Sep. 3--First Niagara Bank will hit the local scene this weekend by instantly emerging as the Pittsburgh region's fourth-biggest bank.

The bank will convert 57 National City Bank branches, along with some 200,000 personal-checking accounts, over Labor Day weekend, Frank Polino, executive vice president on First Niagara who is leading the comprehensive conversion effort, said Wednesday.

"This will be our biggest conversion so far," said Polino. "We're looking forward to being a viable new competitor in the marketplace."

First Niagara bought and converted a 50-branch bank near Albany in early 2005.

The Pittsburgh region deal, after it closes at the end of business Friday, gives First Niagara about $4 billion in National City deposits and about $800 million in small-business loans. That will make First Niagara the fourth-largest bank here by deposits -- just behind Citizens Bank at No. 3 and ahead of Dollar Bank at No 5. The PNC Bank/National City Bank combination is No. 1 and Bank of New York Mellon is No. 2.

Customers should see "competitive" interest rates on their deposits, said Polino.

"Our goal is not necessarily to have high-teaser rates, but to have consistent rates that are not always at the high end or at the low end," he said.

First Niagara hasn't splashed this market with ads touting interest rates, said Tim Zimmerman, president of Standard Bank, Murrysville. He, therefore, doubts First Niagara will try to match the "elevated rates" that National City had been paying.

National City "kind of went off the deep end toward the end of its life," paying high interest rates to keep deposits, said bank analyst Matt Schultheis, of Boenning & Scattergood in W. Conshohocken, Pa.

Based near Buffalo, First Niagara agreed to acquire the 57 branches in Western Pennsylvania, including Erie and Warren, from PNC Financial Services Group for $54.1 million in early April. PNC acquired troubled National City Corp. in December and was required by anti-trust enforcers to divest 57 branches to foster competition in the region.

Customers of those National City branches should have received by last week First Niagara checks and automated teller-machine cards, which they should use starting Saturday, said Polino.

Those who use online bill-payment should see their payee list and schedule convert to First Niagara on Tuesday, or possibly Monday.

First Niagara did not acquire National City mortgages, home-equity loans or credit-card accounts, but primarily small-business loans. It will gain about 4,000 commercial-checking accounts, said Polino.

The bank is retaining all 500 or so of National City's employees at the 57 branches in Western Pennsylvania. It also is hiring 50 to 75 in the Pittsburgh area, including some loan officers that it added in the last two months.

Not counting the National City branches, First Niagara has 113 branches stretching from Buffalo eastward to Albany, N.Y. It currently has $11.6 billion in assets and about $6.2 billion in deposits.

Thomas Olson can be reached via e-mail or at 412-320-7854.

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