InterBay Commercial has exchanged contracts with OneSavings Bank, which has conditionally agreed to acquire all the issued share capital of the specialist lender.
In May, the bank, which is part-owned by JC Flowers, revealed that it was in talks to buy the lender.
As part of the deal, the lender will continue to trade as InterBay Commercial and Colin Bell will continue in his role as chief executive officer.
InterBay Commercial has spent the past three years servicing its pool of commercial mortgages and retained a number of its lending staff to ensure it could return to lending once a suitable funder was found.
Bell says the partnership will allow it to return to lending in the small and medium business arena through brokers.
He adds: “The business will continue to focus on building on partnerships with packagers and widen our product offering into new market areas.”
Andy Golding, chief executive of OneSavings Bank, says: “We are committed to the UK market and look forward to announcing exciting products in the near future.