The impending merger between KeyCorp (NYSE: KEY) and First Niagara Financial Group (NASDAQ: FNFG), which was announced back in October, represents the fusion of two of the largest financial institutions in the United States. With approximately $135 billion in combined assets, the union will be the 13th largest commercial bank in the country.
Banks aren’t the only ones on alert, though, as First Niagara is also one of the largest providers of personal and business insurance solutions in American soil.
A $39-billion company, First Niagara currently has about 5,400 employees, 2,300 of which are in Western New York.
The acquisition will scale up KeyCorp and First Niagara’s operations to serve approximately three million clients. If the merger goes ahead, KeyCorp is projected to become a top bank in Upstate New York, as well as a strong market player offering First Niagara products in metropolitan areas throughout Connecticut, Massachusetts, and Pennsylvania.
Many in the insurance sector remain watchful, curious as to what the merger can bring to the table.
“The question that everybody keeps asking is, ‘What is KeyCorp’s plan going to be?’” Chris Ross, principal at the Lawley agency in WNY, told Buffalo Business First on Friday (November 20). First Niagara is among Lawley’s top competitors in Buffalo and Rochester.
Ross said that Lawley will keep a lookout on how the transaction goes and what new products the prospective union will offer to determine if there would be a need to add clients or insurance personnel.
“But we don’t view this as being particular positive. We can’t. They’re a major employer and they’ve said there will be [job] duplication, which will result in fewer jobs in our economy. That’s not good for us or anybody here,” said Ross.
Another broker, who wished to remain anonymous, voiced fears that chaos might ensue in the wake of the merger.
