The Federal Reserve has approved KeyCorp’s pending acquisition of First Niagara Financial Group Inc., and the merger will be completed around Aug. 1, KeyCorp CEO Beth Mooney said.
Computer-system conversions and customer changeover to KeyBank accounts is expected in the fourth quarter of this year, subject to pending final approval by the Office of the Comptroller of the Currency, Mooney said in a news release.
“We are pleased to reach another important milestone as we bring Key and First Niagara together,” she said.
KeyCorp, based in Cleveland, Ohio, will buy First Niagara in a cash-and-stock transaction worth about $4.1 billion.
The banks have agreed to sell 18 branches in the Buffalo, New York, area, where First Niagara is based, to Northwest Bancshares Inc., in part to alleviate anti-competitive concerns in that area. The banks have no overlap of service areas in New England.
Mooney said KeyCorp intends to make Buffalo the combined banks’ northeast regional headquarters.
KeyCorp. will close 70 First Niagara and 36 KeyBank branches, beginning late this year, and move those accounts to nearby branches, she said.
Branch employees displaced by the pending merger have been offered “roles with the new KeyBank,” she said. Despite the branch closings, Mooney said the bank plans to reach pre-merger employment levels by 2021.
The merger will give KeyBank 488 branches in upstate New York, Connecticut, Massachusetts, and Pennsylvania, including 304 former First Niagara branches and 184 existing KeyBank branches in New York State.
Overall, KeyBank will have more than 1,200 branches and 1,500 ATMS in 15 states, mostly in the Midwest.
First Niagara entered the New England market in 2011 when it acquired New Haven-based NewAlliance Bank. The buyout resulted in more than 200 layoffs, including 83 at its Manchester office.
NewAlliance was formed by the 2004 merger of New Haven Savings Bank with Savings Bank of Manchester and Tolland Bank.
