TribLIVE

| Business

 
Larger text Larger text Smaller text Smaller text | Order Photo Reprints

First Niagara CEO Koelmel stepping down after failed merger

Email Newsletters

Click here to sign up for one of our email newsletters.

On the Grid

From the shale fields to the cooling towers, Trib Total Media covers the energy industry in Western Pennsylvania and beyond. For the latest news and views on gas, coal, electricity and more, check out On the Grid today.

'American Coyotes' Series

Traveling by Jeep, boat and foot, Tribune-Review investigative reporter Carl Prine and photojournalist Justin Merriman covered nearly 2,000 miles over two months along the border with Mexico to report on coyotes — the human traffickers who bring illegal immigrants into the United States. Most are Americans working for money and/or drugs. This series reports how their operations have a major impact on life for residents and the environment along the border — and beyond.

Staff and Wire Reports
Tuesday, March 19, 2013, 5:51 p.m.
 

First Niagara Financial Group said CEO John R. Koelmel is stepping down and being replaced on an interim basis.

Koelmel's departure was “mutually agreed,” the Buffalo, N.Y.-based company said Tuesday in a statement, without elaborating on the reason for his exit. “I agree with the board that it's in the best interests of the organization under present circumstances to move forward with new leadership,” Koelmel, 60, said in the statement.

The interim CEO, Gary M. Crosby, 59, was the bank's chief administrative and operations officer since July 2009. Before joining First Niagara, he served as CFO and COO for the Buffalo City School District, according to a regulatory filing.

Bank analyst Anthony Polini said that First Niagara embarked on “an overly aggressive acquisition campaign,” under Koelmel and that his biggest deal did not pay off.

Koelmel did “hit two home runs” with acquisitions in 2009, said Polini, an analyst at Raymond James & Associates, New York. They were the $54 million acquisition of 57 National City branches in the Pittsburgh region that were sold by PNC Bank, followed a few months later by the $237 million acquisition of Harleysville National Corp., a Philadelphia-area financial services company.

But Koelmel's $1 billion acquisiton of 195 HSBC branches mostly in upstate New York was “a big mistake” because First Niagara “ended up paying too much,” said the analyst.

Koelmel joined First Niagara in 2004 and served as chief financial officer. He was named CEO in December 2006 and succeeded Paul Kolkmeyer, who departed amid philosophical differences with the board, then-Chairman Robert Weber said in a statement at the time.

First Niagara shares have declined 41 percent since Koelmel took over, closing Tuesday at $8.44. The stock has dropped 18 percent in the past year, the worst performance in the index of 24 lenders, which has climbed 14 percent. M&T Bank Corp., the Buffalo lender that counts Warren Buffett's Berkshire Hathaway Inc. among its biggest shareholders, has advanced 19 percent.

Koelmel led the bank “during a period of difficult economic conditions and financial industry turmoil,” Chairman G. Thomas Bowers said in the statement. “The board and I are grateful to John for his leadership through this critical period in our history and for positioning us so that we can focus on enhancing shareholder value through continuing organic growth and the efficient operation of the business we have today.”

Bloomberg News and Trib Total Media staff writer Thomas Olson contributed to this report.

Subscribe today! Click here for our subscription offers.

 

 


Show commenting policy

Most-Read Business Headlines

  1. Stocks end 5-day slide on strong Ford, UPS earnings
  2. Consol Energy, Range Resources report 2Q losses, plan deeper cuts
  3. U.S. Steel joins major producers in new dumping complaint
  4. Ambridge’s PittMoss takes off with help from TV show, Mt. Lebanon native Cuban
  5. Muni bond funds stressed
  6. Leisure, hospitality lead Pittsburgh area job gains
  7. Bayer sets sights beyond aspirin
  8. Plummeting natural gas prices slash revenue of Marcellus shale producers
  9. Analysts fear momentum in housing market won’t last
  10. Chronic job-seekers giving up the hunt
  11. Israel’s Teva drops bid for Mylan, buys Allergan for $40.5B