Optus Bank and M&F Bank plan merger to create largest Black-owned U.S. bank

Optus Financial Corporation and M&F Bancorp said July 22 they have agreed to merge their banks, creating what they describe as the largest African American-owned financial institution in the United States. The deal values M&F shares at up to $53.30 and is expected to close in the fourth quarter of 2026, pending shareholder and regulatory approval.

Why it matters: - The combination would unite two of the nation’s longest-standing Minority Depository Institutions. - The merged bank would become the largest African American-owned financial institution in the U.S. - The deal is designed to expand access to capital, support small business growth and finance affordable housing across the Carolinas. - The transaction also would preserve a relationship-based banking model focused on underserved communities.

What happened: - Optus Financial Corporation, parent of Optus Bank, and M&F Bancorp, parent of Mechanics & Farmers Bank, announced a definitive merger agreement on July 22, 2026. - M&F Bancorp will merge into Optus, and M&F Bank will merge into Optus Bank. - The combined organization is expected to operate ten locations across North and South Carolina. - James H. Sills III, president and CEO of M&F Bancorp, will become CEO of the combined holding company and bank. - Paul Mitchell, chairman of Optus and Optus Bank, will remain chairman of both entities.

The details: - M&F Bancorp shareholders are expected to receive up to $53.30 per common share in cash. - The consideration includes $46.57 per share at closing. - An additional $6.73 per share is contingent on repurchasing certain outstanding M&F preferred shares before closing or within 12 months after closing. - The deal’s aggregate value is expected to exceed $105 million. - The combined institution would have about $1.27 billion in total assets as of March 31, 2026. - Optus Bank is set to mark its 105th anniversary of “Banking on Communities” in October. - Optus was founded in 1921 as Victory Savings Bank. - M&F Bank was founded in 1907 and is described as one of the nation’s oldest African American-owned financial institutions. - Optus Bank is South Carolina’s only African American-owned bank. - M&F Bank operates across eight locations. - Both firms are federally designated Minority Depository Institutions and certified Community Development Financial Institutions. - Performance Trust Capital Partners advised Optus, with Nelson Mullins Riley & Scarborough LLP as legal counsel. - Piper Sandler & Co. advised M&F Bancorp, with Brooks, Pierce, McLendon, Humphrey & Leonard, LLP as legal counsel.

Between the lines: - The merger reflects continued consolidation among mission-driven banks that serve Black communities and other underserved customers. - The companies are framing the deal as both a scale play and a legacy-preservation effort. - The new bank could gain more capacity to invest in community development and lending products that are harder for smaller institutions to offer.

What's next: - The transaction still needs approval from M&F Bancorp shareholders and regulators. - Closing is expected in the fourth quarter of 2026. - After closing, the combined institution will continue operating as an MDI and CDFI focused on financial inclusion and economic opportunity. - The company expects the merger to strengthen community investment and broaden access to banking services across the Carolinas.

The bottom line: - If approved, the deal would create a larger Black-owned bank with more scale, more branches and more firepower to serve communities that have long faced barriers to capital.