Digital bank OakNorth has acquired a bank in Michigan which it says will drive its growth across the United States.
The London firm, which serves lower mid-market entrepreneurs and real estate firms with credit facilities, has agreed a stock-for-stock transaction for Community Unity Bank.
OakNorth, which saw profits of £215m in 2024 and surpassed £12.5bn in total lending, says the acquisition is subject to regulatory approval.
It follows authorisation which OakNorth received in August 2024 from the Federal Reserve and the New York State Department of Financial Services for a Representative Office in New York.
“In the summer of 2023 following the collapse of several US banks which had been focused on serving the lower mid-market, we saw an opportunity to step up and do our part in helping to fill the funding gap they were experiencing,” said Rishi Khosla, CEO and co-founder.
“Over the last 18 months, we’ve supported businesses with their growth ambitions, providing several hundred million dollars of capital. Demand from US borrowers continues to be exceptionally strong and our differentiated offering and unique approach to lending has enabled us to rapidly establish a strong presence in the US market, resulting in us lending c.3x our initial expectations.
“As a founder-led business built by entrepreneurs, CUB appealed to us as it shares a lot of our same values with regards to customer experience. These values are reflected in its customer feedback, as well as its strong company culture.”
Greg Wernette, CEO of CUB, added: “Our board, along with Founder Andy Meisner, had a vision of filling a void in the small business community and serving our customers with a personal touch and outstanding products and services.
“CUB was formed by bringing together entrepreneurs from around Oakland County with diverse backgrounds to meet a growing need for small business banking. As business owners and executives, we know that access to capital means everything, and CUB was started to meet that need, assembling a team experienced at lending during both up cycles and down cycles.
“With an entrepreneurial focus at our core, and every team member striving for customer delight, we are very excited to be joining forces with OakNorth to support an even greater number of US businesses together.”
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