Optus Bank and M&F Bank plan merger to create largest African American-owned bank

Optus Financial and M&F Bancorp have agreed to merge their banks in a deal expected to top $105 million and close in the fourth quarter of 2026. The combined institution would become the largest African American-owned financial institution in the U.S., with 10 branches across the Carolinas and about $1.27 billion in assets.

Why it matters: - The combined Optus Bank and M&F Bank would become the largest African American-owned financial institution in the United States. - The merger would bring together two Minority Depository Institutions with more than 220 years of combined banking experience. - The new bank is expected to expand access to credit, capital, small-business financing, affordable housing and community investment across the Carolinas.

What happened: - Optus Financial Corporation and M&F Bancorp announced a definitive merger agreement on July 22, 2026. - Optus Financial, the parent of Optus Bank, will merge with M&F Bancorp, the parent of Mechanics & Farmers Bank. - M&F Bank will merge into Optus Bank. - The transaction is expected to close in the fourth quarter of 2026.

The details: - M&F Bancorp shareholders are expected to receive up to $53.30 per common share in cash. - The deal includes $46.57 per share paid at closing. - An additional $6.73 per share is contingent on repurchasing certain outstanding M&F Bancorp preferred shares before closing or within 12 months after closing. - The transaction value is expected to exceed $105.0 million. - The combined institution will operate 10 locations across North and South Carolina. - The combined company will have about $1.27 billion in total assets as of March 31, 2026. - James H. Sills III, president and CEO of M&F Bancorp and M&F Bank, will serve as CEO of the combined holding company and bank. - Paul Mitchell, chairman of Optus and Optus Bank, will remain chairman of both entities. - The boards of both companies unanimously approved the transaction. - Closing still needs M&F Bancorp shareholder approval and required regulatory approvals. - Performance Trust Capital Partners advised Optus, with Nelson Mullins Riley & Scarborough as legal counsel. - Piper Sandler & Co. advised M&F Bancorp, with Brooks, Pierce, McLendon, Humphrey & Leonard as legal counsel.

Between the lines: - The deal comes as Optus Bank approaches its 105th anniversary in October. - Optus Bank was founded in 1921 as Victory Savings Bank and is headquartered in Columbia, South Carolina. - M&F Bank was founded in 1907 and is headquartered in Durham, North Carolina. - Both banks are federally designated Minority Depository Institutions and certified Community Development Financial Institutions. - M&F Bank is described as the nation’s second-oldest African American-owned financial institution. - The combination reflects a broader push to preserve legacy mission-driven banks while adding scale and resources.

What's next: - Shareholders of M&F Bancorp must approve the merger. - Regulators still must sign off before the transaction can close. - The companies expect the deal to finish in the fourth quarter of 2026. - After closing, the combined bank will continue operating as a mission-driven MDI and CDFI focused on financial inclusion and economic opportunity.

The bottom line: - Optus Bank and M&F Bank are betting that scale can strengthen a legacy of serving underserved communities without losing the mission that defined both institutions.