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Feds: First Niagara, HSBC to divest 26 branches

BUFFALO — Federal officials say First Niagara Financial Group and HSBC Holdings PLC have agreed to sell 26 New York bank branches to satisfy antitrust concerns arising from First Niagara’s planned purchase of the London-based financial giant’s upstate retail network.

The agreement with the Justice Department’s Antitrust Division announced Thursday involves branches in Erie, Niagara and Orleans counties. The offices have approximately $1.6 billion in deposits.

Buffalo-based First Niagara announced over the summer its plans to buy 195 HSBC branches in New York and Connecticut for $1 billion cash. First Niagara executives said at the time they expected to have to sell or close as many as 100 branches because of antitrust concerns.

The Justice Department says it won’t challenge approval of the merger if the 26 specified branches are divested.