The two remaining branches of National City bank on the Northside have finally found a buyer. In a deal announced last week, First Niagara Financial Group will purchase 57 National City branches in Western Pennsylvania along with $4.2 billion in deposits and $839 million in business and consumer loans.
This acquisition immediately provides Upstate New York-based First Niagara more than 400,000 customer accounts and the number-three deposit market share position in the combined Pittsburgh, Erie and Warren regions. Divestiture of these branches was a regulatory condition of PNC’s purchase of National City in December of 2008.
“This transaction enables us to strategically expand our franchise, leverage our strong financial position and enhance shareholder value,” First Niagara President and CEO John R. Koelmel said.
“We are also very pleased to be able to retain 500 jobs in the Western Pennsylvania market and add upwards of 200 new jobs there and in Upstate New York during these very challenging economic times. We will provide the same high quality, personalized financial services to the communities served by these branches, just as we’re doing across Upstate New York. We’re excited to become an active lender in Western Pennsylvania and provide our new employees with continued career and growth opportunities.”
The acquisition is expected to close in September 2009.
This purchase was part of a larger plan that fell into place after PNC Bank announced the acquisition of National City Bank. Because of market constraints and anti-trust regulations, PNC Bank had to divest a certain number of branches to a competitor. Government officials involved had been looking for an outside entity to take over the banks.
First Niagara anticipates that approximately 500 employees in Western Pennsylvania, most of whom work in the branches to be acquired, will join First Niagara. In addition, 50 to 75 new jobs will be created in and around Pittsburgh to support the newly acquired branches and lending teams.
“The people of Western Pennsylvania and neighboring Upstate New York share common cultures and values, a tremendous work ethic and an unwavering commitment to their communities,” Koelmel said. “Given the similarities in the economic, demographic and competitive profiles of the regions, we believe First Niagara’s business model will succeed in our newest markets.”
The branch acquisition has received approvals from the parties’ boards of directors and remains subject to regulatory approval and other customary closing conditions.
First Niagara Financial Group, Inc., through its wholly owned subsidiary First Niagara Bank, has assets of $9.3 billion and deposits of $5.9 billion as of December 31, 2008.
To view first quarter earnings from First Niagara, follow the link below: