First Niagara Reports Third Quarter 2012 Operating Net Income Per Share of $0.19

First Niagara Reports Third Quarter 2012 Operating Net Income Per Share of
$0.19

Highlights:

  *Non-GAAP Operating Net Income per Share of $0.19, a $0.02 Increase Over
    the Prior Quarter

    *Net Interest Margin Increases 28 Basis Points to 3.54%
    *Operating Revenues Increase 8%

  *Average Commercial Loans Increase 17% Over the Prior Quarter

    *11^th Consecutive Quarter of Double Digit Commercial Loan Growth
    *C&I Loans Increase 24%; Commercial Real Estate Loans Increase 14%
    *15% Commercial Loan Growth in the New York Market; Continued Growth
      Across All Geographies

  *Fee Income Increases 22%

    *Mortgage Banking Revenues Increase 53% Over Prior Quarter
    *Strength in Capital Markets Activity and Fees Sustained

  *Core Deposit Platform Growth Continues

    *Transactional Deposits Increase to 31% of Total Deposits
    *Checking Account Production per Branch Increases 36% over Prior Year

  *GAAP EPS of $0.14 per Share Includes $29 million of Acquisition and
    Restructuring Charges

BUFFALO, N.Y., Oct. 19, 2012 (GLOBE NEWSWIRE) -- First Niagara Financial
Group, Inc. (Nasdaq:FNFG) today announced third quarter 2012 results
reflecting continued strength and momentum in its regional banking business.
The solid performance continues to be driven by sustained market share gains
through new customer acquisition as well as deepening relationships with
existing customers and growth in fee income.

"Our team continues to deliver differentiating results and outcomes and strong
fundamental performance by helping our customers and communities Do Great
Things," said John R. Koelmel, First Niagara President and Chief Executive
Officer. "We have worked diligently to put the pieces together by assimilating
a strong team and culture, an enviable footprint and franchise and strong ties
to our growing base of customers and communities. As we look ahead, our entire
organization – from top to bottom – is now singularly focused on running the
business we have built and optimally executing our operating plan."

"First Niagara's lending franchise continues to deliver solid and
differentiated fundamental performance throughout the continuing low-growth
economic environment," said Gregory W. Norwood, Chief Financial Officer. "Our
ability and continued success in gaining market share affords us the
opportunity to be selective and discerning in credit underwriting. Further,
the growth potential in our newer geographies coupled with the greater density
in our Upstate New York markets combined with our enhanced fee generation
services such as treasury management and online delivery channel are
additional levers that will further improve our efficiency and profitability."

Third Quarter Performance

In the third quarter of 2012, First Niagara reported non-GAAP operating net
income available to common shareholders of $66.5 million, or $0.19 per diluted
share, compared to $0.17 per share in the second quarter of 2012 and $0.25 per
diluted share in the third quarter of 2011. The decline in earnings per share
from the year ago period was driven in large part by the June 2012 sale of
$3.1 billion in mortgage backed securities (MBS) associated with the
investment portfolio repositioning.

Total operating revenues of $366.5 million increased $27.8 million, or 8% over
the second quarter of 2012.Net interest income was up $10.6 million, or 4%,
from the prior quarter.Net interest margin increased by 28 basis points to
3.54% in the third quarter of 2012. Those increases include the benefits of
the full quarter impact of the HSBC branch transaction and lower premium
amortization on mortgage backed security prepayments partially offset by the
loss of net interest income resulting from the June MBS sale.

Non-GAAP operating noninterest income increased 22% from the prior quarter
primarily driven by the benefits of the HSBC branch acquisition and strong
mortgage banking revenues.

Excluding loans acquired from HSBC, average commercial loans increased $463
million for the quarter, up 17% annualized over the prior three-month period,
marking the eleventh consecutive quarter of organic double-digit average
commercial portfolio growth.Indirect auto loan originations totaled $247
million in the third quarter, an increase of $76 million over the prior
quarter, as that business unit continues to deliver profitable growth across
its expanding dealer network.

The provision for credit losses totaled $22.2 million during the third quarter
of 2012, including $12.1 million to support loan growth and $10.1 million to
cover net charge-offs. Net charge-offs equaled 30 basis points of average
originated loans in the third quarter of 2012 compared to 55 basis points in
the prior quarter.

On a GAAP basis, First Niagara reported third quarter net income to common
shareholders of $50.8 million, or $0.14 per diluted share, compared to a net
loss to common shareholders of $18.5 million, or $0.05 per diluted share, in
the second quarter of 2012.Reported GAAP results for the third quarter of
2012 include $29.4 million of acquisition and restructuring costs incurred
primarily in connection with the HSBC branch acquisition and a $5.3 million
gain related to the second quarter MBS sale.

Operating Results (Non-GAAP)                         Q3 2012 Q2 2012   Q3 2011
Net interest income                                  $269.6 $259.0   $235.4
Provision for credit losses                          22.2    28.1      14.5
Noninterest income                                   96.9    79.7      68.7
Noninterest expense                                  237.1   210.4     178.5
Operating net income before non-operating items      74.0    66.6      73.6
Preferred stock dividend                             7.5     7.5       --
Operating net income available to common             66.5    59.1      73.6
shareholders
Weighted average diluted shares outstanding          349.4   348.9     292.5
Operating earnings per diluted share                 $0.19  $0.17    $0.25
                                                                    
Reported Results (GAAP)                                              
Operating net income before non-operating items      $74.0  $66.6    $73.6
Gain on securities portfolio repositioning (a)       3.5     10.3      --
Non-operating expenses (b)                           19.1    87.9      16.7
Net income (loss)                                    58.4    (10.9)    57.0
Preferred stock dividend                             7.5     7.5       --
Net income (loss) available to common shareholders   50.8    (18.5)    57.0
Weighted average diluted shares outstanding          349.4   348.9     292.5
Earnings (loss) per diluted share                    $ 0.14 $ (0.05) $0.19

All amounts in millions except earnings per diluted share.The
Non-GAAP/Operating Results table above summarizes the company's operating
results excluding certain non-operating items. For a detailed reconciliation
of non-GAAP measures, refer to the attached tables.

(a) Amount is shown net of tax and represents the gains recorded on the sale
of $3.1 billion of mortgage-backed securities in the second and third quarters
of 2012.

(b) Amounts are shown net of tax and represent expenses related to
acquisition, integration, and restructuring.

Loans

Average total loans increased $540 million, or 13% annualized over the prior
quarter, excluding loans acquired from HSBC on May 18. This organic increase
from the prior quarter was driven by sustained strength in all commercial loan
categories and indirect auto loans.

Average commercial loans increased $463 million, or 17% annualized over the
prior quarter, excluding the HSBC impact. Commercial business (C&I) loans
averaged $4.5 billion, or a 24% annualized increase over the prior quarter.
Commercial real estate loans increased 14% annualized to $6.6 billion. Average
other consumer loan balances increased $229 million and was driven by $247
million of indirect auto originations at net yields of approximately 3.5%
during the quarter.

Including the impact of the HSBC branch transaction, average loans increased
$1.3 billion, or 29% annualized over the prior quarter.

Deposits

The Company's strategic focus on customer acquisition, in particular
increasing consumer and business checking balances, resulted in average
transactional deposits, which include interest-bearing checking and
non-interest bearing balances, increasing to 31% of the company's deposit
base, compared to 25% a year ago. New checking account openings per branch
increased an annualized 10% over the prior quarter and 36% over the prior
year. The New York state franchise was a meaningful contributor at 32% as the
increased branch density and positive brand positioning in these markets
continues to drive significant new customer acquisitions.

Average noninterest-bearing deposits, excluding accounts acquired through the
HSBC branch transaction, increased 17% over the prior quarter.
Interest-bearing checking deposits increased 5% over the prior quarter,
excluding the impact of the HSBC deposits. These increases were offset by the
company's pricing strategy to reduce higher-cost money market and savings
balances.

Net Interest Income

Net interest income of $269.6 million increased 4% from the prior quarter
reflecting the favorable impacts of debt repayments using low-cost deposits
acquired through the HSBC branch transaction as well as lower premium
amortization expense on mortgage backed securities. Those benefits were
partially offset by net interest income foregone on the sale of $3.1 billion
of mortgage backed securities at the end of June. Tax equivalent net interest
margin in the third quarter of 2012 was 3.54%, a 28 basis points increase over
the prior quarter.

Average earning assets decreased 22% annualized compared to the prior quarter
given the sale of the mortgage backed securities.Investment securities
averaged $11.2 billion, a $2.8 billion decrease from the prior period. This
decrease was offset by the $1.3 billion increase in average loans.

Credit Quality

At September 30, 2012, the allowance for loan losses was $149.9 million
compared to $138.5 million at June 30, 2012. Information for both the
originated and acquired portfolios follows.

                                                
               Q3 2012                           Q2 2012
$ in millions   Originated   Acquired   Total     Originated  Acquired  Total
Provision for   $ 21.4       $ 0.4      $ 21.8    $ 25.4      $ 2.4     $ 27.8
loan losses*
Net charge-offs 9.1          1.0        10.1      15.1        0.7       15.8
NCOs/ Avg Loans 0.30%        0.06%      0.21%     0.55%       0.04%     0.36%
Total loans**   $ 12,232     $ 7,086    $ 19,318  $ 11,392    $ 7,600   $
                                                                        18,992

(*) Excludes provision for unfunded commitments of $0.4 million and $0.3
million in 3Q12 and 2Q12, respectively
(**) Acquired loans before associated credit discount; see accompanying tables
for further information

Originated loans

The provision for loan losses on originated loans totaled $21.4 million, down
$4 million from the prior quarter. The company provided $12.3 million in
excess of net charge-offs to support the ongoing momentum in originated loans.
Net charge-offs decreased significantly to $9.1 million or 30 basis points of
average originated loans from $15.1 million or 55 basis points in the prior
quarter.

At the end of the third quarter, nonperforming assets to total assets were
0.42%, comparable to the prior quarter.Nonperforming originated loans as a
percentage of originated loans decreased slightly to 0.93% at September 30,
2012 and totaled $114.2 million. At September 30, 2012, the allowance for loan
losses on originated loans totaled $147.2 million or 1.20% of such loans,
compared to $135.2 million or 1.19% of loans at June 30, 2012.

Acquired loans

The provision for losses on acquired loans totaled $0.4 million, compared to
$2.4 million in the prior quarter. Net charge-offs on those portfolios totaled
$1.0 million during the quarter, compared to $0.7 million in the prior period.
At September 30, 2012, the allowance for loan losses on acquired loans totaled
$2.7 million, compared to $3.3 million at June 30, 2012. Acquired
nonperforming loans totaled $28.2 million, up from $19.4 million at June 30,
2012.At September 30, 2012, remaining credit marks available to absorb losses
on a pool-by-pool basis totaled $212 million.

Fee Income

Third quarter 2012 non-GAAP operating noninterest income of $96.9 million
increased 22% or $17.2 million compared to the prior quarter.The increase was
driven by stronger mortgage banking revenues as well as the full quarter
benefit of the HSBC transaction. Deposit service charges increased $5.0
million or 23% over the prior quarter primarily with the benefit of the
accounts acquired from HSBC. Mortgage banking revenues increased $3.8 million
or 53% over the prior quarter driven by higher gain-on-sale margins as well as
sustained strength in origination volumes. Merchant and card fees increased
30% over the prior quarter to $12.0 million reflecting the upside of the
credit card accounts acquired from HSBC.

On a GAAP basis, noninterest income totaled $102.2 million, including a $5.3
million gain recognized on the sale of mortgage-backed securities in the
second quarter.The gain represents the company's share of the sale proceeds
in excess of the floor price set on the date of original sale to a third
party.

Noninterest Expense

Third quarter non-GAAP operating noninterest expense was $237.1 million, up
$26.7 million, or 13% over the second quarter of 2012.The increase primarily
reflects the full quarter cost of operating the acquired HSBC branches. The
non-GAAP operating efficiency ratio increased to 64.7% compared to 62.1% in
the prior quarter given the impact of the loss of revenue attributed to the
MBS sale.

On a GAAP basis, noninterest expense for the second quarter was $266.5
million, including $29.4 million in acquisition and restructuring expenses
primarily associated with the HSBC branch transaction.

Capital

At September 30, 2012, the company's estimated consolidated Total Risk Based
capital and Tier 1 Common Risk Based capital ratios were 11.5% and 7.6%,
respectively. The company remains well above current regulatory guidelines
for well-capitalized institutions.

About First Niagara

First Niagara, through its wholly owned subsidiary, First Niagara Bank, N.A.,
is a multi-state community-oriented bank with approximately 430 branches,
approximately $36 billion in assets, $28 billion in deposits, and
approximately 6,000 employees providing financial services to individuals,
families and businesses across Upstate New York, Pennsylvania, Connecticut and
Massachusetts. For more information, visit www.firstniagara.com.

Investor Call

A conference call will be held at 10:30 a.m. Eastern Time on Friday, October
19, 2012 to discuss the company's financial results.Those wishing to
participate in the call may dial toll-free 1-888-606-8413 with the passcode:
FNFG.Presentation slides will be used during the earnings conference call and
is available under the investor relations tab of our website at
www.firstniagara.com. A replay of the call will be available until November 2,
2012 by dialing 1-866-353-3016, passcode: 7253.

Non-GAAP Measures - This news release contains financial information
determined by methods other than in accordance with accounting principles
generally accepted in the United States of America (GAAP).The Company
believes that 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 non-operating 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.These
disclosures should not be viewed as a substitute for financial measures
determined in accordance with GAAP, nor are they necessarily comparable to
non-GAAP performance measures that may be presented by other companies.Where
non-GAAP disclosures are used in this news release, the comparable GAAP
financial measure, as well as the reconciliation to the comparable GAAP
financial measure, can be found in this document.

Forward-Looking Statements - This press release contains forward-looking
statements with respect to the financial condition and results of operations
of First Niagara Financial Group, Inc. including, without limitations,
statements relating to the earnings outlook of the company.These
forward-looking statements involve certain risks and uncertainties.Factors
that may cause actual results to differ materially from those contemplated by
such forward-looking statements include, among others, the following
possibilities: (1) changes in the interest rate environment; (2) competitive
pressure among financial services companies; (3) general economic conditions
including an increase in non-performing loans that could result from an
economic downturn; (4) changes in legislation or regulatory requirements; (5)
difficulties in continuing to improve operating efficiencies; (6) difficulties
in the integration of acquired businesses; and (7) increased risk associated
with an increase in commercial real estate and business loans and
non-performing loans.

                                                                                                       
First Niagara Financial Group, Inc.                                                                     
Income Statement Highlights -- Reported Basis                                                           
(in thousands, except per share amounts)                                                                
                                                                                
                2012                               2011                  Nine months ended
                 Third     Second      First     Fourth    Third     September    September
                Quarter   Quarter     Quarter   Quarter   Quarter   30,          30,
                                                                          2012         2011
                                                                                
Interest income:                                                                 
Loans and leases $211,767 $200,725   $189,385 $195,434 $192,772 $601,877   $509,230
Investment
securities and   90,101    99,116      101,395   96,472    94,375    290,612     264,171
other
Total interest   301,868   299,841     290,780   291,906   287,147   892,489     773,401
income
                                                                                
Interest                                                                         
expense:
Deposits        18,358    16,391      14,998    21,521    24,771    49,747      61,716
Borrowings      13,905    24,437      33,411    27,872    26,947    71,753      72,951
Total interest   32,263    40,828      48,409    49,393    51,718    121,500     134,667
expense
                                                                                
Net interest     269,605   259,013     242,371   242,513   235,429   770,989     638,734
income
Provision for    22,200    28,100      20,000    13,400    14,500    70,300      44,707
credit losses
Net interest
income after     247,405   230,913     222,371   229,113   220,929   700,689     594,027
provision
                                                                                
Noninterest                                                                      
income:
Deposit service  26,422    21,433      17,037    18,049    18,413    64,892      48,095
charges
Insurance        18,764    17,072      16,833    15,440    16,886    52,669      49,685
commissions
Merchant and     12,014    9,271       5,528     5,044     8,933     26,813      24,209
card fees
Wealth
management       11,069    9,207       9,039     8,179     7,933     29,315      22,550
services
Mortgage banking 10,974    7,174       5,649     5,279     5,254     23,797      9,903
Capital markets  6,381     6,831       6,539     2,746     2,687     19,751      5,603
income
Lending and      3,730     4,245       3,123     3,103     3,399     11,098      8,322
leasing
Bank owned life  3,449     3,848       3,387     3,302     2,742     10,684      7,827
insurance
Other income     9,400     16,517      2,773     2,543     2,408     28,690      5,430
Total
noninterest      102,203   95,598      69,908    63,685    68,655    267,709     181,624
income
                                                                                
Noninterest                                                                      
expense:
Salaries and     115,484   104,507     96,477    88,796    89,131    316,468     253,099
benefits
Occupancy and    25,694    24,089      22,017    22,580    20,434    71,800      55,583
equipment
Technology and   28,110    24,434      19,713    18,942    16,634    72,257      43,434
communications
Marketing and    8,954     6,676       6,763     7,724     7,554     22,393      14,126
advertising
Professional     11,193    9,263       8,895     11,669    9,171     29,351      24,348
services
Amortization of  14,506    9,839       6,466     6,586     6,896     30,811      18,958
intangibles
FDIC premiums    8,850     10,552      6,133     6,097     10,301    25,535      22,763
Merger and
acquisition      29,404    131,460     12,970    6,149     9,008     173,834     92,012
integration
expenses
Restructuring    --        3,750       2,703     13,496    16,326    6,453       29,038
charges
Other expense    24,347    21,069      18,041    20,132    18,416    63,457      50,801
Total
noninterest      266,542   345,639     200,178   202,171   203,871   812,359     604,162
expense
                                                                                
Income (loss)
before income    83,066    (19,128)   92,101    90,627    85,713    156,039     171,489
tax
Income tax
expense          24,682    (8,204)    32,236    32,166    28,732    48,714      56,040
(benefit)
Net income       58,384    (10,924)   59,865    58,461    56,981    107,325     115,449
(loss)
Preferred stock  7,547     7,547       5,115    --       --       20,209     --
dividend
Net income
(loss) available $50,837  $(18,471) $54,750  $58,461  $56,981  $87,116    $115,449
to common
stockholders
                                                                                
Financial                                                                        
Ratios:
Earnings (loss)  $0.15    $(0.05)   $0.16    $0.19    $0.19    $0.25      $0.44
per basic share
Earnings (loss)
per diluted      0.14      (0.05)     0.16      0.19      0.19      0.25        0.44
share
Weighted average
shares           349,001   348,941     348,823   304,065   292,211   348,956     260,259
outstanding -
basic^(1)
Weighted average
shares           349,371   348,941     349,069   304,341   292,503   349,248     260,689
outstanding -
diluted^(1)
Net revenue^(2)  $371,808 $354,611   $312,279 $306,198 $304,084 $1,038,698 $820,358
Noninterest
income as a      27.49%     26.96%       22.39%     20.80%     22.58%     25.77%       22.14%
percentage of
net revenue^(2)
Pre-tax,
pre-provision    $105,266 $8,972     $112,101 $104,027 $100,213 $226,339   $216,196
income^(3)
Pre-tax,
pre-provision
income per       $0.30    $0.03      $0.32    $0.34    $0.34    $0.65      $0.83
diluted
share^(3)
Pre-tax,
pre-provision
return on        1.19%      0.10%        1.36%      1.30%      1.28%      0.86%        1.07%
average
assets^(3)
Net interest     3.54%      3.26%        3.34%      3.48%      3.48%      3.38%        3.63%
margin^(4)
Interest yield
on average       4.47%      4.59%        4.62%      4.76%      4.73%      4.56%        4.91%
loans^(4)
Rate paid on
interest-bearing 0.51%      0.61%        0.79%      0.82%      0.87%      0.63%        0.87%
liabilities^(4)
Efficiency ratio 71.69%     97.47%       64.10%     66.03%     67.04%     78.21%       73.65%
Effective tax    29.7%      42.9%        35.0%      35.5%      33.5%      31.2%        32.7%
rate
Return on
average          0.66 %    (0.12)%     0.73%      0.73%      0.73%      0.41%        0.57%
assets^(5)
Return on
average          4.77 %    (0.90)%     4.96%      5.54%      5.61%      2.95%        4.34%
equity^(5)
Return on
average tangible 10.34 %   (1.64)%     7.90%      9.75%      10.28%     5.40%        7.76%
equity^(3)(5)
Return on
average common   4.46 %    (1.64)%     4.88%      5.63%      5.61%      2.57%        4.34%
equity
Return on
average tangible 10.60 %   (3.18)%     8.12%      10.03%     10.28%     5.02%        7.76%
common
equity^(3)
                                                                                
^(1) Share count excludes unallocated ESOP shares and unvested restricted stock shares.                 
^(2) Net revenue is comprised of net interest income and noninterest income.                            
^(3) The tables in this earnings release present computation of earnings and certain other ratios
using non-GAAP financial measures, which we believe provide investors with information that is
useful in understanding our financial performance and position. See Appendix A for further
detail.
^(4) Yields and rates calculated on a tax equivalent basis.                                             
^(5) Return used to calculate ratio excludes preferred stock dividend.                                  

                                                                                             
First Niagara Financial Group, Inc.                                                           
Period End Balance Sheet                                                                      
(in thousands)                                                                                
                   2012                                      2011
                   September 30, June 30,      March 31,     December 31, September 30,
                                                                       
Cash and cash       $447,087    $488,227    $370,380    $836,555    $332,437
equivalents
Investment                                                              
securities:
Available for sale  10,579,970   9,937,271    12,248,058   9,348,296    8,349,237
Held to maturity    1,387,763    1,463,872    2,503,156    2,669,630    2,830,744
FHLB and FRB common 373,311      329,555      499,328      358,159      331,747
stock
Total investment    12,341,044   11,730,698   15,250,542   12,376,085   11,511,728
securities
Loans held for sale 117,375      101,596      102,513      94,484       79,820
Loans and leases:                                                      
Commercial:                                                             
Real estate         6,835,971    6,710,009    6,369,098    6,244,381    6,148,988
Business            4,682,154    4,514,537    4,108,363    3,771,649    3,588,733
Total commercial    11,518,125   11,224,546   10,477,461   10,016,030   9,737,721
loans
Consumer:                                                               
Residential real    3,870,756    4,037,045    3,881,003    4,012,267    4,171,374
estate
Home equity         2,661,429    2,683,236    2,149,135    2,165,988    2,177,772
Indirect auto       419,258      185,774      --           --           --
Credit cards        308,387      304,368      --           --           --
Other consumer      328,571      328,547      283,320      278,298      278,499
Total consumer      7,588,401    7,538,970    6,313,458    6,456,553    6,627,645
loans
Total loans and     19,106,526   18,763,516   16,790,919   16,472,583   16,365,366
leases
Allowance for loan  149,933      138,516      126,746      120,100      112,749
losses
Loans and leases,   18,956,593   18,625,000   16,664,173   16,352,483   16,252,617
net
Bank owned life     401,211      397,739      395,944      392,468      416,449
insurance
Goodwill and other  2,626,625    2,631,605    1,796,394    1,803,240    1,812,628
intangibles
Other assets        983,999      1,130,891    937,859      955,300      803,828
Total assets        $35,873,934 $35,105,756 $35,517,805 $32,810,615 $31,209,507
                                                                       
Deposits:                                                               
Savings accounts    $3,941,528  $4,103,773  $2,554,720  $2,621,016  $2,641,723
Interest-bearing    4,090,322    3,887,568    2,431,672    2,259,576    2,028,052
checking
Money market        10,801,280   10,919,766   7,100,646    7,220,902    7,507,189
deposits
Noninterest-bearing 4,658,374    4,774,764    3,200,824    3,335,356    3,095,283
deposits
Certificates of     4,206,192    4,211,116    3,741,525    3,968,265    4,351,930
deposit
Total deposits      27,697,696   27,896,987   19,029,387   19,405,115   19,624,177
                                                                       
Short-term          1,995,610    958,044      6,353,189    2,208,845    1,156,711
borrowings
Long-term           732,339      732,263      4,688,251    5,918,276    5,928,632
borrowings
Other liabilities   532,868      700,249      571,532      480,201      499,312
Total liabilities   30,958,513   30,287,543   30,642,359   28,012,437   27,208,832
Preferred
stockholders'       338,002      338,002      338,002      338,002      --
equity
Common
stockholders'       4,577,419    4,480,211    4,537,444    4,460,176    4,000,675
equity
Total stockholders' 4,915,421    4,818,213    4,875,446    4,798,178    4,000,675
equity
Total liabilities
and stockholders'   $35,873,934 $35,105,756 $35,517,805 $32,810,615 $31,209,507
equity
                                                                       
Selected balance                                                        
sheet information:
Total
interest-earning    $31,316,470 $30,403,035 $31,959,556 $29,284,139 $27,805,974
assets^(1)
Total
interest-bearing    25,767,271   24,812,530   26,870,002   24,196,880   23,614,238
liabilities
Net
interest-earning    $5,549,199  $5,590,505  $5,089,554  $5,087,259  $4,191,736
assets
                                                                       
Tangible common     $1,950,794  $1,848,606  $2,741,050  $2,656,936  $2,188,047
equity^(2)
Unrealized gain on
securities, net of  204,347      133,430      152,408      105,276      116,666
tax
                                                                       
Total core deposits $23,491,504 $23,685,871 $15,287,862 $15,436,850 $15,272,247
                                                                       
Originated          $12,232,568 $11,392,158 $10,517,021 $9,876,005  $9,425,194
loans^(3)
Acquired loans^(4)  7,085,839    7,600,213    6,459,798    6,801,689    7,195,250
Credit related
discount on         (211,881)    (228,855)    (185,900)    (205,111)    (255,078)
acquired loans^(5)
Total Loans         $19,106,526 $18,763,516 $16,790,919 $16,472,583 $16,365,366
                                                                       
^(1) Includes interest bearing cash and cash equivalents, investment securities at           
amortized cost, loans held for sale, and total loans and leases.
^(2) The tables in this earnings release present computation of earnings and certain
other ratios using non-GAAP financial measures, which we believe provide investors with
information that is useful in understanding our financial performance and position. See
Appendix A for further detail.
^(3) Originated loans represent total loans excluding acquired loans.                         
^(4) Represents the carrying value of acquired loans plus the principal not expected to       
be collected.
^(5) Represent principal on acquired loans not expected to be collected.                      

                                                                                                                                                                                                        
First Niagara Financial Group, Inc.                                                                                                                                                                      
Average Balance Sheet and Related Tax Equivalent Yields & Rates                                                                                                                                       
(in millions)                                                                                                                                                                                             
                                                                                                                                                                                                         
                   For the three months ended                                                                          Nine months ended
                   September 30, 2012                June 30, 2012                    September 30, 2011               September 30, 2012                September 30, 2011
                    Average                 Yields                           Yields                           Yields
                   Balances  Interest^(1) and       Average               and       Average                and       Average                Yieldsand Average                Yieldsand
                                            Rates^(1) Balances  Interest^(1) Rates^(1) Balances  Interest^(1) Rates^(1) Balances  Interest^(1) Rates^(1) Balances  Interest^(1) Rates^(1)
                                                                                                                                                                  
Interest-earning                                                                                                                                                   
assets:
Loans and                                                                                                                                                          
leases^(2)
Commercial:                                                                                                                                                        
Real estate         $6,783  $80         4.60%     $6,501  $80        4.88%     $6,143  $82        5.23%     $6,529  $239       4.81%      $5,467  $223       5.39%
Business            4,609    45           3.81    4,293    44          4.03    3,424    35          3.95    4,274    129         3.96     3,056    98          4.23
Total commercial    11,392   125          4.28    10,794   124         4.54    9,567    117         4.78    10,803   368         4.48     8,523    321         4.97
loans
Consumer:                                                                                                                                                          
Residential real    3,962    40           4.03    3,964    40          4.07    4,227    47          4.49    3,957    123         4.13     3,269    113         4.60
estate
Home equity         2,672    30           4.42    2,412    27          4.42    2,167    25          4.55    2,415    80          4.42     1,908    65          4.56
Indirect auto       301      3            3.64    84       1           4.16    --       --         --      131      4           3.86     --       --         --
Credit cards        308      9            11.31   160      5           11.58   --       --         --      165      14          11.31    --       --         --
Other consumer      329      7            8.80    283      6           8.12    277      5           6.81    285      17          8.07     272      14          6.93
Total consumer      7,572    88           4.64    6,903    78          4.55    6,671    77          4.58    6,953    237         4.56     5,449    192         4.71
loans
Total loans and     18,964   213          4.47    17,697   202         4.59    16,238   194         4.73    17,756   605         4.56     13,972   513         4.91
leases
Residential MBS     5,677    40           2.81    8,982    52          2.35    8,748    73          3.40    7,729    158         2.72     8,111    217         3.57
Commercial MBS      1,895    19           3.93    1,867    18          3.94    598      5           3.60    1,822    54          3.95     411      12          3.90
Other investment    3,645    29           3.21    3,183    27          3.43    1,594    18          4.44    3,038    76          3.35     1,341    42          4.11
securities
Total securities,   11,217   88           3.13    14,032   98          2.81    10,940   97          3.56    12,589   288         3.05     9,863    271         3.65
at cost
Money market and    558      5            3.56    818      5           2.20    411      3           2.34    682      13          2.60     333      7           2.81
other investments
Total
interest-earning    30,739   $306        3.96%     32,547   $305       3.77%     27,589   $294       4.22%     31,027   $907       3.90%      24,168   $791       4.37%
assets
Goodwill and other  2,627                          2,207                         1,828                         2,213                          1,562                
intangibles
Other
noninterest-earning 1,938                          1,746                         1,566                         1,737                          1,373                
assets
                                                                                                                                                                  
Total assets       $35,304                       $36,500                      $30,983                      $34,977                       $27,103             
                                                                                                                                                                  
Interest-bearing                                                                                                                                                   
liabilities:
Deposits                                                                                                                                                           
Savings accounts    $4,026  $2          0.20%     $3,302  $1         0.14%     $2,699  $2         0.25%     $3,300  $3         0.14%      $2,174  $4         0.24%
Interest-bearing    3,871    1            0.06    3,095    1           0.08    2,025    1           0.13    3,066    2           0.08     1,910    2           0.12
checking
Money market        10,899   8            0.29    9,125    6           0.28    7,148    11          0.65    9,071    19          0.28     6,197    27          0.58
deposits
Certificates of     4,083    8            0.75    4,019    8           0.83    4,444    11          0.96    3,977    25          0.85     4,022    29          0.97
deposit
Total interest      22,879   19           0.32%     19,541   16          0.34%     16,316   25          0.60%     19,414   50          0.34%      14,303   62          0.58%
bearing deposits
Borrowings                                                                                                                                                         
Short-term          1,666    1            0.36%     5,046    7           0.55%     1,303    2           0.46%     3,442    15          0.56%      1,550    4           0.38%
borrowings
Long-term           732      12           6.74    2,433    18          2.91    6,048    25          1.67    2,825    57          2.70     4,897    69          1.87
borrowings
Total borrowings   2,398    13           2.31    7,479    24          1.31    7,351    27          1.45    6,267    72          1.53     6,447    73          1.51
Total
interest-bearing    25,277   $32         0.51%     27,020   $41        0.61%     23,667   $52        0.87%     25,681   $122       0.63%      20,750   $135       0.87%
liabilities
Noninterest-bearing 4,618                          3,835                         2,857                         3,838                          2,433                
deposits
Other
noninterest-bearing 536                            765                           431                           590                            367                  
liabilities
Total liabilities  30,431                         31,620                        26,955                        30,110                         23,550               
Total stockholders' 4,873                          4,880                         4,028                         4,868                          3,553                
equity
Total liabilities
and stockholders'   $35,304                       $36,500                      $30,983                      $34,977                       $27,103             
equity
                                                                                                                                                                  
Net interest income          $274                          $264                         $242                         $785                          $656       
(FTE)
Taxable Equivalent           4                              5                             7                             14                             17          
Adjustment^(1)
                                                                                                                                                                  
Total core         $23,414 $11         0.18%     $19,357 $8         0.17%     $14,729 $14        0.38%     $19,275 $24        0.17%      $12,714 $32        0.34%
deposits
Total deposits    27,497   19           0.27%     23,376   16          0.28%     19,173   25          0.51%     23,252   50          0.29%      16,736   62          0.49%
                                                                                                                                                                  
Tax equivalent net
interest rate                             3.45%                          3.16%                          3.35%                          3.27%                           3.50%
spread
Tax equivalent net
interest rate                             3.54%                          3.26%                          3.48%                          3.38%                           3.63%
margin
                                                                                                                                                                  
^(1) Tax equivalent interest income is calculated based upon a 35% effective tax rate.                                                                                                              
^(2) Includes nonaccrual loans.                                                                                                                                                                          

                                                                                      
First Niagara Financial Group, Inc.                                                                             
Allowance for Loans and Lease Losses & Asset Quality                                                            
(in thousands)                                                                                                  
                2012                                  2011                      Nine months ended
                 Third       Second      First       Fourth       Third        September   September
                Quarter    Quarter      Quarter     Quarter     Quarter     30,         30,
                                                                                 2012        2011
                                                                                      
Beginning        $138,516  $126,746   $120,100   $112,749   $107,028   $120,100  $95,354
balance
Net loan
(charge-offs)                                                                          
recoveries:
Commercial real  $(1,791)  $(2,384)   $(5,994)   $212       $(5,580)   $(10,169) $(10,373)
estate
Commercial       (6,077)    (10,958)    (4,143)     (4,665)     (2,123)     (21,178)   (9,953)
business
Residential real (396)      (155)       (1,120)     (318)       171         (1,671)    (668)
estate
Home equity      (401)      (1,536)     (1,161)     (268)       (223)       (3,098)    (1,833)
Other consumer   (1,406)    (805)       (836)       (796)       (370)       (3,047)    (963)
Total net loan   $(10,071) $(15,838)  $(13,254)  $(5,835)   $(8,125)   $(39,163) $(23,790)
charge-offs
Provision for    21,800     27,803      19,900      13,186      13,846      69,503     41,185
loan losses
Allowance
related to loans (312)     (195)      --         --         --         (507)     --
sold
Ending balance   $149,933  $138,516   $126,746   $120,100   $112,749   $149,933  $112,749
                                                                                      
Supplemental                                                                           
information
Allowance to     0.78%       0.74%        0.75%        0.73%        0.69%        0.78%       0.69%
loans
Allowance for
originated loans 1.20%       1.19%        1.19%        1.20%        1.20%        1.20%       1.20%
to originated
loans^(1)
                                                                                      
Net charge-offs
to average loans                                                                       
(annualized)
Commercial real  0.11%       0.15%        0.38%        -0.01%       0.36%        0.21%       0.25%
estate
Commercial       0.53%       1.02%        0.42%        0.51%        0.25%        0.66%       0.43%
business
Total commercial 0.28%       0.49%        0.40%        0.18%        0.32%        0.39%       0.32%
loans
Residential real 0.04%       0.02%        0.11%        0.03%        -0.02%       0.06%       0.03%
estate
Home equity      0.06%       0.25%        0.22%        0.05%        0.04%        0.17%       0.13%
Other consumer   0.60%       0.61%        1.20%        1.14%        0.53%        0.70%       0.47%
Total consumer   0.12%       0.15%        0.20%        0.08%        0.03%        0.15%       0.08%
loans
Total loans      0.21%       0.36%        0.32%        0.14%        0.20%        0.29%       0.23%
                                                                                      
Net charge-offs
of originated
loans to average                                                                       
originated loans
(annualized)^(1)
Commercial real  0.12%       0.18%        0.16%        -0.05%       0.59%        0.15%       0.37%
estate
Commercial       0.64%       1.25%        0.54%        0.67%        0.34%        0.82%       0.56%
business
Total commercial 0.36%       0.66%        0.32%        0.25%        0.49%        0.45%       0.45%
loans
Residential real 0.09%       0.04%        0.27%        0.08%        -0.04%       0.13%       0.05%
estate
Home equity      0.13%       0.51%        0.40%        0.10%        0.08%        0.35%       0.25%
Other consumer   0.59%       0.81%        1.25%        1.51%        0.93%        0.76%       0.90%
Total consumer   0.18%       0.28%        0.38%        0.17%        0.06%        0.27%       0.17%
loans
Total loans      0.30%       0.55%        0.34%        0.22%        0.35%        0.40%       0.36%
                                                                                      
Nonperforming                                                                          
loans:
Originated:                                                                            
Commercial real  $46,413   $46,881    $44,749    $43,119    $41,295    $46,413   $41,295
estate
Commercial       37,375     30,714      39,682      20,173      18,839      37,375     18,839
business
Residential real 21,377     23,058      22,021      18,668      15,555      21,377     15,555
estate
Home equity      8,084      8,119       7,071       6,790       5,428       8,084      5,428
Other consumer   938        926         697         1,048       769         938        769
Total originated
nonperforming    114,187    109,698     114,220     89,798      81,886      114,187    81,886
loans
Total acquired
nonperforming    28,193     19,374      19,041      --          --          28,193     --
loans^(2)
Total
nonperforming    142,380    129,072     133,261     89,798      81,886      142,380    81,886
loans
Real estate      9,669      10,632      7,202       4,482       9,392       9,669      9,392
owned
Total
nonperforming    $152,049  $139,704   $140,463   $94,280    $91,278    $152,049  $91,278
assets
                                                                                      
Accruing
troubled debt    $55,732   $42,140    $42,358    $43,888    $45,282    $45,518   $45,282
restructurings
(TDR)
Loans 90 days
past due still   145,323    125,668     116,810     143,237     143,270     145,323    143,270
accruing^(3)
Total classified 693,006    732,762     753,536     748,375     692,961     693,006    692,961
loans^(4)
Total criticized $990,670  $1,030,471 $1,044,731 $1,144,222 $1,268,879 $990,670  $1,268,879
loans^(5)
                                                                                      
Total
nonperforming    0.75%       0.69%        0.79%        0.55%        0.50%        0.75%       0.50%
loans to loans
Total
nonperforming
originated loans 0.93%       0.96%        1.09%        0.91%        0.87%        0.93%       0.87%
to originated
loans^(1)
Total
nonperforming
assets to loans  0.80%       0.74%        0.84%        0.57%        0.56%        0.80%       0.56%
and real estate
owned
Total
nonperforming    0.42%       0.40%        0.40%        0.29%        0.29%        0.42%       0.29%
assets to assets
Allowance to
nonperforming    105.3%      107.3%       95.1%        133.7%       137.7%       105.3%      137.7%
loans
Texas ratio^(6)  14.16%      13.35%       8.97%        8.55%        10.19%       14.16%      10.19%
                                                                                      
^(1) Originated loans represent total loans excluding acquired loans.                                          
^(2) Nonperforming acquired loans include certain lines of credit that are considered nonaccruing.The    
remaining credit discount, recorded at acquisition, is adequate to cover losses on these balances.
^(3) Includes acquired loans that were originally recorded at fair value upon acquisition, credit card
loans, and loans that have matured which are in the process of collection.Amounts for the first and
second quarter of 2012 have been revised to include matured loans in the process of collection.
^(4) Includes consumer loans, which are considered classified when they are 90 days or more past due.
Classified loans include substandard, doubtful, and loss, which are consistent with regulatory
definitions, and as described in Item 1, "Business", under the heading "Classification of Assets" in our
Annual Report on 10-K for the year ended December 31, 2011.
^(5) Beginning in the third quarter of 2011, criticized loans include consumer loans when they are 90
days or more past due. Prior to the third quarter of 2011, criticized loans include consumer loans when
they are 60 days or more past due. The impact of the change at September 30, 2011 was a reduction of
criticized loans by $24 million. Criticized loans include special mention, substandard, doubtful, and
loss.
^(6) Represents ratio computed using non-GAAP financial measures, which we believe provide investors with
information that is useful in understanding our financial performance and position. See Appendix A for
further detail.

                                                     
First Niagara Financial Group, Inc.                                         
Key Statistics                                                              
(Share counts in thousands)                                                 
                                                     
              2012                           2011
              September June 30, March       December    September
               30,                31,          31,         30,
                                                     
First Niagara
Financial
Group, Inc                                            
capital
ratios:
Tier 1 risk    9.51%     9.40%    14.66%   (1) 15.60%   (1) 11.90%
based capital
Tier 1 common  7.59%     7.41%    12.47%   (1) 13.23%   (1) 11.29%
capital^(2)
Total risk     11.48%    11.37%   16.75%   (1) 17.84%   (1) 12.56%
based capital
Leverage       6.83%     6.32%    9.67%    (1) 9.97%    (1) 7.42%
Equity to      13.70%    13.72%   13.73%   (1) 14.62%   (1) 12.82%
assets
Tangible
common equity  5.87%     5.69%    8.13%    (1) 8.57%    (1) 7.44%
to tangible
assets^(2)
                                                     
First Niagara
Bank, N.A                                             
capital
ratios:
Tier 1 risk    10.19%    9.63%    14.69%   (1) 14.66%   (1) 11.51%
based capital
Total risk     10.88%    10.57%   15.66%   (1) 16.47%   (1) 12.17%
based capital
Leverage       7.32%     6.48%    9.69%    (1) 9.38%    (1) 7.17%
                                                     
Number of      432      452     334        333        332
branches
Full time
equivalent     6,036    6,103   4,753      4,827      4,712
employees
                                                     
Share
information                                           
and per share
metrics:
Common shares  352,632  352,665 351,936    351,834    294,898
outstanding
Preferred
shares         14,000   14,000  14,000     14,000     --
outstanding
Treasury       13,370   13,337  14,066     14,168     14,192
shares
Market price
(NASDAQ:       $8.07   $7.65  $9.84     $8.63     $9.15
FNFG):
Book value per 13.11    12.84   13.00      12.79      13.72
share^(3)
Tangible book
value per      5.59     5.30    7.86       7.62       7.50
share^(2)(3)
Price/Book     61.56%    59.58%   75.69%      67.47%      66.69%
Price/Tangible 144.36%   144.34%  125.19%     113.25%     122.00%
book^(2)
Common stock   $0.08   $0.08  $0.08     $0.16     $0.16
dividends
Preferred
stock          0.54     0.54    0.37       --        --
dividends
Dividend       53.33%    N/M      50.00%      84.21%      84.21%
payout ratio
Dividend yield 3.94%     4.21%    3.27%       7.36%       6.94%
(annualized)
                                                     
N/M Not                                               
meaningful
(1) Ratios reflect the impact of our capital raise completed in
December 2011, the proceeds of which were used to consummate the
acquisition of branches from HSBC Bank-USA, National Association in
May 2012.
(2) The tables in this earnings release present computation of
earnings and certain other ratios using non-GAAP financial measures,
which we believe provide investors with information that is useful in
understanding our financial performance and position. See Appendix A
for further detail.
(3) Share count excludes unallocated ESOP shares and unvested               
restricted stock shares.

                                                                                   
First Niagara                                                                       
Financial Group, Inc.
Appendix A - Non-GAAP                                                               
Reconciliation
(in thousands, except                                                               
per share amounts)
                                                                                   
                     2012                               2011                  Nine months ended
                      Third     Second      First     Fourth     Third     September  September
                     Quarter   Quarter     Quarter   Quarter   Quarter   30,       30,
                                                                               2012       2011
Financial ratios
computed on an                                                                      
operating basis^(1):
Earnings per basic    $0.19    $0.17      $0.19    $0.24    $0.25    $0.54    $0.75
share
Earnings per diluted  0.19      0.17        0.19      0.24      0.25      0.54      0.75
share
Weighted average
shares outstanding -  349,001   348,941     348,823   304,065   292,211   348,956   260,259
basic^(2)
Weighted average
shares outstanding -  349,371   348,941     349,069   304,341   292,503   349,248   260,689
diluted^(2)
Pre-tax,              129,333   128,287     127,774   123,672   125,547   385,394   337,246
pre-provision income
Pre-tax,
pre-provision income  0.37      0.37        0.37      0.41      0.43      1.10      1.29
per diluted share
Pre-tax,
pre-provision return  1.46%      1.41%        1.55%      1.55%      1.61%      1.47%      1.66%
on average assets
Net interest          3.54%      3.26%        3.34%      3.48%      3.48%      3.38%      3.63%
margin^(3)
Interest yield on     4.47%      4.59%        4.62%      4.76%      4.73%      4.56%      4.91%
average loans^(3)
Rate paid on
interest-bearing      0.51%      0.61%        0.79%      0.82%      0.87%      0.63%      0.87%
liabilities^(3)
Efficiency ratio      64.71%     62.13%       59.08%     59.61%     58.71%     62.12%     58.89%
Effective tax rate    30.9%      33.5%        35.0%      34.7%      33.7%      33.1%      33.5%
Noninterest income as
a percentage of net   26.43%     23.53%       22.39%     20.80%     22.58%     24.22%     22.14%
revenue^(4)
Return on average     0.83%      0.73%        0.85%      0.90%      0.94%      0.80%      0.96%
assets
Return on average     6.04%      5.49%        5.81%      6.82%      7.25%      5.78%      7.33%
equity
Return on average     13.11%     10.03%       9.24%      12.02%     13.28%     10.60%     13.08%
tangible equity^(5)
Return on average     5.83%      5.23%        5.79%      6.93%      7.25%      5.62%      7.33%
common equity
Return on average
tangible common       13.86%     10.18%       9.63%      12.36%     13.28%     10.98%     13.08%
equity^(6)
                                                                                   
Reconciliation of
noninterest income on
operating basis to                                                                  
reported noninterest
income^(1):
Total noninterest
income on operating   $96,866  $79,703    $69,908  $63,685  $68,655  $246,477 $181,624
basis (Non-GAAP)
Gain on securities
portfolio             5,337     15,895      --       --       --       21,232    --
repositioning
Total reported
noninterest income    102,203   95,598      69,908    63,685    68,655    267,709   181,624
(GAAP)
                                                                                   
Reconciliation of
noninterest expense
on operating basis to                                                               
reported noninterest
expense^(1):
Total noninterest
expense on operating  $237,138 $210,429   $184,505 $182,526 $178,537 $632,072 $483,112
basis (Non-GAAP)
Merger and
acquisition           29,404    131,460     12,970    6,149     9,008     173,834   92,012
integration expenses
Restructuring charges --       3,750       2,703     13,496    16,326    6,453     29,038
Total reported
noninterest expense   $266,542 $345,639   $200,178 $202,171 $203,871 $812,359 $604,162
(GAAP)
                                                                                   
Reconciliation of net
operating income to                                                                 
net income^(1):
Net operating income  $74,027  $66,630    $70,053  $72,057  $73,645  $210,710 $194,661
(Non-GAAP)
Nonoperating income
and expenses, net of                                                                
tax:
Gain on securities
portfolio             (3,469)   (10,331)    --        --        --        (13,800)  --
repositioning
Merger and
acquisition           19,112    85,448      8,431     4,256     5,925     112,991   60,164
integration expenses
Restructuring charges --       2,437       1,757     9,340     10,739    4,194     19,048
Total nonoperating    15,643    77,554      10,188    13,596    16,664    103,385   79,212
expenses, net of tax
Net income (GAAP)     $58,384  $(10,924) $59,865  $58,461  $56,981  $107,325 $115,449
                                                                                   
Reconciliation of net
operating income
available to common
stockholders to net                                                                 
income available to
common
stockholders^(1):
Net operating income
available to common   $66,480  $59,083    $64,938  $72,057  $73,645  $190,501 $194,661
stockholders
(Non-GAAP)
Nonoperating income
and expenses, net of                                                                
tax:
Gain on securities
portfolio             (3,469)   (10,331)    --       --       --       (13,800)  --
repositioning
Merger and
acquisition           19,112    85,448      8,431     4,256     5,925     112,991   60,164
integration expenses
Restructuring charges --       2,437       1,757     9,340     10,739    4,194     19,048
Total nonoperating
income and expenses,  15,643    77,554      10,188    13,596    16,664    103,385   79,212
net of tax
Net income available
to common             $50,837  $(18,471) $54,750  $58,461  $56,981  $87,116  $115,449
stockholders (GAAP)
                                                                                   
Computation of
pre-tax,pre-provision                                                               
income:
Net interest income   $269,605 $259,013   $242,371 $242,513 $235,429 $770,989 $638,734
Noninterest income    102,203  95,598     69,908   63,685   68,655   267,709  181,624
Noninterest expense   (266,542) (345,639)   (200,178) (202,171) (203,871) (812,359) (604,162)
Pre-tax,
pre-provision income  105,266   8,972       112,101   104,027   100,213   226,339   216,196
(GAAP)
Less: non-operating
noninterest income    (5,337)   (15,895)    --       --       --       (21,232)  --
^(1)
Add back:
non-operating         29,404    135,210     15,673    19,645    25,334    180,287   121,050
noninterest expenses
^(1)
Pre-tax,
pre-provision income  $129,333 $128,287   $127,774 $123,672 $125,547 $385,394 $337,246
(Non-GAAP)^(1)
                                                                                   
^(1) Noninterest income and expense on an operating basis, net operating income, and pre-tax,
pre-provision income on an operating basis are non-GAAP measures that we believe provide meaningful
comparisons of our underlying operational performance and facilitates investors' assessments of
business and performance trends in comparison to others in the financial services industry. In
addition, we believe exclusion of these nonoperating items enables management to perform a more
effective evaluation and comparison of our results and to assess performance in relation to our
ongoing operations.
^(2) Share count
excludes unallocated
ESOP shares and                                                                     
unvested restricted
stock shares.
^(3) Yields and rates
calculated on a tax                                                                 
equivalent basis.
^(4) Net revenue is
comprised of net                                                                    
interest income and
noninterest income.
^(5) Tangible equity
is a non-GAAP measure
and excludes goodwill                                                               
and other
intangibles.
^(6) Tangible common equity is a non-GAAP
measure and excludes goodwill and other                                               
intangibles as well as preferred stock.

                                                                                            
First Niagara Financial Group, Inc.                                                                                    
Appendix A - Non-GAAP Reconciliation (Cont.)                                                                           
(in thousands, except per share amounts)                                                                               
                                                                                            
              2012                                      2011                        Nine months ended
              Third         Second        First        Fourth        Third         September     September
               Quarter      Quarter      Quarter      Quarter      Quarter      30,2012      30,2011
Computation of
Ending                                                                                       
Tangible
Common Equity:
Total
stockholders'  $4,915,421  $4,818,213  $4,875,446  $4,798,178  $4,000,675  $4,915,421  $4,000,675
equity
Less: Goodwill
and other      (2,626,625) (2,631,605) (1,796,394) (1,803,240) (1,812,628) (2,626,625) (1,812,628)
intangibles
Less:
Preferred      (338,002)   (338,002)   (338,002)   (338,002)   --          (338,002)    --
stockholders'
equity
Tangible       $1,950,794  $1,848,606  $2,741,050  $2,656,936  $2,188,047  $1,950,794  $2,188,047
common equity
                                                                                            
Computation of
Average                                                                                      
Tangible
Equity:
Total
stockholders'  $4,872,605  $4,879,791  $4,850,276  $4,188,800  $4,027,572  $4,867,576  $3,552,559
equity
Less: Goodwill
and other      (2,626,666) (2,206,682) (1,800,613) (1,809,690) (1,827,820) (2,212,836) (1,562,320)
intangibles
Tangible       $2,245,939  $2,673,109  $3,049,663  $2,379,110  $2,199,752  $2,654,740  $1,990,239
equity
                                                                                            
Computation of
Average                                                                                      
Tangible
Common Equity:
Total
stockholders'  $4,872,605  $4,879,791  $4,850,276  $4,188,800  $4,027,572  $4,867,576  $3,552,559
equity
Less: Goodwill
and other      (2,626,666) (2,206,682) (1,800,613) (1,809,690) (1,827,820) (2,212,836) (1,562,320)
intangibles
Less:
Preferred      (338,002)   (338,002)   (338,002)    (66,226)     --          (338,002)   --
stockholders'
equity
Tangible       $1,907,937  $2,335,107  $2,711,661  $2,312,884  $2,199,752  $2,316,738  $1,990,239
common equity
                                                                                            
Computation of                                                                               
Texas Ratio:
Nonperforming  $152,049    $139,704    $140,463    $94,280     $91,278     $152,049    $91,278
Assets
Loans 90 days
past due still 145,323      125,668      116,810      143,237      143,270      145,323      143,270
accruing^(1)
Sum of
nonperforming
assets and     $297,372    $265,372    $257,273    $237,517    $234,548    $297,372    $234,548
loans 90 days
past due still
accruing
                                                                                            
Tangible       $1,950,794  $1,848,606  $2,741,050  $2,656,936  $2,188,047  $1,950,794  $2,188,047
common equity
Allowance for  149,933      138,516      126,746      120,100      112,749      149,933      112,749
loan loss
Sum of
tangible
common equity  $2,100,727  $1,987,122  $2,867,796  $2,777,036  $2,300,796  $2,100,727  $2,300,796
and allowance
for loan loss
                                                                                            
Sum of
nonperforming
assets and
acquired loans
90 days past
due still      14.16%        13.35%        8.97%         8.55%         10.19%        14.16%        10.19%
accruing/Sum
of tangible
common equity
and allowance
for loan loss
                                                                                            
Computation of
Tier 1 Common                                                                                
Capital:
Tier 1 capital $2,225,121  $2,128,702  $3,009,727  $2,962,031  $2,151,953  $2,225,121  $2,151,953
Less:
Qualifying
restricted     (111,820)   (111,630)   (111,453)    (111,284)    (111,112)    (111,820)   (111,112)
core capital
elements
Less:
Perpetual
non-cumulative (338,002)   (338,002)   (338,002)    (338,002)    --          (338,002)   --
preferred
stock
Tier 1 common
capital        $1,775,299  $1,679,070  $2,560,272  $2,512,745  $2,040,841  $1,775,299  $2,040,841
(Non-GAAP)
                                                                                            
^(1) Includes acquired loans that were originally recorded at fair value upon acquisition, credit card loans,       
and loans that have matured which are in the process of collection.

CONTACT:  Investors:
          Ram Shankar
          Senior Vice President, Investor Relations
          (716) 270-8623
          ram.shankar@fnfg.com

          News Media:
          David Lanzillo
          Senior Vice President, Corporate Communications
          (716) 819-5780
          david.lanzillo@fnfg.com
 
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