Mechanics & Farmers cuts jobs, branches

In the wake of its acquisition of Mutual Community Savings Bank, Mechanics & Farmers Bank is cutting costs by closing branches and eliminating jobs.

The Durham bank laid off 10 employees at the end of June, leaving it with about 90 workers, said Lyn Hittle, chief financial officer.

The bank, which previously said it was closing a branch in Mutual Community's former headquarters building, also has decided to close two other offices -- one in Durham and one in Charlotte.

Neither of the additional offices being closed are full-fledged branches. The Charlotte office is only a drive-through facility. The Durham office, located downtown in the N.C. Mutual Life Insurance building, is a "part-time branch" open limited hours, Hittle said.

The offices marked for closure were not acquired as part of the Mutual Community deal.

In the case of all three branch closings, there are "very nearby branches that can provide these services," Hittle said.

The closings will leave M&F with nine branches -- three in Durham, two each in Raleigh and Charlotte, and single offices in Winston-Salem and Greensboro. No additional layoffs are anticipated after the offices are closed, Hittle said, thanks to attrition at other branches.

The union of M&F and Mutual Community combined two of the nation's oldest black-owned financial institutions.

Mechanics & Farmers' corporate parent, M&F Bancorp, also filed documents with the Securities and Exchange Commission Thursday showing that in the second quarter it posted a loss of $352,000, compared with a $92,000 profit a year ago.

Hittle said M&F would have broken even in the quarter except for one-time charges related to the layoffs and a change in the depreciation rate of computer hardware and software.

Hittle said she expects the bank to return to profitability in the third quarter. The 100-year-old bank has posted an annual profit every year since it opened.