KeyCorp will sell 18 branches as part of an agreement with the Justice Department and the Federal Reserve Board to complete its purchase of First Niagara Financial Group.
Northwest Bancshares in Warren, Pa., will purchase the First Niagara branches in the Buffalo, N.Y., market in addition to $1.7 billion of deposits and $500 million of loans. The $98.4 billion-asset KeyCorp said Thursday that it will retain middle-market, private-banking, municipal and commercial real estate client relationships in this market.
KeyCorp announced in October it would buy the $39.9 billion-asset First Niagara in Buffalo for $4.1 billion. It has been widely assumed that KeyCorp would have to divest some branches in upstate New York to satisfy antitrust authorities.
The branch sale is subject to the completion of the deal between KeyCorp and First Niagara. Beth Mooney, KeyCorp's chairman and chief executive, said in the press release that the deal was on track to close in the third quarter.
The $9 billion-asset Northwest has been operating in the Buffalo market for 15 years and has completed more than 37 bank deals, including 14 branch purchases, according to the press release.