Chief disruption officer: started from scratch and now backed by giant banks and foundations, Martin Eakes' Self-Help empire goes national.

• Author: Kelley, Pam
• Position: NC BANKING

At the Feb. 8 board meeting of the Center for Community Self-Help in Durham, Chief Executive Officer Martin Eakes described an offer seemingly easy to refuse. The center's credit union had an opportunity to acquire part of a failed bank--about $200 million in deposits, plus eight branches serving Chicago's South Side.

With directors gathered around folding tables in the office lobby that doubles as Self-Help's boardroom, Eakes explained that they'd be assuming the costs of running the offices while not receiving any profit-generating loans. But the acquisition involved a greater good: preserving some of the few remaining bank branches in several low-income neighborhoods. The board unanimously approved the purchase. On May 1, Self-Help Federal Credit Union began operating Chicago's Seaway Bank &. Trust, once the largest black-owned bank in the Midwest.

The deal is the latest example of Self-Help's strategy of making investments spurned by traditional banks and lending to individuals, many of them people of color, who often get pegged as bad credit risks. Since its 1980 start, Self-Help has built a national reputation for working with low- and moderate-income borrowers, investing in communities and, more recently, leading research and lobbying efforts to fight predatory lending. With the Seaway acquisition, its assets stand at about $2.3 billion, including a venture unit that makes higher-risk business loans. Overall, Self-Help is among the dozen largest U.S. community-development credit unions, institutions that focus on customers of limited means.

Last year, Eakes was listed among 25 "disruptive leaders" working to improve the lives of low-income people in America's cities. Also cited by Living Cities, a nonprofit created by various foundations and financial institutions, was Mark Zuckerberg. Unlike the Facebook CEO, the 62-year-old Greensboro native is hardly a household name.

"He's never been one to put himself out front," says Greensboro writer Howard Covington Jr., whose book on Self-Help's history will be published by Duke University Press this fall. "People don't know how important he is."

The Seaway acquisition is the latest move extending Self-Help's brand beyond North Carolina. "I tell this joke about myself," Eakes says, "that when we were in our early planning in North Carolina, I had two rules. One rule was that we would never have a teller, which meant we're going to be focused on doing the one thing we know how to do, which is to make business loans and home loans to people who need it. The second thing I said is we're not going to have a staff person outside the state of North Carolina."

Today, more than half of Self-Help's 660 employees work in California, Florida, Illinois and Washington, D.C., while a third are customer-service representatives--including tellers--in its 52 branches. Two-thirds of its members are minorities, while a third live in rural areas.

Self-Help is headquartered on West Main Street in downtown Durham in an eight-story building purchased in the mid-1990s. Initially leasing half the building to others, it now occupies the entire space. Eakes meets me in his office, a modest space with metal filing cabinets and fluorescent ceiling lights. His bookshelf holds a selection of works exploring race and poverty, and "The Art of War," the ancient Chinese military treatise with timeless advice for leaders. For Eakes, doing battle means fighting for good against "forces that want you to keep the status quo."

The man has a no-frills style. He's trim, with wire-rimmed glasses and white hair that was once red. On a recent afternoon, he wears all black--shirt, pants and jacket, but no tie--and sandals with socks. When The Wall Street Journal profiled Eakes in 2005, it photographed him with his car, a 1992 Chevrolet Corsica with a cracked windshield. He now drives a Chevrolet Impala, a company car that had 180,000 miles when he inherited it. His pay is $84,000 a year, which is Self-Help's...