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First Niagara rebounds to earn $71.1 million in second quarter

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First Niagara Financial Group reported profits of $71.1 million in the second quarter, bouncing back from a $10.9 million loss a year earlier when the Buffalo-based bank was hit by the cost of acquiring HSBC’s upstate branches.

In a Friday conference call, Gary M. Crosby, the interim president and chief executive officer, offered few details of the bank’s search for a new CEO, other than to say the process was continuing without a specific deadline for making a choice. John Koelmel departed from the job in March, prompting the search for a new permanent CEO.

“In the meantime, we’re not missing a beat, as evidenced by our second-quarter results,” Crosby said. The search committee is pleased with the “quantity and the quality” of candidates for the position, he said.

Including the dividends it paid on preferred stock, First Niagara reported second-quarter net income available to common stockholders of $63.6 million, compared with an $18.5 million loss a year ago, stemming from the impact of the HSBC deal. Its earnings per share of 18 cents in the second quarter, which ended June 30, met analysts’ expectations.

First Niagara’s net interest income increased 3.9 percent from a year ago, to $269 million. Its net revenue, which combines net interest income and non-interest income, was $365 million, up 3 percent from the second quarter of 2012.

First Niagara’s non-interest expenses fell 32 percent from a year ago, to $235.2 million. The key difference was, a year ago First Niagara incurred $131.5 million in merger and acquisition-related expenses and none in the second quarter.

Total commercial loans increased to $12.6 billion, from $11.2 billion a year ago. First Niagara in the first half of this year has hired 10 additional, experienced commercial lending leaders to help bolster that segment, said Greg Norwood, the bank’s chief financial officer.

The bank closed five branches during the quarter, bringing to nine the total it has consolidated since the start of this year.

email: mglynn@buffnews.com

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