-- Track record of solid profitability continues

-- Additional revenue growth despite a very difficult environment

-- Solid commercial loan growth maintained

-- Credit trends well contained with strong capital and reserve levels__

-- Announced National City branch acquisition will significantly enhance

future performance__

First Niagara Financial Group, Inc. (Nasdaq: FNFG), today announced first quarter 2009 operating (Non-GAAP) net income of $21.5 million or $0.16 per diluted share. Reported (GAAP) net income was $18.7 million or $0.14 per diluted share.

Operating Results (Non-GAAP)__ Q1 2009__ Q4 2008__ Q1 2008

----------------------------__ -------__ -------__ -------

Net interest income__ $72.6__ $71.7__ $60.1

Provision for credit losses__ 8.8__ 8.0__ 3.1

Noninterest income__ 28.5__ 27.6__ 29.3

Noninterest expense__ 58.5__ 57.5__ 55.5

Net income__ 21.5__ 22.8__ 20.0

Net income available to common

shareholders__ 18.8__ 21.7__ 20.0

Earnings per diluted share__ $0.16__ $0.19__ $0.19

Reported Results(GAAP)

----------------------

Nonrecurring(a)__ $4.6__ $0.0__ $2.0

Net income__ 18.7__ 22.8__ 18.8

Net income available to common

shareholders__ 16.1__ 21.6__ 18.8

Earnings per diluted share__ $0.14__ $0.19__ $0.18__

All amounts in millions except earnings per diluted share. The non-GAAP/Operating Results table above summarized the Company's operating results excluding certain non-recurring items.

(a) - Q1 2009: Pre-tax noninterest expense - settlement of service mark infringement matter of $2.9 million, professional services related to the National City branch acquisition of $1.7 million. Q1 2008: Pre-tax noninterest expense - severance and real estate write-downs related to the acquisition of Great Lakes Bancorp of $2.0 million.

The Company believes these 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 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.

John R. Koelmel, President and CEO said "Our first quarter performance provides further evidence of the increasing power of the First Niagara franchise. We are firing on all cylinders and have carried our momentum into the new year despite the severe economic headwinds. We are continuing to invest wisely in people as well as our priority businesses, which has led to sustained loan growth and increased revenues. Our track record of solid profitability, strong capital, and firm credit discipline affords us great flexibility to capitalize on opportunities in the marketplace. We continue to gain new customers as well as add business from existing relationships. We are also tremendously excited by our recently announced expansion into Pittsburgh and Western Pennsylvania via the acquisition of the divested National City banking operations of PNC, which immediately gives us a solid position in a market that is very similar to Upstate New York. It's a strategic and financial homerun that represents a significant opportunity to leverage our competitive strengths, generate new jobs, and create shareholder value."

Loans

Average commercial loan balances grew by $67 million or an annualized 7% from the fourth quarter. Average commercial business loans were up an annualized 12% from the prior quarter, the largest increase in over a year as line advances and pipeline activity moved higher. Average balances for both commercial real estate and home equity loans posted solid annualized gains of 7%. Significant increases in residential loan refinancing activity due to declining interest rates was the primary cause of the decrease in that portfolio. However, our own residential mortgage origination volume also increased substantially, and while we do not hold such long term fixed rate product in portfolio, our fee income benefitted accordingly during the quarter.

Credit Quality

Credit trends continue to hold up relatively well. Nonetheless, we are seeing the effects of the deterioration in the overall economy. While first quarter net chargeoffs decreased by $0.9 million from the linked quarter to $6.9 million, or 0.44% of average loans, nonperforming loans increased by $5.5 million over the previous quarter to $51.9 million or 0.81% of total loans. This increase was largely attributable to a single commercial real estate relationship which we believe is well secured. The provision for credit losses was $8.8 million for the quarter, compared to $8.0 million in the linked quarter and $3.1 million a year ago. At March 31, 2009 the allowance for credit losses represented 1.23% of total loans and 153% of nonperforming loans.

Deposits

Average deposit balances rose by an annualized 5% from the prior quarter. This increase was primarily due to the seasonal expansion of municipal money market deposits and new account growth driven by the ongoing push to obtain active checking account relationships. Core deposits now comprise 68% of total deposits, an increase from 62% a year earlier. Total deposits were higher by 3% from the first quarter of 2008 as money market balance growth more than offset the CD run-off attributed to the Company's focus on a disciplined pricing strategy.

Net Interest Income

Net interest income increased by 1% to $72.6 million from the linked quarter despite the downward re-pricing of our loan portfolio caused by multiple fourth quarter Federal Reserve rate cuts. The 54 basis point drop in the interest earning asset yield for the quarter was mitigated by the continuing deposit pricing discipline and a decrease in wholesale funding costs of 62 basis points, as our continuing overall funding mix continued to improve with higher yielding CD balances replaced with lower priced core deposits and wholesale borrowings. The net impact of these factors resulted in a tax equivalent net interest margin of 3.61%, a modest 7 basis points decline from the linked quarter.

Noninterest Income

Noninterest income for the current quarter was $28.5 million or $0.8 million above fourth quarter levels as a seasonal increase in insurance revenue was offset by lower banking transaction and service fees. Noninterest income for the first quarter of 2009 decreased by 3% from a year ago for the same reasons.

Noninterest Expense

Operating (Non-GAAP) noninterest expense for the first quarter increased by $1.0 million, or 2% from the linked quarter, and was attributable to additional FDIC deposit insurance premiums. Reported (GAAP) noninterest expense also includes $2.9 million related to the settlement of a service mark infringement legal matter and $1.7 million for professional services incurred in connection with the National City branch acquisition. Operating (Non-GAAP) noninterest expense for the current quarter increased by $3.1 million, compared to last year's first quarter, reflecting higher FDIC costs and the full absorption of staff from the 2008 acquisition of Great Lakes Bancorp.

Capital Management

The tangible common equity ratio at March 31, 2009 was 8.89%, a substantial increase from last year's level of 7.56%. The preferred dividends and warrant expense related to the securities issued for the Company's participation in the Treasury's Capital Purchase Program amounted to $2.7 million in this quarter. No shares of the Company's stock have been repurchased since January 2008.

Profile - First Niagara Financial Group, Inc., through its wholly owned subsidiary First Niagara Bank, has assets of $9.6 billion and deposits of $6.2 billion. First Niagara Bank is a full-service, community-focused bank that provides financial services to individuals, families and businesses through 113 branches and four Regional Market Centers across Upstate New York. For more information, visit www.fnfg.com.

Conference Call - A conference call will be held at 9 a.m.