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M&T stays dominant in Buffalo Niagara region as major deals alter ranks of competition

M&T continues to dominate in deposits among banks in the Buffalo Niagara region.

That was no surprise. But recent major deals altered the ranks of the banks that trail M&T.

Once a year, the Federal Deposit Insurance Corp. releases deposit market share data for the region. It’s just a one-day snapshot, based on the banks’ total in-market deposits June 30, but it still provides a glimpse of how they stack up to one another.

And this year, even the snapshot has an asterisk, since two significant events occurred after the figures were collected: KeyCorp has acquired First Niagara Financial group, and Northwest Bank bought 18 First Niagara branches.

None of that affected M&T’s status as the market leader. In fact, the Buffalo-based bank’s share of the region’s deposits increased, to 54.7 percent, compared with 50.8 percent a year ago, according to the FDIC.

Based on estimates, KeyBank moved up to No. 2 due to its purchase of First Niagara; their holding companies completed that deal Aug. 1. Last year, First Niagara was No. 2 in the market, and Key was No. 3.

But estimating Key’s newly enhanced market share isn’t as simple as combining the two banks’ totals, which would have been about 31 percent, based on the FDIC numbers.

That’s because the Justice Department required some First Niagara branches to be sold off to alleviate concerns about the deal’s impact on competition. Enter Northwest, which acquired $1.6 billion worth of deposits Sept. 9 through the First Niagara branches that it bought, according to a regulatory filing.

Taking that deal into account, Key had an estimated market share of 27 percent, up from about 9 percent the year before, and slightly above First Niagara’s 26 percent stand-alone share in 2015.

Bank of America made only a slight gain in market share from last year, to 5.2 percent. But the bank still moved up to No. 3, from No. 4, because the two banks ahead of it on the list merged.

Northwest made the biggest leap, to No. 4, from No. 7 last year, thanks to its deal for the First Niagara branches. Northwest’s new market share appeared to be about 4.5 percent, after adding the First Niagara deposits. Next came Citizens Bank at No.  5, with about 4 percent market share, and Evans Bank at No. 6, with 1.9 percent. The nine other banks on the FDIC’s list each had market share of less than 1 percent.

Total deposits in the Buffalo Niagara market this year increased by 5.5 percent, or $2.3 billion, from the year before, to $42 billion, according to the FDIC. The figures that the locally based banks report in the FDIC data for their headquarters branches can bulk up their numbers, since banks often hold deposits from large corporate or institutional customers in their central offices.

Among the 15 banks in the market, total branches dropped by 2 percent, to 277, according to the FDIC.


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