BUFFALO, N.Y. ( TheStreet) -- First Niagara Financial ( MI) on Thursday reported fourth-quarter operating earnings of $31.3 million, or 17 cents a share, matching the consensus estimate of analysts polled by Thomson Reuters.

In comparison, on the same basis, the thrift holding company earned $27.3 million, or 19 cents a share, in the third quarter, and $22.8 million or 20 cents a share in year-ago equivalent period.

For the full year 2009, operating earnings were $105.6 million or 72 cents a share, up from $89.8 million or 83 cents a share, in 2008.

On a GAAP generally accepted accounting principles basis, First Niagara's fourth-quarter net income was $28.9 million or 16 cents a share, compared to $10.9 million, or 7 cents a share ,in the third quarter and $21.6 million, or 19 cents a share, a year earlier. GAAP results in the latest period reflect the impact of $23 million in expenses related to the acquisition of 57 National City Branches from PNC Financial ( PNC.) in Western Pennsylvania.

The earnings comparisons reflect the issuance of 78 million shares through three stock offerings during 2009 that raised close to $1 billion in common equity. First Niagara participated in the Troubled Assets Relief Program, receiving issuing preferred shares to the government in November 2008 to receive $184 million in capital, which the company repaid in May.

First Niagara expects to complete its pending acquisition of Harleysville National ( HNBC) during the first quarter, which will bring in another $4 billion in deposits in Pennsylvania.

As the company took advantage of market turmoil in 2009 to make significant branch acquisitions and increase its total assets 56% to $14.1 billion, credit quality remained very strong, with nonperforming assets -- including nonaccrual loans and repossessed real estate - comprising 0.52% of total assets as of Dec. 31. Loan losses during 2009 were low, with net charge-offs totaling $33.1 million or 0.50% of total loans.

While the company's 2009 earnings were hit by the branch acquisition expenses and $43.7 million in provisions for loan losses, leading to historically mediocre returns on average assets and tangible common equity of 0.69% and 6.06% respectively, earnings performance and loan quality measured up well, considering the difficult industry environment, and the capital raises have left First Niagara in a very strong position to complete the Harleysville acquisition and possibly expand further.

First Niagara shares dipped 2 cents to $14.45 in morning trades. The stock's high for session of $14.58, however, was a shade lower than its 52-week peak of $14.60, which it reached last week. So far in 2010, the shares have tacked on 4%.

Written by Philip van Doorn in Jupiter, Fla.

Philip W. van Doorn joined TheStreet.com Ratings., Inc., in February 2007. He is the senior analyst responsible for assigning financial strength ratings to banks and savings and loan institutions. He also comments on industry and regulatory trends. Mr. van Doorn has fifteen years experience, having served as a loan operations officer at Riverside National Bank in Fort Pierce, Florida, and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a Bachelor of Science in business administration from Long Island University.