First Niagara Financial Group Inc. will lend up to $50 million to recapitalize Harleysville National Corp. and its bank unit.

First Niagara, of Buffalo, N.Y., agreed in July to acquire the struggling $5.2 billion-asset Pennsylvania company in an all-stock deal valued at $272 million, but the closing is not expected to happen until next quarter.

The $14.1 billion-asset First Niagara said $35 million of the $50 million has already been lent to Harleysville as Tier 1 capital, helping the company boost the regulatory ratios at its bank unit to well-capitalized levels for the first time since September 2008. First Niagara said the injection also increases Harleysville's lending capacity.

As of Monday, the bank unit had a total risk-based capital ratio of 10.44%, a Tier 1 risk-based capital ratio of 9.17% and a leverage ratio of 6.49%, all above the regulatory minimums.

Regulators had asked Harleysville to boost those ratios even higher. The company missed a June deadline for doing so under an order. But First Niagara said Monday that, because of the loan, the Office of the Comptroller of the Currency agreed to extend the deadline until March 31, which should be enough time for the pending merger to close.

First Niagara also said it is prepared to buy up to $80 million of commercial and commercial real estate loan participations from Harleysville and allow it to make loans on its behalf via a correspondence relationship, "both of which will further enhance Harleysville's regulatory capital ratios and boost lending activities."

Shares of First Niagara and Harleysville slipped Monday, First Niagara by 0.45%, to close at $13.26, Harleysville by 0.82%, to close at $6.02.

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