Citadel Says Credit Unions Can Compete for Bigger Business Relationships

Small business banking is undergoing a significant shift as entrepreneurs seek financial partners that combine sophisticated digital treasury tools with personalized, local decision-making. Credit unions are increasingly challenging the dominance of large national banks by investing in commercial capabilities such as fraud protection, cash management, and AI-assisted credit processes. This evolution allows smaller institutions to offer the high-tech services required by modern businesses while maintaining the relationship-driven model that many national banks have transitioned to digital-only channels.

Thomas Sebok, Chief Commercial Banking Officer at Citadel Credit Union, highlights a fundamental change in the commercial banking landscape where businesses are moving beyond simple price-based decisions to seek comprehensive financial partnerships. While large national institutions have historically dominated the commercial sector, their scale often forces small business clients into virtual or digital-only channels, eroding the personal relationships entrepreneurs value. Sebok, who spent over two decades at larger banks, notes that credit unions are actively working to dismantle the stereotype of being limited to small personal accounts by offering embedded services for professional firms, restaurateurs, and local franchisees.

Modern commercial banking now requires a suite of sophisticated digital tools that were once the exclusive domain of major banks. Citadel and similar institutions are integrating payroll services, ACH capabilities, wire origination, and remote deposit capture into their core offerings to meet the operational needs of businesses. Furthermore, the industry is facing a paralyzing volume of fraud in both electronic and check formats, making integrated fraud protection and treasury management essential components of the commercial relationship. To address these needs, Citadel is utilizing technology including AI-assisted credit processes and predictive analytics to provide 24/7 digital access without sacrificing the community-focused relationship model.

The success of this relationship-focused strategy is reflected in Citadel’s financial performance, with the institution reporting $449 million in commercial loans, representing a 17% increase year over year. The credit union’s approach focuses on banking the whole relationship rather than treating lending as an isolated product, allowing for more flexible evaluations of how a company operates instead of relying on rigid lending templates. This strategy positions credit unions as viable competitors for larger business relationships, providing a blend of modern financial technology and informed, local expertise that is becoming increasingly critical in an environment of elevated interest rates and liquidity pressures.