First Niagara Repurchases TARP Warrant from U.S. Treasury

LOCKPORT, N.Y., June 29 /PRNewswire-FirstCall/ -- First Niagara Financial
Group, Inc. (Nasdaq: FNFG) completed the final step in its previously
announced plan to return the funds invested by the U.S. Treasury Department
under the Troubled Asset Relief Program (TARP) with the repurchase of the
warrant for the remaining 953 thousand shares of common stock issued to
Treasury on November 21, 2008 for $2.7 million. The repurchase will not have
an impact on earnings per share. During their six-month investment in First
Niagara, the government earned more than $7.4 million for an annualized return
of nearly 8%.

On May 27, 2009, the Company returned all $184 million received from the
preferred stock that had been issued to the Treasury under TARP after
conducting a follow-on stock offering that raised $380.4 million in
private-sector equity capital. The number of shares available to the Treasury
under the warrant was reduced by one-half due to First Niagara's ability to
raise capital through an underwritten public offering on April 14, 2009. Since
October 2008, First Niagara has raised over $495 million in private-sector
capital.

"We leveraged the federal investment to make commercial and consumer credit
readily available in the communities where we do business, just as the program
intended, and replaced it with private investors' capital when stock market
conditions improved," said First Niagara President & CEO John R. Koelmel.
"Unlike most others, we raised more than twice the amount originally received
from the government and provided a solid return to taxpayers on their
investment while continuing to execute our long term strategy for the benefit
of our shareholders."

First Niagara Financial Group, Inc., through its wholly owned subsidiary First
Niagara Bank, has assets of $9.6 billion and deposits of $6.2 billion at March
31, 2009. First Niagara Bank is a community-oriented savings bank providing
financial services to individuals, families and businesses through 113
branches and four Regional Market Centers across Upstate New York. In April
2009, the Company announced plans to add another 57 branches in Pittsburgh,
Warren and Erie, Pa., additional deposits of $4.2 billion and additional loans
of $839 million in an acquisition that is expected to close in September 2009.
For more information, visit www.fnfg.com.

SOURCE First Niagara Financial Group, Inc.

John R. Koelmel, President and Chief Executive Officer, or Michael W.
Harrington, Chief Financial Officer, or Anthony M. Alessi, Investor Relations
Manager, tony.alessi@fnfg.com, all of First Niagara Financial Group, Inc.,
+1-716-625-7692; or Leslie G. Garrity, First Niagara Financial Group Public
Relations and Corporate Communications Manager, +1-716-625-7528,
leslie.garrity@fnfg.com