Tri-State Bank, Memphis’ highest-profile Black-owned bank, has been acquired by New Orleans-based Liberty Bank and Trust Co., the nation’s third-largest Black-owned bank.
Once the merger is complete, the bank will be the largest Black-owned bank in the United States. The all-cash transaction — at an undisclosed price — closes Friday, the institutions said.
Angel Price, Liberty Bank Memphis senior vice president, said the acquisition would mean easier access to banking services for customers and borrowers.
“The union of both banks is really being viewed as a partnership,” she said in an interview. “Under the Liberty brand, we’re able to scale with having access to better technology and a suite of more products and services to offer our customers and borrowers.”
One big change is that loan limits for highly qualified borrowers have been raised from $1.2 million to $5 million, according to a news release.
As of June 30, Tri-State had $102 million in deposits and $113 million in assets on the books, according to the Federal Deposit Insurance Corporation. At that time, Liberty had $768 million worth of deposits and $121 million in additional assets.
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“We are excited about this transaction and Liberty is approaching this as a union,” Price said. “They want to pick up on the mission of Tri-State Bank and have a lot of respect for the legacy of Tri-State in this community. The bank has been a staple in the Memphis community, and they absolutely want to be good stewards of what the bank has done for this community.”
All Tri-State employees are able to keep their jobs under Liberty if they so choose, the institutions said.
With the acquisition, Liberty now operates in Alabama, Illinois, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Texas and Tennessee.
History and mission
Liberty and Tri-State released an announcement about the proposed deal in June. At the time, the deal had been approved by Tri-State’s board but had not yet been approved by shareholders or federal regulators.
Founded in 1946 by insurance executives Joseph E. Walker and Maceo Walker, Tri-State provided banking and lending options for Black Americans before and during integration. The bank, oriented around Downtown, started to struggle in later decades as Black families left Downtown or started banking with larger institutions.
The bank reported losing $866,000 last year and saw four leadership changes from 2016 to 2021.
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In a 2020 report in Investopedia on the country’s remaining Black-owned banks, the authors said, “In the first 10 years after its founding, Tri-State Bank of Memphis made more than $10 million in first mortgage loans on homes, representing homeownership for more than 2,000 African American families. Tri-State has also played a critical part in the civil rights movement, including hosting local sit-ins in the bank’s boardroom, providing bail money for protesters, and providing $60,000 in loans to help save the Lorraine Motel, the site of Dr. Martin Luther King’s assassination, from foreclosure in 1982.”
Price said Liberty and Tri-State had parallel missions with focus on Black communities and community development. Liberty Bank, founded in 1972, has in recent years drawn investments from IberiaBank, which merged with First Horizon last year, JPMorgan Chase and Wells Fargo.
“Their passion mirrors our passion,” said Alden J. McDonald Jr., president and chief executive officer for Liberty. “Our missions, to serve our communities as agents for constructive change, are aligned.”
“With access to larger lending limits, with a broader offering of financial products and services, and with the convenience and efficiency of our digital platforms, it is not unrealistic to expect the Liberty Bank Memphis team to double our bank’s share in the market in short order,” McDonald said in a statement.
Tri-State Bank chairman Archie Willis III called the deal “a thoughtful combination” and a “win-win.”
“The Memphis market is a natural extension for Liberty Bank. It’s a good fit,” he said in a statement. “Plus, the operational expertise and financial strength Liberty Bank brings to town enhances our ability to serve our current customers and create new opportunities.”
Corinne S Kennedy covers economic development, healthcare and soccer for The Commercial Appeal. She can be reached via email at Corinne.Kennedy@CommercialAppeal.com.
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