US: Key, First Niagara to unload 18 branches to satisfy Feds

Cleveland-based KeyCorp and First Niagara Financial Group Inc will sell 18 First Niagara branches in and around Buffalo, New York, to resolve antitrust concerns tied to KeyCorp’s planned acquisition of First Niagara, the U.S. Justice Department said on Thursday.

The department said the 18 branches have approximately $1.7 billion in deposits.

The deal was valued at $4.1 billion when it was announced in October. It is the latest in a string of mergers among smaller U.S. banks, spurred by years of near-zero interest rates and higher costs related to stricter regulations imposed since the financial crisis.

In an unusual request by a governor, New York’s Andrew Cuomo urged federal regulators in February to block the acquisition, saying a merger would impede retail banking competition and cost thousands of jobs upstate.

He said it would add to the tens of thousands of Buffalo-area residents who have difficulty accessing bank branches, and likely force many people to rely on costly alternatives such as payday lenders and check-cashing providers.

The deal is subject to further regulatory approvals, the Justice Department said.

Full Content: Reuters

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