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First Niagara reported a fourth-quarter profit, but the more interesting question was why the Buffalo, N.Y., bank won't fully explain the customer problem that has forced it to set aside more than $20 million.
January 23 -
First Niagara Financial Group raised to $1.1 billion the amount of the goodwill impairment charge it recorded in the third quarter, as the Buffalo, N.Y., company cuts the value of assets acquired since 2009.
November 10 -
The company's $800 million goodwill impairment charge may reflect macroeconomic factors, but also likely resulted from a purchase of HSBC branches two years ago. Other banks are unlikely to face the exact same issues, observers said.
October 24
First Niagara Financial Group in Buffalo, N.Y., overstated its allowance for loan and lease losses from the middle of 2013 through the end of 2014 and may restate earnings for the period.
The "misconduct of a mid-level employee" led to the overstatement, the $38 billion-asset First Niagara said in a
First Niagara is working to correct the allowance overstatement, which will result in an increase in retained earnings and changes to the bank's coverage ratios, which measure its ability to absorb potential losses from bad loans. The company did not provide an exact date when the overstatement began, but it spanned at least five quarters.
First Niagara said it will complete its analysis of the effect of the overstatement "as expeditiously as possible" and it may issue a revised version of financial statements when it files its annual report. The company said it expects to file its annual report late.
The overstatement is the latest snafu for First Niagara's management to confront.
The bank last quarter set aside a reserve of $22 million to cover a "
It also took a $1.1 billion goodwill impairment charge in the third quarter to cover declines in the value of certain assets.
