When Kevin Cohee, chairman and CEO of OneUnited Bank, looks at One Lincoln Street in Boston’s financial district, he sees his vision for the future of black-owned banks slowly coming into focus. The $370 million, 36-story, 1 million square foot office tower, which officially opens for business in July, was built in no small part because of his bank’s leadership in financing the purchase of the development rights to the construction site in 1997.
It was a move that gave the bank the largest minority ownership stake in the project and key influence in determining who would develop the site and how much minority participation would be involved during and after construction. The project has meant more than 4,000 permanent jobs for the community and a steady stream of income for the bank and the building’s other shareholders.
But financing deals like the Lincoln Street project are only part of Cohee’s vision. In fact, the Harvard Law School alumnus spent the last six years transforming the former Boston Bank of Commerce into the largest, and arguably most progressive, black-owned bank in the country. Implementing an acquisition strategy mirroring those used by mainstream banks during the 1990s, Cohee has linked black-owned banks in Boston, Miami, and Los Angeles to create the first black-owned interstate bank in the nation.
“This bank is taking advantage of the bank reform policy developed during the 1990s, the Gramm-Leach-Bliley Act, which removed the firewall that previously existed between financial institutions and opened the door for mergers of the mega-financial institutions like Citigroup,” says Bernard E. Anderson, Ph.D., professor of management and economics at The Wharton School of the University of Pennsylvania and member of the BLACK ENTERPRISE Board of Economists. “Competition for capital is very intense in the financial services industry and smaller banks have a very difficult time serving their customers without more capital. So the effort by this financial institution to merge other African American institutions is an attempt to remain financially viable and profitable, and to continue to serve the community under very different financial conditions.”
The acquisitions have increased the bank’s assets from $137 million in 1999 to $499.7 million by the end of 2002, providing more resources for the bank to deliver greater financial services.
Under its new name, OneUnited Bank offers a national approach to banking. It started in January when the institution’s name was changed and it continues with upgrades in technology and personnel that make bank operations as seamless as those of major banks. Cohee, 44, and his management team are rolling out a set of innovative products that include financial literacy seminars, home mortgage initiatives, and a low-fee banking program designed to help customers escape the costs associated with mainstream banking.
By using an acquisition strategy to unseat Carver Federal as the No. 1 bank on the BE BANK list, Cohee’s OneUnited Bank has signaled a new level of competition among black-owned banks. He is also creating a model for other banks to follow as they struggle to remain black-owned in an