.6 billion in loans and $4.1 billion in deposits in 83 bank branches in nine Eastern Pennsylvania counties. The parent company of Harleysville National Bank also operates East Penn Bank, Millennium Wealth Management and Cornerstone Companies.
First Niagara intends to maintain all Harleysville National and East Penn branches, and the Pennsylvania company's growing commercial banking and wealth-management business. Harleysville has over 1,100 employees.
HSBC deal expands presence in US northeast
On July 31, 2011, First Niagara announced it would purchase from UK-based HSBC Holdings plcHSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
nearly half of its HSBC Bank USA
HSBC Bank USA
HSBC Bank USA, National Association, the American subsidiary of UK-based HSBC Holdings plc, is a bank with its operational head office in New York City and its nominal head office in McLean, Virginia . HSBC Bank USA, N.A...
branch network, including 195 branches for a price of US$1 billion. Of these, 183 branches are in upstate New York, six in New York City suburbs and six in Connecticut; most of these branches had been part of Buffalo-based Marine Midland Bank
Marine Midland Bank
Marine Midland Bank was a bank formerly headquartered in Buffalo with several hundred branches throughout the state of New York. Marine Midland began in 1850 in Buffalo as the Marine Trust Company with the objective of financing the new shipping trade on the Great Lakes...
before being re-branded to HSBC Bank USA in the late 1990s. The deal included US$15 billion in deposits, US$2.8 billion in loans and US$4.3 billion in assets under management. The deal also nearly doubled First Niagara's branch network to about 450 branches, US$38 billion in assets and US$30 billion in deposits. Pending regulatory approval, the deal will close in early 2012. Investors had complained that HSBC had spread itself too thinly, with roughly 95 million customers and 300,000 employees in 87 markets.