M&F Bancorp Inc. (MFBP)

[56Chevy]

Hi James...consider your hand shook and thank you for sharing your insights in such detail with the board...you're an impressive young guy and a real thinker. Congrats on the MBA and we all wish you well with your career in banking.

In a perfect world our bank wouldn't have any TARP debts to repay...but its far from perfect and the bank eventually will have to face the repayment of its TARP loan. Its worth repeating for anyone else reading this that MFBP doesn't have the standard 5% for 5 years and 9% thereafter TARP terms that most every other banks across the country came under. MFBP has terms at 2% for 8 years which changes things a bit...and that's what you and I are discussing. To let you know where I stand on TARP I'm of the opinion that although TARP was a very unpopular gov't program it was something that had to done to meet a dire need. I'm not sure the average taxpayer really understands just how close to the abyss our banking system really was...and even though TARP went down like a bitter pill it still did its job and ultimately saved the day. My opinion on this was shaped by my friend and partner Enterprising Investor who is also an MBA with a career in banking, mortgage and finance.

GBExpress writes:

Their assets are improving, the Treasury (I assume) has allowed the Bank to pay a dividend and their ALLL looks like it is covering the potential losses in the loan portfolio. So my point is that there is no need to have such a high tier one capital when the preferred shares are yielding 66% of total earnings.

The high capital levels are no accident and could be there by design. Perhaps MFBP is looking to acquire other bank(s). ??