KeyCorp is acquiring First Niagara Financial Group Inc for $4.1 billion in the biggest deal this year between two U.S. banks. The transaction will create the 13th largest U.S. based commercial bank. The deal is the latest in a series of mergers between smaller U.S. banks, sparked by years of close to zero interest rates and higher costs due to stricter regulations that have been implemented since the financial crisis. KeyCorp offered $11.40 per share for First Niagara, which is a 9.8% premium to First Niagara’s closing price on Thursday. Ken Usdin an analyst for Jefferies said, “Expansion into similar, contiguous markets makes sense, but the size of the deal is surprising.” He also added, “It will take tight execution with a deal of this size and long time for it to be accretive to earnings.”