Cortland (N.Y.) First Financial Corp. and Oneida Valley Bancshares agreed this month to a merger of equals in a tax-free pooling of interests.

The deal would create a $450 million-asset company to be named Alliance Financial Corp.

The subsidiaries of both banks-First National Bank of Cortland and Oneida Valley National Bank-would be renamed Alliance Bank NA and operate 16 branches with 250 employees.

The deal is expected to close in the fourth quarter.

Both parties said they intend to expand immediately through branch openings in the Syracuse area. Such a policy would be expected to reduce short-term earnings.

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