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First Niagara asks for change

Published:November 28, 2009, 6:51 AM

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Updated: August 21, 2010, 3:21 AM

First Niagara Financial Group, a local thrift holding company that has been making several highly visible changes lately, is seeking to make another major adjustment that, it says, will cause customers and employees to see no difference.

Instead of operating as a thrift holding group, allowed only to own other thrifts, FNFG has petitioned the federal government for permission to convert itself into a bank holding company, allowed to own other banks.

The move, if approved, will shift oversight of the company from the Office of Thrift Supervision to the Federal Reserve Board.

FNFG spokeswoman Leslie Garrity said by e-mail Friday that the change in category will allow the company to buy and hold commercial banks as separate entities. Otherwise, acquired banks would have to cease to exist on the date of their purchase and be fully absorbed into First Niagara.

Still, the statement says, “Converting to a bank holding company would have no impact on First Niagara employees’ day-to-day responsibilities or interactions with customers.”

According to information posted by the Federal Reserve, a commercial bank is a for-profit institution that “engages in various lending activities,” while a thrift, “primarily accepts savings account deposits and invests most of the proceeds in mortgages.”

In the last several months, FNFG has announced that it was moving its corporate headquarters from Pendleton in Niagara County to Buffalo’s Larkin at Exchange Building downtown. The firm won’t be abandoning Niagara County, as its current HQ in Pendleton is slated to continue to employ at least its current number of 300 employees. Total employment in Niagara and Erie counties is expected to reach 1,000 jobs.

The company this spring purchased and rebranded 57 Western Pennsylvania branches of PNC Bank. It is in the process of buying the Philadelphia-area headquarters, assests and 83 branches of Harleysville National Bank.

If FNFG’s petition to change its category succeeds, jurisdiction over the Harleysville acquisition will also shift from OTS to the Fed. But, the statement said, FNFG officials still expect that deal to close in the first quarter of next year.

And, in June, it unveiled a new logo.

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