What Are the Benefits of a Mutual Bank?

Do all banks seem the same? If so, you might want to take a closer look. After all, there are more than 10,000 banks in the U.S., and each one offers its own unique set of services, branch locations, account fees, interest rates, and more. Banks can be categorized into several types, each with distinct functions and target audiences.

A mutual bank is a financial institution owned by its account holders. This structure means the bank prioritizes its members' needs and interests, reinvesting profits to benefit them directly through competitive interest rates, lower fees, and community-focused initiatives. Essentially, it's a cooperative banking model where customers share in the success of the institution. 

Mutual banks are known for accessible mortgages and a community focus. Yahoo! Finance explains:

What makes mutual banks different?

Mutual savings banks, or mutual banks, offer all the same accounts you can get at other banks, but they have some fundamental differences. These institutions are owned by customers instead of shareholders, and their main focus is on giving you access to savings accounts and mortgages.

 Mutual banks, which represent less than 10% of all banks in the U.S., tend to be small. While they may lack some of the conveniences you get with large banks, such as technology-driven services and vast ATM networks, there are some compelling reasons to switch banks and join a mutual institution:

• Competitive rates on deposit accounts and loans
• No or low banking fees
• Policies and programs that make mortgages more accessible
• Investment in their local communities
• More fiscally conservative and less likely to fail than large banks 

History of mutual banks in the U.S.

Mutual banks were first established in the U.S. in 1816... Their initial purpose was to give customers a place to deposit money and earn interest, and early on, deposits as small as a dime were accepted. Some mutual banks were similar to social clubs or lending circles, with members chipping in to help one another purchase homes.

Mutual banks have maintained a focus on mortgages as they've evolved, and nearly all of them are now community banks that specialize in mortgage lending. Today, there are over 400 of these banks in the U.S...

You can read the full article here.

As the only Florida-based community mutual bank, First Federal Bank is uniquely positioned for the future. Our organization’s structure provides an adaptability and independence that enables us to be responsive to the needs of the customers and communities we serve. With our steady, forward-thinking leadership we are able to expertly and thoughtfully develop state-of-the-art solutions as the economic landscape continues to evolve. Our focus on providing exceptional service and value will never change! 

First Federal is honored to have been named Newsweek's Best Small Bank in Florida for three years and, most recently, the Best Regional Bank. We have established ourselves as a community and economic partner, investing our time and energy into the markets we serve with charitable giving and volunteering efforts. Read more about our history here, and learn what benefits we can offer you!