M&F Bank president steps down from day-to-day role
Kim D. Saunders has stepped down from running the day-to-day operations of Mechanics and Farmers Bank, the Durham-based bank with a long profitability record and a deep history as a prominent African-American-led business on what was known as Durham’s Black Wall Street.
Although Saunders has stepped down from her post as president and CEO of Mechanics and Farmers Bank, she will remain as president and chief executive of the bank’s holding company, M&F Bancorp.
According to an announcement by the bank, her resignation was effective at the end of the day on Tuesday, the day the bank released its year-end financial results. The bank continued its 106-year-long profitability record in 2013, posting a profit of about $126,000.
“Although she will be stepping down from control of day-to-day operations, Ms. Saunders will continue to support us in very important ways during this transition,” board chairman James A. Stewart said in a news release. “We believe that the bank is poised to step onto a much bigger platform, and to operate more aggressively and competitively than before.”
In her role as the chief executive of the bank holding company, she is expected to help the board raise capital, to maintain community regulation and government relationships, and to explore the expansion of the bank as a community-development financial institution, according to the release.
She also is expected to help ensure a smooth transition for her successor. James E. Sansom, M&F’s senior vice president and chief lending officer, will serve in the role on an interim basis. A search committee will choose her permanent successor.
Stewart said in the release that Saunders has been “instrumental” in helping the bank sustain its profitability through the recession and afterwards, through its first acquisition, and first “non-organic capital infusion” in the past several decades.
Saunders took over the role in February 2007. In that year, the bank had $222 million in total assets, and $146 million in loans, according to regulatory filings.
In 2013, the bank had assets of nearly $302 million. Although its interest income from loans was down about 3 percent to $10.23 million, its total loans were up by more than 8 percent to $189.5 million, and it saw a decrease in non-accrual loans.
The bank got a boost in the fourth quarter in the year through a U.S. Treasury Bank Enterprise Award of $323,000 for financing and supporting economic development activities in economically distressed areas.
Saunders led the bank during the economic recession, which Stewart said made banking a lot more difficult. It was harder to find qualified borrowers in a time of high jobless rates, he said, and to keep loan repayments up.
In 2009, the company sold about $11.7 million worth of stock to the U.S. Department of Treasury through the capital Purchase Program of the Troubled Asset Relief Program, known as TARP. Treasury launched the program in 2008 to stabilize the U.S. financial system. In 2010, the company exchanged its stock under another program in order to pay a lower interest rate.
“I am truly honored to have led the bank through such a tumultuous time in our country, industry and its life cycle,” Saunders said in an email. “We remained profitable and well-capitalized and are well poised to move forward. My new focus is perfect, in that regard, because I can now focus my efforts on critical future initiatives, rather than the Bank’s day-to-day operations.”
During her tenure, the company acquired Mutual Community Savings in March 2008. Like M&F, Mutual Savings was a prominent African American-led business on what was known as Black Wall Street in Durham.
Stewart said Saunders was recently out on leave for medical issues. While she was away, she had time to reflect and “decided that she could serve us better in a more strategic role rather than as a day-to-day operations person.”
“Serving as M&F Bank’s president and CEO has been extremely rewarding for me,” Saunders said in a statement. “I look forward to focusing my efforts on key initiatives that will position the company for its future.”