Ten months after First Niagara Bank announced a $1 billion acquisition of nearly 200 HSBC Bank USA branches in New York and Connecticut, the conversion is complete.
Beginning May 21, First Niagara, the banking subsidiary of First Niagara Financial Group Inc., will have a drastically expanded presence in the Hudson Valley.
Before the acquisition First Niagara had one Hudson Valley branch, in Dutchess County. Now it has 25 more offices in the region: five in Westchester, five more in Dutchess, three in Orange, one in Putnam, nine in Rockland, and one each in Sullivan and Ulster.
The acquisition involved 195 branches with $15 billion in deposits, $2.8 billion in loans, one million accounts and 650,000 customers.
First Niagara will also consolidate 35 branches in cases where a previous office is located near a newly integrated branch. None of the branches being consolidated is in the Hudson Valley.
With the deal complete, First Niagara has nearly 430 retail locations, $30 billion in deposits and $38 billion in assets ”“ not to mention 1,200 new employees.
David Ring, First Niagara”™s regional president for the Hudson Valley and New England, said the completion of the branch acquisition is “critical” as the bank aims to extend its reach south along the I-95 corridor.
“It helps us move along with our strategy of creating a bank that is not only in upstate New York and western Pennsylvania but also follows the I-95 corridor from western Massachusetts to hopefully Philadelphia some day,” said Ring, who also heads the commercial lending division for First Niagara.
“So this is a critical move for us and a critical transaction for us, helping to fill in markets like Westchester and Rockland,” Ring continued. “This is a very robust market, it”™s not overbanked, and we feel we have a compelling value for customers in this market.”
First Niagara has long been concentrated in upstate New York, with 119 locations there prior to the acquisition.
Now First Niagara is among the top 25 regional banks in the country by assets, Ring said.
Just as the new Hudson Valley locations fill a hole in First Niagara”™s network, he said the bank is hoping to fill the demand for commercial lines of credit in the Hudson Valley ”“ an area in which he said HSBC came up short.
“From a business lending perspective, HSBC was not very active,” Ring said. “We”™re seeing very robust loan growth and loan pipelines, and we never stopped lending through the downturn.”
First Niagara last month reported its ninth consecutive quarter of double-digit commercial loan growth. Commercial loans averaged $10.2 billion during the first quarter of 2012, an increase of $353 million from the previous quarter.
Net income for the first quarter was $59.9 million, up 33 percent from $44.9 million in first quarter 2011.
Deposits also rose sharply, to $19 billion from $13.5 billion in the first quarter of 2011.
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