First Niagara Financial Group has been on a tear for the past year — gobbling up two banks, raising $1 billion in capital and converting to a commercial bank — and its aggressive growth strategy appears to be paying off.

First Niagara said Monday that first-quarter profit soared 79.5 percent from a year ago, following a successful major acquisition in Western Pennsylvania that is yielding strong growth in loans and deposits.

The Buffalo-based parent of First Niagara Bank reported net income available to shareholders of $28.9 million, or 16 cents per share, up from $16.1 million, or 14 cents per share, a year ago. That includes one-time merger-related, legal and other accounting charges.

Without those factors, operating earnings soared 52 percent to $32.6 million from $21.5 million. Earnings per share, however, fell a penny to 18 cents, as a result of the bank issuing 69 million more shares last year in a pair of stock offerings to raise more capital to support its growth. That matched analysts’ consensus expectations.

The bank’s stock fell 30 cents to $14.29 Monday, after hitting a 52- week high of $14.86 last week. It will hold its annual meeting at 10 a. m. today at its Buffalo headquarters in the Larkin at Exchange Building.

“We’re very very pleased with the solid beginning to 2010,” said President and CEO John R. Koelmel. “We put another excellent quarter up on the table and believe we have a lot of positive wind at our back.”

Bank executives attributed the “superior business growth” to the acquisition and strong loan generation since then, both in its original upstate New York market as well as in Pennsylvania, where the bank is performing above expectations.

Last September, the bank purchased 57 branches in the greater Pittsburgh, Warren and Erie, Pa., markets from PNC Financial Services Group’s National City Bank. Koelmel said the purchased operations are already “going gangbusters.”

Average retail core deposits in that region rose 7 percent in the first quarter to preclosing levels, and commercial loan originations are running ahead of plan with $350 million in new loans this quarter, officials said. Those branches also posted the highest wealth management sales per branch of any region.

Earlier this month, in its biggest deal ever, First Niagara completed its purchase of Harleysville National Corp. in the greater Philadelphia area, adding 83 branches in that major market. Koelmel said the conversion and initial integration went “exceptionally well,” with “no hiccups at all to report” and strong activity in new account openings and cross-sales since then.

“I’m incredibly proud of what we see,” he said. “Most importantly, we have a lot of happy customers, and they’re bringing new money into the door.”

The deal included $300 million to $400 million in troubled loans, which had threatened at one point to drag Harleysville down. Losses have improved, but First Niagara plans to sell off “as much of the troubled portfolio as we can, as quickly as we can,” rather than divert resources, said chief credit officer Kevin O’Bryan.

“We’re not in the workout business, so we don’t want to take on the additional burden,” Koelmel said.

The bank now has 255 branches and $20 billion in assets in two states, but results from Harleysville are not included in the first quarter because the deal closed after March 30. The company and its subsidiary also converted to bank holding company and commercial bank charters, to give it more flexibility.

Koelmel said he is “very upbeat and excited about the future.” And he sought to reassure investors that the bank is able to handle its rapid growth.

“The shopping cart is always in motion,” he said. “I’m incredibly confident in the team we have here, in their ability to walk and chew gum.”

That’s borne out by the quarter’s results, Koelmel said. Total revenues jumped 49.4 percent from a year ago to $151.1 million. Net interest income from taking deposits and making loans jumped 57.3 percent from a year ago to $114.2 million, helped by lower interest costs on deposits and borrowings.

Strong loan demand in both upstate New York and Pennsylvania, from both new customers and more use of existing credit lines, drove $1 billion in new lending, with annualized increases of 15 percent and 11 percent, respectively, in commercial and home equity loans (The term “annualized” refers to one quarter’s pace multiplied by four). Loan demand is up somewhat, but the bank is getting a bigger piece.

The bank set aside $13.1 million for loan losses, up 49 percent from $8.8 million a year ago and up 19 percent from $11 million in the fourth quarter. Bad loans rose, mostly from two commercial loans, and the bank wrote off more than in the fourth quarter, largely because the bank charged off two “shared national credit” loans.

Core deposits — not including higher-cost certificates of deposit — grew in both regions by $124 million from December, led by retail money market and municipal deposits, while higher-cost CDs fell. Core deposits are now 73 percent of the total, and the bank said it retained 100 percent of the Western Pennsylvania deposits — almost unheard of in mergers.

Fee and other income rose 29.5 percent from a year ago and 3.9 percent from the fourth quarter, to $36.9 million, driven by wealth management and insurance revenues, while banking fees fell, largely because of lower overdraft fees. Operating expenses rose 48.7 percent from a year ago, to $87 million.

“All in all, a fine way to kick off the year,” said Chief Financial Officer Michael Harrington. “Our confidence couldn’t be higher as we push ahead.”