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First Niagara Reports First Quarter 2014 Results

First Niagara Financial Group logo

First Quarter Highlights:

  • Operating Earnings of $0.17 per diluted share, excluding restructuring charges
    • GAAP Earnings of $0.15 per diluted share
  • Revenues flat YOY excluding Historic Tax Credit (HTC) asset amortization
    • Net interest income increased 2% YOY driven by balance sheet growth
    • Fees, excluding HTC amortization, decreased 6% YOY driven by lower mortgage banking and capital markets revenues
  • Organic loan growth continues, with average loans up 8% annualized QOQ
    • Average commercial business and real estate loans increased 9% QOQ
    • Momentum in average indirect auto loans continues with $160 million increase
  • Strong credit quality maintained
    • NCOs decreased to 0.36% of average originated loans in the first quarter of 2014
    • Nonperforming originated loans to originated loans decreased 11 basis points QOQ
  • Successful launch of remote deposit capture mobile feature in January 2014
    • Transactional deposits averaged 36% of deposits, up from 32% a year-ago

BUFFALO, N.Y., April 24, 2014 (GLOBE NEWSWIRE) -- First Niagara Financial Group, Inc. (Nasdaq:FNFG) today reported first quarter results, highlighted by continued balance sheet growth, consistent credit quality and stable core net interest margin.

"As we execute on our strategic investment plan to position First Niagara to generate long-term shareholder value, our first quarter results demonstrate that the organization continues to be focused on acquiring and deepening customer relationships and delivering on our objectives," said Gary M. Crosby, President and Chief Executive Officer. "Our customers and their preferences will remain at the center of all we do as we execute on our strategic investment plan. The main focus of those investments will be dedicated to expanding and enhancing our products and services and improving our operating efficiency."

"In the first quarter of 2014, business momentum remained strong as evidenced by the 9% annualized increase in average commercial loans and 8% annualized increase in total loans," said Gregory W. Norwood, Chief Financial Officer. "Consistent with industry trends in the first quarter, fee income declined from the prior quarter driven by lower activity consistent with seasonal trends. Operating expenses, excluding restructuring expenses, increased from the fourth quarter of 2013 and were driven by seasonal increases in payroll taxes as well as technology and consulting expenses related to our previously announced strategic investment plan."

First Quarter Results

In the first quarter of 2014, First Niagara reported net income available to common shareholders of $51.9 million, or $0.15 per diluted share, which included $8.3 million in after-tax restructuring and severance expenses, or $0.02 per diluted share, incurred primarily in connection with the previously announced branch staffing realignment and consolidation of certain branches completed in the first quarter. In the fourth quarter of 2013, First Niagara reported net income available to common shareholders of $70.1 million, or $0.20 per diluted share. For the first quarter of 2013, net income available to common shareholders was $59.7 million or $0.17 per diluted share and included $4.3 million in after-tax charges related to executive departures.

Balance sheet growth remained strong as average loans increased 8% annualized compared to the prior quarter. Average commercial business and real estate loans increased 9% annualized over the prior quarter, while average consumer loans increased 6% annualized driven by continued growth in indirect auto loan balances, partially offset by a decline in residential mortgage loans. Average transactional deposit balances, which include interest-bearing checking and noninterest bearing deposits, were unchanged compared to the prior quarter. The company continues to garner strong customer traction to the recent roll-out of mobile remote deposit capture.

Revenues, excluding the $7.5 million amortization related to the company's historic tax credit investments (HTC amortization), decreased 4% in the first quarter of 2014 compared to the prior quarter due in large part to seasonal declines in certain fee income categories and two fewer days in the quarter. Net interest income decreased 3% in the first quarter compared to the prior quarter driven in large part due to items that benefited the prior quarter as well as two fewer days. Net interest margin was 3.33%, as compared to 3.41% in the fourth quarter of 2013. Noninterest income, excluding the $7.5 million HTC amortization, declined 6% from the prior quarter primarily due to seasonally lower deposit service charges and lower derivative sales volumes in the capital markets business.

The provision for loan losses on originated loans totaled $21.2 million in the first quarter of 2014, including $5.5 million to support loan growth and $15.6 million to cover net charge-offs during the quarter. At March 31, 2014, nonperforming originated loans comprised 0.82% of originated loans, a 11 basis point improvement from the prior quarter. Net charge-offs equaled 0.36% of average originated loans, consistent with 0.34% reported in 2013.

Excluding $10.4 million in restructuring expenses, operating expenses for first quarter of 2014 were $238.4 million, and increased $11.2 million from the prior quarter. This increase was driven by seasonal increases in payroll taxes, higher marketing costs, as well as technology and consulting expenses related to the previously announced strategic investment plan.

Operating Results (Non-GAAP) Q1 2014 Q4 2013 Q1 2013
Net interest income $ 270.7 $ 280.3 $ 266.1
Provision for credit losses 24.8 32.0 20.2
Noninterest income 76.7 89.3 89.3
Noninterest expense 238.4 227.1 237.7
Operating net income 67.8 77.7 67.3
Preferred stock dividend 7.5 7.5 7.5
Operating net income available to common shareholders $ 60.2 $ 70.1 $ 59.7
Weighted average diluted shares outstanding 351.4 350.7 350.0
Operating earnings per diluted share $ 0.17 $ 0.20 $ 0.17

Reported Results (GAAP)
Operating net income before non-operating items $ 67.8 $ 77.7 $ 67.3
Non-operating expenses (a) 8.3 -- --
Net income 59.4 77.7 67.3
Preferred stock dividend 7.5 7.5 7.5
Net income available to common shareholders $ 51.9 $ 70.1 $ 59.7
Weighted average diluted shares outstanding 351.4 350.7 350.0
Earnings per diluted share $ 0.15 $ 0.20 $ 0.17
All amounts in millions except earnings per diluted share. The Non-GAAP/Operating Results table above summarizes the company's operating results excluding certain non-operating items. For a detailed reconciliation of non-GAAP measures, refer to the attached tables.
(a) Restructuring charges primarily related to branch realignment and consolidations, net of taxes.

Loans

Average total loans increased 8% annualized from the prior quarter, driven by continued growth in the company's commercial lending businesses as well as sustained momentum in the company's indirect auto business.

Average CRE loans increased 7% annualized to $7.8 billion compared to the fourth quarter of 2013. Commercial business (C&I) loans averaged $5.4 billion, representing a 12% annualized increase over the prior quarter. All of First Niagara's regional markets contributed to first quarter commercial lending growth, with particular strength in the company's New York and Western Pennsylvania regions, which posted growth rates of 8% and 17%, respectively.

Average indirect auto loan balances increased $160 million to $1.6 billion. During the first quarter, indirect auto originations totaled $242 million at an average customer FICO score of 753 and yielded 3.21%, net of dealer reserve. Average residential real estate loans declined by $63 million, or 7% annualized reflecting industry-wide weakness in application volumes. Home equity balances increased for the fourth consecutive quarter, and averaged $2.8 billion, or a 4% annualized quarter-over-quarter increase.

Deposits

The company strategic focus remains on efforts to grow its core deposit customer base, re-position its account mix and introduce new products and services that further enhance its value proposition. Average transaction deposit balances, which include interest-bearing and noninterest bearing checking accounts, were unchanged from the prior quarter and currently represent 36% of the company's deposit balances, up from 32% a year ago. The average cost of interest-bearing deposits of 0.23% was unchanged from the prior quarter.

Average noninterest-bearing checking deposits decreased 1% annualized compared to the prior quarter, driven by seasonal trends particularly in commercial account balances. Interest-bearing checking balances averaged $4.7 billion and increased 1% annualized from the prior quarter.

Money market and time deposit balances declined 1% and 6% annualized, respectively, driven by the company's continued pricing actions.

In response to changing consumer banking behaviors, First Niagara continues to invest in enhancing its self-service channels such as online, mobile and telephonic banking capabilities for retail and small business customers, while continuing to transform its branch network and in-branch experience. In the first quarter of 2014, the company introduced mobile remote deposit capture through which a growing number of mobile banking customers can deposit checks using their smartphones.

Net Interest Income

First quarter 2014 net interest income decreased 3% from the prior quarter to $270.7 million and was driven by an eight basis point decrease in the net interest margin to 3.33% and the effect of two fewer days in the quarter, partially offset by a 4% annualized increase in average earning assets. Growth in average earning assets reflected continued strong loan growth. Average investment securities balances remained consistent with the prior quarter.

The eight basis point quarter-over-quarter decrease in net interest margin reflected lower benefits from retroactive adjustments on the company's residential mortgage backed securities (RMBS) portfolio, lower commercial real estate prepayment income as well as continued compression of loan yields from prepayments and reinvestments at current market rates.

In the first quarter, premium amortization on the RMBS portfolio was $3.8 million, which included a $1.1 million retroactive adjustment to reflect updated estimates of future prepayment speeds. The premium amortization on the RMBS portfolio in the fourth quarter of 2013 was $0.3 million which included a $3.5 million retroactive adjustment.

Credit Quality

At March 31, 2014, the allowance for loan losses was $215.0 million, compared to $209.3 million at December 31, 2013. Nonperforming assets to total assets were 0.52%, down 4 basis points from the prior quarter, driven by a decrease in nonperforming originated loans.

Information for both the originated and acquired portfolios follows.

Q1 2014 Q4 2013
$ in millions Originated Acquired Total Originated Acquired Total
Provision for loan losses* $21.2 $3.2 $24.4 $28.2 $3.4 $31.6
Net charge-offs 15.6 3.0 18.6 17.8 2.4 20.3
NCOs/ Avg Loans 0.36% 0.28% 0.34% 0.43% 0.21% 0.38%
Total loans** $17,389 $4,476 $21,750 $16,922 $4,643 $21,440
(*) Excludes provision for unfunded commitments of $0.4 million each in 1Q14 and 4Q13
(**) Acquired loans before associated credit discount; see accompanying tables for further information

Originated loans

The provision for loan losses on originated loans totaled $21.2 million, compared to $28.2 million in the prior quarter. The provision in the first quarter included $5.5 million to support sequential originated loan growth of $466 million, compared to $10.3 million in the prior quarter that supported $711 million of originated loan growth. Net charge-offs equaled $15.6 million, or 36 basis points of average originated loans, in the first quarter of 2014, consistent with 34 basis points reported in 2013.

At March 31, 2014, nonperforming originated loans comprised 0.82% of originated loans, compared to 0.93% at December 31, 2013. Nonperforming originated loan balances declined 10% from the prior quarter driven by resolutions of credits.

At March 31, 2014, the allowance for loan losses on originated loans totaled $210.8 million or 1.21% of such loans, compared to $205.3 million at December 31, 2013.

Acquired loans

The provision for losses on acquired loans totaled $3.2 million, compared to $3.4 million in the prior quarter. Net charge-offs on those portfolios totaled $3.0 million during the quarter, compared to $2.4 million in the prior period. At March 31, 2014, the allowance for loan losses on acquired loans totaled $4.2 million, compared to $4.0 million at December 31, 2013. Acquired nonperforming loans totaled $30.6 million, compared to $30.1 million at the end of the prior quarter. At March 31, 2014, remaining credit marks available to absorb losses on a pool-by-pool basis totaled $113 million.

Fee Income

First quarter noninterest income was $76.7 million and included the $7.5 million HTC amortization charge. Excluding HTC amortization, noninterest income totaled $84.2 million and decreased 6%, or $5.1 million compared to the prior quarter. Seasonal weakness drove the quarter-over-quarter decline in deposit service charges and merchant and card fees.

Capital markets revenue decreased $2.7 million from the fourth quarter reflecting lower derivative sales volume in the current pricing environment. Deposit service charges decreased 9% from the prior quarter and were driven by seasonal patterns and lower NSF incident rates. Insurance commissions increased 2% from the prior quarter reflecting higher policy renewal activity. Mortgage banking revenues improved $0.6 million from the fourth quarter of 2013, but declined by $3.0 million or 47% from the year-ago quarter driven by lower volumes as well as lower gain-on-sale margins. Wealth management revenues increased 1% from the prior quarter and were driven by annuity sales.

Noninterest Expense

First quarter noninterest expenses were $248.7 million and included $10.4 million in restructuring charges primarily related to branch staffing realignment and consolidation of branches. Excluding these charges, operating expenses were $238.4 million. Salaries and benefit expenses increased by $4.2 million from the prior quarter driven primarily by typical resetting of payroll taxes, new hires and employee merit increases partially offset by lower healthcare costs. Marketing and advertising expense increased $2.5 million driven by promotional marketing campaigns. Professional services expenses increased $2.6 million or 28% from the prior quarter reflecting consulting fees associated with the company's strategic investments.

In the first quarter of 2014, the efficiency ratio, excluding the restructuring charges and HTC amortization, was 67.2% compared to 61.5% in the prior quarter, reflecting various seasonal impacts in both operating revenues and expenses.

Capital

At March 31, 2014, the company's estimated consolidated Total Risk Based capital and Tier 1 Common Risk Based capital ratios were 11.6% and 7.9% respectively. The company remains well above current regulatory guidelines for well-capitalized institutions.

Effective Tax Rate

In the first quarter of 2014, the company's effective tax rate declined to 19.6% from 29.7% in the prior quarter reflecting the benefits derived from historic tax credit investments funded during the quarter as well as the taxable reorganization of a subsidiary.

About First Niagara

First Niagara, through its wholly owned subsidiary, First Niagara Bank, N.A., is a multi-state community-oriented bank with 411 branches, $38 billion in assets, $28 billion in deposits, and approximately 5,800 employees providing financial services to individuals, families and businesses across New York, Pennsylvania, Connecticut and Massachusetts. For more information, visit www.firstniagara.com.

Investor Call

A conference call will be held at 10:00 a.m. Eastern Time on Thursday, April 24, 2014 to discuss the company's financial results. Those wishing to participate in the call may dial toll-free 1-888-469-1365 with the passcode: FNFG. Presentation slides will be used during the earnings conference call and are available under the investor relations tab of our website at www.firstniagara.com. A replay of the call will be available until June 1, 2014 by dialing 1-888-567-0414, passcode: 9468.

Non-GAAP Measures - This news release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). The company believes that non-GAAP financial measures provide a meaningful comparison of the underlying operational performance of the company, and facilitate investors' assessments of business and performance trends in comparison to others in the financial services industry. In addition, the company believes the exclusion of these non-operating items enables management to perform a more effective evaluation and comparison of the company's results and to assess performance in relation to the company's ongoing operations. These disclosures should not be viewed as a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Where non-GAAP disclosures are used in this news release, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in this document.

Forward-Looking Statements - This press release contains forward-looking statements with respect to the financial condition and results of operations of First Niagara Financial Group, Inc. including, without limitations, statements relating to the earnings outlook of the company. These forward-looking statements involve certain risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (1) changes in the interest rate environment; (2) competitive pressure among financial services companies; (3) general economic conditions including an increase in non-performing loans that could result from an economic downturn; (4) changes in legislation or regulatory requirements; (5) difficulties in continuing to improve operating efficiencies; and (6) execution risk associated with the announced strategic investment plan.

First Niagara Financial Group, Inc.
Income Statement Highlights -- Reported Basis
(in thousands, except per share amounts)
2014 2013 2012
First Fourth Third Second First Fourth
Quarter Quarter Quarter Quarter Quarter Quarter
Interest income:
Loans and leases $ 209,644 $ 213,778 $ 214,746 $ 209,970 $ 206,640 $ 212,035
Investment securities and other 90,421 96,020 91,996 88,110 88,961 71,564
Total interest income 300,065 309,798 306,742 298,080 295,601 283,599
Interest expense:
Deposits 12,236 12,941 12,931 12,967 14,277 16,902
Borrowings 17,082 16,579 16,271 15,670 15,194 14,411
Total interest expense 29,318 29,520 29,202 28,637 29,471 31,313
Net interest income 270,747 280,278 277,540 269,443 266,130 252,286
Provision for credit losses 24,800 32,000 27,600 25,200 20,200 22,000
Net interest income after provision 245,947 248,278 249,940 244,243 245,930 230,286
Noninterest income:
Deposit service charges 23,356 25,726 27,115 26,482 24,800 26,345
Insurance commissions 15,691 15,431 17,854 17,692 16,355 15,497
Merchant and card fees 11,504 12,567 12,464 12,380 11,298 11,945
Wealth management services 15,587 15,441 15,189 14,945 12,845 12,000
Mortgage banking 3,396 2,754 2,268 6,882 6,424 8,060
Capital markets income 3,623 6,310 5,058 5,002 6,031 7,098
Lending and leasing 4,732 4,140 4,886 4,534 3,906 3,739
Bank owned life insurance 5,405 6,027 3,725 3,321 3,467 3,021
Other income (6,570) 916 2,863 4,308 4,186 4,116
Total noninterest income 76,724 89,312 91,422 95,546 89,312 91,821
Noninterest expense:
Salaries and benefits 117,940 113,754 115,034 116,305 115,790 111,026
Occupancy and equipment 27,876 27,420 26,582 28,506 28,045 27,609
Technology and communications 30,345 29,483 28,999 29,603 27,113 28,257
Marketing and advertising 7,364 4,879 5,822 5,450 4,346 9,292
Professional services 11,923 9,314 9,820 9,782 9,603 11,163
Amortization of intangibles 7,509 7,562 7,702 10,850 14,119 14,224
FDIC premiums 8,855 7,431 9,351 9,348 8,901 9,158
Merger and acquisition integration expenses -- -- -- -- -- 3,678
Restructuring charges 10,356 -- -- -- -- --
Other expense 26,568 27,305 27,883 25,326 29,749 24,377
Total noninterest expense 248,736 227,148 231,193 235,170 237,666 238,784
Income before income tax 73,935 110,442 110,169 104,619 97,576 83,323
Income tax expense 14,491 32,752 31,026 33,485 30,291 22,226
Net income 59,444 77,690 79,143 71,134 67,285 61,097
Preferred stock dividend 7,547 7,547 7,547 7,547 7,547 7,547
Net income available to common stockholders $ 51,897 $ 70,143 $ 71,596 $ 63,587 $ 59,738 $ 53,550
Financial Ratios:
Earnings per basic share $ 0.15 $ 0.20 $ 0.20 $ 0.18 $ 0.17 $ 0.15
Earnings per diluted share 0.15 0.20 0.20 0.18 0.17 0.15
Weighted average shares outstanding - basic(1) 349,906 349,718 349,653 349,542 349,278 349,071
Weighted average shares outstanding - diluted(1) 351,408 350,699 350,896 350,384 349,999 349,663
Net revenue(2) $ 347,471 $ 369,590 $ 368,962 $ 364,989 $ 355,442 $ 344,107
Noninterest income as a percentage of net revenue(2) 22.08% 24.17% 24.78% 26.18% 25.13% 26.68%
Pre-tax, pre-provision income(3) $ 98,735 $ 142,442 $ 137,769 $ 129,819 $ 117,776 $ 105,323
Pre-tax, pre-provision income per diluted share(3) $ 0.28 $ 0.41 $ 0.39 $ 0.37 $ 0.34 $ 0.30
Pre-tax, pre-provision return on average assets(3) 1.06% 1.51% 1.47% 1.41% 1.30% 1.15%
Net interest margin(4) 3.33% 3.41% 3.40% 3.36% 3.39% 3.22%
Interest yield on average loans(4) 3.98% 4.04% 4.14% 4.19% 4.25% 4.39%
Rate paid on interest-bearing liabilities 0.44% 0.43% 0.43% 0.43% 0.44% 0.48%
Efficiency ratio 71.58% 61.46% 62.66% 64.43% 66.86% 69.39%
Expenses as a percentage of average loans and deposits 2.06% 1.89% 1.94% 1.98% 2.01% 2.03%
Effective tax rate 19.6% 29.7% 28.2% 32.0% 31.0% 26.7%
Return on average assets(5) 0.64 % 0.82% 0.85% 0.77 % 0.74% 0.67%
Return on average equity(5) 4.79 % 6.18% 6.37% 5.72 % 5.50% 4.92%
Return on average tangible equity(3)(5) 9.66 % 12.64% 13.20% 11.75 % 11.62% 10.45%
Return on average common equity 4.48 % 5.99% 6.18% 5.48 % 5.24% 4.62%
Return on average tangible common equity(3) 9.76 % 13.25% 13.92% 12.21 % 12.05% 10.72%
(1) Share count excludes unallocated ESOP shares and unvested restricted stock shares.
(2) Net revenue is comprised of net interest income and noninterest income.
(3) The tables in this earnings release present computation of earnings and certain other ratios using non-GAAP financial measures, which we believe provide investors with information that is useful in understanding our financial performance and position. See Appendix A for further detail.
(4) Yields and rates calculated on a tax equivalent basis.
(5) Return used to calculate ratio excludes preferred stock dividend.
First Niagara Financial Group, Inc.
Period End Balance Sheet
(in thousands)
2014 2013 2012
March 31, December 31, September 30, June 30, March 31, December 31,
Cash and cash equivalents $ 503,070 $ 462,927 $ 558,086 $ 552,210 $ 424,176 $ 430,862
Investment securities:
Available for sale 7,060,237 7,423,162 7,609,676 7,916,353 7,876,160 10,993,605
Held to maturity 4,467,213 4,042,481 3,841,700 3,856,960 4,218,687 1,299,806
FHLB and FRB common stock 437,550 469,217 437,534 429,740 401,373 420,277
Total investment securities 11,965,000 11,934,860 11,888,910 12,203,053 12,496,220 12,713,688
Loans held for sale 34,465 50,137 80,468 118,104 126,389 154,745
Loans and leases:
Commercial:
Real estate 7,867,724 7,777,903 7,697,407 7,482,375 7,295,544 7,093,193
Business 5,470,177 5,290,392 5,204,672 5,165,606 5,044,738 4,953,323
Total commercial loans 13,337,901 13,068,295 12,902,079 12,647,981 12,340,282 12,046,516
Consumer:
Residential real estate 3,389,071 3,447,997 3,519,233 3,558,274 3,614,912 3,761,567
Home equity 2,767,024 2,752,229 2,706,603 2,670,672 2,646,645 2,651,891
Indirect auto 1,655,489 1,543,983 1,339,449 1,049,763 818,401 601,456
Credit cards 305,663 325,140 311,600 303,455 298,310 314,973
Other consumer 295,692 302,009 310,107 313,037 316,669 333,609
Total consumer loans 8,412,939 8,371,358 8,186,992 7,895,201 7,694,937 7,663,496
Total loans and leases 21,750,840 21,439,653 21,089,071 20,543,182 20,035,219 19,710,012
Allowance for loan losses 215,037 209,274 197,953 183,708 172,002 162,522
Loans and leases, net 21,535,803 21,230,379 20,891,118 20,359,474 19,863,217 19,547,490
Bank owned life insurance 417,031 415,205 413,555 410,182 407,419 404,321
Goodwill and other intangibles 2,535,271 2,542,783 2,549,931 2,557,560 2,567,681 2,617,810
Other assets 999,804 992,071 958,473 949,144 959,459 937,316
Total assets $ 37,990,444 $ 37,628,362 $ 37,340,541 $ 37,149,727 $ 36,844,561 $ 36,806,232
Deposits:
Savings accounts $ 3,664,765 $ 3,666,759 $ 3,695,221 $ 3,878,053 $ 3,915,836 $ 3,887,587
Interest-bearing checking 4,929,302 4,743,829 4,637,807 4,499,963 4,534,444 4,450,970
Money market deposits 10,106,569 9,739,539 9,905,341 10,013,996 10,493,243 10,581,137
Noninterest-bearing deposits 5,101,681 4,865,873 4,968,501 4,845,835 4,803,835 4,643,580
Certificates of deposit 3,795,438 3,649,257 3,762,132 3,911,989 3,985,702 4,113,257
Total deposits 27,597,755 26,665,257 26,969,002 27,149,836 27,733,060 27,676,531
Short-term borrowings 4,137,496 4,822,222 4,169,416 3,698,279 2,928,929 2,983,718
Long-term borrowings 733,384 733,883 732,547 732,598 732,510 732,425
Other liabilities 495,590 413,647 531,379 666,270 503,389 487,000
Total liabilities 32,964,225 32,635,009 32,402,344 32,246,983 31,897,888 31,879,674
Preferred stockholders' equity 338,002 338,002 338,002 338,002 338,002 338,002
Common stockholders' equity 4,688,217 4,655,351 4,600,195 4,564,742 4,608,671 4,588,556
Total stockholders' equity 5,026,219 4,993,353 4,938,197 4,902,744 4,946,673 4,926,558
Total liabilities and stockholders' equity $ 37,990,444 $ 37,628,362 $ 37,340,541 $ 37,149,727 $ 36,844,561 $ 36,806,232
Selected balance sheet information:
Total interest-earning assets(1) $ 33,684,828 $ 33,396,058 $ 33,039,023 $ 32,906,363 $ 32,524,313 $ 32,321,964
Total interest-bearing liabilities 27,366,955 27,355,489 26,902,465 26,734,878 26,590,664 26,749,094
Net interest-earning assets $ 6,317,873 $ 6,040,569 $ 6,136,558 $ 6,171,485 $ 5,933,649 $ 5,572,870
Tangible common equity(2) $ 2,152,946 $ 2,112,568 $ 2,050,264 2,007,182 2,040,990 1,970,746
Unrealized gain on available for sale securities, net of tax(3) 72,579 63,930 76,686 83,898 160,942 206,733
Total core deposits $ 23,802,317 $ 23,016,000 $ 23,206,870 $ 23,237,847 $ 23,747,358 $ 23,563,274
Originated loans(4) $ 17,388,542 $ 16,922,161 $ 16,211,505 $ 15,102,336 $ 14,100,190 $ 13,372,357
Acquired loans(5) 4,475,593 4,642,775 5,006,753 5,581,651 6,083,912 6,513,636
Credit related discount on acquired loans(6) (113,295) (125,283) (129,187) (140,805) (148,883) (175,981)
Total Loans $ 21,750,840 $ 21,439,653 $ 21,089,071 $ 20,543,182 $ 20,035,219 $ 19,710,012
(1) Includes interest bearing cash and cash equivalents, investment securities at amortized cost, loans held for sale, and total loans and leases.
(2) The tables in this earnings release present computation of earnings and certain other ratios using non-GAAP financial measures, which we believe provide investors with information that is useful in understanding our financial performance and position. See Appendix A for further detail.
(3) Excludes unamortized unrealized gains recorded in accumulated other comprehensive income related to available for sale securities transferred to held to maturity.
(4) Originated loans represent total loans excluding acquired loans.
(5) Represents the carrying value of acquired loans plus the principal not expected to be collected.
(6) Represent principal on acquired loans not expected to be collected.
First Niagara Financial Group, Inc.
Average Balance Sheet and Related Tax Equivalent Yields & Rates
(in millions)
For the three months ended
March 31, 2014 December 31, 2013 March 31, 2013
Average Interest(1) Yields Average Interest(1) Yields Average Interest(1) Yields
Balances
and
Rates(1)
Balances
and
Rates(1)
Balances
and
Rates(1)
Interest-earning assets:
Loans and leases(2)
Commercial:
Real estate $ 7,801 $ 76 3.89% $ 7,673 $ 79 4.02% $ 7,179 $ 76 4.25%
Business 5,413 48 3.56 5,257 48 3.60 4,999 47 3.74
Total commercial loans 13,214 124 3.76 12,930 127 3.85 12,178 123 4.04
Consumer:
Residential real estate 3,416 33 3.88 3,479 34 3.89 3,691 37 4.01
Home equity 2,756 28 4.12 2,732 29 4.15 2,648 28 4.29
Indirect auto 1,613 12 2.93 1,453 11 3.03 712 6 3.29
Credit cards 314 9 11.64 313 9 11.38 304 8 10.40
Other consumer 300 6 8.64 307 7 8.66 328 7 8.17
Total consumer loans 8,399 88 4.26 8,284 89 4.27 7,683 85 4.50
Total loans and leases 21,613 212 3.98 21,214 216 4.04 19,861 208 4.25
Residential MBS 5,689 39 2.75 5,502 42 3.07 5,488 34 2.50
Commercial MBS 1,697 14 3.28 1,772 17 3.84 1,914 18 3.78
Other investment securities (3) 4,388 39 3.55 4,505 38 3.40 4,822 38 3.19
Total securities, at amortized cost 11,774 92 3.12 11,779 98 3.31 12,224 91 2.97
Money market and other investments 125 1 1.64 189 1 1.38 241 1 1.31
Total interest-earning assets 33,512 $ 305 3.69% 33,182 $ 314 3.76% 32,326 $ 300 3.76%
Goodwill and other intangibles 2,539 2,546 2,609
Other noninterest-earning assets 1,697 1,651 1,872
Total assets $ 37,748 $ 37,379 $ 36,807
Interest-bearing liabilities:
Deposits
Savings accounts $ 3,631 $ 1 0.08% $ 3,670 $ 1 0.09% $ 3,894 $ 1 0.11%
Interest-bearing checking 4,735 -- 0.03 4,725 -- 0.04 4,379 1 0.05
Money market deposits 9,887 5 0.20 9,900 5 0.20 10,643 6 0.23
Certificates of deposit 3,647 6 0.70 3,698 7 0.71 4,081 7 0.67
Total interest bearing deposits 21,900 12 0.23% 21,993 13 0.23% 22,997 14 0.25%
Borrowings
Short-term borrowings 4,642 5 0.44% 4,259 4 0.42% 3,152 3 0.40%
Long-term borrowings 734 12 6.69 732 12 6.56 730 12 6.71
Total borrowings 5,376 17 1.29 4,991 17 1.32 3,882 15 1.59
Total interest-bearing liabilities 27,276 $ 29 0.44% 26,984 $ 30 0.43% 26,879 $ 29 0.44%
Noninterest-bearing deposits 4,864 4,878 4,468
Other noninterest-bearing liabilities 574 532 502
Total liabilities 32,714 32,395 31,849
Total stockholders' equity 5,034 4,984 4,958
Total liabilities and stockholders' equity $ 37,748 $ 37,379 $ 36,807
Net interest income (FTE) $ 275 $ 285 $ 270
Taxable Equivalent Adjustment(1) 4 5 4
Total core deposits $ 23,117 $ 6 0.10% $ 23,173 $ 6 0.11% $ 23,384 $ 8 0.13%
Total transactional deposits 9,599 -- 0.02% 9,603 -- 0.02% 8,847 1 0.03%
Total deposits 26,764 12 0.19% 26,871 13 0.19% 27,465 14 0.21%
Tax equivalent net interest rate spread(2) 3.25% 3.33% 3.32%
Tax equivalent net interest rate margin(2) 3.33% 3.41% 3.39%
(1) Tax equivalent interest income is calculated using a 35% tax rate.
(2) Includes nonaccrual loans.
(3) Includes debt securities, collateralized loan obligations, asset-backed securities, FHLB and FRB common stock, and other investment securities.
First Niagara Financial Group, Inc.
Allowance for Loans and Lease Losses & Asset Quality
(in thousands)
2014 2013 2012
First Fourth Third Second First Fourth
Quarter Quarter Quarter Quarter Quarter Quarter
Beginning balance $ 209,274 $ 197,953 $ 183,708 $ 172,002 $ 162,522 $ 149,933
Net loan (charge-offs) recoveries:
Commercial real estate $ 905 $ (5,764) $ 1,013 $ (2,817) $ (2,121) $ (1,935)
Commercial business (9,138) (6,382) (9,694) (7,175) (4,902) (3,385)
Residential real estate (174) (168) (137) (291) (427) (658)
Home equity (3,045) (1,528) (322) (905) (613) (673)
Indirect auto (2,086) (1,215) (692) (552) (252) (231)
Credit cards (3,044) (3,082) (1,300) (194) (204) (291)
Other consumer (2,055) (2,140) (1,823) (1,160) (1,801) (1,763)
Total net loan charge-offs $ (18,637) $ (20,279) $ (12,955) $ (13,094) $ (10,320) $ (8,936)
Provision for loan losses 24,400 31,600 27,200 24,800 19,800 21,525
Ending balance $ 215,037 $ 209,274 $ 197,953 $ 183,708 $ 172,002 $ 162,522
Supplemental information
Allowance to loans 0.99 % 0.98 % 0.94 % 0.89 % 0.86 % 0.82 %
Allowance for originated loans to originated loans(1) 1.21 % 1.21 % 1.20 % 1.21 % 1.21 % 1.20 %
Net charge-offs (recoveries) to average loans (annualized)
Commercial real estate (0.05)% 0.30 % (0.05)% 0.15 % 0.12 % 0.11 %
Commercial business 0.68 % 0.49 % 0.75 % 0.56 % 0.39 % 0.28 %
Total commercial loans 0.25 % 0.38 % 0.27 % 0.32 % 0.23 % 0.18 %
Residential real estate 0.02 % 0.02 % 0.02 % 0.03 % 0.05 % 0.07 %
Home equity 0.44 % 0.22 % 0.05 % 0.14 % 0.09 % 0.10 %
Indirect auto 0.52 % 0.33 % 0.23 % 0.23 % 0.15 % 0.18 %
Credit cards 3.88 % 3.93 % 1.68 % 0.26 % 0.27 % 0.38 %
Other consumer 2.74 % 2.79 % 2.01 % 0.88 % 1.27 % 1.29 %
Total consumer loans 0.50 % 0.40 % 0.22 % 0.16 % 0.17 % 0.19 %
Total loans 0.34 % 0.38 % 0.25 % 0.26 % 0.21 % 0.18 %
Net charge-offs (recoveries) of originated loans to average originated loans (annualized)(1)
Commercial real estate (0.11)% 0.24 % (0.07)% 0.14 % 0.10 % 0.07 %
Commercial business 0.73 % 0.53 % 0.83 % 0.64 % 0.45 % 0.33 %
Total commercial loans 0.26 % 0.37 % 0.33 % 0.36 % 0.26 % 0.19 %
Residential real estate 0.04 % 0.04 % 0.03 % 0.07 % 0.10 % 0.15 %
Home equity 0.21 % 0.29 % 0.09 % 0.26 % 0.19 % 0.21 %
Indirect auto 0.52 % 0.33 % 0.23 % 0.23 % 0.15 % 0.18 %
Credit cards 3.88 % 3.93 % 1.68 % 0.26 % 0.34 % 0.69 %
Other consumer 2.74 % 2.80 % 2.59 % 1.91 % 2.44 % 1.71 %
Total consumer loans 0.57 % 0.56 % 0.33 % 0.27 % 0.28 % 0.33 %
Total loans 0.36 % 0.43 % 0.33 % 0.33 % 0.27 % 0.24 %
Nonperforming loans:
Originated(1):
Commercial real estate $ 41,296 $ 53,395 $ 51,302 $ 59,624 $ 49,953 $ 50,848
Commercial business 35,335 42,013 35,854 44,658 47,523 47,066
Residential real estate 32,736 31,478 31,312 29,667 28,455 27,192
Home equity 19,516 18,426 15,709 14,601 14,270 14,233
Indirect auto 7,943 6,274 5,129 3,276 2,426 931
Other consumer 5,216 5,838 5,538 2,818 3,018 2,806
Total originated nonperforming loans 142,042 157,424 144,844 154,644 145,645 143,076
Total acquired nonperforming loans(2) 30,617 30,088 30,388 27,556 27,678 29,648
Total nonperforming loans 172,659 187,512 175,232 182,200 173,323 172,724
Real estate owned 25,466 24,788 24,262 8,144 10,816 10,114
Total nonperforming assets $ 198,125 $ 212,300 $ 199,494 $ 190,344 $ 184,139 $ 182,838
Accruing troubled debt restructurings (TDR) $ 56,038 $ 52,263 $ 69,877 $ 69,892 $ 64,311 $ 46,280
Loans 90 days past due still accruing(3) 119,134 113,212 136,248 167,560 172,062 171,568
Total classified loans(4) 667,327 663,700 648,235 701,104 720,197 708,468
Total criticized loans(5) $ 1,075,523 $ 985,019 $ 977,798 $ 1,012,305 $ 1,044,874 $ 1,002,659
Total nonperforming loans to loans 0.79 % 0.87 % 0.83 % 0.89 % 0.87 % 0.88 %
Total nonperforming originated loans to originated loans(1) 0.82 % 0.93 % 0.89 % 1.02 % 1.03 % 1.07 %
Total nonperforming assets to loans and real estate owned 0.91 % 0.99 % 0.94 % 0.93 % 0.92 % 0.93 %
Total nonperforming assets to assets 0.52 % 0.56 % 0.53 % 0.51 % 0.50 % 0.50 %
Allowance to nonperforming loans 124.5 % 111.6 % 113.0 % 100.8 % 99.2 % 94.1 %
Originated loans(1) $ 17,388,542 $ 16,922,161 $ 16,211,505 $ 15,102,336 $ 14,100,190 $ 13,372,357
Acquired loans(6) 4,475,593 4,642,775 5,006,753 5,581,651 6,083,912 6,513,636
Credit related discount on acquired loans(7) (113,295) (125,283) (129,187) (140,805) (148,883) (175,981)
Total Loans $ 21,750,840 $ 21,439,653 $ 21,089,071 $ 20,543,182 $ 20,035,219 $ 19,710,012
(1) Originated loans represent total loans excluding acquired loans.
(2) Nonperforming acquired loans include certain lines of credit that are considered nonaccruing.
(3) Includes acquired loans that were originally recorded at fair value upon acquisition, credit card loans, and loans that have matured which are in the process of collection.
(4) Includes consumer loans, which are considered classified when they are 90 days or more past due. Classified loans include substandard, doubtful, and loss, which are consistent with regulatory definitions, and as described in Item 1, "Business", under the heading "Asset Quality Review" in our Annual Report on 10-K for the year ended December 31, 2013.
(5) Criticized loans includes consumer loans when they are 90 days or more past due. Criticized loans include special mention, substandard, doubtful, and loss.
(6) Represents the carrying value of acquired loans plus the principal not expected to be collected.
(7) Represent principal on acquired loans not expected to be collected.
First Niagara Financial Group, Inc.
Key Statistics
(Share counts in thousands)
2014 2013 2012
March 31, December 31, September 30, June 30, March 31, December 31,
First Niagara Financial Group, Inc. capital ratios:
Tier 1 risk based capital 9.62% 9.56% 9.45% 9.41% 9.45% 9.29%
Tier 1 common capital(1) 7.92% 7.86% 7.72% 7.65% 7.64% 7.45%
Total risk based capital 11.60% 11.53% 11.40% 11.35% 11.38% 11.23%
Leverage 7.28% 7.26% 7.14% 7.01% 6.92% 6.75%
Equity to assets 13.23% 13.27% 13.22% 13.20% 13.43% 13.39%
Tangible common equity to tangible assets(1) 6.07% 6.02% 5.89% 5.80% 5.95% 5.77%
Total risk weighted assets(2) $ 26,639 $ 26,412 $ 26,078 $ 25,564 $ 24,949 $ 24,379
First Niagara Bank, N.A capital ratios:
Tier 1 risk based capital 10.22% 10.15% 10.08% 10.08% 10.15% 9.94%
Total risk based capital 11.08% 10.99% 10.89% 10.85% 10.89% 10.66%
Leverage 7.74% 7.70% 7.61% 7.50% 7.43% 7.23%
Total risk weighted assets(2) $ 26,597 $ 26,365 $ 26,037 $ 25,520 $ 24,933 $ 24,379
Number of branches 411 421 422 422 427 430
Full time equivalent employees 5,750 5,807 5,788 5,779 5,875 5,927
Share information and per share metrics:
Common shares outstanding 354,127 353,941 353,973 353,932 353,008 352,621
Preferred shares outstanding 14,000 14,000 14,000 14,000 14,000 14,000
Treasury shares 11,875 12,061 12,029 12,070 12,994 13,381
Market price (NASDAQ:FNFG): $ 9.45 $ 10.62 $ 10.37 $ 10.07 $ 8.86 $ 7.93
Book value per common share(3) 13.40 13.31 13.15 13.06 13.19 13.15
Tangible book value per common share(1)(3) 6.15 6.04 5.86 5.74 5.84 5.65
Price/Book 70.52% 79.79% 78.86% 77.11% 67.17% 60.30%
Price/Tangible book(1) 153.66% 175.83% 176.96% 175.44% 151.71% 140.35%
Common stock dividends $ 0.08 $ 0.08 $ 0.08 $ 0.08 $ 0.08 $ 0.08
Preferred stock dividends 0.54 0.54 0.54 0.54 0.54 0.54
Dividend payout ratio 53.33% 40.00% 40.00% 44.44% 47.06% 53.33%
Dividend yield (annualized) 3.43% 2.99% 3.06% 3.19% 3.66% 4.01%
(1) The tables in this earnings release present computation of earnings and certain other ratios using non-GAAP financial measures, which we believe provide investors with information that is useful in understanding our financial performance and position. See Appendix A for further detail.
(2) Represents an estimate of total risk weighted assets as of March 31, 2014. All preceding quarters represent actual calculated balances.
(3) Share count excludes unallocated ESOP shares and unvested restricted stock shares.
First Niagara Financial Group, Inc.
Appendix A - Non-GAAP Reconciliation
(in thousands, except per share amounts)
2014 2013 2012
First Fourth Third Second First Fourth
Quarter Quarter Quarter Quarter Quarter Quarter
Financial ratios computed on an operating basis(1):
Earnings per basic share $ 0.17 $ 0.20 $ 0.20 $ 0.18 $ 0.17 $ 0.19
Earnings per diluted share 0.17 0.20 0.20 0.18 0.17 0.19
Weighted average shares outstanding - basic(2) 349,906 349,718 349,653 349,542 349,278 349,071
Weighted average shares outstanding - diluted(2) 351,408 350,699 350,896 350,384 349,999 349,663
Noninterest income as a percentage of net revenue(3) 22.08% 24.17% 24.78% 26.18% 25.13% 25.48%
Pre-tax, pre-provision income 109,091 142,442 137,769 129,819 117,776 125,281
Pre-tax, pre-provision income per diluted share 0.31 0.41 0.39 0.37 0.34 0.36
Pre-tax, pre-provision return on average assets 1.17% 1.51% 1.47% 1.41% 1.30% 1.37%
Net interest margin(4) 3.33% 3.41% 3.40% 3.36% 3.39% 3.42%
Interest yield on average loans(4) 3.98% 4.04% 4.14% 4.19% 4.25% 4.39%
Rate paid on interest-bearing liabilities 0.44% 0.43% 0.43% 0.43% 0.44% 0.48%
Efficiency ratio 68.60% 61.46% 62.66% 64.43% 66.86% 65.24%
Effective tax rate 19.6% 29.7% 28.2% 32.0% 31.0% 27.0%
Return on average assets 0.73% 0.82% 0.85% 0.77% 0.74% 0.83%
Return on average equity 5.46% 6.18% 6.37% 5.72% 5.50% 6.06%
Return on average tangible equity(5) 11.02% 12.64% 13.20% 11.75% 11.62% 12.89%
Return on average common equity 5.20% 5.99% 6.18% 5.48% 5.24% 5.86%
Return on average tangible common equity(6) 11.33% 13.25% 13.92% 12.21% 12.05% 13.57%
Reconciliation of net interest income on operating basis to reported net interest income(1):
Total net interest income on operating basis (Non-GAAP) $ 270,747 $ 280,278 $ 277,540 $ 269,443 $ 266,130 $ 268,566
Additional premium amortization on securities portfolio -- -- -- -- -- (16,280)
Total reported net interest income (GAAP) 270,747 280,278 277,540 269,443 266,130 252,286
Reconciliation of noninterest expense on operating basis to reported noninterest expense(1):
Total noninterest expense on operating basis (Non-GAAP) $ 238,380 $ 227,148 $ 231,193 $ 235,170 $ 237,666 $ 235,106
Merger and acquisition integration expenses -- -- -- -- -- 3,678
Restructuring charges 10,356 -- -- -- -- --
Total reported noninterest expense (GAAP) $ 248,736 $ 227,148 $ 231,193 $ 235,170 $ 237,666 $ 238,784
Reconciliation of net operating income to net income(1):
Net operating income (Non-GAAP) $ 67,789 $ 77,690 $ 79,143 $ 71,134 $ 67,285 $ 75,358
Nonoperating income and expenses, net of tax:
Additional premium amortization on securities portfolio -- -- -- -- -- 11,633
Merger and acquisition integration expenses -- -- -- -- -- 2,628
Restructuring charges 8,345 -- -- -- -- --
Total nonoperating expenses, net of tax 8,345 -- -- -- -- 14,261
Net income (GAAP) $ 59,444 $ 77,690 $ 79,143 $ 71,134 $ 67,285 $ 61,097
Reconciliation of net operating income available to common stockholders to net income available to common stockholders(1):
Net operating income available to common stockholders (Non-GAAP) $ 60,242 $ 70,143 $ 71,596 $ 63,587 $ 59,738 $ 67,811
Nonoperating income and expenses, net of tax:
Additional premium amortization on securities portfolio -- -- -- -- -- 11,633
Merger and acquisition integration expenses -- -- -- -- -- 2,628
Restructuring charges 8,345 -- -- -- -- --
Total nonoperating income and expenses, net of tax 8,345 -- -- -- -- 14,261
Net income available to common stockholders (GAAP) $ 51,897 $ 70,143 $ 71,596 $ 63,587 $ 59,738 $ 53,550
Computation of pre-tax,pre-provision income:
Net interest income $ 270,747 $ 280,278 $ 277,540 $ 269,443 $ 266,130 $ 252,286
Noninterest income 76,724 89,312 91,422 95,546 89,312 91,821
Noninterest expense (248,736) (227,148) (231,193) (235,170) (237,666) (238,784)
Pre-tax, pre-provision income (GAAP) 98,735 142,442 137,769 129,819 117,776 105,323
Add back: non-operating premium amortization -- -- -- -- -- 16,280
Add back: non-operating noninterest expenses (1) 10,356 -- -- -- -- 3,678
Pre-tax, pre-provision income (Non-GAAP)(1) $ 109,091 $ 142,442 $ 137,769 $ 129,819 $ 117,776 $ 125,281
(1) Net interest income, noninterest income and expense on an operating basis, net operating income, and pre-tax, pre-provision income on an operating basis are non-GAAP measures that we believe provide meaningful comparisons of our underlying operational performance and facilitates investors' assessments of business and performance trends in comparison to others in the financial services industry. In addition, we believe exclusion of these nonoperating items enables management to perform a more effective evaluation and comparison of our results and to assess performance in relation to our ongoing operations.
(2) Share count excludes unallocated ESOP shares and unvested restricted stock shares.
(3) Net revenue is comprised of net interest income and noninterest income.
(4) Yields and rates calculated on a tax equivalent basis.
(5) Tangible equity is a non-GAAP measure and excludes goodwill and other intangibles.
(6) Tangible common equity is a non-GAAP measure and excludes goodwill and other intangibles as well as preferred stock.
First Niagara Financial Group, Inc.
Appendix A - Non-GAAP Reconciliation (Cont.)
(in thousands, except per share amounts)
2014 2013 2012
First Fourth Third Second First Fourth
Quarter Quarter Quarter Quarter Quarter Quarter
Computation of Ending Tangible Common Equity:
Total stockholders' equity $ 5,026,219 $ 4,993,353 $ 4,938,197 $ 4,902,744 $ 4,946,673 $ 4,993,353
Less: Goodwill and other intangibles (2,535,271) (2,542,783) (2,549,931) (2,557,560) (2,567,681) (2,617,810)
Less: Preferred stockholders' equity (338,002) (338,002) (338,002) (338,002) (338,002) (338,002)
Tangible common equity $ 2,152,946 $ 2,112,568 $ 2,050,264 $ 2,007,182 $ 2,040,990 $ 2,037,541
Computation of Average Tangible Equity:
Total stockholders' equity $ 5,034,093 $ 4,984,003 $ 4,932,949 $ 4,989,006 $ 4,958,402 $ 4,945,132
Less: Goodwill and other intangibles (2,538,891) (2,546,031) (2,553,647) (2,561,507) (2,609,409) (2,619,322)
Tangible equity $ 2,495,202 $ 2,437,972 $ 2,379,302 $ 2,427,499 $ 2,348,993 $ 2,325,810
Computation of Average Tangible Common Equity:
Total stockholders' equity $ 5,034,093 $ 4,984,003 $ 4,932,949 $ 4,989,006 $ 4,958,402 $ 4,945,132
Less: Goodwill and other intangibles (2,538,891) (2,546,031) (2,553,647) (2,561,507) (2,609,409) (2,619,322)
Less: Preferred stockholders' equity (338,002) (338,002) (338,002) (338,002) (338,002) (338,002)
Tangible common equity $ 2,157,200 $ 2,099,970 $ 2,041,300 $ 2,089,497 $ 2,010,991 $ 1,987,808
Computation of Tier 1 Common Capital:
Tier 1 capital $ 2,562,261 $ 2,525,656 $ 2,464,801 $ 2,406,473 $ 2,356,763 $ 2,264,679
Less: Qualifying restricted core capital elements (113,107) (112,886) (112,667) (112,449) (112,236) (112,025)
Less: Perpetual non-cumulative preferred stock (338,002) (338,002) (338,002) (338,002) (338,002) (338,002)
Tier 1 common capital (Non-GAAP) $ 2,111,152 $ 2,074,768 $ 2,014,132 $ 1,956,022 $ 1,906,525 $ 1,814,652

CONTACT: First Niagara Investors: Ram Shankar Senior Vice President, Investor Relations (716) 270-8623 ram.shankar@fnfg.com News Media: David Lanzillo Senior Vice President, Corporate Communications (716) 819-5780 david.lanzillo@fnfg.com

Source:First Niagara Financial Group, Inc.