Transitioning branches from one corporate parent to another is no easy task. But in the case of KeyBank — whose Cleveland-based parent KeyCorp this year acquired Buffalo-based First Niagara Financial Group for $4 billion, creating the 13th largest commercial bank in the country — one potential headache was missing.
“This is a little unusual,” said Jeff Hubbard, who was the New England region president for First Niagara and is staying on as market president for Connecticut and western Massachusetts at KeyBank. “A lot of the time with something like this you have competing banks right across the street from each other, but in this region at least, there was very little overlap.”
Such is not the case in upstate New York and in other major metro areas served by First Niagara, he noted.
KeyCorp formally acquired First Niagara on Aug. 1, with regulatory approval from the Office of the Comptroller of the Currency announced on Sept. 22.
A total of 70 First Niagara and 36 KeyBank branches will be closed in New York, Connecticut, Massachusetts and Pennsylvania during the consolidation. The closings will take place in phases, beginning with 69 First Niagara branches in October. Additional closings, including the 36 KeyBank branches, will take place through early 2017.
No closings are scheduled for Fairfield County, where First Niagara has nine branches after closing five offices earlier this year.
In the Hudson Valley, the following branches are scheduled to close:
• First Niagara, 600 Bedford Road, Bedford Hills. Closing in October.
• First Niagara, Erie Street & Route 303, Orangetown. Closing in October.
• First Niagara, 101 Kings Mall Court, Kingston. Closing in October.
• First Niagara, 117 E. Route 59, Nanuet. Closing in October.
• First Niagara, 219 S. Main St., New City. Closing in October.
• First Niagara, 1 Lagrange Ave., Poughkeepsie. Closing in October.
• First Niagara, 180 S. Liberty Drive, Stony Point. Closing in October.
• First Niagara, 62 Lafayette Ave., Suffern. Closing in October.
• First Niagara, 16 Route 303, Tappan. Closing in October.
• Key, 800 Westchester Ave., Rye Brook. Closing in November.
• Key, 338 Route 59, Nyack. Closing in 2017.
• Key, 23 S. Moger Ave., Mount Kisco. Closing in 2017.
• Key, 88 Croton Ave., Ossining. Closing in 2017.
• Key, 230 N. Middletown Road, Pearl River. Closing in 2017.
• Key, 366 Windsor Highway, New Windsor. Closing in 2017.
First Niagara entered Fairfield County in 2011 with its acquisition of NewAlliance Bank, picking up eight branches with more than $266 million in deposits.
That same year, it bought all of HSBC’s upstate New York branches north of New York City for $1 billion. By May 2012, more than 100 former HSBC offices reopened as First Niagara branches, with First Niagara adding 1,200 employees and 500,000 retail customers.
Hubbard said that employees affected by the KeyBank acquisition are being offered other positions within the bank. “We’re making a really strong effort to retain all of our customer-facing personnel,” he said. “In every case, every employee is being offered a position at a neighboring branch.” He declined to say how many had accepted those positions.
The main challenge of the transition, Hubbard said, is technological in nature. “Account numbers, online access, loan account information … we’re making sure that all of those are being changed over to KeyBank in as painless a way as possible. A lot of planning has gone into this and the transition is being done in a very methodical way.”
Conversion of First Niagara systems and clients to KeyBank will take place over the long Columbus Day weekend. All First Niagara branches will close at 3 p.m. Friday, Oct. 7, reopening as KeyBank branches on Tuesday, Oct. 11.
“People want to know what’s happening to their accounts,” Hubbard said. “But we’re very prepared and sending out the message that they don’t have to worry. We’ve sent out information kits to all of our existing customers explaining what’s happening. The main message is that our commitment to customers is unchanged. In most cases, the person they have been dealing with will still be there, just under a new bank name. Continuity is something we’re striving for.”
Commercial banking customers have raised concerns about possible changes in processes, he noted. “We have worked with a lot of businesses in Connecticut and they’re wondering if decisions are going to be made in Cleveland moving forward. I’m pleased to say that those decisions will continue to be made locally.”
Hubbard noted that many general-service employees already have traveled to Cleveland for extensive training with the new KeyBank systems and processes, with retail- and small business-focused personnel expected to do the same over the next few months.
The two banks “have very similar values,” he said. “We’re actually more alike than different. We anticipate continuing to be good corporate citizens in the communities we serve.”
One difference, Hubbard said, is that KeyBank has typically been well ahead of First Niagara when it comes to digital and mobile offerings to customers. “Lots of our employees are very excited about the new enhancements we’ll now be able to offer our customers,” he said. “Many of our competitors have those services already, so this will be a very positive addition for us.”