Key Completes First Niagara Acquisition
KeyCorp in Cleveland has completed its acquisition of First Niagara Financial Group in Buffalo, N.Y.
The $101 billion-asset Key said in a press release Friday that it had finalized the $4.1 billion purchase of the $40 billion-asset First Niagara. Key said that systems and client conversation should take place in the fourth quarter, pending approval from the Office of the Comptroller of the Currency to merge First Niagara Bank into its own bank.
The deal was announced in October.
"Our teams have worked hard over the past nine months to bring our two organizations together," Beth Mooney, Key’s chairman and chief executive, said in the release. "As we begin to move forward, as one company, I am excited for the opportunities we have to accelerate our performance, drive growth and maximize long-term value for our clients, communities, employees, and shareholders."
Key's executives have vowed to slash roughly $400 million in costs, but they have also said that internal expense savings targets are even higher than what they publicly disclosed. Key plans to lower the company's cash efficiency ratio of 69% by about 300 basis points. Roughly 40% of those cuts will involve dealings with third-party vendors, while closing more than 100 branches will produce more savings.
First Niagara earlier in the day reported that its second-quarter profit fell 27% from a year earlier to $38.9 million. The company recorded $24.8 million in merger-related expenses during the second quarter.