KeyCorp will stretch its reach deeper into the Northeast with a $4.1 billion deal to buy First Niagara Financial Group and create the 13th largest commercial bank in the United States.
Officials say the acquisition is set to close in the third quarter, pending regulatory approval.
As rumors of the deal surfaced in recent weeks, there has been concern about possible layoffs in Western NY. That’s because the deal will involve an overlap of branches and some back office operations for First Niagara and Key Bank, and that potentially could mean some layoffs.
About 2,300 First Niagara employees work in Western New York. First Niagara has 390 branches in New York, Pennsylvania, Massachusetts and Connecticut.
And in the statement released early Friday, bank officials said that shareholders of both companies will benefit from annual cost savings “in excess of $400 million from maximizing efficiencies of technology infrastructure, procurement savings across the combined organization, and optimizing overlapping branches.”
"I am confident that the combination of First Niagara and Key will benefit our shareholders, customers and the communities we serve and will build off the great progress that the First Niagara team has made," said Nathaniel D. Woodson, Chairman of the Board of Directors of First Niagara.
Gary Crosby, President and CEO of First Niagara, said that, "Combining our strengths with those of Key will enable us to even better serve customers with a broader set of product features and functionality, while providing our team members with expanded opportunities as part of a larger, more-diversified organization."
