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First Niagara Adding Jobs and Commits to Buffalo as the Bank's Headquarters

By Jonathan D. Epstein

NEWS BUSINESS RPEORTER

May 2, 2011

First Niagara Financial Group said Monday that it expects to continue to grow in markets outside of upstate and Western New York, but that expansion elsewhere will still bring benefits locally as the bank reiterated its commitment to Buffalo as its home.

In particular, it's likely to benefit Buffalo's Larkin District, where the bank's headquarters is now based in the Larkin at Exchange Building.

"This is our corporate home," said President and CEO John R. Koelmel. "And while our customer expansion will include other markets, the benefits to this region and New York State will be significant as we further strengthen the foundation we need to leverage today's success for many years to come."

Koelmel's remarks came as the bank formally announced plans — already reported by The Buffalo News — to create at least 500 new jobs in upstate New York, mostly in Western New York, over the next five years. That's on top of 500 jobs the bank created in upstate New York over the past two years.

The new high-paying jobs are designed to support the company's "ambitious growth strategy," which already has seen the bank triple in size in just over two years with a trio of acquisitions in Pennsylvania and New England.

And Koelmel has made clear his intention to continue that growth, not only by opening additional branches but also by making other "fill-in" acquisitions within its new branch network.

"While proud of what we have built to date, we are even more excited about future opportunities to grow and deepen our franchise in the years ahead," Koelmel said in a press release. "To support our continuing success, it is important that we strengthen the foundation we have built here in Buffalo and Western New York, as well as across the Upstate region."

Specifics of how many jobs will be available, when and in what locations were not available prior to a Monday afternoon press conference. Besides Buffalo, First Niagara also has a major branch and operational presence in the Albany area.

But the bank said the new positions will include a combination of customer service, support, administrative and back-office roles, including bank operations, loan processing and account management. They are expected to pay average annual wages and benefits of more than $78,000 each.

In exchange, the Empire State Development Corp., the state's economic development arm, awarded $5.7 million in tax credits to the bank under the state's new Excelsior Jobs Program. Those incentives, which equate to $11,400 per job, are directly tied to job creation and investment.

"This is one of the most significant private sector economic development announcements in Western New York and I'm pleased ESD could be a part of it," said Empire State Development President and CEO Kenneth Adams. "This project secures the company's existing workforce and leaves no doubt in my mind that First Niagara is committed to both the Western New York community and to remaining competitive in New York State."

Additionally, the bank will receive unspecified federal tax credits, tax deductions and other incentives through the Renewable Community program. Administered by the U.S. Department of Housing and Urban Development, the nine-year old program is designed to stimulate economic development in low-income neighborhoods by encouraging businesses to invest in such areas and hire their residents.

"This is absolutely outstanding, game-changing news for Upstate New York and First Niagara," said U.S. Sen. Charles E. Schumer, D-N.Y., who said he played a key role in having the Larkin District designated as a "renewable community" in 2004. "These 500 jobs will create huge ripple effects across the state, sustaining middle-class families and providing new economic opportunities for New York."

"There is nothing more important than job growth and this announcement by First Niagara is very exciting news," said Congressman Brian Higgins, D-Buffalo. "First Niagara Bank is a unique corporate citizen."

The added jobs are the latest growth news to come from First Niagara, which has been on a tear throughout the financial crisis and subsequent national recession. The bank has taken advantage of opportunities and a strong capital position to quickly stake out a franchise that now stretches from Buffalo to Boston, and south through Connecticut, Philadelphia and Pittsburgh.

The bank bought 57 branches in Western Pennsylvania and then Harleysville National Corp. outside Philadelphia, with 83 branches in Eastern Pennsylvania. Last month, it completed its third major deal, buying NewAlliance Bancshares of New Haven, Conn., to add $8.8 billion in assets and 88 branches in Connecticut and Massachusetts.

It now has $30 billion in assets, $18 billion in deposits, $14 billion in loans, 730,000 customers and 346 branches in four states. And it employs 5,500 in all, including 2,500 in upstate New York. The new job pledge will raise its upstate employment to more than 3,000 by 2016.

In conjunction with the new jobs, the bank also said it will make "substantial capital investments to expand and improve its infrastructure and facilities and otherwise further invest in the stability, growth and vitality of the region."

"First Niagara has been an engine of job growth and investment in Buffalo and a catalyst for revitalization of our historic Larkin District," said Buffalo Mayor Byron Brown. "We're proud First Niagara calls our city and the Buffalo Niagara region home."

jepstein@buffnews.com