Country’s second-oldest Black-owned bank is making waves from its Durham headquarters
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One hundred fifteen years after its founding, Mechanics and Farmers Bank adheres to its original mission: “Meeting the needs of a wide range of individuals and businesses” irrespective of race or ethnicity.
The Durham institution — America’s second-oldest, Black-owned bank — was born of need. In 1907, a hostile banking system limited African American access to financial backing. Few could secure the capital they needed for business ventures.
“So it became sort of this anchor of Black Wall Street,” said James Sills, M&F’s CEO. “A Black-owned bank to serve African Americans and others who needed assistance — minority small businesses.”
Two decades into the next century, similar inequity persists in the financial system. More than 6% of Americans are “unbanked,” according to the FDIC. Nearly 17% of Black households and 14% of Hispanic families lack basic financial services, compared to 3% of white households.
Black-owned banks such as M&F combat the pecuniary divide, but their ranks are dwindling.
“We’re the only African American-owned bank in North Carolina,” Sills said, “and given that there’s only about seventeen African American-owned banks in the United States we have to continue the mission of our organization to continue to serve to provide access to capital.... Other banks do great, but they’re not focused on the same demographics or diverse populations that we are.”
Following the Great Recession, M&F nearly faltered. In 2017, the company reported its first net loss since the bank’s inception. Many of its patrons were aging.
But in the wake of George Floyd’s death and 2020’s Black Lives Matter movement, M&F attracted new interest from investors keen to preserve the bank’s mission. Prominent Triangle companies such as Global Data Consortium and Pendo deposited millions of dollars.
“I’ll tell you, 2021 was the best year in the history of the bank in terms of financial performance,” Sills said. “Over the last few years, and especially since the murder of George Floyd, our total assets have gone up about $100 million.”
Sills expects the bank can eventually reach $1 billion in total assets. By the end of 2022’s first quarter, M&F should have received $76 million from the U.S. Treasury, bringing its total assets to about $450 million with $117 million in capital.
With expanded resources, the bank plans to enhance its educational tools, fostering financial literacy, and improve its technologies to facilitate easier customer transactions.
“The key is that we continue what we were founded to do,” Sills said. “...The bank is here to work with everybody in the community. We have customers of all ethnicities and we’re focused on small business owners. We really, we really want to help everybody grow their business.”
Mechanics and Farmers Bank
Corporate headquarters: 2634 Durham Chapel Hill Blvd., Durham
This story was originally published February 16, 2022 at 6:00 AM with the headline "Country’s second-oldest Black-owned bank is making waves from its Durham headquarters."
