In 1979, a community-based organization, the La Mansaamo Kpee {LMK}, La Town Development Association, was established by the youth in the town to mobilise community resources for community development. One of the projects of LMK was a Community Bank.

In 1984 the Association made a formal application to the African Development Foundation {ADF} in the United States to assist in the establishment of the Bank. ADF considered and approved the request in 1985 and an amount of US$164,561 was granted by ADF to LMK to cover cost of Renovation, Furniture, Stationery and Equipment etc. and a Revolving Fund of US$83,103.

Bank of Ghana License was obtained and on 3rd November 1987 the bank was opened to the public with the help of individuals such as late Mr. Justice Nii Amaa Ollennu, patron of LMK and Mr. P. V. Obeng, a member of the government at the time. Prior to the opening, the people of La had been invited to subscribe to the shares of the Bank. The response was overwhelming.