John R. Koelmel is always talking about running his bank today for what he expects it to be tomorrow: much, much larger.
But he admits he never expected tomorrow to come so soon.
"I always knew we could accomplish this. I couldn't have anticipated that we'd make it happen in this tight a timeframe," said Koelmel, CEO of First Niagara Financial Group. "I wouldn't have bet against it, but I wouldn't have bet on it."
Perhaps he should have. Just a week ago, Koelmel's company agreed to buy 195 HSBC Bank USA branches across New York State and in Connecticut, beating out much larger rivals for one of the region's premier businesses -- the former Marine Midland Bank.
It's the fourth major purchase in three years for First Niagara, which will have nearly quintupled in size when the deal closes in early 2012.
Koelmel says he couldn't be prouder of his management team, his employees, and the high-flying, fast-growing bank that just over a dozen years ago was the tiny Lockport Savings Bank in rural Niagara County.
"People are pumped up," Koelmel said. "They're jacked up and high-fiving and all the rest. There's just a lot of pride."
How First Niagara got there, expanding so fast, so quickly, is a story of passion, confidence, discipline, and, according to Koelmel, "a dose of good luck and good timing."
And it has largely come under the leadership of Koelmel, an Orchard Park native and public accountant who has been in banking only nine yars.
"It certainly is a meteoric rise," said Jonathan E. Dandes, president of Bisons baseball and former chairman of the Buffalo Niagara Partnership. "It doesn't seem that long ago that it was Lockport Savings Bank."
The remarkable growth spurt -- which catapulted the bank into the ranks of the nation's 50 largest -- has captivated the attention not only of Western New York but the banking industry and Wall Street, particularly since it has come in the midst of the worst financial crisis and recession since the Great Depression.
It's a feat that few if any other Buffalo-area companies, in any industry, have achieved in perhaps a century.
"The idea that Lockport Savings Bank would be Marine Midland in 2011, you would have gotten no odds on that 20 years ago," Koelmel said.
Like any good CEO, Koelmel credits the success to the entire company, but a key facet comes from exuding confidence and encouragement from the top down.
With his soft-spoken but enthusiastic style and his imposing frame, the 58-year-old Koelmel is First Niagara's cheerleader-in-chief, raising expectations to new heights, and driving his management team and 5,000 employees to aim higher.
"That's what's been a hoot for me," he said. "What gets me up and running every day, keeps my motor running, is that opportunity to create an organization that's energized."
> A growth machine
Koelmel isn't your average banker; he came from the other side of the ledger. He entered the industry in 2002, working at Financial Institutions in Warsaw after 26 years in public accounting at KPMG, where his clients were banks.
Since joining First Niagara in 2004 as chief financial officer and taking the reins two years later, Koelmel has transformed the company into an acquisition and growth machine.
He's always thinking ahead and considering his next move, willing to take reasoned risks and eager for the next challenge.
And he has committed not only to the success of his company but also to his home community, where he takes pride in supporting nonprofits and redevelopment, and in creating and retaining jobs.
"We do our best to lead by example, because that's what makes the region sustainable and scalable. We take that responsibility very seriously," Koelmel said. "It's easy to invest in communities in the best of times. We pride ourselves that when the going gets tough, you can count on us to be there."
Indeed, that's what made the opportunity to buy the HSBC branches and preserve most of the 1,900 jobs so meaningful. HSBC's announcement in May that it would sell the branches had provoked fears of layoffs.
"A real source of pride for me is that we were able to be ready for this type of transaction at this time," Koelmel said. "We're very respectful and appreciative of the opportunity we do have, and are very determined to ensure that we deliver on that. We're thrilled to be in the right place at the right time."
Besides the $1 billion purchase price, that philosophy and local commitment may have been key reasons why First Niagara won the day with the HSBC bidding.
"We're pleased to be working with First Niagara on this deal, given its strong commitment to relationship banking and historic roots in the region," Irene Dorner, president and CEO of HSBC Bank USA, said by email.
> Playing to win
Still, the process wasn't easy. "From the get-go, we were going to play this one to win, because it was strategically important," Koelmel said. "We knew this one would be aggressively sought after. My assumption was we were the smallest of the bidders for this, so we knew we had to really prove ourselves."
It was about 10 p.m. on July 26, a Tuesday night, when Koelmel took the call at his desk. It was Niall Booker, the British-born CEO of HSBC North America, telling him that First Niagara had won the bidding for the branches. But they had to seal the deal over four grueling days.
With his characteristic enthusiasm, Koelmel immediately started slapping hands in the air across his desk with his top lieutenants, who were already gathered in his office at the Larkin at Exchange Building.
"It's not just the thrill of the chase. It's being able to win," said Koelmel, an avid sports fan known for his metaphors. "It was a high-five moment."
So began what seemed like 24-hour-a-day negotiations between the two banks and their advisors to iron out the details. Koelmel even smoothed out a late-breaking issue near midnight on Friday on his cellphone, as he paced back and forth on Delaware Avenue in front of Hutch's Restaurant while his wife and two other couples dined inside.
He had done the same thing a year ago during talks on the previous deal. "Hutch's will have special significance for us," he joked. "I was pacing up and down because our presumed competition could have been at the next table."
But while they were arduous, those long, late hours paid off. The whopping $1 billion deal, signed at noon July 30 and announced the next day, doubles First Niagara's branch network across the state. It adds billions of dollars in deposits and hundreds of thousands of customers. And it puts First Niagara in a tie for the top market share across upstate New York with cross-town rival M&T Bank Corp., one of two competitors that it beat out.
As CEO, Koelmel receives much of the credit for leading the charge and inspiring the troops. It's a role he takes with passion.
"Each transaction creates some extra snap, crackle and pop," Koelmel said. "But we're very focused, first and foremost, on creating that same sizzle, as much sizzle as we can, with what we do each and every day."
> Setting the tone
He's cheerful and boisterous, and always ready with a smile and a handshake. He tries to greet all employees, asking how they're doing, and gets upset with himself when he can't remember a name.
"I do my best to set the tone and tempo culturally. Not only am I the CEO, I'm the chief cultural officer," he said. "It's my responsibility to lead by example, to set the tone and expectation in terms of how we continue to knit the cultural fabric of this organization together."
Developer Howard Zemsky, who has worked closely with Koelmel in redeveloping the Larkin District, calls him "gregarious, generous, gutsy and goal-oriented," with a determination to just "make it happen."
"I don't know if people understand how warm he is. He's very empathetic, very definitely feels both your happiness and your pain," Zemsky said. "John wears it right out there."
But Koelmel prefers to create a culture of followers, not a cult of leadership, and insists on giving credit to the team rather than taking it for himself.
"Our jobs as leaders is to create followership, and you do that by winning the hearts and minds of your teammates, connecting with those in your organization," he said. "I'm just the CEO. We're all in this together. It's a person-to-person business. It's a very collaborative, collegial environment.
"So how are we able to grow? We've made it about people."