First Niagara Reports First Quarter 2013 Results

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| Source: First Niagara Financial Group, Inc.

First Quarter Highlights:

  • Net Income of $0.17 per share included $0.01 in executive departure related charges
  • Operating revenues declined 1% QOQ primarily driven by a 3% decline in fee income
  • Net interest margin of 3.39% decreased 3 basis points from adjusted fourth quarter
  • Lower margins drove a 20% QOQ decline in mortgage banking revenues
  • Operating expenses declined $3.7 million from the prior quarter adjusted for executive departure related charges
  • Average total loans increased 11% annualized QOQ driven by 13th consecutive quarter of double-digit increases in average commercial lending
  • Double-digit average commercial growth rates QOQ in each of the company's geographies
  • New York commercial loans increased 9% annualized since HSBC Transaction
  • Interest-bearing checking balances up 19% annualized
  • New checking account unit production per branch increased 15% QOQ
  • Mobile banking platform successfully launched in January 2013
  • Strong credit quality maintained
  • Originated NPL balances flat QOQ and declined 4 basis points to 1.03% of originated loans
  • NCOs equaled 0.27% of average originated loans, compared to 0.35% in 2012

BUFFALO, N.Y., April 19, 2013 (GLOBE NEWSWIRE) -- First Niagara Financial Group, Inc. (Nasdaq:FNFG) today announced first quarter 2013 results that reflect continued organic loan growth, particularly in commercial lending, positive operating leverage driven by strong focus on expense management, and strong credit quality.

"Our first-quarter results are evidence of our continued strong fundamentals and a focus on enhancing shareholder value," said Gary Crosby, Interim President and Chief Executive Officer. "We are driving profitable growth by enabling our people to provide our customers what they need every day, and focusing on the efficiency and effectiveness of our organization as never before. In 2013, it is "business as usual" at First Niagara as we continue to execute our existing strategic plan, focusing on managing expenses, maintaining our strong credit quality and maximizing the company's potential in the diverse and attractive markets we serve."

The company is progressing on its search for a permanent CEO. The Board of Directors' search committee, chaired by Nathaniel D. Woodson and including Carl A. Florio and Carlton L. Highsmith, is being assisted by the national search firm of Korn/Ferry International.

First Quarter Results

In the first quarter of 2013, First Niagara reported net income available to common shareholders of $59.7 million, or $0.17 per diluted share compared to net income of $53.6 million, or $0.15 per diluted share in the fourth quarter of 2012. Results for the first quarter 2013 include the impact of a $6.3 million pre-tax charge, or $0.01 per share related to two executive departures announced last month. Reported GAAP results for the fourth quarter of 2012 included $3.7 million of restructuring charges as well as the impact of the $16 million accelerated CMO premium amortization adjustment.

Net interest margin declined 3 basis points to 3.39% from the adjusted 3.42% reported in the fourth quarter of 2012. Net interest income in the first quarter declined 1% annualized compared to adjusted fourth quarter levels. Noninterest income decreased $2.5 million or 3% from the prior quarter primarily due to lower mortgage banking, deposit service charges, and capital markets revenues.

Balance sheet growth remained strong as average interest-earning assets increased 8% annualized compared to the prior quarter. Average commercial loans increased 17% annualized over the prior quarter, the 13th consecutive quarter of double-digit growth. Average indirect auto loan balances increased $197 million while other consumer loan categories declined modestly compared to the prior quarter. Average interest-checking deposits increased 19% annualized from the prior quarter driven by greater account acquisition activity as well as increases in balances held by customers.

The provision for loan losses on originated loans totaled $18.9 million in the first quarter of 2013, including $9.8 million to support loan growth and $9.1 million to cover net charge-offs during the quarter. At March 31, 2013, nonperforming originated loans were flat compared to prior quarter levels and as a percentage of originated loans decreased four basis points to 1.03% from 1.07% at December 31, 2012. Net charge-offs equaled 27 basis points of average originated loans, compared to 35 basis points in 2012.

First quarter 2013 expenses, excluding a $6.3 million pre-tax charge related to two executive departures announced last month, declined $3.7 million, or 2%, compared to the prior quarter. Seasonal increases in salaries and benefits expense driven by payroll taxes and employee merit increases were more than offset by expense management.

Reported Results (GAAP) Q1 2013 Q4 2012 Q1 2012
Net interest income $ 266.1 $ 252.3 $ 242.4
Provision for credit losses 20.2 22.0 20.0
Noninterest income 89.3 91.8 69.9
Noninterest expense 237.7 238.8 200.2
Net income 67.3 61.1 59.9
Preferred stock dividend 7.5 7.5 5.1
Net income available to common shareholders 59.7 53.6 54.8
Weighted average diluted shares outstanding 350.0 349.7 349.1
Earnings per diluted share $ 0.17  $ 0.15  $ 0.16
       
All amounts in millions except earnings per diluted share.      

"During the first quarter, our focus on managing expenses drove a $3.7 million sequential reduction in operating expenses and resulted in positive operating leverage as well as protecting the downside from the industry-wide decline in mortgage banking revenues, competitive loan pricing  environment and other typical seasonal weaknesses," said Gregory W. Norwood, Chief Financial Officer. "A key focus throughout the remainder of the year will be expense management with only selective hiring and investments that support maximizing revenue potential and enhancing shareholder value while driving our efficiency ratio lower."

Loans

Average total loans increased 11% annualized from the linked quarter boosted by double-digit increases in commercial business (C&I) and commercial real estate (CRE) lending as well as sustained momentum in the company's indirect auto business.  For the 13th consecutive quarter, average commercial loans, which includes commercial business and commercial real estate loans, increased at a double-digit pace organically, up $484 million, or 17% annualized over the prior quarter.  Commercial business loans averaged $5.0 billion, representing an 18% annualized increase over the prior quarter.  Commercial real estate loans increased 16% annualized to $7.2 billion.  Average commercial loans in the company's New York, Western Pennsylvania, Eastern Pennsylvania and New England markets increased at double-digit annualized growth rates of 10%, 29%, 30%, and 25%, respectively. Since the acquisition of HSBC branches in May 2012, commercial loans in the company's New York market have increased at a 9% annualized growth rate.

Average indirect auto loan balances increased $197 million to $712 million. During the first quarter, new originations yielded 3.34%, net of dealer reserve. During the quarter, the company added an additional 72 dealers to its network within its contiguous footprint. Average residential real estate loans declined by $128 million, or 14% annualized, from the fourth quarter reflecting elevated industry-wide prepayment levels. 

Deposits

The company continued to focus its efforts to grow its core customer base, re-position its account mix and increase lower cost deposits. Average transaction deposits, which include interest-bearing and noninterest bearing checking balances, increased slightly over the prior quarter and currently represent 32% of the company's deposit base, up from 28% a year ago. Increases in average interest-bearing checking balances were offset by seasonal declines in non-interest bearing deposit balances.

Average interest-bearing checking deposits increased 19% annualized compared to the prior quarter driven by acquisitions of new checking accounts and mass affluent households, particularly in the company's New York state footprint as well as higher balances held by customers. New checking account openings per branch increased 15% over the prior quarter. Average total core deposits, excluding time deposits, totaled $23.4 billion, representing a $150 million decline, or 3% annualized, from the linked quarter. This decline was partially driven by balance attrition due to continued pricing actions taken by the company on money market and online savings accounts.

The average cost of interest-bearing deposits declined four basis points to 0.25% from 0.29% in the fourth quarter. Pricing actions on non-transactional deposit accounts together with a favorable shift in mix of deposits drove the decline in overall cost of interest-bearing deposits.

The company continues to grow and deepen customer relationships by delivering its "Simple Fast Easy" value proposition.  First Niagara launched its mobile banking offering in the first quarter, and approximately 20% of the company's online banking customers have signed up for mobile banking services via smartphone and tablet applications.

The company's Retail business, in tandem with Consumer Finance, continues to further expand relationships with core checking account customers. Beginning in the first quarter, the incentive program for sales personnel at the branches was enhanced to drive greater cross-solving referrals to Consumer Finance and Investment Services businesses. At March 31, 2013, the number of checking account households that also had a mortgage with the company increased 12% annualized from the prior quarter. The number of credit card accounts opened per branch increased by a factor greater than 3x compared to the prior quarter and was primarily driven by marketing campaigns targeted at existing deposit customers and greater cross-solving referrals at the point of sale.

Net Interest Income

First quarter 2013 net interest income of $266.1 million decreased slightly from the prior quarter adjusted amount of $268.6 million.  Compared to the prior quarter, the benefits of an 8% annualized increase in average interest-earning assets were offset by a 3 basis point decline in the adjusted net interest margin from the prior quarter.

In the first quarter of 2013, total premium amortization on the CMO portfolio was $10.4 million compared to an adjusted $14.5 million in the prior quarter.  The modest benefits from slower CMO cash flows together with a 4 basis point decline in cost of interest bearing deposits were offset by continued compression of loan yields from elevated prepayments and reinvestments at lower spreads.

Credit Quality


At March 31, 2013, the allowance for loan losses was $172.0 million, compared to $162.5 million at December 31, 2012.  Information for both the originated and acquired portfolios follows. 

  Q1 2013 Q4 2012
$ in millions Originated Acquired Total Originated Acquired Total
Provision for loan losses* $ 18.9 $ 0.9 $ 19.8 $ 21.4 $ 0.2 $ 21.5
Net charge-offs 9.1 1.2 10.3 7.6 1.3 8.9
NCOs/ Avg Loans 0.27 % 0.08 % 0.21 % 0.24 % 0.08 % 0.18 %
Total loans** $ 14,100 $ 6,084 $ 20,035 $ 13,372 $ 6,514 $ 19,710
 
(*) Excludes provision for unfunded commitments of $0.4 million and $0.5 million in 1Q13 and 4Q12, respectively
(**) Acquired loans before associated credit discount; see accompanying tables for further information

Originated loans

The provision for loan losses on originated loans totaled $18.9 million, compared to $21.4 million in the prior quarter. This provision included $9.8 million to support sequential originated loan growth of $0.7 billion and $9.1 million to cover net charge-offs. Net charge-offs equaled 27 basis points of average originated loans in the first quarter of 2013, compared to 35 basis points in 2012.

At March 31, 2013, nonperforming assets to total assets were 0.50%, unchanged from the prior quarter. Nonperforming originated loans as a percentage of originated loans decreased four basis points to 1.03% at March 31, 2013 from 1.07% at December 31, 2012.  

At March 31, 2013, the allowance for loan losses on originated loans totaled $170.7 million or 1.21% of such loans, compared to $161.0 million or 1.20% of loans at December 31, 2012.

Acquired loans

The provision for losses on acquired loans totaled $0.9 million, compared to $0.2 million in the prior quarter. Net charge-offs on those portfolios totaled $1.2 million during the quarter, compared to $1.3 million in the prior period.  At March 31, 2013, the allowance for loan losses on acquired loans totaled $1.3 million, compared to $1.6 million at December 31, 2012. Acquired nonperforming loans totaled $27.7 million, compared to $29.6 million at the end of the prior quarter. At March 31, 2013, remaining credit marks available to absorb losses on a pool-by-pool basis totaled $149 million.

Fee Income

First quarter 2013 noninterest income of $89.3 million decreased 3% or $2.5 million compared to the prior quarter primarily due to lower mortgage banking, deposit service charges, and capital markets revenues.

Mortgage banking revenues declined 20% to $6.4 million from $8.1 million in the prior quarter. Deposit service charges declined $1.5 million or 6% from the prior quarter in large part due to seasonality and to a lesser extent due to lower customer non-sufficient funds (NSF) incident rates.  Capital markets income declined 15% to $6.0 million from an all-time high in the prior quarter due to lower derivative swap activity during the quarter.

These declines were partially offset by higher wealth management fees and seasonal increase in insurance commissions. Wealth management services fees increased 7% driven by an 18% annualized increase in assets under management. Insurance commissions increased 6% compared to the fourth quarter driven by typical seasonal increases in renewal rates.

Noninterest Expense

First quarter noninterest expenses were $237.7 million and included $6.3 million in charges related to two recently announced executive departures. Excluding these charges, operating expenses totaled $231.4 million or $3.7 million lower than operating expenses in the fourth quarter of 2012.

First Niagara's focus on expense management resulted in a first-quarter reduction in brand-related marketing expenses as the company focused on select product promotions, as well as sequential decreases in professional fees, technology and communications expenses driven by vendor sourcing management. Compared to the fourth quarter of 2012, marketing and advertising expense declined $4.9 million and professional fees and technology and communications expenses declined $1.6 million and $1.1 million, respectively.

Salaries and benefits expenses increased $4.8 million, compared to the fourth quarter of 2012, entirely due to seasonal increases in payroll tax expenses and employee merit increases.

Operating expenses, excluding the executive departure charges, declined 1.6% outpacing a 1.4% decline in operating revenues and resulted in positive operating leverage during the quarter.  The efficiency ratio, excluding the executive departure related charge, was 65.1% in the first quarter, down slightly from 65.2% in the prior quarter.

Capital

At March 31, 2013, the company's estimated consolidated Total Risk Based capital and Tier 1 Common Risk Based capital ratios were 11.4% and 7.6% respectively.  The company remains well above current regulatory guidelines for well-capitalized institutions. 

About First Niagara

First Niagara, through its wholly owned subsidiary, First Niagara Bank, N.A., is a multi-state community-oriented bank with approximately 430 branches, approximately $37 billion in assets, $28 billion in deposits, and approximately 6,000 employees providing financial services to individuals, families and businesses across Upstate 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 Friday, April 19, 2013 to discuss the company's financial results. Those wishing to participate in the call may dial toll-free 1-888-324-3414 with the passcode: FNFG. Presentation slides will be used during the earnings conference call and is available under the investor relations tab of our website at www.firstniagara.com. A replay of the call will be available until May 2, 2013 by dialing 1-866-421-6880, passcode: 2563.

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; (6) difficulties in the integration of acquired businesses; and (7) increased risk associated with an increase in commercial real estate and business loans and non-performing loans. 

First Niagara Financial Group, Inc.            
Income Statement Highlights -- Reported Basis            
(in thousands, except per share amounts)            
             
   2013 2012 2011
   First   Fourth   Third   Second   First   Fourth 
   Quarter   Quarter   Quarter   Quarter   Quarter   Quarter 
             
Interest income:            
Loans and leases  $ 206,640  $ 212,035  $ 211,767  $ 200,725  $ 189,385  $ 195,434
Investment securities and other   88,961  71,564  90,101  99,116  101,395  96,472
Total interest income   295,601  283,599  301,868  299,841  290,780  291,906
             
Interest expense:            
Deposits   14,277  16,902  18,358  16,391  14,998  21,521
Borrowings   15,194  14,411  13,905  24,437  33,411  27,872
Total interest expense   29,471  31,313  32,263  40,828  48,409  49,393
             
Net interest income  266,130  252,286  269,605  259,013  242,371  242,513
Provision for credit losses  20,200  22,000  22,200  28,100  20,000  13,400
Net interest income after provision  245,930  230,286  247,405  230,913  222,371  229,113
             
Noninterest income:            
Deposit service charges  24,800  26,345  26,422  21,433  17,037  18,049
Insurance commissions  16,355  15,497  18,764  17,072  16,833  15,440
Merchant and card fees  11,298  11,945  12,014  9,271  5,528  5,044
Wealth management services  12,845  12,000  11,069  9,207  9,039  8,179
Mortgage banking  6,424  8,060  10,974  7,174  5,649  5,279
Capital markets income  6,031  7,098  6,381  6,831  6,539  2,746
Lending and leasing   3,906  3,739  3,730  4,245  3,123  3,103
Bank owned life insurance   3,467  3,021  3,449  3,848  3,387  3,302
Other income  4,186  4,116  9,400  16,517  2,773  2,543
Total noninterest income  89,312  91,821  102,203  95,598  69,908  63,685
             
Noninterest expense:            
Salaries and benefits  115,790  111,026  115,484  104,507  96,477  88,796
Occupancy and equipment  28,045  27,609  25,694  24,089  22,017  22,580
Technology and communications  27,113  28,257  28,110  24,434  19,713  18,942
Marketing and advertising  4,346  9,292  8,954  6,676  6,763  7,724
Professional services  9,603  11,163  11,193  9,263  8,895  11,669
Amortization of intangibles  14,119  14,224  14,506  9,839  6,466  6,586
FDIC premiums  8,901  9,158  8,850  10,552  6,133  6,097
Merger and acquisition integration expenses  --   3,678  29,404  131,460  12,970  6,149
Restructuring charges  --   --   --   3,750  2,703  13,496
Other expense  29,749  24,377  24,347  21,069  18,041  20,132
Total noninterest expense  237,666  238,784  266,542  345,639  200,178  202,171
             
Income (loss) before income tax  97,576  83,323  83,066  (19,128)   92,101  90,627
Income tax expense (benefit)  30,291  22,226  24,682  (8,204)   32,236  32,166
Net income (loss)  67,285  61,097  58,384  (10,924)   59,865  58,461
Preferred stock dividend  7,547  7,547   7,547   7,547   5,115  -- 
Net income (loss) available to common stockholders  $ 59,738  $ 53,550  $ 50,837  $ (18,471)  $ 54,750  $ 58,461
             
Financial Ratios:            
Earnings (loss) per basic share  $ 0.17  $ 0.15  $ 0.15  $ (0.05)  $ 0.16  $ 0.19
Earnings (loss) per diluted share  $ 0.17  0.15  0.14  (0.05)  0.16  0.19
Weighted average shares outstanding - basic(1)  349,278  349,071  349,001  348,941  348,823  304,065
Weighted average shares outstanding - diluted(1)  349,999  349,663  349,371  348,941  349,069  304,341
Net revenue(2)  $ 355,442  $ 344,107  $ 371,808  $ 354,611  $ 312,279  $ 306,198
Noninterest income as a percentage of net revenue(2) 25.13% 26.68% 27.49% 26.96% 22.39% 20.80%
Pre-tax, pre-provision income(3)  $ 117,776  $ 105,323  $ 105,266  $ 8,972  $ 112,101  $ 104,027
Pre-tax, pre-provision income per diluted share(3)  $ 0.34  $ 0.30  $ 0.30  $ 0.03  $ 0.32  $ 0.34
Pre-tax, pre-provision return on average assets(3) 1.30% 1.15% 1.19% 0.10% 1.36% 1.30%
Net interest margin(4) 3.39% 3.22% 3.54% 3.26% 3.34% 3.48%
Interest yield on average loans(4) 4.25% 4.39% 4.47% 4.59% 4.62% 4.76%
Rate paid on interest-bearing liabilities 0.44% 0.48% 0.51% 0.61% 0.79% 0.82%
Efficiency ratio 66.86% 69.39% 71.69% 97.47% 64.10% 66.03%
Effective tax rate 31.0% 26.7% 29.7% 42.9% 35.0% 35.5%
Return on average assets(5)  0.74 % 0.67% 0.66%  (0.12)% 0.73% 0.73%
Return on average equity(5)  5.50 % 4.92% 4.77%  (0.90)% 4.96% 5.54%
Return on average tangible equity(3)(5)  11.62 % 10.45% 10.34%  (1.64)% 7.90% 9.75%
Return on average common equity  5.24 % 4.62% 4.46%  (1.64)% 4.88% 5.63%
Return on average tangible common equity(3)  12.05 % 10.72% 10.60%  (3.18)% 8.12% 10.03%
             
(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)            
             
   2013 2012 2011
  March 31, December 31,  September 30, June 30, March 31, December 31, 
             
Cash and cash equivalents  $ 424,176  $ 430,862  $ 447,087  $ 488,227  $ 370,380  $ 836,555
Investment securities:            
Available for sale  7,876,160  10,993,605  10,579,970  9,937,271  12,248,058  9,348,296
Held to maturity  4,218,687  1,299,806  1,387,763  1,463,872  2,503,156  2,669,630
FHLB and FRB common stock  401,373  420,277  373,311  329,555  499,328  358,159
Total investment securities  12,496,220  12,713,688  12,341,044  11,730,698  15,250,542  12,376,085
Loans held for sale  126,389  154,745  117,375  101,596  102,513  94,484
Loans and leases:             
Commercial:            
Real estate  7,295,544  7,093,193  6,835,971  6,710,009  6,369,098  6,244,381
Business  5,044,738  4,953,323  4,682,154  4,514,537  4,108,363  3,771,649
Total commercial loans  12,340,282  12,046,516  11,518,125  11,224,546  10,477,461  10,016,030
Consumer:            
Residential real estate  3,614,912  3,761,567  3,870,756  4,037,045  3,881,003  4,012,267
Home equity  2,646,645  2,651,891  2,661,429  2,683,236  2,149,135  2,165,988
Indirect auto  818,401  601,456  419,258  185,774  --  --
Credit cards  298,310  314,973  308,387  304,368  --  --
Other consumer  316,669  333,609  328,571  328,547  283,320  278,298
Total consumer loans  7,694,937  7,663,496  7,588,401  7,538,970  6,313,458  6,456,553
Total loans and leases  20,035,219  19,710,012  19,106,526  18,763,516  16,790,919  16,472,583
Allowance for loan losses  172,002  162,522  149,933  138,516  126,746  120,100
Loans and leases, net  19,863,217  19,547,490  18,956,593  18,625,000  16,664,173  16,352,483
Bank owned life insurance  407,419  404,321  401,211  397,739  395,944  392,468
Goodwill and other intangibles  2,567,681  2,617,810  2,626,625  2,631,605  1,796,394  1,803,240
Other assets  959,459  937,317  983,999  1,130,891  937,859  955,300
Total assets  $ 36,844,561  $ 36,806,232  $ 35,873,934  $ 35,105,756  $ 35,517,805  $ 32,810,615
             
Deposits:            
Savings accounts  $ 3,915,836  $ 3,887,587  $ 3,941,528  $ 4,103,773  $ 2,554,720  $ 2,621,016
Interest-bearing checking  4,534,444  4,450,970  4,090,322  3,887,568  2,431,672  2,259,576
Money market deposits  10,493,243  10,581,137  10,801,280  10,919,766  7,100,646  7,220,902
Noninterest-bearing deposits  4,803,835  4,643,580  4,658,374  4,774,764  3,200,824  3,335,356
Certificates of deposit  3,985,702  4,113,257  4,206,192  4,211,116  3,741,525  3,968,265
Total deposits  27,733,060  27,676,531  27,697,696  27,896,987  19,029,387  19,405,115
             
Short-term borrowings  2,928,929  2,983,718  1,995,610  958,044  6,353,189  2,208,845
Long-term borrowings  732,510  732,425  732,339  732,263  4,688,251  5,918,276
Other liabilities  503,389  487,000  532,868  700,249  571,532  480,201
Total liabilities  31,897,888  31,879,674  30,958,513  30,287,543  30,642,359  28,012,437
Preferred stockholders' equity  338,002  338,002  338,002  338,002  338,002  338,002
Common stockholders' equity  4,608,671  4,588,556  4,577,419  4,480,211  4,537,444  4,460,176
Total stockholders' equity  4,946,673  4,926,558  4,915,421  4,818,213  4,875,446  4,798,178
Total liabilities and stockholders' equity  $ 36,844,561  $ 36,806,232  $ 35,873,934  $ 35,105,756  $ 35,517,805  $ 32,810,615
             
Selected balance sheet information:            
Total interest-earning assets(1)  $ 32,524,313  $ 32,321,964  $ 31,316,470  $ 30,403,035  $ 31,959,556  $ 29,284,139
Total interest-bearing liabilities  26,590,664  26,749,094  25,767,271  24,812,530  26,870,002  24,196,880
Net interest-earning assets  $ 5,933,649  $ 5,572,870  $ 5,549,199  $ 5,590,505  $ 5,089,554  $ 5,087,259
             
Tangible common equity(2)  $ 2,040,990  $ 1,970,746  $ 1,950,794  1,848,606  2,741,050  2,656,936
Unrealized gain on securities, net of tax(3)  160,942  206,732  204,347  133,430  152,408  105,276
             
Total core deposits  $ 23,747,358  $ 23,563,274  $ 23,491,504  $ 23,685,871  $ 15,287,862  $ 15,436,850
             
Originated loans(4)  $ 14,100,190  $ 13,372,357  $ 12,232,568  $ 11,392,158  $ 10,517,021  $ 9,876,005
Acquired loans(5)  6,083,912  6,513,636  7,085,839  7,600,213  6,459,798  6,801,689
Credit related discount on acquired loans(6)  (148,883)  (175,981)  (211,881)  (228,855)  (185,900)  (205,111)
Total Loans  $ 20,035,219  $ 19,710,012  $ 19,106,526  $ 18,763,516  $ 16,790,919  $ 16,472,583
             
(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) Unrealized gain at March 31, 2013 excludes $54 million of net pre-tax unrealized gains recorded in accumulated other comprehensive income related to available for sale securities transferred to held to maturity classification as of March 31, 2013.
(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, 2013 December 31, 2012 March 31, 2012
     Average  Interest(1)  Yields   Average  Interest(1)  Yields   Average  Interest(1)  Yields 
     Balances
 
  and
Rates(1)
 Balances
 
  and
Rates(1)(2)
 Balances
 
  and
Rates(1)
Interest-earning assets:                  
Loans and leases(3)                  
Commercial:                  
Real estate  $ 7,179  $ 76 4.25%  $ 6,911  $ 79 4.45%  $ 6,300  $ 79 4.98%
Business  4,999  47  3.74   4,783  47  3.89   3,915  41  4.08 
Total commercial loans  12,178  123  4.04   11,694  126  4.22   10,215  120  4.63 
Consumer:                  
Residential real estate  3,691  37  4.01   3,819  39  4.05   3,945  42  4.28 
Home equity  2,648  28  4.29   2,659  29  4.31   2,157  24  4.40 
Indirect auto  712  6  3.29   515  5  3.50   --   --   -- 
Credit cards  304  8  10.40   310  8  10.19   --   --   -- 
Other consumer  328  7  8.17   328  7  8.73   278  5  7.34 
Total consumer loans  7,683  85  4.50   7,631  87  4.54   6,380  71  4.47 
Total loans and leases  19,861  208  4.25   19,325  213  4.39   16,595  191  4.62 
Residential MBS(2)  5,488  34  2.50   5,746  36  2.50   8,550  65  3.03 
Commercial MBS  1,914  18  3.78   1,953  18  3.79   1,704  17  3.99 
Other investment securities (4)  4,822  38  3.19   4,474  35  3.16   2,678  23  3.44 
Total securities, at cost(2)    12,224  91  2.97   12,173  90  2.95   12,932  105  3.24 
Money market and other investments  241  1  1.31   207  1  1.54   256  1  0.94 
Total interest-earning assets(2)  32,326  $ 300 3.76%  31,705  $ 304 3.81%  29,783  $ 296 3.99%
Goodwill and other intangibles  2,609      2,619      1,801    
Other noninterest-earning assets  1,872      2,005      1,540    
                     
Total assets   $ 36,807      $ 36,329      $ 33,124    
                     
Interest-bearing liabilities:                   
Deposits                  
Savings accounts  $ 3,894  $ 1 0.11%  $ 3,898  $ 2 0.18%  $ 2,566  $ --  0.03%
Interest-bearing checking  4,379  1  0.05   4,181  1  0.07   2,224  1  0.10 
Money market deposits   10,643  6  0.23   10,810  7  0.25   7,167  5  0.28 
Certificates of deposit   4,081  7  0.67   4,259  8  0.71   3,827  9  0.98 
Total interest bearing deposits  22,997  14 0.25%  23,148  17 0.29%  15,784  15 0.38%
Borrowings                  
Short-term borrowings  3,152  3 0.40%  2,331  2 0.38%  3,632  6 0.65%
Long-term borrowings  730  12  6.71   732  12  6.63   5,334  27  2.07 
Total borrowings   3,882  15  1.59   3,063  14  1.87   8,966  33  1.50 
Total interest-bearing liabilities   26,879  $ 29 0.44%  26,211  $ 31 0.48%  24,750  $ 48 0.79%
Noninterest-bearing deposits   4,468      4,645      3,053    
Other noninterest-bearing liabilities   502      528      471    
Total liabilities   31,849      31,384      28,274    
Total stockholders' equity  4,958      4,945      4,850    
Total liabilities and stockholders' equity  $ 36,807      $ 36,329      $ 33,124    
                     
Net interest income (FTE)    $ 270      $ 273      $ 248  
Taxable Equivalent Adjustment(1)    4      4      6  
                     
 Total core deposits   $ 23,384  $ 8 0.13%  $ 23,534  $ 10 0.16%  $ 15,010  $ 6 0.15%
 Total deposits   27,465  14 0.21%  27,793  17 0.24%  18,837  15 0.32%
                     
Tax equivalent net interest rate spread(2)     3.32%     3.33%     3.20%
Tax equivalent net interest rate margin(2)     3.39%     3.42%     3.34%
                     
(1) Tax equivalent interest income is calculated using a 35% tax rate.          
(2) Amounts for the three months ended December 31, 2012 exclude accelerated CMO adjustments of $16 million. The yields, including these adjustments, are:
        Three months ended
December 31, 2012
       
Residential MBS       1.37%        
Total securities, at cost     2.41%        
Total interest earning assets       3.61%        
Tax equivalent net interest rate spread   3.13%        
Tax equivalent net interest rate margin       3.22%        
(3) Includes nonaccrual loans.
(4) 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)            
   2013 2012 2011
   First   Fourth   Third   Second   First   Fourth 
   Quarter   Quarter   Quarter   Quarter   Quarter   Quarter 
Beginning balance  $ 162,522  $ 149,933  $ 138,516  $ 126,746  $ 120,100  $ 112,749
Net loan (charge-offs) recoveries:            
Commercial real estate  $ (2,121)  $ (1,935)  $ (1,791)  $ (2,384)  $ (5,994)  $ 212
Commercial business  (4,902)  (3,385)  (6,077)  (10,958)  (4,143)  (4,665)
Residential real estate  (427)  (658)  (396)  (155)  (1,120)  (318)
Home equity  (613)  (673)  (401)  (1,536)  (1,161)  (268)
Other consumer  (2,257)  (2,285)  (1,406)  (805)  (836)  (796)
Total net loan charge-offs  $ (10,320)  $ (8,936)  $ (10,071)  $ (15,838)  $ (13,254)  $ (5,835)
Provision for loan losses  19,800  21,525  21,800  27,803  19,900  13,186
Allowance related to loans sold  --   --   (312)  (195)  --  --
Ending balance  $ 172,002  $ 162,522  $ 149,933  $ 138,516  $ 126,746  $ 120,100
             
Supplemental information            
Allowance to loans 0.86% 0.82% 0.78% 0.74% 0.75% 0.73%
Allowance for originated loans to originated loans(1) 1.21% 1.20% 1.20% 1.19% 1.19% 1.20%
             
Net charge-offs to average loans (annualized)            
Commercial real estate 0.12% 0.11% 0.11% 0.15% 0.38% -0.01%
Commercial business 0.39% 0.28% 0.53% 1.02% 0.42% 0.51%
Total commercial loans 0.23% 0.18% 0.28% 0.49% 0.40% 0.18%
Residential real estate 0.05% 0.07% 0.04% 0.02% 0.11% 0.03%
Home equity 0.09% 0.10% 0.06% 0.25% 0.22% 0.05%
Other consumer 0.67% 0.79% 0.60% 0.61% 1.20% 1.14%
Total consumer loans 0.17% 0.19% 0.12% 0.15% 0.20% 0.08%
Total loans 0.21% 0.18% 0.21% 0.36% 0.32% 0.14%
             
Net charge-offs of originated loans to average originated loans (annualized)(1)            
Commercial real estate 0.10% 0.07% 0.12% 0.18% 0.16% -0.05%
Commercial business 0.45% 0.33% 0.64% 1.25% 0.54% 0.67%
Total commercial loans 0.26% 0.19% 0.36% 0.66% 0.32% 0.25%
Residential real estate 0.10% 0.15% 0.09% 0.04% 0.27% 0.08%
Home equity 0.19% 0.21% 0.13% 0.51% 0.40% 0.10%
Other consumer 0.64% 0.94% 0.59% 0.81% 1.25% 1.51%
Total consumer loans 0.28% 0.35% 0.18% 0.28% 0.38% 0.17%
Total loans 0.27% 0.24% 0.30% 0.55% 0.34% 0.22%
             
Nonperforming loans:            
Originated(1):            
Commercial real estate  $ 49,953  $ 50,848  $ 46,413  $ 46,881  $ 44,749  $ 43,119
Commercial business  47,523  47,066  37,375  30,714  39,682  20,173
Residential real estate  28,455  27,192  21,377  23,058  22,021  18,668
Home equity  14,270  14,233  8,084  8,119  7,071  6,790
Other consumer  5,444  3,737  938  926  697  1,048
Total originated nonperforming loans  145,645  143,076  114,187  109,698  114,220  89,798
Total acquired nonperforming loans(2)  27,678  29,648  28,193  19,374  19,041  -- 
Total nonperforming loans  173,323  172,724  142,380  129,072  133,261  89,798
Real estate owned  10,816  10,114  9,669  10,632  7,202  4,482
Total nonperforming assets  $ 184,139  $ 182,838  $ 152,049  $ 139,704  $ 140,463  $ 94,280
             
Accruing troubled debt restructurings (TDR)  $ 64,311  $ 46,280  $ 55,732  $ 42,140  $ 42,358  $ 43,888
Loans 90 days past due still accruing(3)  172,062  171,568  145,323  125,668  116,810  143,237
Total classified loans(4)  720,197   708,468  693,006  732,762  753,536  748,375
Total criticized loans(5)  $ 1,044,874  $ 1,002,659  $ 990,670  $ 1,030,471  $ 1,044,731  $ 1,144,222
             
Total nonperforming loans to loans 0.87% 0.88% 0.75% 0.69% 0.79% 0.55%
Total nonperforming originated loans to originated loans(1) 1.03% 1.07% 0.93% 0.96% 1.09% 0.91%
Total nonperforming assets to loans and real estate owned 0.92% 0.93% 0.80% 0.74% 0.84% 0.57%
Total nonperforming assets to assets 0.50% 0.50% 0.42% 0.40% 0.34% 0.29%
Allowance to nonperforming loans 99.2% 94.1% 105.3% 107.3% 95.1% 133.7%
Texas ratio(6) 16.10% 16.61% 14.16% 13.35% 8.97% 8.55%
             
Originated loans(1)  $ 14,100,190  $ 13,372,357  $ 12,232,568  $ 11,392,158  $ 10,517,021  $ 9,876,005
Acquired loans(7)  6,083,912  6,513,636  7,085,839  7,600,213  6,459,798  6,801,689
Credit related discount on acquired loans(8)  (148,883)   (175,981)   (211,881)   (228,855)   (185,900)   (205,111) 
Total Loans  $ 20,035,219  $ 19,710,012  $ 19,106,526  $ 18,763,516  $ 16,790,919  $ 16,472,583
             
(1 ) Originated loans represent total loans excluding acquired loans. 
(2 ) Nonperforming acquired loans include certain lines of credit that are considered nonaccruing. The remaining credit discount, recorded at acquisition, is adequate to cover losses on these balances.
(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, 2012.
(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 ratio computed 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.
(7) Represents the carrying value of acquired loans plus the principal not expected to be collected.
(8) Represent principal on acquired loans not expected to be collected.
                 
First Niagara Financial Group, Inc.                
Key Statistics                
(Share counts in thousands)                
                 
  2013  2012   2011  
  March 31, December 31,  September 30, June 30, March 31,   December 31,   
First Niagara Financial Group, Inc capital ratios:                
Tier 1 risk based capital 9.45% 9.29% 9.51% 9.40% 14.66% (1) 15.60% (1)
Tier 1 common capital(2) 7.64% 7.45% 7.59% 7.41% 12.47% (1) 13.23% (1)
Total risk based capital 11.38% 11.23% 11.48% 11.37% 16.75% (1) 17.84% (1)
Leverage 6.92% 6.75% 6.83% 6.32% 9.67% (1) 9.97% (1)
Equity to assets 13.43% 13.39% 13.70% 13.72% 13.73% (1) 14.62% (1)
Tangible common equity to tangible assets(2) 5.95% 5.77% 5.87% 5.69% 8.13% (1) 8.57% (1)
                 
First Niagara Bank, N.A capital ratios:                
Tier 1 risk based capital 10.15% 9.94% 10.19% 9.63% 14.69% (1) 14.66% (1)
Total risk based capital 10.89% 10.66% 10.88% 10.57% 15.66% (1) 16.47% (1)
Leverage 7.43% 7.23% 7.32% 6.48% 9.69% (1) 9.38% (1)
                 
Number of branches  427  430  432  452  334    333  
Full time equivalent employees  5,875  5,927  6,036  6,103  4,753    4,827  
                 
Share information and per share metrics:                
Common shares outstanding  353,008  352,621  352,632  352,665  351,936    351,834  
Preferred shares outstanding  14,000  14,000  14,000  14,000  14,000    14,000  
Treasury shares  12,994  13,381  13,370  13,337  14,066    14,168  
Market price (NASDAQ: FNFG):  $ 8.86  $ 7.93  $ 8.07  $ 7.65  $ 9.84    $ 8.63  
Book value per share(3)  13.19  13.15  13.11  12.84  13.00    12.79  
Tangible book value per share(2)(3)  5.84  5.65  5.59  5.30  7.86    7.62  
Price/Book 67.17% 60.30% 61.56% 59.58% 75.69%   67.47%  
Price/Tangible book(2) 151.71% 140.35% 144.36% 144.34% 125.19%   113.25%  
Common stock dividends  $ 0.08  $ 0.08  $ 0.08  $ 0.08  $ 0.08    $ 0.16  
Preferred stock dividends  0.54  0.54  0.54  0.54  0.37    --   
Dividend payout ratio 47.06% 53.33% 53.33% N/M 50.00%   84.21%  
Dividend yield (annualized) 3.66% 4.01% 3.94% 4.21% 3.27%   7.36%  
                 
N/M Not meaningful                
(1) Ratios reflect the impact of our capital raise completed in December 2011, the proceeds of which were used to consummate the acquisition of branches from HSBC Bank-USA, National Association in May 2012.
(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) 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)            
             
  2013  2012 2011
   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  $ 0.19  $ 0.19  $ 0.19  $ 0.19  $ 0.24
Earnings per diluted share  0.17  0.19  0.19  0.19  0.19  0.24
Weighted average shares outstanding - basic(2)  349,278  349,071  349,001  348,941  348,823  304,065
Weighted average shares outstanding - diluted(2)  349,999  349,663  349,371  348,941  349,069  304,341
Noninterest income as a percentage of net revenue(4) 25.13% 25.48% 26.43% 22.96% 22.39% 20.80%
Pre-tax, pre-provision income  117,776  125,281  129,333  136,645  127,774  123,672
Pre-tax, pre-provision income per diluted share  0.34  0.36  0.37  0.39  0.37  0.41
Pre-tax, pre-provision return on average assets 1.30% 1.37% 1.46% 1.51% 1.55% 1.55%
Net interest margin(3) 3.39% 3.42% 3.54% 3.37% 3.34% 3.48%
Interest yield on average loans(3) 4.25% 4.39% 4.47% 4.59% 4.62% 4.76%
Rate paid on interest-bearing liabilities(3) 0.44% 0.48% 0.51% 0.61% 0.79% 0.82%
Efficiency ratio 66.86% 65.24% 64.71% 60.63% 59.08% 59.61%
Effective tax rate 31.0% 27.0% 30.9% 33.5% 35.0% 34.7%
Return on average assets 0.74% 0.83% 0.83% 0.80% 0.85% 0.90%
Return on average equity 5.50% 6.06% 6.04% 5.95% 5.81% 6.82%
Return on average tangible equity(5) 11.62% 12.89% 13.11% 10.86% 9.24% 12.02%
Return on average common equity 5.24% 5.86% 5.83% 5.72% 5.79% 6.93%
Return on average tangible common equity(6) 12.05% 13.57% 13.86% 11.13% 9.63% 12.36%
             
Reconciliation of net interest income on operating basis to reported net interest income(1):            
Total net interest income on operating basis (Non-GAAP)  $ 266,130  $ 268,566  $ 269,605  $ 267,371  $ 242,371  $ 242,513
Additional premium amortization on securities portfolio  --   (16,280)  --  (8,358)  --  --
Total reported net interest income (GAAP)  266,130  252,286  269,605  259,013  242,371  242,513
             
Reconciliation of noninterest income on operating basis to reported noninterest income(1):            
Total noninterest income on operating basis (Non-GAAP)  $ 89,312  $ 91,821  $ 96,866  $ 79,703  $ 69,908  $ 63,685
Gain on securities portfolio repositioning  --   --   5,337  15,895  --   -- 
Total reported noninterest income (GAAP)  89,312  91,821  102,203  95,598  69,908  63,685
             
Reconciliation of noninterest expense on operating basis to reported noninterest expense(1):            
Total noninterest expense on operating basis (Non-GAAP)  $ 237,666  $ 235,106  $ 237,138  $ 210,429  $ 184,505  $ 182,526
Merger and acquisition integration expenses  --   3,678  29,404  131,460  12,970  6,149
Restructuring charges  --   --   --   3,750  2,703  13,496
Total reported noninterest expense (GAAP)  $ 237,666  $ 238,784  $ 266,542  $ 345,639  $ 200,178  $ 202,171
             
Reconciliation of net operating income to net income(1):            
Net operating income (Non-GAAP)  $ 67,285  $ 75,358  $ 74,027  $ 72,188  $ 70,053  $ 72,057
Nonoperating income and expenses, net of tax:            
Additional premium amortization on securities portfolio  --   11,633  --  5,558  --  --
Gain on securities portfolio repositioning  --   --  (3,469)  (10,331)  --  --
Merger and acquisition integration expenses  --   2,628  19,112  85,448  8,431  4,256
Restructuring charges  --   --   --   2,437  1,757  9,340
Total nonoperating expenses, net of tax  --   14,261  15,643  83,112  10,188  13,596
Net income (GAAP)  $ 67,285  $ 61,097  $ 58,384  $ (10,924)  $ 59,865  $ 58,461
             
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)  $ 59,738  $ 67,811  $ 66,480  $ 64,641  $ 64,938  $ 72,057
Nonoperating income and expenses, net of tax:            
Additional premium amortization on securities portfolio  --   11,633  --   5,558  --  --
Gain on securities portfolio repositioning  --   --   (3,469)  (10,331)  --  --
Merger and acquisition integration expenses  --   2,628  19,112  85,448  8,431  4,256
Restructuring charges  --   --   --   2,437  1,757  9,340
Total nonoperating income and expenses, net of tax  --   14,261  15,643  83,112  10,188  13,596
Net income available to common stockholders (GAAP)  $ 59,738  $ 53,550  $ 50,837  $ (18,471)  $ 54,750  $ 58,461
             
Computation of pre-tax,pre-provision income:            
Net interest income  $ 266,130  $ 252,286  $ 269,605  $ 259,013  $ 242,371  $ 242,513
Noninterest income  89,312   91,821   102,203   95,598   69,908   63,685 
Noninterest expense  (237,666)  (238,784)  (266,542)  (345,639)  (200,178)  (202,171)
Pre-tax, pre-provision income (GAAP)  117,776  105,323  105,266  8,972  112,101  104,027
Add back: non-operating premium amortization  --   16,280  --   8,358  --   -- 
Add back: non-operating noninterest expenses (1)  --   3,678  29,404  135,210  15,673  19,645
Less: non-operating noninterest income (1)  --   --   (5,337)  (15,895)  --   -- 
Pre-tax, pre-provision income (Non-GAAP)(1)  $ 117,776  $ 125,281  $ 129,333  $ 136,645  $ 127,774  $ 123,672
             
(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) Yields and rates calculated on a tax equivalent basis.
(4) Net revenue is comprised of net interest income and noninterest income.
(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)            
             
   2013 2012 2011
   First   Fourth   Third   Second   First   Fourth 
   Quarter   Quarter   Quarter   Quarter   Quarter   Quarter 
Computation of Ending Tangible Common Equity:            
Total stockholders' equity  $ 4,946,673  $ 4,926,558  $ 4,915,421  $ 4,818,213  $ 4,875,446  $ 4,798,178
Less: Goodwill and other intangibles  (2,567,681)   (2,617,810)   (2,626,625)   (2,631,605)   (1,796,394)   (1,803,240) 
Less: Preferred stockholders' equity  (338,002)   (338,002)   (338,002)   (338,002)   (338,002)   (338,002) 
Tangible common equity  $ 2,040,990  $ 1,970,746  $ 1,950,794  $ 1,848,606  $ 2,741,050  $ 2,656,936
             
Computation of Average Tangible Equity:            
Total stockholders' equity  $ 4,958,402  $ 4,945,132  $ 4,872,605  $ 4,879,791  $ 4,850,276  $ 4,188,800
Less: Goodwill and other intangibles  (2,609,409)   (2,619,322)   (2,626,666)   (2,206,682)   (1,800,613)   (1,809,690) 
Tangible equity  $ 2,348,993  $ 2,325,810  $ 2,245,939  $ 2,673,109  $ 3,049,663  $ 2,379,110
             
Computation of Average Tangible Common Equity:            
Total stockholders' equity  $ 4,958,402  $ 4,945,132  $ 4,872,605  $ 4,879,791  $ 4,850,276  $ 4,188,800
Less: Goodwill and other intangibles  (2,609,409)   (2,619,322)   (2,626,666)   (2,206,682)   (1,800,613)   (1,809,690) 
Less: Preferred stockholders' equity  (338,002)   (338,002)  (338,002)  (338,002)  (338,002)  (66,226)
Tangible common equity  $ 2,010,991  $ 1,987,808  $ 1,907,937  $ 2,335,107  $ 2,711,661  $ 2,312,884
             
Computation of Texas Ratio:            
Nonperforming Assets  $ 184,139  $ 182,838  $ 152,049  $ 139,704  $ 140,463  $ 94,280
Loans 90 days past due still accruing(1)  172,062  171,548  145,323  125,668  116,810  143,237
Sum of nonperforming assets and loans 90 days past due still accruing  $ 356,201  $ 354,386  $ 297,372  $ 265,372  $ 257,273  $ 237,517
             
Tangible common equity  $ 2,040,990  $ 1,970,746  $ 1,950,794  $ 1,848,606  $ 2,741,050  $ 2,656,936
Allowance for loan losses  172,002  162,522  149,933  138,516  126,746  120,100
Sum of tangible common equity and allowance for loan losses  $ 2,212,992  $ 2,133,268  $ 2,100,727  $ 1,987,122  $ 2,867,796  $ 2,777,036
             
Sum of nonperforming assets and acquired loans 90 days past due still accruing/Sum of tangible common equity and allowance for loan losses 16.10% 16.61% 14.16% 13.35% 8.97% 8.55%
             
Computation of Tier 1 Common Capital:            
Tier 1 capital  $ 2,356,763  $ 2,264,679  $ 2,225,121  $ 2,128,702  $ 3,009,727  $ 2,962,031
Less: Qualifying restricted core capital elements  (112,236)   (112,025)  (111,820)  (111,630)  (111,453)  (111,284)
Less: Perpetual non-cumulative preferred stock  (338,002)   (338,002)  (338,002)  (338,002)  (338,002)  (338,002)
Tier 1 common capital (Non-GAAP)  $ 1,906,525  $ 1,814,652  $ 1,775,299  $ 1,679,070  $ 2,560,272  $ 2,512,745
             
(1) 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.            
First Niagara Contacts

Investors:
Ram Shankar
Senior Vice President, Investor Relations
(716) 270-8623


News Media:
David Lanzillo
Senior Vice President, Corporate Communications
(716) 819-5780