OakNorth deepens support for US lower mid-market businesses with acquisition of Michigan-based, Community Unity Bank
We’re delighted to share some more exciting news from our partners, OakNorth.
Since it began operating in the US in July 2023, OakNorth has lent over $700m to the lower mid-market.
OakNorth, the leading commercial digital bank for entrepreneurs by entrepreneurs, today announces that it has agreed to purchase Community Unity Bank (CUB), the home-grown, FDIC-insured community bank based in Birmingham, Michigan, in a stock for stock transaction. The acquisition, which is subject to regulatory approval, follows authorization 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. It will enable OakNorth, through CUB, to expand its business lending throughout the United States, as well as in Michigan.
Launched in September 2015, OakNorth is the market leader when it comes to supporting the lower mid-market (businesses with $1M-100M revenue), providing fast, flexible debt finance and personalized banking services. It leverages data and analytics to apply larger company lending approaches to this market segment, with its granular, forward-looking approach enabling it to develop an in-depth understanding of different industries and businesses.
To date, OakNorth has provided c.$16bn to businesses across a wide range of sectors, achieving performance metrics that place it amongst the top 1% of commercial banks globally in terms of return on assets (ROA) and efficiency ratio. Its loans have directly contributed to the creation of 56,000 new jobs, and 34,000 new homes in the UK and US – the majority of which are affordable and social housing. OakNorth began operating in the US in mid-2023 and has since lent over $700m to businesses there, including to several of its existing customers with US and UK operations, such as F1 Arcade, Ultimate Performance, Croud, and The Boundary.
Launched in 2023, CUB is an Oakland County, Michigan Community Bank that provides a full-service suite of banking products to businesses and individuals, primarily in Southeast Michigan. The bank has brought together a high-quality team of bankers with decades of experience in the local community. This team has been establishing relationships with a broad range of local businesses with funding for business expansions, and depository services. CUB’s team will provide a solid foundation for OakNorth’s continued expansion across the US, with Greg Wernette, CUB’s CEO, to serve as CEO of OakNorth’s US Bank.
Rishi Khosla, CEO and Co-founder of OakNorth, commented: “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. 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.”
About OakNorth:
Launched in September 2015 and founded by entrepreneurs, OakNorth is a digital bank focused on serving and empowering the lower mid-market (businesses with £$1m-$100m in turnover), that are seeking to scale but are routinely underserved or overlooked by traditional banks.
To date, it has provided c.$16bn to these businesses across a wide range of sectors, achieving performance metrics that place it amongst the top 1% of commercial banks globally. Its loans have directly contributed to the creation of 56,000 jobs, and over 34,000 new homes across the UK and the US – the majority of which are affordable and social housing.
It is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Visit www.oaknorth.co.uk for more information.
About Community Unity Bank:
Launched in 2022, Community Unity Bank is a home-grown, FDIC-insured community bank in Oakland County, Michigan. The bank offers a full suite of banking products and services and was formed by bringing together entrepreneurs from around Oakland County with diverse backgrounds to meet a growing need for small business lending. As business owners and executives, it knows that access to capital means everything, and CUB was started to meet that need, lending during up cycles and down cycles.
Visit https://www.communityunity.bank/ for more information.
Media contact:
OakNorth press office – press@oaknorth.com
