Niagara Bancorp of Buffalo is aggressively expanding in upstate New York while broadening its offerings.

As Citicorp did by merging with Travelers Group, $1.7 billion-asset Niagara wants to offer customers a wider array of products and services.

"When we see Citibank and Travelers do their thing, we want to do that on a community scale," said Niagara president and chief executive William E. Swan. Since its initial public offering in April 1998, Niagara has purchased two insurance agencies, a leasing company, and a bank. It also has agreements to buy an investment advisory firm and two more banks, deals that would boost its banking assets to $2.5 billion. All its current assets are held by its largest subsidiary, the 130-year-old thrift First Niagara Bank, which has 22 branches and until recently was known as Lockport Savings Bank.

In its attempt to reposition itself as a full-service firm, Niagara converted from a mutual savings bank to a mutual holding company and raised $135 million through the sale of its stock to its account holders.

Most of that capital has been depleted by recent acquisitions, but Mr. Swan said that will not halt the buying spree.

"We'll always be in a growth mode," he said. "At the rate we're earning, there could be other acquisitions. … We have our antennae out there. If it makes sense, we'll look at it."

Niagara's strategy is impressing some analysts, if not investors. Heather Rosenkoetter, an analyst at Friedman, Billings, Ramsey in Arlington, Va., said the banking company has done a good job with its acquisitions and has not overpaid.

Heather L. Dilbeck, an analyst at Ryan, Beck & Co. in Livingston, N.J., said Niagara has a "very liquid balance sheet" and room to grow, though she said it should pursue more acquisitions of insurance agencies.

In January 1999, Niagara acquired Warren-Hoffman & Associates, one of the largest full-service insurance agencies in western New York. The agency and its affiliated companies, including NOVA Healthcare Administrators, have premium volume of $72 million and gross commissions of $12 million. A year later Niagara bought Buffalo-based Empire National Leasing, which has revenues of $19 million.

Niagara wants to build its core banking franchise, hence the completed purchase of Albion Bancorp and pending deals to acquire CNY Financial, the parent of $300 million-asset Cortland Savings Bank; and Iroquois Bancorp of Auburn, the holding company of Cayuga Bank and Homestead Savings.

Both $595 million-asset Cayuga and Cortland Savings are expected to maintain their local identities, while Homestead may be merged into Cayuga or sold, Mr. Swan said.

Niagara's net income for 1999 was $18.4 million, or 69 cents a share, up 28%. But its stock has traded at $8 to $11 for the past 12 months and around $9.50 in recent weeks.

One investor, Jewelcor Management Inc., wants Niagara to put itself up for sale. Shareholders are to vote on Jewelcor's proposal at Niagara's annual meeting May 2, but the bid is expected to fail because Niagara owns 60% of the voting shares.

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