#United States #Scottsdale #Banking Trends #Cornerstone Advisors #Commercial Lending

Insights on the Future of Commercial Lending in 2026

Cornerstone Advisors, a prominent consulting firm specializing in business and technology services for banks and fintech companies, has recently published its 2026 commercial lending outlook. This report titled What's Going On in Commercial Lending 2026 provides critical insights into upcoming trends, challenges, and opportunities in the lending landscape. Many are expressing cautious optimism looking ahead, expecting modest growth in commercial loans, but with a notable increase in competition, especially from non-bank lenders and private credit providers.

Key Takeaways from the Report

1. Focus on Commercial Real Estate (CRE) and Commercial Investments (CI)
The report indicates a shift in priorities, with a growing number of financial institutions placing increased emphasis on commercial real estate and commercial investment portfolios. This change signals a recognition by lenders of the burgeoning opportunities in these segments.

2. The AI Debate: Expectation vs. Reality
While nearly 60% of bankers envision that artificial intelligence will significantly improve underwriting and lending processes, actual implementation across institutions is still quite limited. This gap highlights the challenges faced by traditional banks in fully harnessing the power of AI technology.

3. Customer Relationship Management (CRM) Shortcomings
Despite the considerable funds being allocated to CRM systems, it’s alarming to note that over 70% of banks report minimal to no enhancements in loan production. This statistic raises concerns regarding the effective utilization of technology in streamlining lending operations.

4. Rising Competitive Pressure from Private Credit Firms
Although current reports indicate that only 4% of lenders feel strong competitive pressure, more than half recognize a growing threat from private credit providers. This trend is particularly prevalent in areas catering to underserved or complex borrower segments, such as small businesses and startups.

Joel Pruis, a senior director at Cornerstone Advisors, remarked on the evolving commercial lending landscape, emphasizing that banks still possess inherent strengths. However, the true test for their success lies in leveraging technology effectively, reimagining their operational models, and enhancing their abilities to deliver swift and flexible financial solutions.

Andy Ivanovich, chairman and CEO of Baker Hill, pointed out that the industry has reached an inflection point. He emphasized that the barriers to growth are not rooted in demand but rather in execution. The institutions that successfully capture pertinent data, streamline their workflows, and modernize their lending platforms will not only accelerate their processes but will also gain a competitive edge, especially in tackling more complex lending scenarios. Those who fail to adapt will increasingly lag as competition intensifies and market expectations rise.

Research Methodology

This report's findings stem from an extensive survey involving over 400 banking and credit union executives across the United States, with institutions holding assets ranging between $250 million to $50 billion. The breadth of this research provides a genuine representation of the current sentiments and anticipations within the commercial lending sector.

Upcoming Presentation

For those interested in these findings, Joel Pruis and Sam Kilmer from Cornerstone will be presenting the outcomes of the What's Going On in Commercial Lending study at the Baker Hill's RISE conference scheduled for May 3-5 in San Antonio, Texas. This event presents an excellent opportunity to delve deeper into the discussions surrounding commercial lending trends.

About Cornerstone Advisors

Having served the banking sector for over 20 years, Cornerstone Advisors is dedicated to providing insightful data, robust strategies, and innovative solutions that aid banks, credit unions, and fintechs in thriving amidst market complexities. Their services span from technology system selection and implementation to strategic planning and mergers and acquisitions.

About Baker Hill

Baker Hill stands as a leading provider of lending technology for U.S. banks and credit unions. Their platform seamlessly facilitates the processing of more than $7 billion in lending originations each month, aimed at empowering institutions to Lend Better, Lend Faster, and Lend More™, meeting modern banking demands.

In conclusion, the outlook for commercial lending in 2026 paints a picture of both opportunities for growth and the necessity of transformation within financial institutions. As the market continues to evolve, those who adapt swiftly and effectively will undoubtedly thrive.