Stand and deliver: Kevin Cohee turned OneUnited into the nation's largest black banking institution one acquisition at a time. And he's not finished yet - B.E. Financial Company Of The Year

Black Enterprise, June, 2003 by Matthew S. Scott

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 industry that is consolidating at the highest levels. Because of this leadership role in the black banking community, OneUnited Bank is the 2003 BE Financial Company of the Year.

FROM RETIREMENT TO REVOLUTION

This isn't the first time Cohee has turned around a company. While carving out a successful career as an investment banker at Salomon Smith Barney in the 1980s, he began dating Teri Williams, who at the time was one of the youngest vice presidents at American Express at age 29. In 1989, the two purchased Military Professional Services, a firm that markets credit cards to military personnel. After improving the company's financial picture, they made a fortune selling it to First Chicago Corp. in 1991. The two married and were able to retire, but early retirement didn't suit Cohee very well.

In 1995, Cohee and Williams used $1 million of their own money to purchase a controlling interest in the Boston Bank of Commerce, which, at the time, was run by Ron Homer, a hero in Boston's black financial circles. Cohee was appointed chairman, and although he had been brought on to assist Homer in reviving the ailing institution, within a year, the board appointed him as CEO. His aggressiveness at pushing a local icon out of a leadership role at the bank earned him a reputation as a hard-nosed manager who played to win at all costs. Walter B. Prince, partner at Prince, Lobel, Glovsky & Tye L.L.P., and OneUnited board member, says, "The reputation is probably exaggerated. Kevin is a bright, intelligent businessman, and he's made some marvelous creative business decisions."

But no matter what you think of Cohee's style, he has proven effective in business. He has demonstrated the savvy to pull off three acquisitions since 1999, establishing the foundation for what he says is a movement to change the nature of banking in low-income communities. Ultimately, Cohee wants to create a bank that has the strength of billions of dollars in assets to facilitate significant community development in black neighborhoods.