[Letterhead of Cleary, Gottlieb, Steen & Hamilton]
Writer's Direct Dial: (202) 974-1520
November 24, 1997
ALBANK Financial Corporation
10 North Pearl Street
Albany, New York 12207
Re: Registration Statement on Form S-4
----------------------------------
Ladies and Gentlemen:
We have acted as counsel to ALBANK Financial
Corporation, a Delaware corporation (the "Company"), and Sponsor
of ALBANK Capital Trust I, a Delaware statutory business trust
(the "Trust"), in connection with the Registration Statement on
Form S-4 of the Company and the Trust (the "Registration
Statement") filed with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and amended today, in respect of (i) the
proposed issuance by the Trust of $50,000,000 aggregate
liquidation amount of 9.27% Capital Securities, Series B (the
"New Capital Securities") registered under the Securities Act in
exchange for up to $50,000,000 aggregate liquidation amount of
9.27% Capital Securities, Series A (the "Old Capital
Securities"); (ii) the proposed issuance by the Company to the
Trust of $51,547,000 aggregate principal amount of the Company's
9.27% Junior Subordinated Deferrable Interest Debentures due
2027, Series B (the "New Junior Subordinated Debentures")
registered under the Securities Act in exchange for up to
$51,547,000 aggregate principal amount of the Company's 9.27%
Junior Subordinated Deferrable Interest Debentures due 2027,
Series A (the "Old Junior Subordinated Debentures"); and (iii)
the Company's Guarantee of the New Capital Securities (the "New
Guarantee") registered under the Securities Act in exchange for
the Company's Guarantee of the Old Capital Securities (the "Old
Guarantee"), all as more fully described in the Registration
Statement and the Prospectus included as part of the Registration
Statement.
ALBANK Financial Corporation, p. 2
The New Capital Securities will be issued pursuant to
an Amended and Restated Declaration of Trust, dated as of June 6,
1997, among the Company, as Sponsor, the Administrators thereof,
Chase Manhattan Bank Delaware, as Delaware Trustee, and The Chase
Manhattan Bank, as Property Trustee (the "Amended Declaration");
and the New Junior Subordinated Debentures will be issued
pursuant to an Indenture, dated as of June 6, 1997, between the
Company and The Chase Manhattan Bank, as trustee (the
"Indenture").
We have participated in the preparation of the
Registration Statement and have reviewed originals or copies
certified or otherwise identified to our satisfaction of such
documents and records of the Company and the Trust and such other
instruments and other certificates of public officials, officers
and representatives of the Company and the Trust and such other
persons, and we have made such investigations of law, as we have
deemed appropriate as a basis for the opinions expressed below.
Based on the foregoing, and subject to the further
assumptions and qualifications set forth below, it is our opinion
that:
1. When the New Junior Subordinated Debentures, in the
form filed as an exhibit to the Registration Statement, have been
duly executed and authenticated in accordance with the Indenture,
and duly issued and delivered by the Company in exchange for an
equal principal amount of Old Junior Subordinated Debentures
pursuant to the terms of the Registration Rights Agreement, the
New Junior Subordinated Debentures will be valid and binding
obligations of the Company, entitled to the benefits of the
Indenture.
2. The New Guarantee to be issued by the Company has
been duly and validly authorized and, upon proper execution and
delivery thereof, will be a valid and binding obligation of the
Company enforceable against the Company in accordance with its
terms.
The foregoing opinions are subject to applicable
bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to general principles of equity.
The foregoing opinions are limited to the law of the
State of New York.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement and to the reference to
this firm under the heading "Legal Matters" in the Prospectus
included in the Registration Statement. In giving such consent,
we do not thereby admit that we
ALBANK Financial Corporation, p. 3
are "experts" within the meaning of the Securities Act or the
rules and regulations of the Securities and Exchange Commission
issued thereunder with respect to any part of the Registration
Statement, including this exhibit.
Very truly yours,
CLEARY, GOTTLIEB, STEEN & HAMILTON
By /s/ Kenneth L. Bachman
---------------------------------
Kenneth L. Bachman, a Partner