Boston Bank of Commerce (BBOC) and Los Angeles-based Family Savings Bank (Family) have jointly announced the signing of a definitive agreement to merge and create the largest Black-owned bank in the country. The merger combines BBOC in Boston, Peoples Bank of Commerce in Miami and Founders Bank of Commerce in Los Angeles with Family Savings Bank. The combined entity, with its A-list of celebrity shareholders including NBA Hall of Famer turned businessman Earvin “Magic” Johnson, entertainer Janet Jackson and former Motown Records president Jheryl Busby, has over $460 million in assets and will continue its mission to be the premier banking institution for urban communities.

The merger, which is structured as a cash deal with BBOC acquiring all the stock of Family Savings Bank, was approved by the respective Boards of Directors and is subject to shareholder and regulatory approval. If all continues as planned, the deal will be finalized during the first quarter of 2003.

“With the addition of Family Savings Bank to the Boston Bank of Commerce network of banks, we are realizing our vision of fostering economic growth and individual opportunity in urban neighborhoods from coast-to-coast by offering affordable financial services to all,” said Johnson.

“This merger will serve as a model and source of strength for Black businesses as we unite to share resources and expertise,” stated Kevin Cohee, Chairman & CEO of BBOC. “Our focus on growth and profitability through partnerships will ensure that critical capital is available to urban communities across the nation.” With approximately 50 minority-owned banks in the U.S., and about $7 billion in combined assets, urban areas will be ensured greater access to capital.

The BBOC Board of Directors will continue to manage the combined entity, led by Cohee and Kenneth T. Lombard, Vice Chairman of BBOC and President of Johnson Development Corporation and Magic Johnson Theatres. The Board of Family Savings Bank will be retained. “We believe the combination will enable Family and BBOC to better fulfill our commitment to serve our respective communities,” stated Dr. Clyde Oden, Chairman of Family Savings Bank. “We were able to fulfill our dual goals of maximizing shareholder value and continuing our mission to serve urban communities.”

Dr. Oden and Jheryl Busby, the previous chairman of Founders National Bank of Los Angeles (which last year merged with BBOC), were the original architects of the BBOC and Family merger. “In these times of economic turbulence, this merger serves as a beacon of light and hope to the people living in our often forgotten communities. It guarantees access to capital, the key ingredient to our communities’ stability and growth,” said Busby. California Governor Gray Davis congratulated BBOC and Family on becoming the nation’s largest Black-owned bank, saying, “Minority banks traditionally make loans in areas where other banks do not, thereby investing critical money for neighborhoods that need it the most. This welcome merger will help many African American residents realize their dreams, whether it is buying their own home or building a small business.”
“As a member of the Committee on Financial Services of Congress I have worked hard to expand the opportunities for bank ownership by minorities,” said Representative Maxine Waters, who represents Los Angeles’ 35th District. “This purchase is a giant step for our community.” “For more than 50 years, Family Savings Bank has been a central part of Los Angeles’ African American community,” added Lombard. “We are proud that together our institutions will build on this tradition.”

Boston Bank of Commerce, established in 1892, is the first interstate and fastest growing African American bank in the U.S. with over $260 million in assets and branches in Massachusetts, Florida and California. Family Savings Bank began in 1948 as the Watts Savings and Loan Association to provide access to homeownership and quality financial services within the community. In 1996, under the direction of Dr. Clyde W. Oden, Jr., the Watts Health Systems purchased a 65% controlling interest in Family Savings Bank. The primary motive for the purchase stemmed from the need to effect empowerment in the areas of housing, education, human services and economics. Family Savings Bank is a thrift institution in Los Angeles with over $208 million in assets. Family has headquarters in Los Angeles with branches in Compton, Ladera Heights and Pasadena.