First Niagara removes CEO John Koelmel

BUFFALO, N.Y. (WIVB) - John Koelmel, who guided First Niagara Bank through a difficult economy and on to rapid growth, is no longer the bank's President and CEO.

First Niagara made the surprise announcement after its regular board meeting Tuesday, March 19. The bank offered no explanation, other than to say that Koelmel was being replaced following a "mutually agreed upon departure." For the interim, Executive Vice President and Chief Administrative and Operations Officer Gary Crosby will step up to fill Koelmel's shoes.

MORE | Koelmel's departure comes just days after Business First revealed his $3.8 million in total annual compensation tops those of other banking executives in WNY

Koelmel has headed the bank since 2006. During his time as President and CEO, First Niagara acquired 195 HSBC Bank branches in upstate New York and Connecticut -- nearly the entire branch network HSBC had locally -- and secured the naming rights to the former HSBC Arena, now called First Niagara Center. It also bought up other banks in New England and Pennsvylvania.

The acquisitions catapulted First Niagara to one of the biggest banks in WNY and the entire Northeastern United States,more than quadrupling its assets.

“John Koelmel has guided the company’s transformation from a local thrift to a leading northeast banking franchise, and led First Niagara during a period of difficult economic conditions and financial industry turmoil,” First Niagara's Chairman of the Board, G. Thomas Bowers, said in a statement. “The Board and I are grateful to John for his leadership through this critical period in our history."

An executive search firm will be used to help find Koelmel's permanent replacement.

In a statement released by the bank, Koelmel said, "I agree with the Board that it’s in the best interests of the organization under present circumstances to move forward with new leadership."

Neither Koelmel or First Niagara have commented further on his departure.

"John was ideally suited to grow the bank, by leaps and bounds," his friend, Larkin Development Managing Partner Howard Zemsky told News 4 Tuesday evening.

Zemsky had high praise not only for his friend's business practices, but for Koelmel as a person.

He remembers when the concept for what is now Larkin Square was just coming together, and the neighborhood, along Seneca Street near Hamburg Street, was mostly empty.

First Niagara had just moved its headquarters into the building next door, the one on which its emblem is visible today from I-190.

"John asked, 'What can we do to help?'" Zemsky recounted. "And we had a concept for Larkin Square and for an upgraded infrastructure all in and around Larkin, and he was -- as you know John is -- tremendously enthusiastic."

Indeed, Koelmel's energy, along with that powerful, gravelly voice and charismatic personality have made him perhaps one of the most recognizable figures in Western New York.

And he is a prolific champion for his native Buffalo.

"Larkin Square wouldn't have happened without the commitment of John and the bank. The bank's also been very supportive of rehab of a number of residential properties in the neighborhood," Zemsky said. "Both John and the bank have played a vital role in not only sharing our vision, but enhancing our vision. I think they saw it as a great investment both, in the city, in Larkinville and in their people."

Koelmel has put the bank's, as well as his personal support behind countless initiatives that are trying to make this community a better place to live. They include the new John R. Oishei Children's Hospital, being built on the Buffalo Niagara Medical Campus; the veterinary college -- one of less than 30 across the entire United States -- that will move into the former Millard Fillmore Gates Circle hospital building; the Buffalo Arts & Technology Center, which provides education and job training to at-risk kids and struggling adults; the Buffalo Sabres; the local arts scene and the transformation of Larkin Square.

"It goes on and on," Zemsky said. "John loves Buffalo. He wears his emotion on his sleeve. He has great vision, great passion [and] great compassion."

Even without First Niagara, Koelmel has a lengthy resume and remains entrenched in local development. He's one of the representatives on Governor Cuomo's Western New York Regional Economic Development Council, which has identified the medical sciences, manufacturing and tourism as priorities for growth.

Koelmel is the Chairman of both the New York Power Authority and Kaleida Health's Board of Directors.

"John's an amazing leader, and he will emerge as an amazing leader in another capacity, for the benefit of Buffalo. So, I think it will work out for all involved," Zemsky said.