BUFFALO, N.Y. (WIVB) — Amid plans to acquire First Niagara Bank, the company, along with KeyCorp have announced an agreement to sell 18 First Niagara branches in western New York with $1.7 billion in deposits.
The move is a play to resolve any antitrust concerns over the merger, which would create a massive banking company and merge two banks that formerly competed with one another for business.
The proposed deal to buy First Niagara for $4.1 billion was announced back in October. It would make KeyCorp the 13th largest commercial bank in the United States.
In all, First Niagara has 390 branches in New York, Pennsylvania, Connecticut and Massachusetts. KeyBank, an Ohio-based company, is further spread out, with branches in 12 states.
Thirteen of the branches which will be sold are in Erie County, another five are in Niagara County.
The Department of Justice (DOJ) says that as a result of the agreement, commercial loans associated with the divested branches will be included in the divested assets.
In a DOJ release, the branches in jeopardy were highlighted:
- Erie County – 2300 Grand Island Boulevard in Grand Island.
- Erie County – 6409 Transit Road in Clarence.
- Erie County – 14 Lafayette Square in Buffalo’s downtown Rand Building.
- Erie County – 2070 George Urban Boulevard in Depew.
- Erie County – 3105 Niagara Falls Boulevard in Amherst.
- Erie County – 5751 South Park Avenue in Hamburg.
- Erie County – 4435 Transit Road in Clarence.
- Erie County – 1531 Niagara Falls Boulevard in Amherst.
- Erie County – 1248 Abbott Road in Lackawanna.
- Erie County – 690 Kenmore Avenue in Buffalo.
- Erie County – 3488 Amelia Drive in Orchard Park.
- Erie County – 364 Connecticut Street in Buffalo.
- Erie County – 1690 Sheridan Drive in the Town of Tonawanda.
- Niagara County – 55 East Avenue in the City of Lockport.
- Niagara County – 1035 Payne Avenue in North Tonawanda.
- Niagara County – 805 Main Street in Niagara Falls.
- Niagara County – 4381 Military Road in the Town of Niagara.
- Niagara County – 500 Center Street in Lewiston.
Northwest Bank, owned by Northwest Bancshares, Inc., announced on Thursday it will be purchasing all 18 branches, acquiring the $1.7 billion in deposits. The Pennsylvania-based bank has expanded into western New York and the CEO, William Wagner, called his company familiar with the area.
“The offices we are purchasing are excellent facilities in exceptional locations, with deposit balances averaging $96 million per branch. All 18 offices will remain open and the staffs of these offices will be offered employment with Northwest so that they can continue to serve their customers.”
Northwest will pay 4.5 percent premium on the deposits, meaning total assets gained to the company will be about $1 billion in cash with about $511 million in loans.
The official purchase is expected to close in the third quarter of 2016.