The days of Independence Federal Savings Bank (No. 14 on the BE BANKS list with $161 million in assets) as one of the nation’s largest black-owned banks may be numbered. Morton Bender, a white shareholder who now owns 21% of the historically black institution, has received authority to acquire as much as 51%.
The Office of Thrift Supervision ruled in favor of Bender’s takeover of Independence in March.
The U.S. District Court for the District of Columbia stated that the bank’s former management team violated securities laws and the institution’s bylaws. By the end of the proceedings the president and several board members had resigned, including two heirs of founder William Fitzgerald III. They were unavailable for comment.
Since Bender’s victory, the board now consists of three African Americans, one of whom serves as chair; a Hispanic male; a white woman; and two white men. The current management team–the CEO, CFO, vice president of operations, and senior vice president–are all African American. Currently, Bender does not serve on the board.
Independence was founded in 1968 and went public in 1985. As defined by the OTS, the minority status of a publicly traded bank is not automatically lost when its stockholders are not 51% (or more) minority. The FDIC designation requires that 51% or more of the voting stock in the bank be owned by minority individuals or that the majority of the bank’s directors are members of minority groups and the community served must be predominantly minority.
“Independence Federal Savings Bank will remain a minority institution,” promised Bender.