OakNorth, the UK-based digital commercial bank, has announced its agreement to acquire Community Unity Bank (CUB), an FDIC-insured institution headquartered in Birmingham, Michigan. The stock-for-stock transaction marks a significant step in OakNorth’s expansion strategy across the United States.
This acquisition follows the regulatory authorisations OakNorth received in August 2024 from both the Federal Reserve and the New York State Department of Financial Services. Through this deal, OakNorth will gain a foothold in Michigan and extend its business lending capabilities across the US market.
Founded in 2015, OakNorth has built a reputation for serving the lower mid-market segment—businesses with revenues between $1 million and $100 million—providing them with fast, flexible debt financing and personalised banking solutions. Leveraging data and advanced analytics, OakNorth applies lending strategies typically reserved for larger institutions to this underserved segment. To date, the bank has lent $16 billion to businesses across multiple sectors and is recognised among the top 1% of commercial banks globally for its return on assets (ROA) and efficiency ratio.
Since entering the US market in mid-2023, OakNorth has deployed over $700 million in loans to businesses, including existing UK clients with operations in the US, such as F1 Arcade, Ultimate Performance, Croud, and The Boundary.
Commenting on the acquisition, Rishi Khosla, CEO and Co-founder of OakNorth, stated:
“Following the collapse of several US banks in 2023 that focused on serving the lower mid-market, we identified an opportunity to step in and fill the funding gap. Over the past 18 months, we’ve provided several hundred million dollars in capital to support US businesses in achieving their growth ambitions. Demand from US borrowers remains exceptionally strong, and our differentiated approach has enabled us to significantly exceed our initial lending targets.”
Khosla added: “As a founder-led institution built by entrepreneurs, CUB shares OakNorth’s customer-centric values and strong company culture. We are excited to partner with a team that has established deep roots in its local community and is committed to delivering exceptional customer experiences.”
Community Unity Bank, launched in 2023, serves businesses and individuals throughout Southeast Michigan, offering a comprehensive suite of banking services. The bank was founded by a group of entrepreneurs from Oakland County and is staffed by a team of seasoned bankers with extensive local market expertise.
Greg Wernette, CEO of CUB, commented:
“CUB was established to meet the growing need for small business banking in our community. As entrepreneurs ourselves, we understand the critical importance of access to capital. We are thrilled to join forces with OakNorth, whose mission and approach align closely with ours. Together, we look forward to supporting an even greater number of businesses across the US.”
The acquisition of CUB marks OakNorth’s latest milestone in its US expansion journey and underscores its commitment to supporting lower mid-market businesses with innovative lending solutions.
