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                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                             ----------------------

                                   FORM 10-KSB

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


                   For the fiscal year ended DECEMBER 31, 2000

                          Commission file number 027307

                                M&F BANCORP, INC.
                                -----------------
             (Exact Name of Registrant as Specified in Its Charter)

        NORTH CAROLINA                                       56-1980549
 ------------------------------             ------------------------------------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
 Incorporation or Organization)

     2634 CHAPEL HILL BLVD.
    DURHAM, NORTH CAROLINA                                27707-2800
 --------------------------------------                   ----------
(Address of Principal Executive Offices)                  (Zip Code)


                                 (919) 683-1521
                                 --------------
              (Registrant's Telephone Number, Including Area Code)

     Securities to be Registered Pursuant to Section 12(b) of the Act: NONE

        Securities to be Registered Pursuant to Section 12(g) of the Act:

        COMMON STOCK, NO PAR VALUE

                                (Title of class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No


Indicate by check mark if disclosure of delinquent filers in response to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-KSB. [X]

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant. The aggregate market value shall be
computed by reference to the price at which the common equity was sold, or the
average bid and asked prices of such common equity, as of a specified date
within 60 days prior to the date of filing. $8,750,681 BASED ON THE CLOSING
PRICE OF SUCH COMMON STOCK ON MARCH 15, 2001, WHICH WAS $10.25 PER SHARE.

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date. 853,725 SHARES OF COMMON STOCK,
OUTSTANDING AT MARCH 15, 2001.
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                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Annual Report of M&F Bancorp, Inc. for the year ended December
31, 2000 (the "Annual Report") are incorporated by reference into Part I, Part
II and Part IV.

Portions of the Proxy Statement for the 2001 Annual Meeting of Stockholders of
M&F Bancorp, Inc. to be held on May 1, 2001 (the "Proxy Statement"), are
incorporated by reference into Part III.

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                                     PART I

ITEM 1.           DESCRIPTION OF BUSINESS

GENERAL

         M&F Bancorp, Inc. (the "Company") was formed in 1999 to serve as the
holding company for Mechanics and Farmers Bank (the "Bank"). The Company is a
bank holding company registered with the Board of Governors of the Federal
Reserve System (the "Federal Reserve") under the Bank Holding Company Act of
1956, as amended (the "BHCA"). The Company's sole activity consists of owning
the Bank. The Company's principal source of income is any dividends which are
declared and paid by the Bank on its capital stock.

         The Bank is a North Carolina bank and began operations in 1908. It is
engaged primarily in the business of attracting deposits from the general public
and using such deposits, together with funds, to make primarily consumer and
commercial loans. The Bank makes secured personal, automobile, home improvement,
residential mortgage, commercial real estate, construction and commercial loans.
The Bank also makes some unsecured consumer loans. The Bank's primary source of
revenue is interest income from its lending activities. The Bank's other major
sources of revenue are interest income from investments, interest income from
its interest-bearing investments with other depository institutions and fee
income from its lending and deposit activities. The major expenses of the Bank
are interest on deposits and general and administrative expenses such as
salaries, employee benefits, federal deposit insurance premiums and branch
occupancy and related expenses.

         As a North Carolina bank, the Bank is subject to examination and
regulation by the Federal Deposit Insurance Corporation (the "FDIC") and the
Commissioner of Banks, North Carolina Department of Commerce (the
"Commissioner"). The Bank is further subject to certain regulations of the
Federal Reserve governing reserves required to be maintained against deposits
and other matters. The business and regulation of the Bank are also subject to
legislative changes from time to time. See "SUPERVISION AND REGULATION."

         The Company has no operations and conducts no business of its own other
than owning the Bank. Accordingly, the discussion of the business which follows
concerns the business conducted by the Bank, unless otherwise indicated.

MARKET AREA

         The Bank has three offices in Durham, North Carolina, two offices in
Raleigh, North Carolina, two offices in Charlotte, North Carolina, and one
office in Winston-Salem, North Carolina. All offices are located in metropolitan
areas with employment spread primarily among service, manufacturing and
governmental activities. All offices are located in areas of high competition
among financial service providers. As of June 30, 2000, Durham had eleven
commercial banks, and the Bank ranked approximately seventh in deposit size.
Raleigh had 15 commercial banks, and the Bank ranked thirteenth in deposit size.
The Bank ranked fifteenth in deposit size out of 15 commercial banks in
Charlotte. There were twelve commercial banks in Winston-Salem, and the Bank
ranked eleventh in deposit size.

LENDING ACTIVITIES

         GENERAL. The Bank's primary source of revenue is interest and fee
income from its lending activities, consisting primarily of automobile, home
equity, home improvement, personal, residential mortgage, commercial real
estate, construction and commercial loans. The Bank also offers both personal
and commercial overdraft protection in connection with its checking accounts.
Approximately 86.57% of the Bank's loan portfolio is secured by real property,
11.63% is secured by personal property, and 1.80% is unsecured. On December 31,
2000, the largest amount the Bank had outstanding to any one borrower and its
affiliates was approximately $2.6 million. In addition to interest earned on
loans, the Bank receives fees in connection with loan originations, loan
modifications, late payments, loan assumptions and other miscellaneous services.

         LOAN PORTFOLIO COMPOSITION. The Bank's consolidated net loan portfolio
totaled approximately $114.9 million at December 31, 2000 representing 68.80% of
the Bank's total assets. At December 31, 2000, approximately 19.98% of the
Bank's net loan portfolio was composed of adjustable rate loans, and
approximately 80.02% of the Bank's net loan portfolio was composed of fixed rate
loans. At December 31, 2000, approximately

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$7.7 million, or6.69%, of the Bank's net loan portfolio was composed of consumer
loans. On such date, approximately $64.6 million, or 56.24%, of the Bank's net
loan portfolio was composed of commercial loans and approximately $42.6 million,
or 37.07%, consisted of real estate loans.

         ORIGINATION, PURCHASE AND SALE OF LOANS. The Bank originates its loans
with the intention that they will be sold in the secondary market. Loans
generally are originated in conformity with purchase requirements of the Federal
National Mortgage Association ("FNMA"). The Bank originates loans which satisfy
its underwriting requirements which are tailored for the local communities it
serves. Accordingly, such loans are not readily saleable in the secondary
market. Such loans could be sold only after incurring certain costs, such as
costs for surveys and title insurance and/or discounting the purchase price.

         The Bank did not purchase or sell any loans in fiscal 2000 or 1999.

         ASSET CLASSIFICATION. Applicable regulations require each insured
institution to "classify" its own assets on a regular basis. In addition, in
connection with examinations of financial institutions, regulatory examiners
have authority to identify problem assets and, if appropriate, classify them.
Problem assets are classified as "substandard," "doubtful" or "loss," depending
on the presence of certain characteristics as discussed below.

         An asset is considered "substandard" if not adequately protected by the
current net worth and paying capacity of the obligor or the collateral pledged,
if any. "Substandard" assets include those characterized by the "distinct
possibility" that the insured institution will sustain "some loss" if the
deficiencies are not corrected. Assets classified as "doubtful" have all of the
weaknesses inherent in those classified "substandard" with the added
characteristic that the weaknesses present make "collection or liquidation in
full," on the basis of currently existing facts, conditions, and values, "highly
questionable and improbable." Assets classified "loss" are those considered
"uncollectible" and of such little value that their continuance as assets
without the establishment of a loss reserve is not warranted.

         As of December 31, 2000, the Bank had approximately $4.9 million of
loans classified as "substandard," $5,800 of loans classified as "doubtful," and
no loans classified as "loss." Total classified assets as of December 31, 2000
and 1999 were approximately $4.9 million and $3.3 million, respectively.

         In connection with the filing of periodic reports with regulatory
agencies, the Bank reports any assets which possess credit deficiencies or
potential weaknesses deserving close attention by management. These assets may
be considered "special mention" assets and do not yet warrant adverse
classification. At December 31, 2000, the Bank had approximately $393,000 of
loans in the "special mention" category.

         When an insured institution classifies problem assets as either
substandard or doubtful, it is required to establish general allowances for loan
losses in an amount deemed prudent by management. These allowances represent
loss allowances which have been established to recognize the inherent risks
associated with lending activities and the risks associated with particular
problem assets. When an insured institution classifies problem assets as "loss,"
it charges off the balance of the asset. The Bank's determination as to the
classification of its assets and the amount of its valuation allowances is
subject to review by the FDIC and the Commissioner which can order the
establishment of additional loss allowances.

         ALLOWANCE FOR LOAN LOSSES. In originating loans, the Bank recognizes
that credit losses will be experienced and that the risk of loss will vary with,
among other things, the type of loan being made, the creditworthiness of the
borrower over the term of the loan and, in the case of a secured loan, the
quality of the security for the loan as well as general economic conditions. It
is management's policy to maintain an adequate allowance for loan losses based
on, among other things, the Bank's historical loan loss experience, evaluation
of economic conditions and regular review of delinquencies and loan portfolio
quality. Specific allowances are provided for individual loans when ultimate
collection is considered questionable by management after reviewing the current
status of loans which are contractually past due and considering the net
realizable value of the security for the loans.

         Management actively monitors the Bank's asset quality, charges off
loans against the allowance for loan losses when appropriate and provides
specific loss reserves when necessary. Although management believes it uses

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the best information  available to make  determinations with respect to the
allowance for loan losses, future adjustments may be necessary if economic
conditions differ substantially from the economic conditions in the assumptions
used in making the initial determinations.

INVESTMENTS

         Interest income from investment securities generally provides the
second largest source of income to the Bank after interest on loans. In
addition, the Bank receives interest income from interest on federal funds
invested overnight with other financial institutions.

         On December 31, 2000, the Bank's investment securities portfolio
totaled approximately $31.0 million and consisted of U.S. Treasury and U.S.
Government Agencies, corporate bonds and tax-exempt municipal obligations of
states and political subdivisions.

         The Bank's investment strategy is intended, among other things, to (i)
provide and maintain liquidity, (ii) maintain a balance of high quality,
diversified investments to minimize risk, (iii) maximize returns, and (iv)
manage interest rate risk. In terms of priorities, safety is considered more
important than liquidity or return on investment. The Bank does not engage in
hedging activities.

DEPOSITS AND BORROWINGS

         GENERAL. Deposits are the primary source of the Bank's funds for
lending and other investment purposes. In addition to deposits, the Bank derives
funds from loan principal repayments, interest payments, investment income,
interest from its Fed funds deposits, and otherwise from its operations. Loan
repayments are a relatively stable source of funds while deposit inflows and
outflows may be significantly influenced by general interest rates and money
market conditions. Borrowings may be used on a short-term basis to compensate
for reductions in the availability of funds from other sources. They may also be
used on a longer term basis for general business purposes.

         DEPOSITS. In recent years, the Bank has experienced consistent deposit
growth. On December 31, 2000 and 1999, the Bank's deposits totaled approximately
$135.1 million and $129.5 million, respectively.

         The Bank attracts both short-term and long-term deposits from the
general public by offering a variety of accounts and rates. The Bank offers
savings accounts, checking accounts, and fixed interest rate certificates with
varying maturities. All deposit flows are greatly influenced by economic
conditions, the general level of interest rates, competition and other factors.
The Bank's deposits traditionally have been obtained primarily from its market
area. The Bank utilizes traditional marketing methods to attract new customers
and deposits, including print media advertising and direct mailings. The Bank
does not advertise for deposits outside of its local market area and it has no
brokered deposits.

SUBSIDIARIES

         The Bank has one wholly-owned subsidiary, Realty Services, Inc.
("Realty Services"). Realty Services, a North Carolina corporation, is not
active in producing income, but rather acquires and manages commercial
properties for use as current or potential branch offices of the Bank. During
the fiscal years ended December 31, 2000 and 1999, Realty Services' net income
was $(9,432) and $(32,985), respectively. The financial statements of Realty
Services are consolidated with those of the Bank.

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COMPETITION

         The Bank faces strong competition both in attracting deposits and
making loans. Its most direct competition for deposits has historically come
from savings institutions, credit unions and other commercial banks located in
its primary market area, including large financial institutions which have
greater financial and marketing resources available to them. The Bank has also
faced additional significant competition for investors' funds from short-term
money market securities and other corporate and government securities. The
ability of the Bank to attract and retain deposits depends on its ability to
generally provide a rate of return, liquidity and risk comparable to that
offered by competing investment opportunities. As of June 30, 2000, the Bank had
approximately 2.14% of the deposits market share in Durham, North Carolina, and
less than one percent of the deposits market share in Raleigh, Charlotte and
Winston-Salem, North Carolina.

EMPLOYEES

         As of December 31, 2000, the Bank had 87 full-time equivalent
employees.

SUPERVISION AND REGULATION

         Bank holding companies and state savings banks are extensively
regulated under both federal and state law. The following is a brief summary of
certain statutes and rules and regulations that affect or will affect the
Company and the Bank. This summary is qualified in its entirety by reference to
the particular statute and regulatory provisions referred to below and is not
intended to be an exhaustive description of the statutes or regulations
applicable to the business of the Company and the Bank. Supervision, regulation
and examination of the Company and the Bank by the regulatory agencies are
intended primarily for the protection of depositors rather than shareholders of
the Company.

         REGULATION OF THE COMPANY

         GENERAL. The Company was organized for the purpose of acquiring and
holding all of the capital stock of the Bank. As a bank holding company subject
to the BHCA, the Company is subject to certain regulations of the Federal
Reserve. Under the BHCA, the Company's activities and those of its subsidiaries
are limited to banking, managing or controlling banks, furnishing services to or
performing services for its subsidiaries or engaging in any other activity which
the Federal Reserve determines to be so closely related to banking or managing
or controlling banks as to be a proper incident thereto. Also, see " - The
Gramm-Leach-Bliley Act". The BHCA prohibits the Company from acquiring direct or
indirect control of more than 5% of the outstanding voting stock or
substantially all of the assets of any bank or savings bank or merging or
consolidating with another bank holding company or savings bank holding company
without prior approval of the Federal Reserve.

         Additionally, the BHCA prohibits the Company from engaging in, or
acquiring ownership or control of, more than 5% of the outstanding voting stock
of any company engaged in a nonbanking business unless such business is
determined by the Federal Reserve to be so closely related to banking as to be
properly incident thereto. The BHCA does not place territorial restrictions on
the activities of such non-banking related activities.

         Similarly, Federal Reserve approval (or, in certain cases,
non-disapproval) must be obtained prior to any person acquiring control of the
Company. Control is conclusively presumed to exist if, among other things, a
person acquires more than 25% of any class of voting stock of the Company or
controls in any manner the election of a majority of the directors of the
Company. Control is presumed to exist if a person acquires more than 10% of any
class of voting stock and the stock is registered under Section 12 of the
Exchange Act or the acquiror will be the largest shareholder after the
acquisition.

         There are a number of obligations and restrictions imposed on bank
holding companies and their depository institution subsidiaries by law and
regulatory policy that are designed to minimize potential loss to the depositors
of such depository institutions and the FDIC insurance funds in the event the
depository institution becomes in danger of default or in default. For example,
to avoid receivership of an insured depository institution subsidiary, a bank
holding company is required to guarantee the compliance of any insured
depository institution subsidiary that may become "undercapitalized" with the
terms of any capital restoration plan filed by such subsidiary with its
appropriate federal banking agency up to the lesser of (i) an amount equal to 5%
of the bank's total assets at the time the bank became undercapitalized or (ii)
the amount which is necessary (or would have

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been necessary) to bring the bank into compliance with all acceptable capital
standards as of the time the bank fails to comply with such capital restoration
plan. Under a policy of the Federal Reserve with respect to bank holding company
operations, a bank holding company is required to serve as a source of financial
strength to its subsidiary depository institutions and to commit resources to
support such institutions in circumstances where it might not do so absent such
policy. The Federal Reserve under the BHCA also has the authority to require a
bank holding company to terminate any activity or to relinquish control of a
nonbank subsidiary (other than a nonbank subsidiary of a bank) upon the Federal
Reserve's determination that such activity or control constitutes a serious risk
to the financial soundness and stability of any bank subsidiary of the bank
holding company.

         In addition, insured depository institutions under common control are
required to reimburse the FDIC for any loss suffered by either the Savings
Association Insurance Fund (the "SAIF") or the BIF as a result of the default of
a commonly controlled insured depository institution or for any assistance
provided by the FDIC to a commonly controlled insured depository institution in
danger of default. The FDIC may decline to enforce the cross-guarantee
provisions if it determines that a waiver is in the best interest of the SAIF or
the BIF or both. The FDIC's claim for damages is superior to claims of
stockholders of the insured depository institution or its holding company but is
subordinate to claims of depositors, secured creditors and holders of
subordinated debt (other than affiliates) of the commonly controlled insured
depository institutions.

         Federal regulations require that the Company must notify the Federal
Reserve Bank of Richmond prior to repurchasing Common Stock in excess of ten
percent of its net worth during a rolling twelve month period unless the Company
(i) both before and after the redemption satisfies capital requirements for
"well capitalized" state member banks, (ii) received a one or two rating in its
last examination, and (iii) is not the subject of any unresolved supervisory
issues. As a result of the Company's ownership of the Bank, the Company is
registered under the bank holding company laws of North Carolina. Accordingly,
the Company is also subject to regulation and supervision by the Commissioner.

         CAPITAL ADEQUACY GUIDELINES FOR HOLDING COMPANIES. The Federal Reserve
has adopted capital adequacy guidelines for bank holding companies and banks
that are members of the Federal Reserve system and have consolidated assets of
$150 million or more. For bank holding companies with less than $150 million in
consolidated assets, the guidelines are applied on a bank-only basis unless the
parent bank holding company (i) is engaged in nonbank activity involving
significant leverage or (ii) has a significant amount of outstanding debt that
is held by the general public.

         Bank holding companies subject to the Federal Reserve's capital
adequacy guidelines are required to comply with the Federal Reserve's risk-based
capital guidelines. Under these regulations, the minimum ratio of total capital
to risk-weighted assets (including certain off-balance sheet activities, such as
standby letters of credit) is 8%. At least half of the total capital is required
to be "Tier I capital," principally consisting of common stockholders' equity,
noncumulative perpetual preferred stock, and a limited amount of cumulative
perpetual preferred stock, less certain goodwill items. The remainder ("Tier II
capital") may consist of a limited amount of subordinated debt, certain hybrid
capital instruments and other debt securities, perpetual preferred stock, and a
limited amount of the general loan loss allowance. In addition to the risk-based
capital guidelines, the Federal Reserve has adopted a minimum Tier I capital
(leverage) ratio, under which a bank holding company must maintain a minimum
level of Tier I capital to average total consolidated assets of at least 3% in
the case of a bank holding company which has the highest regulatory examination
rating and is not contemplating significant growth or expansion. All other bank
holding companies are expected to maintain a Tier I capital (leverage) ratio of
at least 1% to 2% above the stated minimum.

         DIVIDEND AND REPURCHASE LIMITATIONS. The Company must obtain Federal
Reserve approval prior to repurchasing Common Stock for in excess of 10% of its
net worth during any twelve-month period unless the Company (i) both before and
after the redemption satisfies capital requirements for "well capitalized" state
member banks; (ii) received a one or two rating in its last examination; and
(iii) is not the subject of any unresolved supervisory issues.

         Although the payment of dividends and repurchase of stock by the
Company are subject to certain requirements and limitations of North Carolina
corporate law, neither the Commissioner nor the FDIC have promulgated any
regulations specifically limiting the right of the Company to pay dividends and
repurchase shares. However, the ability of the Company to pay dividends or
repurchase shares may be dependent upon the

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Company's receipt of dividends from the Bank. The Bank's ability to pay
dividends is limited. See " -- Regulation of the Bank -- Dividends."

         FEDERAL SECURITIES LAW. The Company has registered its Common Stock
with the SEC pursuant to Section 12(g) of the Securities Exchange Act of 1934
(the "Exchange Act"). As a result of such registration, the proxy and tender
offer rules, insider trading reporting requirements, annual and periodic
reporting and other requirements of the Exchange Act are applicable to the
Company.

REGULATION OF THE BANK

         Dividends. North Carolina commercial banks, such as the Bank, are
subject to legal limitations on the amounts of dividends they are permitted to
pay. Dividends may be paid by the Bank from undivided profits, which are
determined by deducting and charging certain items against actual profits,
including any contributions to surplus required by North Carolina law. Also, an
insured depository institution, such as the Bank, is prohibited from making
capital distributions, including the payment of dividends, if, after making such
distribution, the institution would become "undercapitalized" (as such term is
defined in the applicable law and regulations). Based on its current financial
condition, the Bank does not expect that this provision will have any impact on
the Bank's ability to pay dividends.

         Capital Requirements. The Bank, as a North Carolina commercial bank, is
required to maintain a surplus account equal to 50% or more of its paid-in
capital stock. As a North Carolina chartered, FDIC-insured commercial bank which
is not a member of the Federal Reserve System, the Bank is also subject to
capital requirements imposed by the FDIC. Under the FDIC's regulations, state
nonmember banks that (a) receive the highest rating during the examination
process and (b) are not anticipating or experiencing any significant growth, are
required to maintain a minimum leverage ratio of 3% of total consolidated
assets; all other banks are required to maintain a minimum ratio of 1% or 2%
above the stated minimum, with a minimum leverage ratio of not less than 4%. The
Bank exceeded all applicable capital requirements as of December 31, 2000.

         Deposit Insurance Assessments. The Bank is also subject to insurance
assessments imposed by the FDIC. Under current law, the insurance assessment to
be paid by the BIF members such as the Bank shall be as specified in a schedule
required to be issued by the FDIC. All FDIC deposits for deposit insurance have
an effective rate ranging from 0 to 31 basis points per $100 of insured
deposits, depending on the institution's capital position and other supervisory
factors. Based on the current financial condition and capital levels of the
Bank, the Bank does not expect that the FDIC insurance assessments will have a
material impact on the Bank's future earnings.

         Transactions with Affiliates. Under current federal law, depository
institutions are subject to the restrictions contained in Section 22(h) of the
Federal Reserve Act with respect to loans to directors, executive officers and
principal shareholders. Under Section 22(h), loans to directors, executive
officers and shareholders who own more than 10% of a depository institution (18%
in the case of institutions located in an area with less than 30,000 in
population), and certain affiliated entities of any of the foregoing, may not
exceed, together with all other outstanding loans to such person and affiliated
entities, the institution's loans-to-one-borrower limit (as discussed below).
Section 22(h) also prohibits loans above amounts prescribed by the appropriate
federal banking agency to directors, executive officers and shareholders who own
more than 10% of an institution, and their respective affiliates, unless such
loans are approved in advance by a majority of the board of directors of the
institution. Any "interested" director may not participate in the voting. The
FDIC has prescribed the loan amount (which includes all other outstanding loans
to such person), as to which such prior board of director approval is required,
as being the greater of $25,000 or 5% of capital and surplus (up to $500,000).
Further, pursuant to Section 22(h), the Federal Reserve requires that loans to
directors, executive officers, and principal shareholders be made on terms
substantially the same as offered in comparable transactions with non-executive
employees of the Bank. The FDIC has imposed additional limits on the amount a
bank can loan to an executive officer.

         Loans to One Borrower. The Bank is subject to the Commissioner's loans
to one borrower limits which are substantially the same as those applicable to
national banks. Under these limits, no loans and extensions of credit to any
borrower outstanding at one time and not fully secured by readily marketable
collateral shall exceed 15% of the unimpaired capital and unimpaired surplus of
the bank. Loans and extensions of credit fully secured by readily marketable
collateral may comprise an additional 10% of unimpaired capital and unimpaired
surplus.

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         Limits on Rates Paid on Deposits and Brokered Deposits. Regulations
promulgated by the FDIC place limitations on the ability of insured depository
institutions to accept, renew or roll-over deposits by offering rates of
interest which are significantly higher than the prevailing rates of interest on
deposits offered by other insured depository institutions having the same type
of charter in such depository institution's normal market area. Under these
regulations, "well capitalized" depository institutions may accept, renew or
roll-over such deposits without restriction, "adequately capitalized" depository
institutions may accept, renew or roll-over such deposits with a waiver from the
FDIC (subject to certain restrictions on payments of rates) and
"undercapitalized" depository institutions may not accept, renew, or roll-over
such deposits. The regulations contemplate that the definitions of "well
capitalized," "adequately capitalized" and "undercapitalized" will be the same
as the definitions adopted by the FDIC to implement the corrective action
provisions discussed below.

         Only a "well capitalized" (as defined in the statute as significantly
exceeding each relevant minimum capital level) depository institutions may
accept brokered deposits without prior regulatory approval. "Adequately
capitalized" banks may accept brokered deposits with a waiver from the FDIC
(subject to certain restrictions on payment of rates), while "undercapitalized"
banks may not accept brokered deposits. The regulations contemplate that the
definitions of "well capitalized," "adequately capitalized" and
"undercapitalized" are the same as the definitions adopted by the agencies to
implement the prompt corrective action provisions discussed below.

         Federal Home Loan Bank System. The FHLB system provides a central
credit facility for member institutions. As a member of the FHLB of Atlanta, the
Bank is required to own capital stock in the FHLB of Atlanta in an amount at
least equal to the greater of 1% of the aggregate principal amount of its unpaid
residential mortgage loans, home purchase contracts and similar obligations at
the end of each calendar year, or 5% of its outstanding advances (borrowings)
from the FHLB of Atlanta. On December 31, 2000, the Bank was in compliance with
this requirement.

         Community Reinvestment. Under the Community Reinvestment Act ("CRA") as
implemented by regulations of the FDIC, an insured institution has a continuing
and affirmative obligation consistent with its safe and sound operation to help
meet the credit needs of its entire community, including low and moderate income
neighborhoods. The CRA does not establish specific lending requirements or
programs for financial institutions, nor does it limit an institution's
discretion to develop, consistent with the CRA, the types of products and
services that it believes are best suited to its particular community. The CRA
requires the federal banking regulators, in connection with their examinations
of insured institutions, to assess the institutions' records of meeting the
credit needs of their communities, using the ratings of "outstanding,"
"satisfactory," "needs to improve," or "substantial noncompliance," and to take
that record into account in its evaluation of certain applications by those
institutions. All institutions are required to make public disclosure of their
CRA performance ratings. The Bank received an "outstanding" rating in its last
CRA examination which was conducted during December 1997.

         Prompt Corrective Action. The FDIC has broad powers to take corrective
action to resolve the problems of insured depository institutions. The extent of
these powers will depend upon whether the institutions in question are "well
capitalized," "adequately capitalized," "undercapitalized," "significantly
undercapitalized," or "critically undercapitalized." Under the regulations, an
institution is considered "well capitalized" if it has (i) a total risk-based
capital ratio of 10% or greater, (ii) a Tier I risk-based capital ratio of 6% or
greater, (iii) a leverage ratio of 5% or greater and (iv) is not subject to any
order or written directive to meet and maintain a specific capital level for any
capital measure. An "adequately capitalized" institution is defined as one that
has (i) a total risk-based capital ratio of 8% or greater, (ii) a Tier I
risk-based capital ratio of 4% or greater and (iii) a leverage ratio of 4% or
greater (or 3% or greater in the case of an institution with the highest
examination rating). An institution is considered (A) "undercapitalized" if it
has (i) a total risk-based capital ratio of less than 8%, (ii) a Tier I
risk-based capital ratio of less than 4% or (iii) a leverage ratio of less than
4% (or 3% in the case of an institution with the highest examination rating);
(B) "significantly undercapitalized" if the institution has (i) a total
risk-based capital ratio of less than 6%, or (ii) a Tier I risk-based capital
ratio of less than 3% or (iii) a leverage ratio of less than 3% and (C)
"critically undercapitalized" if the institution has a ratio of tangible equity
to total assets equal to or less than 2%.

         The Gramm-Leach-Bliley Act.

         The Gramm-Leach-Bliley Act (the "GLB Act") was signed into law on
November 12, 1999 to remove barriers separating banking, securities and
insurance firms and to make other reforms. Certain provisions of the

                                       9
<PAGE>

GLB Act were effective immediately upon signing; other provisions generally take
effect between 120 days and 18 months following enactment.

         Financial Affiliations. Title I of the GLB Act facilitates affiliations
among banks, securities firms and insurance companies. Financial organizations
may structure new financial affiliations through a holding company structure, or
a financial subsidiary (with limitations on activities and appropriate
safeguards). A bank holding company may now qualify as a financial holding
company and expand into a wide variety of services that are financial in nature,
provided that its subsidiary depository institutions are well-managed,
well-capitalized and have received a "satisfactory" rating on their last
Community Reinvestment Act (the "CRA") examination. A bank holding company which
does not qualify as a financial holding company under the GLB Act is generally
limited in the types of activities in which it may engage to those that the
Federal Reserve had recognized as permissible for a bank holding company prior
to the date of enactment of the GLB Act.

         National banks remain limited in the scope of activities they may
exercise directly within the bank, but an eligible national bank may have a
financial subsidiary that exercises many of the expanded financial services
authorized for a financial holding company. A national bank cannot engage in
merchant banking either directly or through a subsidiary, but a financial
holding company is authorized to have an affiliate company that engages in
merchant banking.

         State banks may have financial subsidiaries that, upon meeting
eligibility criteria, can engage in activities permitted for financial
subsidiaries of national banks.

         Functional Regulation. The GLB Act designates the Federal Reserve as
the overall umbrella supervisor of the new financial services holding companies.
The GLB Act adopts a system of functional regulation where the primary regulator
is determined by the nature of activity rather than the type of institution.
Under this principle, securities activities are regulated by the SEC and other
securities regulators, insurance activities by the state insurance authorities,
and banking activities by the appropriate banking regulator.

         Insurance. The GLB Act reaffirms that states are the regulators for
insurance activities of all persons, including acting as the functional
regulator for the insurance activities of federally-chartered banks. However,
states may not prevent depository institutions and their affiliates from
conducting insurance activities.

         Privacy. The GLB Act imposes restrictions on the ability of financial
services firms to share customer information with nonaffiliated third parties.
The GLB Act: (i) requires financial services firms to establish privacy policies
and disclose them annually to customers, explaining how nonpublic personal
information is shared with affiliates and third parties; (ii) directs regulatory
agencies to adopt standards for sharing customer information; (iii) permits
customers to prohibit ("opt-out") of the disclosure of personal information to
nonaffiliated third parties; (iv) prohibits the sharing with marketers of credit
card and other account numbers; and, (v) prohibits "pretext" calling. The
privacy provisions do allow, however, a community bank to share information with
third parties that sell financial products, such as insurance companies or
securities firms. The privacy provisions became effective November 2000, with
full compliance required by July 1, 2001.

         Other. The GLB Act reforms the Federal Home Loan Bank System to provide
small banks with greater access to funds for making loans to small business and
small farmers. Also, the GLB Act obligates operators of automated teller
machines ("ATMs") to provide notices to customers regarding surcharge practices.
The GLB Act provides that CRA agreements between financial institutions and
community groups must be disclosed and reported to the public.

         Other. The federal banking agencies, including the FDIC, have developed
joint regulations requiring disclosure of contingent assets and liabilities and,
to the extent feasible and practicable, supplemental disclosure of the estimated
fair market value of assets and liabilities. Additional joint regulations
require annual examinations of all insured depository institutions by the
appropriate federal banking agency, with some exceptions for small,
well-capitalized institutions and state chartered institutions examined by state
regulators, and establish operational and managerial, asset quality, earnings
and stock valuation standards for insured depository institutions, as well as
compensation standards where such compensation would endanger the insured
depository institution or would constitute an unsafe practice.

                                       10
<PAGE>

         The Bank is subject to examination by the FDIC and the Commissioner. In
addition, the Bank is subject to various other state and federal laws and
regulations, including state usury laws, laws relating to fiduciaries, consumer
credit and equal credit, fair credit reporting laws and laws relating to branch
banking. The Bank, as an insured North Carolina commercial bank, is prohibited
from engaging as a principal in activities that are not permitted for national
banks, unless (i) the FDIC determines that the activity would pose no
significant risk to the appropriate deposit insurance fund and (ii) the Bank is,
and continues to be, in compliance with all applicable capital standards.

         Under Chapter 53 of the North Carolina General Statutes, if the capital
stock of a North Carolina commercial bank is impaired by losses or otherwise,
the Commissioner is authorized to require payment of the deficiency by
assessment upon the bank's shareholders, pro rata, and to the extent necessary,
if any such assessment is not paid by any shareholder, upon 30 days notice, to
sell as much as is necessary of the stock of such shareholder to make good the
deficiency.

         The Bank does not believe that these regulations have had or will have
a material adverse effect on its current operations.

         Taxation.

         Federal Income Taxation. Financial institutions such as the Bank are
subject to the provisions of the Internal Revenue Code of 1986, as amended (the
"Code") in the same general manner as other corporations. However, banks which
meet certain definitional tests and other conditions prescribed by the Code may
benefit from certain favorable provisions regarding their deductions from
taxable income for annual additions to their bad debt reserve. The Bank may
compute its addition to the bad debt reserve under the specific charge-off
method or the reserve method. Under the reserve method, the addition to bad
debts from losses on loans is computed by use of the experience method. Use of
the experience method requires minimum additions to the reserve based on the
amount allowable under a six-year moving average. The Code also provides annual
limits on the amount the Bank can add to its reserves for loan losses.

         State Taxation. Under North Carolina law, the Bank is subject to
corporate income taxes at a 7.25% rate and an annual franchise tax at a rate of
0.15%.

         Future Requirements. Statutes and regulations which contain
wide-ranging proposals for altering the structures, regulations and competitive
relationships of financial institutions are introduced regularly. The Bank
cannot predict whether or what form any proposed statute or regulation will be
adopted or the extent to which the business of the Bank may be affected by such
statute or regulation.

ITEM 2.           DESCRIPTION OF PROPERTY

         At December 31, 2000, the Bank conducted its business from the
headquarters office in Durham, North Carolina, and its eight branch offices in
Durham, Raleigh, Charlotte and Winston-Salem, North Carolina. The following
table sets forth certain information regarding the Bank's properties as of
December 31, 2000. Unless indicated otherwise, all properties are held in fee by
the Bank or Realty Services. Rentals paid by the Bank under leases totaled
$47,709 for the fiscal year ended December 31, 2000.

                                                            NET BOOK
                                                            VALUE OF
          ADDRESS                                           PROPERTY
          -------                                           --------
            Main Banking Office                             $  3,607
            116 West Parrish Street
            Durham, North Carolina (Leased)

            Corporate Office                               3,284,959
            2634 Chapel Hill Boulevard
            Durham, North Carolina

            Mutual Plaza                                           0
            Durham, North Carolina (Leased)

                                       11
<PAGE>

            2705 Chapel Hill Boulevard                       337,320
            Durham, North Carolina
            13 East Hargett Street                            77,792
            Raleigh, North Carolina
            1824 Rock Quarry Road                             95,459
            Raleigh, North Carolina (Lease Land Only)
            2101 Beatties Ford Road                          195,988
            Charlotte, North Carolina
            101 Beatties Ford Road                            36,570
            Charlotte, North Carolina
            770 Martin Luther King Drive                     522,555
            Winston-Salem, North Carolina


The total net book value of the Bank's furniture, fixtures and equipment on
December 31, 2000 was $780,391. All properties are considered by the Bank's
management to be in good condition and adequately covered by insurance.

ITEM 3.           LEGAL PROCEEDINGS

         In the opinion of management, the Bank is not involved in any pending
legal proceedings other than routine, non-material proceedings occurring in the
ordinary course of business.

ITEM 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         No matter was submitted to a vote of the Bank's shareholders during the
quarter ended December 31, 2000.

                                     PART II

ITEM 5.           MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         The information required by this Item is set forth under the section
captioned "Market for the Company's Common Equity and Related Shareholder
Matters" on page 16 of the Annual Report, which section is incorporated herein
by reference. See "Item 1. BUSINESS--Supervision and Regulation--The Company"
above for regulatory restrictions which limit the ability of the Company to pay
dividends.

ITEM 6.           MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The information required by this Item is set forth in the section
captioned "Management's Discussion and Analysis of Financial Condition and
Results of Operations" on pages 6 to 17 of the Annual Report, which section is
incorporated herein by reference.


ITEM 7.           FINANCIAL STATEMENTS

         The consolidated financial statements of the Company and supplementary
data set forth on pages 18 through 34 of the Annual Report are incorporated
herein by reference.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         Not Applicable.


                                       12
<PAGE>

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

         The information required by this Item regarding directors and executive
officers of the Company is set forth under the sections captioned "Proposal 1 -
Election of Directors - Nominees for Election at this Annual Meeting" on pages
13and 14 of the Proxy Statement and "Executive Officers" on pages 4 and 5 of the
Proxy Statement, which sections are incorporated herein by reference.

         The information required by this Item regarding compliance with Section
16(a) of the Securities Exchange Act of 1934 is set forth under the section
captioned "Section 16(a) Beneficial Ownership Reporting Compliance" set forth on
page 14 of the Proxy Statement, which section is incorporated herein by
reference.

ITEM 10. EXECUTIVE COMPENSATION

         The information required by this Item is set forth under the sections
captioned "Board of Directors and Its Committees - How Are Directors
Compensated?" on page 6 and "Executive Compensation" on pages 7 through 13 of
the Proxy Statement, which sections are incorporated herein by reference.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information required by this Item is incorporated by reference from
the section captioned "Stock Ownership" on pages 3 and 4 of the Proxy Statement.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         See the section captioned "Executive Compensation - Indebtedness of and
Transactions with Management" on page 13 of the Proxy Statement, which section
is incorporated herein by reference.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

13(a)1        Consolidated Financial Statements (contained in the Annual Report
              attached hereto as Exhibit (13) and incorporated herein by
              reference)

              (a)  Independent Auditors' Report

              (b)  Consolidated Statements of Condition as of December 31, 2000
                   and 1999

              (c)  Consolidated Statements of Income for the Years Ended
                   December 31, 2000, 1999 and 1998

              (d)  Consolidated Statements of Shareholders' Equity for the Years
                   Ended December 31, 2000, 1999 and 1998

              (e)  Consolidated Statements of Cash Flows for the Years Ended
                   December 31, 2000, 1999 and 1998

              (f)  Notes to Consolidated Financial Statements

13(a)2        Financial Consolidated Statement Schedules

              All schedules have been omitted as the required information is
              either inapplicable or included in the Notes to Consolidated
              Financial Statements.

13(a)3        Exhibits

              Exhibit (3)(i)   Articles of Incorporation of M&F Bancorp, Inc.,
                               incorporated by reference to Exhibit (3) to the
                               Form 10-QSB for the quarter ended

                                       13
<PAGE>

                               September 30, 1999 filed with the Securities and
                               Exchange Commission on November 12, 1999

              Exhibit (3)(ii)  Bylaws of M&F Bancorp, Inc., incorporated by
                               reference to Exhibit (3) to the Form 10-QSB for
                               the quarter ended September 30, 1999 filed with
                               the Securities and Exchange Commission on
                               November 12, 1999

              Exhibit (4)      Specimen Stock Certificate

              Exhibit (10)(a)  Employment Agreement between Mechanics and
                               Farmers Bank and Lee Johnson, Jr. incorporated
                               by reference to Exhibit 10 to the Form 10-QSB
                               for the quarter ended September 30, 2000 filed
                               with the Securities and Exchange Commission on
                               November 9, 2000

              Exhibit (10)(b)  Retention Bonus Agreement between Mechanics and
                               Farmers Bank and Fohliette Becote incorporated
                               by reference to Exhibit 10.03 to the Form 10-QSB
                               for the quarter ended September 30, 1999 filed
                               with the Securities and Exchange Commission on
                               November 12, 1999

              Exhibit (10)(c)  Retention Bonus Agreement between Mechanics and
                               Farmers Bank and Walter D. Harrington
                               incorporated by reference to Exhibit 10.03 to
                               the Form 10-QSB for the quarter ended September
                               30, 1999 filed with the Securities and Exchange
                               Commission on November 12, 1999

              Exhibit (10)(d)  Retention Bonus Agreement between Mechanics and
                               Farmers Bank and Harold G. Sellers incorporated
                               by reference to Exhibit 10.03 to the Form 10-QSB
                               for the quarter ended September 30, 1999 filed
                               with the Securities and Exchange Commission on
                               November, 1999

              Exhibit (10)(e)  Retention Bonus Agreement between Mechanics and
                               Farmers Bank and Elaine Small incorporated by
                               reference to Exhibit 10.03 to the Form 10-QSB
                               for the quarter ended September 30, 1999 filed
                               with the Securities and Exchange Commission on
                               November, 1999

              Exhibit (11)     Statement regarding Computation of Per Share
                               Earnings

              Exhibit (13)     M&F Bancorp, Inc. 2000 Annual Report to
                               Stockholders

              Exhibit (21)     Subsidiaries of M&F Bancorp, Inc.

              Exhibit (23)     Consent of Deloitte & Touche LLP

13(b)         The Company filed a report on Form 8-K on October 3, 2000,
              announcing the retirement of Julia W. Taylor as President and
              Chief Executive Officer of the Company on September 30, 2000 and
              the appointment of Lee Johnson, Jr. as President of the Company
              effective October 1, 2000.

                                       14
<PAGE>

                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                               M&F Bancorp, Inc.
                                               (Registrant)


                                               By:       /S/ LEE JOHNSON, JR.
                                                        ---------------------
                                                        Lee Johnson, Jr.
                                                        President

                                               Date:    MARCH 27, 2001
                                                        ------------------




         In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated:

  SIGNATURE                       TITLE                             DATE
  ---------                       -----                             ----

 /S/ LEE JOHNSON, JR.           President                      March 27, 2001
--------------------           (Principal Executive Officer)   --------------
Lee Johnson, Jr.

 /S/ FOHLIETTE BECOTE           Secretary and Treasurer        March 27, 2001
---------------------          (Principal Financial and        --------------
Fohliette Becote                Principal Accounting Officer)


 /S/ BENJAMIN S. RUFFIN         Director                       March 27, 2001
-----------------------                                        --------------
Benjamin S. Ruffin

 /S/ JOSEPH M. SANSOM           Director                       March 27, 2001
----------------------                                         --------------
Joseph M. Sansom

 /S/ AARON L. SPAULDING         Director                       March 27, 2001
-----------------------                                        --------------
Aaron L. Spaulding

 /S/ GENEVIA G. FULLBRIGHT      Director                       March 27, 2001
--------------------------                                     --------------
Genevia G. Fullbright

 /S/ MACEO K. SLOAN             Director                       March 27, 2001
-------------------------                                      --------------
Maceo K. Sloan

 /S/ JULIA W. TAYLOR            Director                       March 27, 2001
-------------------------                                      --------------
Julia W. Taylor

                                       15
<PAGE>

                           INDEX TO EXHIBITS



EXHIBIT NO.                    DESCRIPTION
-----------                    -----------

Exhibit (4)           Specimen Stock Certificate

Exhibit (11)          Statement Regarding Computation of Per Share Earnings

Exhibit (13)          M&F Bancorp, Inc. 2000 Annual Report to Stockholders

Exhibit (21)          Subsidiaries of M&F Bancorp, Inc.

Exhibit (23)          Consent of Deloitte & Touche LLP
                                       16