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Bright spots do dot the landscape of Western New York’s long-sagging economy, but none is more alluring than the growth of the region’s banking sector.
At one time, not so long ago, that was because M&T Bank, headquartered in Buffalo, was strong and growing. Now it has local competition, with First Niagara Bank – headquartered in Buffalo – absorbing much of HSBC’s branch network and developing into a financial powerhouse of its own.
Now, in what is being called the largest bank deal announced this year, M&T has agreed to acquire Hudson City Bancorp of Paramus, N.J., in a cash and stock transaction amounting to $3.7 billion.
The deal is expected to be completed in the second quarter of 2013, pending shareholder and regulatory approval. With it, M&T will gain 97 branches in New Jersey, 29 on Long Island and nine in southwestern Connecticut. M&T’s reach will then include 870 branches stretching from Connecticut to Virginia. It will also fill a geographic gap in its Atlantic Coast operations.
To say that M&T has been on a roll lately is merely to state the obvious. M&T announced in late 2010 that it would buy Wilmington Trust Corp., the largest bank in Delaware. Since 2000, it has acquired eight banks or branch clusters in the Mid-Atlantic region.
With its growth, M&T is benefitting more than its own bottom line, though it is certainly doing that in a strategic plan of growth. The bank will, for the first time, hold more than $100 billion in assets while giving it access to New Jersey’s huge market for commercial loans and deposits.
But Western New York will also benefit from M&T’s growth. The bank expects to add more than 200 jobs in this region, for a total of over 400 new jobs locally in the last few years. It added about 170 jobs in its mortgage operations in the past year alone, and that trend is expected to continue.
Meanwhile, First Niagara has been making a name for itself, moving its headquarters from Lockport to Buffalo and making three purchases to give it major operations in western and eastern Pennsylvania, Connecticut and Massachusetts. In addition, its acquisition of much of HSBC’s banking operations has significantly raised its profile in Western New York and in the banking industry.
Indeed, the growth of Western New York’s financial sector is being noticed by, among others, the governor of New York, who commented on Buffalo’s growing reputation.
“The acquisition of Hudson City Bancorp expands on the wide array of private sector investment opportunities that bolster Western New York as a world-class hub for commerce and economic activity,” Gov. Andrew M. Cuomo said in a news release. “This acquisition is a sign that a key industry cluster in Western New York – financial services – is strong and continues to grow and that major financial institutions can come to Western New York to thrive.”
This kind of growth doesn’t happen by accident. It’s a matter of leadership and, within the banking industry, Western New York is blessed. Chairman and CEO Robert G. Wilmers has guided M&T to remarkable growth, not only surviving the banking crisis that felled such institutions as Lehman Brothers, Wachovia Bank and others, but remaking itself from a target of takeovers in the years since the crisis dawned in 2008 to an acquirer.
At First Niagara, meanwhile, President John R. Koelmel is a virtual force of nature, guiding its growth and, like Wilmers, establishing himself as a community leader. In addition to his duties at First Niagara, Koelmel has also taken on the responsibilities of chairman of the New York State Power Authority.
It’s not just banking where Western New York is showing signs of welcome growth. The development of the Buffalo Niagara Medical Campus is a sign of power in the health sector, and rapid progress on Buffalo’s waterfront opens a significant new market in the residential, retail and tourist segments of the regional economy.
All of this gives Western New Yorkers reason for pride, but none more so than the dramatic growth of local banks, whose practices and leadership have given them a sterling record in an industry that has tarnished its own reputation and brought ruin to the American economy. For those reasons and others, Wilmers and Koelmel deserve the thanks and praise of Western New Yorkers.