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BankUnited, Inc. Reports First Quarter 2021 Results


Business Wire | Apr 22, 2021 06:45AM EDT

BankUnited, Inc. Reports First Quarter 2021 Results

Apr. 22, 2021

MIAMI LAKES, Fla.--(BUSINESS WIRE)--Apr. 22, 2021--BankUnited, Inc. (the "Company") (NYSE: BKU) today announced financial results for the quarter ended March 31, 2021.

"This quarter, non-interest DDA grew by almost $1 billion, our net interest margin expanded, and we released some of the reserves we put up last year. This quarter also marks the culmination of our 2 year cloud journey, and the release of our new mobile banking platform." said Rajinder Singh, Chairman, President and Chief Executive Officer.

For the quarter ended March 31, 2021, the Company reported net income of $98.8 million, or $1.06 per diluted share, compared to a net loss of $(31.0) million, or $(0.33) per diluted share, for the quarter ended March 31, 2020. On an annualized basis, earnings for the quarter ended March 31, 2021 generated a return on average stockholders' equity of 13.2% and a return on average assets of 1.14%.

Financial Highlights

* Net interest income increased by $2.9 million compared to the immediately preceding quarter ended December 31, 2020 and by $15.7 million compared to the quarter ended March 31, 2020. The net interest margin, calculated on a tax-equivalent basis, improved to 2.39% for the quarter ended March 31, 2021 from 2.33% for the immediately preceding quarter and 2.35% for the quarter ended March 31, 2020. * The average cost of total deposits continued to decline, dropping by 0.10% to 0.33% for the quarter ended March 31, 2021 from 0.43% for the immediately preceding quarter ended December 31, 2020, and 1.36% for the quarter ended March 31, 2020. On a spot basis, the average annual percentage yield ("APY") on total deposits declined to 0.27% at March 31, 2021 from 0.36% at December 31, 2020 and 1.35% at March 31, 2020. * For the quarter ended March 31, 2021, the Company recorded a recovery of the provision for credit losses of $(28.0) million compared to a recovery of $(1.6) million for the immediately preceding quarter ended December 31, 2020 and a provision for credit losses of $125.4 million for the quarter ended March 31, 2020. The most significant factor leading to the recovery of credit losses for the quarter ended March 31, 2021 was an improving economic forecast. In contrast, the provision for credit losses for the quarter ended March 31, 2020 was driven primarily by a deteriorating economic forecast resulting from the onset of the COVID-19 pandemic. * Pre-tax, pre-provision net revenue ("PPNR") was $103.3 million for the quarter ended March 31, 2021 compared to $105.3 million for the immediately preceding quarter ended December 31, 2020 and $85.0 million for the quarter ended March 31, 2020. * Non-interest bearing demand deposits grew by $957 million during the quarter ended March 31, 2021. Total deposits grew by $236 million as higher cost time deposits continued to runoff, declining by $1.0 billion for the quarter ended March 31, 2021. Average non-interest bearing demand deposits grew by $338 million for the quarter ended March 31, 2021 compared to the immediately preceding quarter ended December 31, 2020 and by $3.1 billion compared to the quarter ended March 31, 2020. At March 31, 2021, non-interest bearing demand deposits represented 29% of total deposits, compared to 25% of total deposits at December 31, 2020. * Total loans and operating lease equipment declined by $487 million for the quarter ended March 31, 2020. * Loans on deferral totaled $126 million or less than 1% of total loans at March 31, 2021. Loans modified under the CARES Act totaled $636 million at March 31, 2021. In the aggregate, this represents $762 million or 3% of the total loan portfolio at March 31, 2021. * Non-performing assets totaled $236 million or 0.67% of total assets at March 31, 2020, a decline from $248 million or 0.71% of total assets at December 31, 2020. * Book value per common share and tangible book value per common share at March 31, 2021 increased to $32.83 and $32.00, respectively, from $32.05 and $31.22, respectively at December 31, 2020 and pre-pandemic levels of $31.33 and $30.52, respectively at December 31, 2019. * As previously reported, on January 20, 2021, the Company's Board of Directors reinstated the share repurchase program that the Company suspended in March 2020. During the quarter ended March 31, 2021, the Company repurchased approximately 0.2 million shares of its common stock for an aggregate purchase price of $7.3 million, at a weighted average price of $35.42 per share.

Loans and Leases

A comparison of loan and lease portfolio composition at the dates indicated follows (dollars in thousands):

March 31, 2021 December 31, 2020

Residential and other $ 6,582,447 28.1 % $ 6,348,222 26.6 %consumer loans

Multi-family 1,507,462 6.5 % 1,639,201 6.9 %

Non-owner occupied 4,871,110 20.9 % 4,963,273 20.8 %commercial real estate

Construction and land 287,821 1.2 % 293,307 1.2 %

Owner occupied commercial 1,932,153 8.3 % 2,000,770 8.4 %real estate

Commercial and industrial 4,048,473 17.3 % 4,447,383 18.6 %

PPP 911,951 3.9 % 781,811 3.3 %

Pinnacle 1,088,685 4.7 % 1,107,386 4.6 %

Bridge - franchise finance 524,617 2.2 % 549,733 2.3 %

Bridge - equipment finance 460,391 2.0 % 475,548 2.0 %

Mortgage warehouse lending 1,145,957 4.9 % 1,259,408 5.3 %("MWL")

$ 23,361,067 100.0 % $ 23,866,042 100.0 %

Operating lease equipment, $ 681,003 $ 663,517 net

Growth in residential and other consumer loans for the quarter was attributable to GNMA early buyout loans. At March 31, 2021 and December 31, 2020, the residential portfolio included $1.7 billion and $1.4 billion, respectively, of GNMA early buyout loans. Residential activity for the quarter included purchases of approximately $578 million in GNMA early buyout loans, offset by approximately $237 million in re-poolings and paydowns. Residential and other consumer loans, excluding GNMA early buyout loans, declined by approximately $107 million.

In the aggregate, commercial loans declined by $739 million for the quarter ended March 31, 2021 as the environment remained challenging for new production, line utilization was below historical levels and accelerated prepayment activity continued. MWL line utilization declined seasonally to 55% at March 31, 2021 compared to 62% at December 31, 2020.

We originated $265 million of PPP loans under the Second Draw Program during the quarter ended March 31, 2021. Loans originated under the First Draw Program totaling $138 million were fully or partially forgiven during the quarter.

Asset Quality and the Allowance for Credit Losses

The following table presents information about non-performing loans, loans on deferral and CARES Act modifications at March 31, 2021 (dollars in thousands):

Currently Non-Performing Under CARES Act Loans Short-Term Modification

Deferral

Residential and other consumer^ $ 26,140 $ 90,811 $ 15,432 (1)

Commercial:

CRE by Property Type:

Retail 21,932 18,108 18,507

Hotel 34,003 - 343,354

Office 5,263 13,163 43,379

Multi-family 15,288 - 24,014

Other 4,788 - -

Owner occupied commercial real 23,451 3,667 11,532 estate

Commercial and industrial 66,491 - 141,741

Bridge - franchise finance 36,276 - 38,182

Total commercial 207,492 34,938 620,709

Total $ 233,632 $ 125,749 $ 636,141

______________(1)

Excludes government insured residential loans.

In the table above, "currently under short-term deferral" refers to loans subject to either a first or second 90-day payment deferral at March 31, 2021 and "CARES Act modification" refers to loans subject to longer-term modifications that, were it not for the provisions of the CARES Act, would likely have been reported as TDRs. Non-performing loans may include some loans that have been modified under the CARES Act.

Non-performing loans declined to $233.6 million or 1.00% of total loans at March 31, 2021, from $244.5 million or 1.02% of total loans at December 31, 2020. Non-performing loans included $48.2 million and $51.3 million of the guaranteed portion of SBA loans on non-accrual status, representing 0.21% and 0.22% of total loans at March 31, 2021 and December 31, 2020, respectively.

The following table presents criticized and classified commercial loans at the dates indicated (in thousands):

______________(1) Excludes government insured residential loans.

In the table above, "currently under short-term deferral" refers to loans subject to either a first or second 90-day payment deferral at March 31, 2021 and "CARES Act modification" refers to loans subject to longer-term modifications that, were it not for the provisions of the CARES Act, would likely have been reported as TDRs. Non-performing loans may include some loans that have been modified under the CARES Act.

Non-performing loans declined to $233.6 million or 1.00% of total loans at March 31, 2021, from $244.5 million or 1.02% of total loans at December 31, 2020. Non-performing loans included $48.2 million and $51.3 million of the guaranteed portion of SBA loans on non-accrual status, representing 0.21% and 0.22% of total loans at March 31, 2021 and December 31, 2020, respectively.

The following table presents criticized and classified commercial loans at the dates indicated (in thousands):

March 31, 2021 December 31, 2020

Special mention $ 420,331 $ 711,516

Substandard - accruing 1,983,191 1,758,654

Substandard - non-accruing 189,589 203,758

Doubtful 17,903 11,867

Total $ 2,611,014 $ 2,685,795

The following table presents the ACL at the dates indicated, related ACL coverage ratios and net charge-off rates for the quarter and year ended March 31, 2021 and December 31, 2020, respectively (dollars in thousands):

ACL to Net ACL to Charge-offs ACL Non-Performing Total Loans ^ to Average (1) Loans Loans^ (2)

December 31, $ 257,323 1.08 % 105.26 % 0.26 %2020

March 31, 2021 $ 220,934 0.95 % 94.56 % 0.17 %

______________(1)

ACL to total loans, excluding government insured residential loans, PPP loans and MWL, which carry nominal or no reserves, was 1.13% and 1.26% at March 31, 2021 and December 31, 2020, respectively.

(2)

Annualized for the three months ended March 31, 2021.

The ACL at March 31, 2021 represents management's estimate of lifetime expected credit losses from the loan portfolio given our assessment of historical data, current conditions and a reasonable and supportable economic forecast as of the balance sheet date. The estimate was informed by Moody's economic scenarios published in March 2021, economic information provided by additional sources, data reflecting the impact of recent events on individual borrowers and other relevant information. The decline in the ACL and in ACL coverage ratios from December 31, 2020 to March 31, 2021 related primarily to the recovery of credit losses recorded during the quarter. The decline in the ACL was primarily related to the pass rated portion of the portfolio.

For the quarter ended March 31, 2021, the Company recorded a recovery of credit losses of $(28.0) million, which included a recovery of $(26.3) million related to funded loans as well as immaterial amounts related to unfunded loan commitments, accrued interest receivable and an AFS debt security. The recovery of provision for credit losses was largely driven by improvements in forecasted economic conditions.

The following table summarizes the activity in the ACL for the periods indicated (in thousands):

______________ ACL to total loans, excluding government insured residential loans, PPP(1) loans and MWL, which carry nominal or no reserves, was 1.13% and 1.26% at March 31, 2021 and December 31, 2020, respectively.

(2) Annualized for the three months ended March 31, 2021.

The ACL at March 31, 2021 represents management's estimate of lifetime expected credit losses from the loan portfolio given our assessment of historical data, current conditions and a reasonable and supportable economic forecast as of the balance sheet date. The estimate was informed by Moody's economic scenarios published in March 2021, economic information provided by additional sources, data reflecting the impact of recent events on individual borrowers and other relevant information. The decline in the ACL and in ACL coverage ratios from December 31, 2020 to March 31, 2021 related primarily to the recovery of credit losses recorded during the quarter. The decline in the ACL was primarily related to the pass rated portion of the portfolio.

For the quarter ended March 31, 2021, the Company recorded a recovery of credit losses of $(28.0) million, which included a recovery of $(26.3) million related to funded loans as well as immaterial amounts related to unfunded loan commitments, accrued interest receivable and an AFS debt security. The recovery of provision for credit losses was largely driven by improvements in forecasted economic conditions.

The following table summarizes the activity in the ACL for the periods indicated (in thousands):

Three Months Ended March 31,

2021 2020

Beginning balance $ 257,323 $ 108,671

Cumulative effect of adoption of CECL - 27,305

Balance after adoption of CECL 257,323 135,976

Provision (recovery) (26,306 ) 121,865

Net charge-offs (10,083 ) (7,262 )

Ending balance $ 220,934 $ 250,579

Net interest income

Net interest income for the quarter ended March 31, 2021 was $196.2 million compared to $193.4 million for the immediately preceding quarter ended December 31, 2020 and $180.6 million for the quarter ended March 31, 2020.

Interest income decreased by $5.7 million for the quarter ended March 31, 2021 compared to the immediately preceding quarter, and by $48.7 million compared to the quarter ended March 31, 2020. Interest expense decreased by $8.6 million compared to the immediately preceding quarter and by $64.4 million compared to the quarter ended March 31, 2020. Decreases in interest income resulted from declines in market interest rates including the impact of repayment of assets originated in a higher rate environment and, with respect to comparison to the immediately preceding quarter, declines in average loans and investment securities. Declines in interest expense reflected decreases in market interest rates, the impact of our strategy focused on lowering the cost of deposits and improving the deposit mix and declines in average interest bearing liabilities.

The Company's net interest margin, calculated on a tax-equivalent basis, increased by 0.06% to 2.39% for the quarter ended March 31, 2021, from 2.33% for the immediately preceding quarter ended December 31, 2020. The decline in the average rate paid on interest bearing liabilities, particularly deposits, exceeded the decline in the average yield on interest earning assets. Offsetting factors contributing to the increase in the net interest margin for the quarter ended March 31, 2021 compared to the immediately preceding quarter ended December 31, 2020 included:

* The average rate paid on interest bearing deposits decreased to 0.45% for the quarter ended March 31, 2021, from 0.58% for the quarter ended December 31, 2020. This decline reflected continued initiatives taken to lower rates paid on deposits, including the re-pricing of term deposits. * The tax-equivalent yield on investment securities decreased to 1.73% for the quarter ended March 31, 2021 from 1.82% for the quarter ended December 31, 2020. This decrease resulted from the impact of purchases of lower-yielding securities, prepayments of higher yielding mortgage-backed securities and decreases in coupon interest rates on existing floating rate assets. * The tax-equivalent yield on loans increased to 3.58% for the quarter ended March 31, 2021, from 3.55% for the quarter ended December 31, 2020. Accelerated amortization of origination fees on PPP loans that were partially or fully forgiven during the quarter impacted the yield on loans by approximately 0.06%. * The average rate paid on FHLB and PPPLF borrowings increased to 2.32% for the quarter ended March 31, 2021, from 2.07% for the quarter ended December 31, 2020, reflecting the maturity of short-term, lower rate FHLB advances and the payoff of all PPPLF borrowings during the fourth quarter of 2020. * The increase in average non-interest bearing demand deposits as a percentage of average total deposits also positively impacted the cost of total deposits and the net interest margin.

Non-interest income

Non-interest income totaled $30.3 million for the quarter ended March 31, 2021 compared to $35.3 million for the immediately preceding quarter ended December 31, 2020 and $23.3 million for the quarter ended March 31, 2020. These fluctuations in non-interest income were primarily attributable to gain (loss) on investment securities, net which totaled $2.4 million, $7.2 million and $(3.5) million for the quarters ended March 31, 2021, December 31, 2020 and March 31, 2020, respectively. Increases in "other non-interest income" related primarily to increased revenue from our customer derivative program.

Non-interest expense

Non-interest expense totaled $123.2 million for the quarter ended March 31, 2021 compared to $123.3 million for the immediately preceding quarter ended December 31, 2020 and $118.9 million for the quarter ended March 31, 2020. Significant factors contributing to the increase in non-interest expense for the quarter ended March 31, 2021 compared to the quarter ended March 31, 2020 included:

* Technology and telecommunications expense increased by $3.1 million reflecting investments in digital and data analytics capabilities and in the infrastructure to support cloud migration. * Deposit insurance expense increased by $3.0 million reflecting an increase in the assessment rate.

Earnings Conference Call and Presentation

A conference call to discuss quarterly results will be held at 9:00 a.m. ET on Thursday, April 22, 2021 with Chairman, President and Chief Executive Officer, Rajinder P. Singh, Chief Financial Officer, Leslie N. Lunak and Chief Operating Officer, Thomas M. Cornish.

The earnings release and slides with supplemental information relating to the release will be available on the Investor Relations page under About Us on www.bankunited.com prior to the call. Due to recent demand for conference call services, participants are encouraged to listen to the call via a live Internet webcast at http://www.ir.bankunited.com/. The dial in telephone number for the call is (855) 798-3052 (domestic) or (234) 386-2812 (international). The name of the call is BankUnited, Inc. and the conference ID for the call is 7587207. A replay of the call will be available from 12:00 p.m. ET on April 22nd through 11:59 p.m. ET on April 29th by calling (855) 859-2056 (domestic) or (404) 537-3406 (international). The conference ID for the replay is 7587207. An archived webcast will also be available on the Investor Relations page of www.bankunited.com.

About BankUnited, Inc.

BankUnited, Inc., with total assets of $35.2 billion at March 31, 2021, is the bank holding company of BankUnited, N.A., a national bank headquartered in Miami Lakes, Florida with 69 banking centers in 14 Florida counties and 4 banking centers in the New York metropolitan area at March 31, 2021.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company's current views with respect to, among other things, future events and financial performance.

The Company generally identifies forward-looking statements by terminology such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "could," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," "forecasts" or the negative version of those words or other comparable words. Any forward-looking statements contained in this press release are based on the historical performance of the Company and its subsidiaries or on the Company's current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by the Company that the future plans, estimates or expectations contemplated by the Company will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions, including (without limitations) those relating to the Company's operations, financial results, financial condition, business prospects, growth strategy and liquidity, including as impacted by the COVID-19 pandemic. If one or more of these or other risks or uncertainties materialize, or if the Company's underlying assumptions prove to be incorrect, the Company's actual results may vary materially from those indicated in these statements. These factors should not be construed as exhaustive. The Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements. Information on these factors can be found in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K, which are available at the SEC's website (www.sec.gov).

BANKUNITED, INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS - UNAUDITED(In thousands, except share and per share data)



March 31, December 31, 2021 2020

ASSETS

Cash and due from banks:

Non-interest bearing $ 20,750 $ 20,233

Interest bearing 1,029,046 377,483

Cash and cash equivalents 1,049,796 397,716

Investment securities (including securitiesrecorded at fair value of $9,234,784 and 9,244,784 9,176,683 $9,166,683)

Non-marketable equity securities 177,709 195,865

Loans held for sale 13,770 24,676

Loans 23,361,067 23,866,042

Allowance for credit losses (220,934 ) (257,323 )

Loans, net 23,140,133 23,608,719

Bank owned life insurance 301,881 294,629

Operating lease equipment, net 681,003 663,517

Goodwill 77,637 77,637

Other assets 492,526 571,051

Total assets $ 35,179,239 $ 35,010,493



LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Demand deposits:

Non-interest bearing $ 7,965,658 $ 7,008,838

Interest bearing 3,096,668 3,020,039

Savings and money market 12,885,645 12,659,740

Time 3,784,111 4,807,199

Total deposits 27,732,082 27,495,816

Federal funds purchased - 180,000

FHLB advances 3,022,174 3,122,999

Notes and other borrowings 721,753 722,495

Other liabilities 641,395 506,171

Total liabilities 32,117,404 32,027,481



Commitments and contingencies



Stockholders' equity:

Common stock, par value $0.01 per share,400,000,000 shares authorized; 93,263,632 and 933 931 93,067,500 shares issued and outstanding

Paid-in capital 1,008,603 1,017,518

Retained earnings 2,091,124 2,013,715

Accumulated other comprehensive loss (38,825 ) (49,152 )

Total stockholders' equity 3,061,835 2,983,012

Total liabilities and stockholders' equity $ 35,179,239 $ 35,010,493

BANKUNITED, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED (In thousands, except per share data)

Three Months Ended

March 31,

December 31,

March 31,

2021

2020

2020

Interest income:

Loans

$

205,335

$

207,232

$

234,359

Investment securities

38,501

42,260

56,060

Other

1,593

1,628

3,720

Total interest income

245,429

251,120

294,139

Interest expense:

Deposits

22,376

29,290

82,822

Borrowings

26,813

28,464

30,741

Total interest expense

49,189

57,754

113,563

Net interest income before provision for credit losses

196,240

193,366

180,576

Provision for (recovery of) credit losses

(27,989

)

(1,643

)

125,428

Net interest income after provision for credit losses

224,229

195,009

55,148

Non-interest income:

Deposit service charges and fees

4,900

4,569

4,186

Gain on sale of loans, net

1,754

2,425

3,466

Gain (loss) on investment securities, net

2,365

7,203

(3,453

)

Lease financing

12,488

13,547

15,481

Other non-interest income

8,789

7,536

3,618

Total non-interest income

30,296

35,280

23,298

Non-interest expense:

Employee compensation and benefits

59,288

60,944

58,887

Occupancy and equipment

11,875

11,797

12,369

Deposit insurance expense

7,450

6,759

4,403

Professional fees

1,912

2,937

3,204

Technology and telecommunications

15,741

16,052

12,596

Depreciation of operating lease equipment

12,217

12,270

12,603

Other non-interest expense

14,738

12,565

14,806

Total non-interest expense

123,221

123,324

118,868

Income (loss) before income taxes

131,304

106,965

(40,422

)

Provision (benefit) for income taxes

32,490

21,228

(9,471

)

Net income (loss)

$

98,814

$

85,737

$

(30,951

)

Earnings (loss) per common share, basic

$

1.06

$

0.89

$

(0.33

)

Earnings (loss) per common share, diluted

$

1.06

$

0.89

$

(0.33

)

BANKUNITED, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME - UNAUDITED(In thousands, except per share data)



Three Months Ended

March 31, December March 31, 31,

2021 2020 2020

Interest income:

Loans $ 205,335 $ 207,232 $ 234,359

Investment securities 38,501 42,260 56,060

Other 1,593 1,628 3,720

Total interest income 245,429 251,120 294,139

Interest expense:

Deposits 22,376 29,290 82,822

Borrowings 26,813 28,464 30,741

Total interest expense 49,189 57,754 113,563

Net interest income before provision for 196,240 193,366 180,576 credit losses

Provision for (recovery of) credit losses (27,989 ) (1,643 ) 125,428

Net interest income after provision for 224,229 195,009 55,148 credit losses

Non-interest income:

Deposit service charges and fees 4,900 4,569 4,186

Gain on sale of loans, net 1,754 2,425 3,466

Gain (loss) on investment securities, net 2,365 7,203 (3,453 )

Lease financing 12,488 13,547 15,481

Other non-interest income 8,789 7,536 3,618

Total non-interest income 30,296 35,280 23,298

Non-interest expense:

Employee compensation and benefits 59,288 60,944 58,887

Occupancy and equipment 11,875 11,797 12,369

Deposit insurance expense 7,450 6,759 4,403

Professional fees 1,912 2,937 3,204

Technology and telecommunications 15,741 16,052 12,596

Depreciation of operating lease equipment 12,217 12,270 12,603

Other non-interest expense 14,738 12,565 14,806

Total non-interest expense 123,221 123,324 118,868

Income (loss) before income taxes 131,304 106,965 (40,422 )

Provision (benefit) for income taxes 32,490 21,228 (9,471 )

Net income (loss) $ 98,814 $ 85,737 $ (30,951 )

Earnings (loss) per common share, basic $ 1.06 $ 0.89 $ (0.33 )

Earnings (loss) per common share, diluted $ 1.06 $ 0.89 $ (0.33 )

BANKUNITED, INC. AND SUBSIDIARIES AVERAGE BALANCES AND YIELDS (Dollars in thousands)

Three Months Ended

March 31, 2021

Three Months Ended

December 31, 2020

Three Months Ended

March 31, 2020

Average

Balance

Interest

(1)(2)

Yield/

Rate (1)(2)

Average

Balance

Interest

(1)(2)

Yield/

Rate (1)(2)

Average

Balance

Interest

(1)(2)

Yield/

Rate (1)(2)

Assets:

Interest earning assets:

Loans

$

23,549,309

$

208,821

3.58

%

$

23,706,859

$

210,896

3.55

%

$

22,850,065

$

238,108

4.18

%

Investment securities (3)

9,070,185

39,188

1.73

%

9,446,389

42,966

1.82

%

8,107,649

56,951

2.81

%

Other interest earning assets

1,062,840

1,593

0.61

%

726,273

1,628

0.89

%

646,628

3,720

2.31

%

Total interest earning assets

33,682,334

249,602

2.98

%

33,879,521

255,490

3.01

%

31,604,342

298,779

3.79

%

Allowance for credit losses

(254,438

)

(280,243

)

(138,842

)

Non-interest earning assets

1,724,176

1,817,476

1,749,752

Total assets

$

35,152,072

$

35,416,754

$

33,215,252

Liabilities and Stockholders' Equity:

Interest bearing liabilities:

Interest bearing demand deposits

$

2,942,874

$

2,774

0.38

%

$

2,903,300

$

3,637

0.50

%

$

2,173,628

$

6,959

1.29

%

Savings and money market deposits

12,793,019

12,127

0.38

%

11,839,631

14,517

0.49

%

10,412,202

37,756

1.46

%

Time deposits

4,330,781

7,475

0.70

%

5,360,630

11,136

0.83

%

7,510,070

38,107

2.04

%

Total interest bearing deposits

20,066,674

22,376

0.45

%

20,103,561

29,290

0.58

%

20,095,900

82,822

1.66

%

Federal funds purchased

8,000

3

0.15

%

20,707

6

0.12

%

94,066

367

1.56

%

FHLB and PPPLF borrowings

3,072,717

17,558

2.32

%

3,698,666

19,207

2.07

%

4,414,830

25,084

2.29

%

Notes and other borrowings

722,305

9,252

5.12

%

722,581

9,251

5.12

%

429,098

5,290

4.93

%

Total interest bearing liabilities

23,869,696

49,189

0.83

%

24,545,515

57,754

0.94

%

25,033,894

113,563

1.82

%

Non-interest bearing demand deposits

7,491,249

7,152,967

4,368,553

Other non-interest bearing liabilities

746,973

772,277

749,101

Total liabilities

32,107,918

32,470,759

30,151,548

Stockholders' equity

3,044,154

2,945,995

3,063,704

Total liabilities and stockholders' equity

$

35,152,072

$

35,416,754

$

33,215,252

Net interest income

$

200,413

$

197,736

$

185,216

Interest rate spread

2.15

%

2.07

%

1.97

%

Net interest margin

2.39

%

2.33

%

2.35

%

BANKUNITED, INC. AND SUBSIDIARIESAVERAGE BALANCES AND YIELDS(Dollars in thousands)



Three Months Ended Three Months Ended Three Months Ended

March 31, 2021 December 31, 2020 March 31, 2020

Average Interest Yield/ Average Interest Yield/ Average Interest Yield/ Balance ^(1)(2) Rate ^ Balance ^(1)(2) Rate ^ Balance ^(1)(2) Rate ^ (1)(2) (1)(2) (1)(2)

Assets:

Interestearning assets:

Loans $ 23,549,309 $ 208,821 3.58 % $ 23,706,859 $ 210,896 3.55 % $ 22,850,065 $ 238,108 4.18 %

Investmentsecurities ^ 9,070,185 39,188 1.73 % 9,446,389 42,966 1.82 % 8,107,649 56,951 2.81 %(3)

Otherinterest 1,062,840 1,593 0.61 % 726,273 1,628 0.89 % 646,628 3,720 2.31 %earningassets

Totalinterest 33,682,334 249,602 2.98 % 33,879,521 255,490 3.01 % 31,604,342 298,779 3.79 %earningassets

Allowance for (254,438 ) (280,243 ) (138,842 ) credit losses

Non-interestearning 1,724,176 1,817,476 1,749,752 assets

Total assets $ 35,152,072 $ 35,416,754 $ 33,215,252

Liabilitiesand Stockholders'Equity:

Interestbearing liabilities:

Interestbearing $ 2,942,874 $ 2,774 0.38 % $ 2,903,300 $ 3,637 0.50 % $ 2,173,628 $ 6,959 1.29 %demanddeposits

Savings andmoney market 12,793,019 12,127 0.38 % 11,839,631 14,517 0.49 % 10,412,202 37,756 1.46 %deposits

Time deposits 4,330,781 7,475 0.70 % 5,360,630 11,136 0.83 % 7,510,070 38,107 2.04 %

Totalinterest 20,066,674 22,376 0.45 % 20,103,561 29,290 0.58 % 20,095,900 82,822 1.66 %bearingdeposits

Federal funds 8,000 3 0.15 % 20,707 6 0.12 % 94,066 367 1.56 %purchased

FHLB andPPPLF 3,072,717 17,558 2.32 % 3,698,666 19,207 2.07 % 4,414,830 25,084 2.29 %borrowings

Notes andother 722,305 9,252 5.12 % 722,581 9,251 5.12 % 429,098 5,290 4.93 %borrowings

Totalinterest 23,869,696 49,189 0.83 % 24,545,515 57,754 0.94 % 25,033,894 113,563 1.82 %bearingliabilities

Non-interestbearing 7,491,249 7,152,967 4,368,553 demanddeposits

Othernon-interest 746,973 772,277 749,101 bearingliabilities

Total 32,107,918 32,470,759 30,151,548 liabilities

Stockholders' 3,044,154 2,945,995 3,063,704 equity

Totalliabilitiesand $ 35,152,072 $ 35,416,754 $ 33,215,252 stockholders'equity

Net interest $ 200,413 $ 197,736 $ 185,216 income

Interest rate 2.15 % 2.07 % 1.97 %spread

Net interest 2.39 % 2.33 % 2.35 %margin

______________(1)

On a tax-equivalent basis where applicable

(2)

Annualized

(3)

At fair value except for securities held to maturity

______________(1) On a tax-equivalent basis where applicable

(2) Annualized

(3) At fair value except for securities held to maturity

BANKUNITED, INC. AND SUBSIDIARIES EARNINGS PER COMMON SHARE (In thousands except share and per share amounts)

Three Months Ended March 31,

2021

2020

Basic earnings per common share:

Numerator:

Net income (loss)

$

98,814

$

(30,951

)

Distributed and undistributed earnings allocated to participating securities

(1,252

)

-

Income (loss) allocated to common stockholders for basic earnings per common share

$

97,562

$

(30,951

)

Denominator:

Weighted average common shares outstanding

93,075,702

93,944,529

Less average unvested stock awards

(1,205,529

)

(1,101,370

)

Weighted average shares for basic earnings (loss) per common share

91,870,173

92,843,159

Basic earnings (loss) per common share

$

1.06

$

(0.33

)

Diluted earnings (loss) per common share:

Numerator:

Income (loss) allocated to common stockholders for basic earnings per common share

$

97,562

$

(30,951

)

Adjustment for earnings reallocated from participating securities

1

-

Income (loss) used in calculating diluted earnings per common share

$

97,563

$

(30,951

)

Denominator:

Weighted average shares for basic earnings (loss) per common share

91,870,173

92,843,159

Dilutive effect of stock options and certain shared-based awards

93,540

-

Weighted average shares for diluted earnings per common share

91,963,713

92,843,159

Diluted earnings (loss) per common share

$

1.06

$

(0.33

)

BANKUNITED, INC. AND SUBSIDIARIESEARNINGS PER COMMON SHARE(In thousands except share and per share amounts)



Three Months Ended March 31,

2021 2020

Basic earnings per common share:

Numerator:

Net income (loss) $ 98,814 $ (30,951 )

Distributed and undistributed earnings allocated to (1,252 ) - participating securities

Income (loss) allocated to common stockholders for $ 97,562 $ (30,951 )basic earnings per common share

Denominator:

Weighted average common shares outstanding 93,075,702 93,944,529

Less average unvested stock awards (1,205,529 ) (1,101,370 )

Weighted average shares for basic earnings (loss) 91,870,173 92,843,159 per common share

Basic earnings (loss) per common share $ 1.06 $ (0.33 )

Diluted earnings (loss) per common share:

Numerator:

Income (loss) allocated to common stockholders for $ 97,562 $ (30,951 )basic earnings per common share

Adjustment for earnings reallocated from 1 - participating securities

Income (loss) used in calculating diluted earnings $ 97,563 $ (30,951 )per common share

Denominator:

Weighted average shares for basic earnings (loss) 91,870,173 92,843,159 per common share

Dilutive effect of stock options and certain 93,540 - shared-based awards

Weighted average shares for diluted earnings per 91,963,713 92,843,159 common share

Diluted earnings (loss) per common share $ 1.06 $ (0.33 )

BANKUNITED, INC. AND SUBSIDIARIES SELECTED RATIOS

Three Months Ended March 31,

2021

2020

Financial ratios (4)

Return on average assets

1.14

%

(0.37

)%

Return on average stockholders' equity

13.2

%

(4.1

)%

Net interest margin (3)

2.39

%

2.35

%

BANKUNITED, INC. AND SUBSIDIARIESSELECTED RATIOS



Three Months Ended March 31,

2021 2020

Financial ratios^ (4)

Return on average assets 1.14 % (0.37 )%

Return on average stockholders' equity 13.2 % (4.1 )%

Net interest margin^ (3) 2.39 % 2.35 %

March 31, 2021

December 31, 2020

Asset quality ratios

Non-performing loans to total loans (1)(5)

1.00

%

1.02

%

Non-performing assets to total assets (2)(5)

0.67

%

0.71

%

Allowance for credit losses to total loans

0.95

%

1.08

%

Allowance for credit losses to non-performing loans (1)(5)

94.56

%

105.26

%

Net charge-offs to average loans (4)

0.17

%

0.26

%

March 31, December 31, 2021 2020

Asset quality ratios

Non-performing loans to total loans^ (1)(5) 1.00 % 1.02 %

Non-performing assets to total assets ^(2)(5) 0.67 % 0.71 %

Allowance for credit losses to total loans 0.95 % 1.08 %

Allowance for credit losses to non-performing 94.56 % 105.26 %loans^ (1)(5)

Net charge-offs to average loans^ (4) 0.17 % 0.26 %

______________(1)

We define non-performing loans to include non-accrual loans and loans other than purchased credit deteriorated and government insured residential loans that are past due 90 days or more and still accruing. Contractually delinquent purchased credit deteriorated and government insured residential loans on which interest continues to be accrued are excluded from non-performing loans.

(2)

Non-performing assets include non-performing loans, OREO and other repossessed assets.

(3)

On a tax-equivalent basis.

(4)

Annualized for the three month periods.

(5)

Non-performing loans and assets include the guaranteed portion of non-accrual SBA loans totaling $48.2 million or 0.21% of total loans and 0.14% of total assets, at March 31, 2021; and $51.3 million or 0.22% of total loans and 0.15% of total assets, at December 31, 2020.

______________ We define non-performing loans to include non-accrual loans and loans other than purchased credit deteriorated and government insured(1) residential loans that are past due 90 days or more and still accruing. Contractually delinquent purchased credit deteriorated and government insured residential loans on which interest continues to be accrued are excluded from non-performing loans.

(2) Non-performing assets include non-performing loans, OREO and other repossessed assets.

(3) On a tax-equivalent basis.

(4) Annualized for the three month periods.

Non-performing loans and assets include the guaranteed portion of(5) non-accrual SBA loans totaling $48.2 million or 0.21% of total loans and 0.14% of total assets, at March 31, 2021; and $51.3 million or 0.22% of total loans and 0.15% of total assets, at December 31, 2020.

March 31, 2021

December 31, 2020

Required to be

Considered Well

Capitalized

BankUnited, Inc.

BankUnited, N.A.

BankUnited, Inc.

BankUnited, N.A.

Capital ratios

Tier 1 leverage

8.7

%

9.8

%

8.6

%

9.5

%

5.0

%

Common Equity Tier 1 ("CET1") risk-based capital

13.2

%

14.8

%

12.6

%

13.9

%

6.5

%

Total risk-based capital

15.2

%

15.5

%

14.7

%

14.8

%

10.0

%

On a fully-phased in basis with respect to the adoption of CECL, the Company's and the Bank's CET1 risk-based capital ratios would have been 13.0% and 14.6%, respectively, at March 31, 2021.

Non-GAAP Financial Measures

PPNR is a non-GAAP financial measure. Management believes this measure is relevant to understanding the performance of the Company attributable to elements other than the provision for credit losses and the ability of the Company to generate earnings sufficient to cover estimated credit losses, particularly in view of the volatility of the provision for credit losses resulting from the COVID-19 pandemic. This measure also provides a meaningful basis for comparison to other financial institutions since it is commonly employed and is a measure frequently cited by investors and analysts. The following table reconciles the non-GAAP financial measurement of PPNR to the comparable GAAP financial measurement of income (loss) before income taxes for the three months ended March 31, 2021 and 2020 and the three months ended December 31, 2020 (in thousands):

Required to March 31, 2021 December 31, 2020 be

Considered Well BankUnited, BankUnited, BankUnited, BankUnited, Inc. N.A. Inc. N.A. Capitalized

Capital ratios

Tier 1 8.7 % 9.8 % 8.6 % 9.5 % 5.0 %leverage

CommonEquity Tier1 ("CET1") 13.2 % 14.8 % 12.6 % 13.9 % 6.5 %risk-basedcapital

Totalrisk-based 15.2 % 15.5 % 14.7 % 14.8 % 10.0 %capital

On a fully-phased in basis with respect to the adoption of CECL, the Company's and the Bank's CET1 risk-based capital ratios would have been 13.0% and 14.6%, respectively, at March 31, 2021.

Non-GAAP Financial Measures

PPNR is a non-GAAP financial measure. Management believes this measure is relevant to understanding the performance of the Company attributable to elements other than the provision for credit losses and the ability of the Company to generate earnings sufficient to cover estimated credit losses, particularly in view of the volatility of the provision for credit losses resulting from the COVID-19 pandemic. This measure also provides a meaningful basis for comparison to other financial institutions since it is commonly employed and is a measure frequently cited by investors and analysts. The following table reconciles the non-GAAP financial measurement of PPNR to the comparable GAAP financial measurement of income (loss) before income taxes for the three months ended March 31, 2021 and 2020 and the three months ended December 31, 2020 (in thousands):

Three Months Ended

March 31, December 31, March 31, 2021 2020 2020

Income (loss) before income taxes $ 131,304 $ 106,965 $ (40,422 )(GAAP)

Plus: Provision for (recovery of) (27,989 ) (1,643 ) 125,428 credit losses

PPNR (non-GAAP) $ 103,315 $ 105,322 $ 85,006

ACL to total loans, excluding government insured residential loans, PPP loans and MWL is a non-GAAP financial measure. Management believes this measure is relevant to understanding the adequacy of the ACL coverage, excluding the impact of loans which carry nominal or no reserves. Disclosure of this non-GAAP financial measure also provides a meaningful basis for comparison to other financial institutions. The following table reconciles the non-GAAP financial measurement of ACL to total loans, excluding government insured residential loans, PPP loans and MWL to the comparable GAAP financial measurement of ACL to total loans at March 31, 2021 and December 31, 2020 (dollars in thousands):

March 31, 2021 December 31, 2020

Total loans (GAAP) $ 23,361,067 $ 23,866,042

Less: Government insured residential loans 1,759,289 1,419,074

Less: PPP loans 911,951 781,811

Less: MWL 1,145,957 1,259,408

Total loans, excluding government insured $ 19,543,870 $ 20,405,749residential loans, PPP loans and MWL (non-GAAP)



ACL $ 220,934 $ 257,323



ACL to total loans (GAAP) 0.95 % 1.08 %



ACL to total loans, excluding governmentinsured residential loans, PPP loans and MWL 1.13 % 1.26 %(non-GAAP)

Tangible book value per common share is a non-GAAP financial measure. Management believes this measure is relevant to understanding the capital position and performance of the Company. Disclosure of this non-GAAP financial measure also provides a meaningful basis for comparison to other financial institutions as it is a metric commonly used in the banking industry. The following table reconciles the non-GAAP financial measurement of tangible book value per common share to the comparable GAAP financial measurement of book value per common share at the dates indicated (in thousands except share and per share data):

March 31, December 31, December 31, 2021 2020 2019

Total stockholders' equity (GAAP) $ 3,061,835 $ 2,983,012 $ 2,980,779

Less: goodwill and other 77,637 77,637 77,674 intangible assets

Tangible stockholders' equity $ 2,984,198 $ 2,905,375 $ 2,903,105 (non-GAAP)



Common shares issued and 93,263,632 93,067,500 95,128,231 outstanding



Book value per common share (GAAP) $ 32.83 $ 32.05 $ 31.33



Tangible book value per common $ 32.00 $ 31.22 $ 30.52 share (non-GAAP)

View source version on businesswire.com: https://www.businesswire.com/news/home/20210422005147/en/

CONTACT: BankUnited, Inc. Investor Relations: Leslie N. Lunak, 786-313-1698 llunak@bankunited.com






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