Two historic Black-owned banks are joining forces in a $105 million merger aimed at creating the nation’s largest African American-owned financial institution.
Joining Assets
Mechanics & Farmers Bank, based in Durham, North Carolina, and Columbia, South Carolina-based Optus Bank announced July 22 that they have entered into a definitive merger agreement. The combined institution would hold approximately $1.27 billion in assets and operate 10 branches across North and South Carolina, pending regulatory and shareholder approval.
The merger is expected to close during the fourth quarter of 2026, pending shareholder and regulatory approval.
The announcement formalizes a union between two banks that have spent decades working toward the same mission.
Although they operated independently, M&F Bank and Optus Bank often functioned like siblings within the Black banking community, collaborating on industry leadership, capital initiatives, and policy advocacy aimed at narrowing the racial wealth gap.
Both institutions have long been leaders in the National Bankers Association, the nation’s leading trade organization for Minority Depository Institutions (MDIs).
According to the FDIC, MDIs are federally insured banks or credit unions in which at least 51% of the voting stock is minority-owned or a majority of the board members are minorities.
Community Development Financial Institutions (CDFIs), are mission-driven lenders certified by the U.S. Treasury that provide affordable loans and financial services to low-income, minority, and underserved communities often overlooked by traditional banks, according to the federal government.
M&F Bank President and CEO James H. Sills III and former Optus Bank CEO Dominik Mjartan each served on the association’s board of directors, pushing for greater investment in Black-owned financial institutions and broader access to capital.
Their partnership extended well beyond advocacy. Following the racial equity movement sparked in 2020, both banks were selected for Wells Fargo’s equity investment initiative supporting Black-owned banks, according to Banking Dive.
They later participated together in the NFL’s $78 million syndicated credit facility for minority-owned financial institutions and became early recipients of State Street’s $100 million investment program for CDFIs and MDIs.
As neighboring CDFIs in the Carolinas, executives from both banks also regularly appeared together at regional banking conferences and Treasury Department roundtables on economic mobility across the South. That longstanding relationship now becomes permanent.
Under the agreement, M&F Bancorp, parent company of Mechanics & Farmers Bank, will merge into Optus Financial Corporation, while M&F Bank itself will merge into Optus Bank. M&F shareholders are expected to receive up to $53.30 per share in cash, including $46.57 at closing and an additional $6.73 contingent upon the repurchase of certain preferred shares within a year of closing.
The merger brings together more than 220 years of combined banking history. Mechanics & Farmers Bank, founded in 1907, is the nation’s second-oldest African American-owned financial institution. Optus traces its roots to 1921, when it opened as Victory Savings Bank before growing into a leading MDI.
“This partnership with M&F Bank represents a defining moment — not only for our organizations, but for mission-driven banking in America,” said Paul Mitchell, chairman of Optus and Optus Bank. “Together, we will create a stronger institution with greater scale, enhanced capabilities, and an expanded capacity to advance economic mobility throughout the Carolinas and beyond.”
Sills, the current president and CEO of M&F Bancorp and Mechanics & Farmers Bank, will become chief executive officer of both the combined holding company and the merged bank, while Mitchell remains chairman.
“M&F Bank was founded on the belief that every community deserves a financial institution that understands and serves its unique needs,” Sills said. “We share a common mission, aligned values, and a steadfast commitment to our customers and communities. This Transaction enables us to honor our legacy while providing enhanced resources and capabilities to those we serve.”
Following completion of the transaction, the combined organization will continue operating as both an MDI and a CDFI. Bank leaders say the increased scale will strengthen their ability to finance affordable housing, support small businesses, and expand access to credit, while maintaining the relationship-driven approach that has defined both institutions for generations.
The merger will also establish the nation’s largest Black-owned bank, proving that collaboration, not competition, remains one of the most powerful tools for building and protecting Black wealth.