Core Bank Taps AI to Supercharge Compliance and Fintech Growth

OMAHA, NE – January 07, 2026 – Core Bank, a community-focused financial institution, has announced a landmark partnership with Kobalt Labs, a leader in AI-driven compliance technology. The move signals a strategic pivot to automate and strengthen risk management, aiming to accelerate the bank's expansion into the high-growth sectors of Banking as a Service (BaaS) and embedded finance. This collaboration equips the Omaha-based institution with an advanced AI platform designed to navigate increasing regulatory complexities while fostering innovation.

Navigating a New Regulatory Landscape

The partnership arrives at a critical juncture for the banking industry, which is grappling with the dual pressures of digital transformation and intensifying regulatory oversight. Financial regulators, including the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the Federal Reserve, have made it clear that banks are ultimately responsible for all activities conducted through third-party relationships. The era of treating fintechs as simple vendors is over; regulators now demand a level of diligence, monitoring, and governance equivalent to a bank’s own internal operations. This heightened focus on Third-Party Risk Management (TPRM) presents a formidable challenge, especially for community and regional banks looking to innovate in the Banking as a Service (BaaS) space.

Traditional, manual due diligence processes—often involving weeks or even months of reviewing paperwork, cross-referencing spreadsheets, and engaging in protracted back-and-forth communication—are proving too slow, costly, and prone to human error. These legacy methods are ill-equipped to keep pace with the rapid product cycles of fintech partners and the sheer volume of data that must be assessed, creating a significant bottleneck that can stifle growth and introduce unacceptable risk. The need for scalable, consistent, and highly efficient compliance operations has therefore become paramount, pushing institutions toward technology that can manage risk without impeding progress.

The 'Building Better' Strategy in Action

For Core Bank, this technological leap is a direct and calculated execution of its "Building Better" corporate vision. The institution, which reports total assets exceeding $1 billion, has been methodically cultivating its role in the digital ecosystem. Its membership in the influential BaaS Association and the establishment of a dedicated "Partner Banking" division signal a deep commitment to this sector. Through this program, Core Bank already provides fintechs with the essential infrastructure they need, including flexible APIs, digital deposit accounts, and comprehensive payment solutions from ACH to Real-Time Payments. However, the bank recognized that scaling these programs responsibly required a compliance framework as agile as the technology it supports.

The partnership with Kobalt Labs is designed to provide just that, creating a fortified operational backbone. "Core Bank's vision is to be high-performing, tech-forward, and solutions-based," said Core Bank Chief Risk Officer Suzanne Mendlik in the announcement. "Partnering with Kobalt Labs strengthens that vision. This partnership will accelerate onboarding and enhance oversight of fintech and embedded banking relationships, maintain earned customer and regulator trust, and supports Core Bank's long-term strategy." By framing effective risk management as a catalyst for growth, the bank is positioning itself to capture a larger share of the burgeoning embedded finance market, which is projected to become a multi-trillion-dollar industry.

From Days to Minutes: The Technology Powering the Shift

At the heart of this strategic transformation is Kobalt Labs' AI-native platform, a technology that represents a generational leap from traditional compliance software. The system moves beyond simple workflow automation to provide what the company describes as an "agentic" platform, capable of performing complex analytical tasks with minimal human intervention. When a potential fintech partner submits its documentation, Kobalt’s AI ingests and analyzes the materials—from security policies and financial statements to compliance certificates. It automatically extracts critical evidence, identifies missing information, and cross-references the partner's posture against an always-synced database of evolving state and federal regulations.

The impact on operational efficiency is profound. During an internal evaluation against other products and manual reviews, Core Bank found that Kobalt's platform reduced the turnaround time for partner risk assessments from several days to mere minutes. This wasn't just a matter of speed; the system also enhanced the accuracy and consistency of reviews, removing the subjectivity that can plague manual processes. This combination of speed, quality, and industry credibility made Kobalt the clear choice, giving Core Bank's risk management teams the confidence to make faster, better-informed decisions in a market where timing is everything.

A Blueprint for Growth in a Digital-First World

Core Bank's proactive adoption of AI for compliance is more than an internal upgrade; it serves as a potential blueprint for other regional and community banks striving to compete in the digital age. By leveraging specialized technology, these institutions can overcome the resource constraints that often prevent them from safely participating in the lucrative BaaS and embedded finance markets. This move also directly addresses the most significant pain points for the fintech community. Fintech founders and executives consistently cite slow, opaque, and inconsistent bank due diligence processes as a primary obstacle to innovation and market entry. A bank partner that can offer a streamlined, transparent, and rapid onboarding experience becomes immensely more attractive, fostering a symbiotic relationship where both parties can thrive.

By creating a more efficient and predictable compliance environment, Core Bank is positioning itself as a preferred partner for innovators, signaling to the market that it is open for business and equipped to handle the complexities of modern finance. This strategic alignment underscores a fundamental shift in banking philosophy: viewing robust, technology-driven risk management not as a restrictive cost center, but as a critical catalyst for sustainable and responsible growth in an increasingly interconnected financial ecosystem.