Buffalo-based First Niagara has made an historic rise over the last ten years.  And Sunday, it surprised analysts by announcing it had a billion dollar agreement to  buy all the HSBC Banks across upstate New York and some in Connecticut.  Many expected larger banks to get the deal.  This could push First Niagara from number 3 in Western New York, to being the biggest bank.  It’s expected to add thousands of employees and customers.

In a press conference to talk about the sale, First Niagara CEO John Koelmel spoke about his sunny outlook…

"This is a great day for First Niagara, and a great day for Buffalo and Western New York."

But the forecast isn’t as clear for HSBC branches in the north country.  First Niagara has purchased twelve banks in the region.  The Buffalo News reports that First Niagara expects to sell branches in rural markets or the North Country. 

When speaking with reporters, Koelmel said First Niagara only plans to keep branches that fit in to his bank’s strategy, not that of HSBC:

"Our focus is on where we are, and where we otherwise think our value proposition best plays, versus where else they might have been and what we may do with that.  Our inclination is to divest ourselves of those branches that don’t fit our strategic lens." 

Keolmel says there’s been a lot of mis information and mis-analysis about the First Niagara purchase.

He says they’ve taken on 15-billion dollars in deposits, and plan to keep 11 billion of that.  He’s not sure how many bank branches that equates to, but he hopes it’s less than 100 of the 195 they’re buying from HSBC. 

Keolmel says the change should be seamless for bank customers as branches change from HSBC to First Niagara.  But if his bank divests of the north country branches, it’s unclear what will happen to customers and employees here.