EXHIBIT (10)(m)



|                          |  |  |  |                                      
|------------------------- |  |  |  | -------------------------------------
|The Sage Group            |  |  |  |                                      
|CONSULTANTS TO MANAGEMENT |  |  |  | 10409 LESLIE DRIVE                   
|                          |  |  |  | RALEIGH, NORTH CAROLINA 27601        
|                          |  |  |  | (919) 844-9783                       
|                          |  |  |  | E-mail: steve@sagegroupconsulting.com



MEMORANDUM



|      |  |                                                                        
|----- |  | -----------------------------------------------------------------------
|DATE: |  | May 1, 2004                                                            
|      | 
|TO:   |  | Lee Johnson, President M&F Bank                                        
|      | 
|FROM: |  | Steven A. Savia, CMC                                                   
|      | 
|RE:   |  | Final 2004 Corporate Support and Tellers Incentive Compensation Program
|      | 
|CC:   |  |                                                                        



This years incentive
compensation program will have multiple components.



| | 1. | Executive Plan
| | -- | --------------



| | 2. | City Executive Plan
| | -- | -------------------



| | 3. | Loan Production Plan
| | -- | --------------------



| | 4. | Branch Customer Service Plan
| | -- | ----------------------------



| | 5. | Corporate Support/Teller Plan
| | -- | -----------------------------



This memo describes the plan for Corporate Support Personnel and Tellers. This plan remains essentially the same as in the previous year.



Schedule F on the following pages provides the list of participants in the Corporate
Support/Teller Incentive Program.



SCHEDULE F 
CORPORATE SUPPORT/TELLER

PLAN PARTICIPANTS





|                 |  |           
|---------------- |  | ----------
|EMPLOYEE         |  | POSITION  
|Bailey, Tabitha  |  | P-T Teller
|                 | 
|Ennis, Claytius  |  | Teller    
|                 | 
|Evans, Danita    |  | Teller    
|                 | 
|Harrison, David  |  | Teller    
|                 | 
|Lee, Tracie      |  | Teller    
|                 | 
|Rogers, Charlene |  | P/T Teller



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---

|                      |  |                                      
|--------------------- |  | -------------------------------------
|                      | 
|Strickland, Cynthia   |  | Teller                               
|                      | 
|Suggs, Kimberly       |  | Teller                               
|                      | 
|Alexander, Brendalyn  |  | Credit Review Officer                
|                      | 
|Allen, Nicole         |  | Compliance Assistant                 
|                      | 
|Banks, Julia          |  | VP/Branch Operations Support         
|                      | 
|Bass, Sherri          |  | Treasury Manager                     
|                      | 
|Bonnette, Kevin       |  | EDP Coordinator                      
|                      | 
|Bradley, Barbara      |  | Loan Documentation Specialist        
|                      | 
|Brooks, Kinon         |  | Operations Tech I                    
|                      | 
|Brown, Eleanor        |  | Operations Clerk II                  
|                      | 
|Carter, Latonia       |  | Operations Accounting Assistant      
|                      | 
|Curtis, Catina        |  | Operations Technician                
|                      | 
|Douglas, Denise       |  | Electronic Services Clerk            
|                      | 
|Ellis, Faye           |  | Receptionist/Secretary               
|                      | 
|Farkas, Donna         |  | Accounting Assistant                 
|                      | 
|Forbes, Todd          |  | Operations Tech I                    
|                      | 
|Gill, Peggy           |  | Internal Auditor                     
|                      | 
|Hailey-Jones, Vermont |  | Loan Services Coordinator            
|                      | 
|Harris, Davon         |  | Finance Assistant                    
|                      | 
|Hollingsworth, Tammie |  | Staff Accountant                     
|                      | 
|Lester, Patricia      |  | Operations Accounting Assistant      
|                      | 
|Lyon, Alice           |  | EDP Operations Manager               
|                      | 
|Mallory, Renee        |  | Human Resources Assistant            
|                      | 
|Mitchell, Pamala E    |  | Loan Operations Coordinator          
|                      | 
|Parker, Charles       |  | Facility Support Services Coordinator
|                      | 
|Parker, Kevin         |  | P/T Network Technician               
|                      | 
|Quick, Saundra        |  | Executive Assistant                  
|                      | 
|Quiett, Valerie       |  | Compliance Officer                   
|                      | 
|Rollins, Sharlene     |  | Loan Procedures Coordinator          
|                      | 
|Rouse, Jane           |  | Electronic Services Clerk            



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---

|                     |  |                              
|-------------------- |  | -----------------------------
|                     | 
|Shands, Artis        |  | Account Services Manager 1   
|                     | 
|Spruill, Ruth        |  | Loan Documentation Specialist
|                     | 
|Sturges, Allan       |  | VP and Controller            
|                     | 
|Thornton, Chevez     |  | Loan Operations Manager      
|                     | 
|Williams, Stephanie  |  | Human Resources Manager      
|                     | 
|Wright, Danielle     |  | Credit Analyst               
|                     | 
|Wright, K. Lynette   |  | Electronic Services Clerk    
|                     | 
|Alston, Sheila       |  | Teller Supervisor            
|                     | 
|McClain, Ann         |  | Teller                       
|                     | 
|Artis, Pearline      |  | Teller                       
|                     | 
|Evans, April         |  | Teller                       
|                     | 
|Graham, Angela       |  | Teller                       
|                     | 
|Jones-Davis, Tiffany |  | Teller                       
|                     | 
|Ray, Lisa            |  | Teller                       
|                     | 
|Boomer, Betty        |  | Teller                       
|                     | 
|Harrington, Yvonne   |  | P/T Teller                   
|                     | 
|Plummer, Lynette     |  | Teller                       
|                     | 
|Johnson, Melanie     |  | Teller                       
|                     | 
|Williams, Jarvis     |  | Teller Supervisor            
|                     | 
|Grimes, Michelle     |  | Teller                       
|                     | 
|Davis, Rochelle      |  | Teller                       



For the purpose of the Plan, employees
will be divided into two groups:



| |  | Tellers(includes working Teller Supervisors)
|- |  | --------------------------------------------



| |  | Corporate Support (Financial Accounting, Credit Administration, Operations Group personnel, Marketing and other support staff)
|- |  | ------------------------------------------------------------------------------------------------------------------------------



Tellers



Incentive compensation for Tellers will be based on individual CAP and shop scores. Working Teller Supervisors awards shall be based
on the individual and branch CAP scores. Regular and part-time tellers must have a minimum average CAP score of 80 and an average shop score of 80 for the quarter to be eligible to participate.



|                       |  |                             
|---------------------- |  | ----------------------------
|Monthly Individual CAP |  | Amount                      
|95 or above            |  | $150 for each month achieved
|90 to 94               |  | $100 for each month achieved
|85 to 89               |  | $ 75 for each month achieved
|80 to 84               |  | $ 60 for each month achieved



45



---

Part-time tellers (20 hours or less or an employee whose primary job is not a teller) will receive
one-half of the award amounts.



Working Teller Supervisors whose primary
responsibility is to operate a tellers window and to supervise all tellers will be paid based on the average monthly CAP and Shop score of their branch (provided their individual average for the quarter is at least 85 for both the CAP and Shop
scores). The monthly Shop score of the branch must be at least 80 in addition to the CAP score to qualify for payment.



|                     |  |                             
|-------------------- |  | ----------------------------
|Monthly Branch Score |  | Amount                      
|95 or above          |  | $175 for each month achieved
|90 to 94             |  | $125 for each month achieved
|85 to 89             |  | $100 for each month achieved
|80 to 84             |  | $ 85 for each month achieved



The incentive will be paid each
quarter within 45 days of the quarter ending March 31, June 30, September 30 and December 31, respectively.



Incentive compensation will be paid only on new funds for both loans and deposits. Incentive compensation will be based upon the individual achieving the quarterly threshold levels specified in the City
Performance Objectives and Goals to be eligible for inclusion in the incentive calculation. Neither loans nor deposits will be counted should the individual fail to attain their minimum quarterly established goal.



New loan and/or deposit accounts from the same customer that are of the same type and term
will be combined and considered as one account for the purpose of this incentive program. Incentives for deposits other than certificates of deposit will be based on an average balance year-to-date and the account must have been opened for at least
30 days to be eligible. This information must be verified quarterly prior to payment. Certificates of deposit with a term of 90 days or less will only be paid 25% of the incentive amount due for other certificates. Renewal of such certificates will
not qualify for incentive consideration.



Corporate Support
Personnel/Departments



Corporate Support is defined as the supporting
departments within the corporate offices: Financial Accounting, Credit Administration, Operations Group, Marketing, Internal Audit and Compliance and other support staff as may be added from time to time:



When the Bank meets the annualized budgeted net income for the applicable quarter, the
individuals within this group shall share in an incentive pool of 5% of net income after taxes for the quarter. The amount an individual receives shall be based on the percentage as his/her salary to the total salaries within his/her respective
assigned department up to a maximum of $1,000 per quarter. Extraordinary accounting items will not be considered for purposes of payment of any incentives.



Performance evaluations will impact individual payment amounts. Any employee with a performance evaluation of less than satisfactory or any employee on probation will not
be eligible to receive an incentive award.



The incentive will be paid each
quarter within 45 days of the quarter ending March 31, June 30, September 30 and December 31, respectively.



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