Charges related to collateralized mortgage obligations and job cuts helped push profit lower at First Niagara Financial Group, Inc. in the fourth quarter. Net income available to common shareholders at Buffalo–based First Niagara (NASDAQ: FNFG) totaled $53.5 million, or 15 cents a share, for the period. That’s down from $58.5 million, or 19 cents a […]
Charges related to collateralized mortgage obligations and job cuts helped push profit lower at First Niagara Financial Group, Inc. in the fourth quarter.
Net income available to common shareholders at Buffalo–based First Niagara (NASDAQ: FNFG) totaled $53.5 million, or 15 cents a share, for the period. That’s down from $58.5 million, or 19 cents a share, in the fourth quarter of 2011.
For the full year in 2012, net income available to common shareholders totaled $140.7 million, or 40 cents per share. That’s down from $173.9 million, or 64 cents per share, in 2011.
First Niagara Bank has 430 branches, $37 billion in assets, and 6,000 employees in upstate New York, Pennsylvania, Connecticut, and Massachusetts.
During the quarter, the banking company took a $16 million charge related to its portfolio of collateralized mortgage obligations. The move reflects higher levels of mortgage prepayments than expected and projections of elevated levels for the foreseeable future, according to First Niagara.
The company also recorded $3.7 million in restructuring charges. First Niagara cut 180 positions across its four-state footprint late last year. The cuts included five positions in Central New York.
First Niagara President and CEO John Koelmel said managing expenses will be a priority for the bank throughout 2013.
“We must spend less,” he said during a Jan. 23 conference call on First Niagara’s fourth-quarter results.
The bank will continue to look for ways to run more efficiently, he added.
Personnel costs, vendor expenses, and other costs will all get continued close attention, First Niagara CFO Gregory Norwood said during the conference call. He said the bank wasn’t announcing any more specific cost-cutting moves, but would continue to focus on expenses in the months ahead.
First Niagara Bank is number four in the Syracuse metro area deposit market with 21 branches, more than $808 million in deposits, and a deposit market share of more than 7.5 percent, according to the latest statistics from the Federal Deposit Insurance Corp. First Niagara is also number four in the Utica–Rome market with nine branches, $405.9 million in deposits, and a market share of about 11 percent.
The bank is number two in the Binghamton market with 10 branches, $342.5 million in deposits, and a market share of 12.8 percent.
First Niagara had total loans of $19.7 billion at the end of 2012, up from about $16.5 billion at the end of 2011. Deposits totaled $27.7 billion, up from $19.4 billion.
Net interest income in the fourth quarter was $252.3 million, up from $242.5 million a year earlier. Noninterest income for the period totaled $91.8 million, up from $63.7 million in the fourth quarter of 2011.
Noninterest expenses totaled $238.8 million in the fourth quarter, up from $202.2 million a year earlier. Koelmel said First Niagara’s goal is to reduce that total to about $225 million per quarter.
Net charge-offs totaled $8.9 million for the period, up from $5.8 million a year earlier. First Niagara’s loan loss provision in the fourth quarter was $21.5 million, up from $13.2 million a year earlier.
Nonperforming loans totaled $172.7 million at the end of the year, up from $89.8 million at the end of 2011.
Contact Tampone at ktampone@cnybj.com
