Durham Banks to Merge, Forming 4th Largest Black Owned Financial Institution
Posted August 10, 2007 2:43 p.m. EDT
Durham - Two of the nation’s largest and oldest black-owned financial institutions are joining forces.
M&F Bancorp, the parent of Mechanics and Farmers Bank, said Friday it would acquire Mutual Community Savings Bank in a deal valued at more than $3 million.
Shareholders in MSCB, which has been struggling financially with losses totaling more than $1 million over the past two years, will receive one share of M&F stock for each MSCB share it owns.
M&F stock trades over the counter under the symbol MFBP. Shares traded at $8.72 Friday afternoon, down 3 cents.
MSCB shares trades over the counter under MTUC. The share price reported Friday was unchanged at $10.51. It has outstanding shares of nearly 364,000, according to the Triangle Business Journal.
The deal still must be approved by MCSB shareholders and the Securities and Exchange Commission. Closing is expected in the first quarter of next year. The companies have been in merger discussion for months.
MSCB reported losses of $846,729 in 2006 and $384,236 in 2005.
The combined bank would form the fourth largest black owned bank in the U.S. with assets of around $355 million.
“I believe that this is a win-win situation for the shareholders and customers of both institutions,” said Kim Saunders, chief executive officer of M&F Bancorp. “This in-market merger represents a strategic step forward that we believe will increase our financial strength and generate efficiencies of scale. That in turn should enable us to provide more products and better service, to compete more aggressively, and to expand our footprint.”
The merged bank would have 10 branches in Durham, Charlotte, Raleigh, Greensboro and Winston-Salem.
“Our mission has always focused on meeting the needs of the communities we serve, and we’re convinced that combining the resources of these two institutions is the best way to continue to do that,” said William Smith, CEO at MCSB.
M&F Bancorp was founded in 1907 and has been profitable since 1908.
MCSB was launched in 1921 as a building and loan association.