Koelmel may have left over shareholders

BUFFALO, N.Y. (WIVB) - Many have been wondering the real reason why John Koelmel suddenly departed as President and CEO of First Niagara Financial Group.

MORE | Koelmel's departure was sudden and was announced after a Board of Directors meeting

Anthony Ogorek of Ogorek Wealth Management would sum it up with this: "Shareholders have lost their patience."

"I think the strategy hasn't played out as well as they had hoped it would for shareholders, and that's probably why they've made the change," he explained.

The bank's stock price over the past couple of years has been on the decline. And shareholders, as you might imagine, are not happy.

Under Koelmel's leadership First Niagara grew from a local bank to a big player in the Northeast. Some point to the timing of the bank's acquisition of 195 HSBC branches.

Ogorek said, "In hindsight, the market would say no [it was not the right move to acquire those branches]. But in America, we seem to believe that bigger is better."

Koelmel was behind First Niagara moving its headquarters from the suburbs to the Larkin Building in Buffalo. Howard Zemsky is a managing partner of Larkin Development, and a friend of the former bank CEO.

"John was ideally suited to grow the bank by leaps and bounds, and the bank strategy now is really to digest those acquisitions and grow organically," Zemsky said.

Ogorek added, "I think they're going to need to look at some efficiencies and how to get scalability with the assets that they have got."

In a statement, Koelmel says he's disappointed to have his tenure as the bank's CEO end, and not see the vision further advanced and fulfilled.

Zemsky noted, "The bank and the community here locally will reap many of the benefits that John and the bank have sown. I think they'll reap the benefits for many decades to come."

"Fundamentally everyone's working for the shareholders, and they're the ones that have really taken a beating over the past five years," Ogorek added.

A search for a permanent chief executive is underway.