Business Wire | Oct 21, 2021 06:45AM EDT

BankUnited, Inc. Reports Third Quarter 2021 Results

Oct. 21, 2021

MIAMI LAKES, Fla.--(BUSINESS WIRE)--Oct. 21, 2021--BankUnited, Inc. (the "Company") (NYSE: BKU) today announced financial results for the quarter ended September 30, 2021.

"The Company delivered a solid quarter. We're pleased by our continued progress in improving the deposit book and in the positive direction of credit trends" said Rajinder Singh, Chairman, President and Chief Executive Officer.

For the quarter ended September 30, 2021, the Company reported net income of $86.9 million, or $0.94 per diluted share, compared to $104.0 million or $1.11 per diluted share for the immediately preceding quarter ended June 30, 2021 and $66.6 million, or $0.70 per diluted share, for the quarter ended September 30, 2020.

For the nine months ended September 30, 2021, the Company reported net income of $289.7 million, or $3.12 per diluted share, compared to $112.1 million, or $1.17 per diluted share, for the nine months ended September 30, 2020. On an annualized basis, earnings for the nine months ended September 30, 2021 generated a return on average stockholders' equity of 12.4% and a return on average assets of 1.09%.

Financial Highlights

* Net interest income decreased by $3.2 million compared to the immediately preceding quarter ended June 30, 2021 and increased by $7.6 million compared to the quarter ended September 30, 2020. The net interest margin, calculated on a tax-equivalent basis, was 2.33% for the quarter ended September 30, 2021 compared to 2.37% for the immediately preceding quarter and 2.32% for the quarter ended September 30, 2020. The net interest margin was impacted by pressure on earning asset yields, in part resulting from lower than expected commercial loan growth for the quarter, leading to continued deployment of liquidity into securities. Lower recognition of PPP fees also had an impact. * As expected, the average cost of total deposits continued to decline, dropping by 0.05% to 0.20% for the quarter ended September 30, 2021 from 0.25% for the immediately preceding quarter ended June 30, 2021, and 0.57% for the quarter ended September 30, 2020. On a spot basis, the average annual percentage yield ("APY") on total deposits declined to 0.19% at September 30, 2021 from 0.22% at June 30, 2021 and 0.36% at December 31, 2020. * Non-interest bearing demand deposits grew by $324 million during the quarter ended September 30, 2021 while average non-interest bearing demand deposits grew by $749 million compared to the immediately preceding quarter. Average non-interest bearing demand deposits grew by $2.7 billion compared to the third quarter of the prior year. At September 30, 2021, non-interest bearing demand deposits represented 33% of total deposits, compared to 25% of total deposits at December 31, 2020. * Total deposits declined by $493 million during the quarter ended September 30, 2021, as the Company continues to execute on a strategy focused on improving the quality of the deposit base rather than on growth in total deposits. Money market and savings deposits declined by $1.1 billion in the third quarter. The majority of this decline was attributable to reductions in accounts that management believes will be more price sensitive in a rising rate environment. * For the quarter ended September 30, 2021, the Company recorded a recovery of credit losses of $(11.8) million compared to a recovery of $(27.5) million for the immediately preceding quarter ended June 30, 2021 and a provision for credit losses of $29.2 million for the quarter ended September 30, 2020. For the nine months ended September 30, 2021 and 2020, the provision for (recovery of) credit losses was $(67.4) million and $180.1 million, respectively. Year over year volatility in the provision related to the expected economic impact of the onset of the COVID-19 pandemic in 2020 and subsequent recovery in 2021. * As expected, as the economy emerges from the COVID-19 crisis and our borrowers' operating results improve, criticized and classified loans continued to decline. During the quarter ended September 30, 2021, total criticized and classified loans declined by $240 million. The ratio of non-performing loans to total loans declined to 1.21% at September 30, 2021 from 1.28% at June 30, 2021. * Loans currently under short-term deferral totaled $17 million and loans modified under the CARES Act totaled $267 million for a total of $285 million at September 30, 2021, down from a total of $497 million at June 30, 2021. * Total loans and operating lease equipment, excluding the runoff of PPP loans, grew by $74 million for the quarter ended September 30, 2021. * Book value per common share and tangible book value per common share continued to accrete, increasing to $34.39 and $33.53, respectively, at September 30, 2021 from $33.91 and $33.08, respectively, at June 30, 2021 and $32.05 and $31.22, respectively at December 31, 2020. * During the quarter ended September 30, 2021, the Company repurchased approximately 3.2 million shares of its common stock for an aggregate purchase price of $129.4 million, at a weighted average price of $40.62 per share. * On October 20, 2021, the Company's Board of Directors authorized the repurchase of up to an additional $150 million in shares of its outstanding common stock.

Loans and Leases

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

September 30, 2021 June 30, 2021 December 31, 2020

Residentialand other $ 7,827,224 34.3 % $ 7,076,274 30.9 % $ 6,348,222 26.6 %consumerloans

Multi-family 1,181,935 5.2 % 1,256,711 5.5 % 1,639,201 6.9 %

Non-owneroccupied 4,537,078 19.9 % 4,724,183 20.7 % 4,963,273 20.8 %commercialreal estate

Construction 163,988 0.7 % 218,634 1.0 % 293,307 1.2 %and land

Owneroccupied 2,012,376 8.8 % 1,960,900 8.6 % 2,000,770 8.4 %commercialreal estate

Commercialand 4,166,914 18.3 % 4,205,795 18.4 % 4,447,383 18.6 %industrial

PPP 332,548 1.5 % 491,960 2.1 % 781,811 3.3 %

Pinnacle 932,865 4.1 % 1,046,537 4.6 % 1,107,386 4.6 %

Bridge -franchise 396,589 1.7 % 463,874 2.0 % 549,733 2.3 %finance

Bridge -equipment 379,446 1.7 % 421,939 1.8 % 475,548 2.0 %finance

Mortgagewarehouse 877,006 3.8 % 1,018,267 4.4 % 1,259,408 5.3 %lending("MWL")

$ 22,807,969 100.0 % $ 22,885,074 100.0 % $ 23,866,042 100.0 %

Operatinglease $ 659,935 $ 667,935 $ 663,517 equipment,net

Residential continues to be an area of strength; residential and other consumer loans grew by $751 million during the quarter ended September 30, 2021. GNMA early buyout loans grew by $50 million, totaling $1.9 billion at September 30, 2021.

The majority of commercial portfolio segments showed net declines for the quarter ended September 30, 2021 as payoffs outpaced production. Commercial real estate portfolio segments in the aggregate declined by $317 million while commercial and industrial loans, including owner-occupied commercial real estate, remained relatively flat, growing by $13 million. Balances for Pinnacle, Bridge and mortgage warehouse declined by $114 million, $110 million and $141 million, respectively. The decrease in multifamily loans was largely attributable to $76 million of runoff in the New York portfolio.

PPP loans declined by $159 million during the quarter ended September 30, 2021, due to forgiveness of first draw program loans.

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 September 30, 2021 (dollars in thousands):

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

Residential and other $ 33,161 $ 17,439 $ 23,012 consumer^ (1)

Commercial:

CRE by Property Type:

Retail 18,678 - 15,874

Hotel 22,043 - 81,632

Office 5,260 - -

Multi-family 11,018 - 7,317

Other 7,193 - -

Owner occupied commercial 22,192 - 15,775 real estate

Commercial and industrial 125,550 - 95,871

Bridge - franchise finance 31,569 - 27,717

Total commercial 243,503 - 244,186

Total $ 276,664 $ 17,439 $ 267,198

--------

(1) Excludes government insured residential loans.

In the table above, "currently under short-term deferral" refers to loans subject to a 90-day payment deferral at September 30, 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 totaled $276.7 million or 1.21% of total loans at September 30, 2021, compared to $292.7 million or 1.28% of total loans at June 30, 2021 and $244.5 million or 1.02% of total loans at December 31, 2020. Non-performing loans included $49.1 million, $47.7 million and $51.3 million of the guaranteed portion of SBA loans on non-accrual status, representing 0.22%, 0.21% and 0.22% of total loans at September 30, 2021, June 30, 2021 and December 31, 2020, respectively.

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

September 30, June 30, 2021 December 31, 2020 2021

Special mention $ 153,373 $ 138,064 $ 711,516

Substandard - accruing 1,432,801 1,684,666 1,758,654

Substandard - 227,055 229,646 203,758non-accruing

Doubtful 16,447 17,332 11,867

Total $ 1,829,676 $ 2,069,708 $ 2,685,795

The following table presents the ACL at the dates indicated, related ACL coverage ratios and net charge-off rates for the quarters ended September 30, 2021 and June 30, 2021 and the year ended December 31, 2020 (dollars in thousands):

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

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

June 30, 2021 $ 175,642 0.77 % 60.02 % 0.24 %

September 30, $ 159,615 0.70 % 57.69 % 0.19 %2021

--------

ACL to total loans, excluding government insured residential loans, PPP(1) loans and MWL, which carry nominal or no reserves, was 0.81%, 0.90% and 1.26% at September 30, 2021, June 30, 2021 and December 31, 2020, respectively.

(2) Annualized for the periods ended June 30, 2021 and September 30, 2021.

The ACL at September 30, 2021 represents management's estimate of lifetime expected credit losses 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 September 2021, economic information provided by additional sources, information about borrower financial condition and collateral values, data reflecting the impact of recent events on individual borrowers and other relevant information.

For the quarter ended September 30, 2021, the Company recorded a recovery of credit losses of $(11.8) million, which included a recovery of $(11.6) million related to funded loans and an insignificant amount related to unfunded loan commitments and accrued interest receivable. The most significant factors contributing to the recovery of the provision for credit losses and corresponding reduction in the ACL for the quarter included declines in commercial loan balances and the accompanying shift in portfolio composition to residential loans which generally carry lower reserves, reductions in certain qualitative factors and an improving economic forecast. Improved borrower financial performance as reflected in the reduction in criticized and classified assets also contributed to the reduction in the ACL.

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

Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Beginning balance $ 175,642 $ 266,123 $ 257,323 $ 108,671

Cumulative effect of - - - 27,305 adoption of CECL

Balance after adoption of 175,642 266,123 257,323 135,976 CECL

Provision (recovery) (11,554) 27,646 (65,523) 181,095

Net charge-offs (4,473) (19,641) (32,185) (42,943)

Ending balance $ 159,615 $ 274,128 $ 159,615 $ 274,128

Net interest income

Net interest income for the quarter ended September 30, 2021 was $195.1 million compared to $198.3 million for the immediately preceding quarter ended June 30, 2021 and $187.5 million for the quarter ended September 30, 2020.

Interest income decreased by $7.5 million for the quarter ended September 30, 2021 compared to the immediately preceding quarter, and by $20.2 million compared to the quarter ended September 30, 2020. Interest expense decreased by $4.3 million compared to the immediately preceding quarter and by $27.9 million compared to the quarter ended September 30, 2020. Decreases in interest income resulted from turnover of the loan and investment portfolios at lower prevailing rates, as well as a decline in average loans. Declines in interest expense reflected the impact of our strategy focused on lowering the cost of deposits and improving the deposit mix, runoff and repricing of deposits generated in a higher rate environment, and declines in average interest bearing liabilities.

The Company's net interest margin, calculated on a tax-equivalent basis, decreased by 0.04% to 2.33% for the quarter ended September 30, 2021, from 2.37% for the immediately preceding quarter ended June 30, 2021. Offsetting factors impacting the net interest margin for the quarter ended September 30, 2021 included:

* The average rate paid on interest bearing deposits decreased to 0.29% for the quarter ended September 30, 2021, from 0.35% for the quarter ended June 30, 2021. 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 1.49% for the quarter ended September 30, 2021 from 1.56% for the quarter ended June 30, 2021. This decrease resulted from the impact of purchases of lower-yielding securities coupled with amortization, maturities and prepayment of securities purchased in a higher rate environment. Accounting adjustments related to faster prepayment speeds of securities purchased at a premium negatively impacted the yield on investment securities for the quarter ended September 30, 2021 by approximately 0.06%. * The tax-equivalent yield on loans decreased to 3.45% for the quarter ended September 30, 2021, from 3.59% for the quarter ended June 30, 2021. Accelerated amortization of origination fees on PPP loans that were partially or fully forgiven during the quarter impacted the yield on loans by approximately 0.03% for the quarter ended September 30, 2021, compared to 0.11% for the quarter ended June 30, 2021. Factoring out the impact of accelerated amortization of PPP origination fees, the yield on loans for the quarter ended September 30, 2021 decreased by 0.06% compared to the immediately preceding quarter. This decrease is mainly the result of growth in the residential portfolio at average yields lower than our commercial loan segments. * 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.

Capital Actions

On October 20, 2021, the Company's Board of Directors authorized the repurchase of up to $150 million in shares of its outstanding common stock. This authorization is in addition to $58.3 million in remaining authorization as of September 30, 2021, under a previously announced share repurchase program. Any repurchases under the program will be made in accordance with applicable securities laws from time to time in open market or private transactions. The extent to which the Company repurchases shares, and the timing of such repurchases, will depend upon a variety of factors, including market conditions, the Company's capital position and amount of retained earnings, regulatory requirements and other considerations. No time limit was set for the completion of the share repurchase program, and the program may be suspended or discontinued without prior notice at any time.

Earnings Conference Call and Presentation

A conference call to discuss quarterly results will be held at 9:00 a.m. ET on Thursday, October 21, 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 9293887. A replay of the call will be available from 12:00 p.m. ET on October 21st through 11:59 p.m. ET on October 28th by calling (855) 859-2056 (domestic) or (404) 537-3406 (international). The conference ID for the replay is 9293887. 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 $35.3 billion at September 30, 2021, is the bank holding company of BankUnited, N.A., a national bank headquartered in Miami Lakes, Florida with 64 banking centers in 13 Florida counties and 4 banking centers in the New York metropolitan area at September 30, 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 SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS - UNAUDITED

(In thousands, except share and per share data)

September 30, December 31, 2021 2020

ASSETS

Cash and due from banks:

Non-interest bearing $ 17,973 $ 20,233

Interest bearing 489,049 377,483

Cash and cash equivalents 507,022 397,716

Investment securities (including securitiesrecorded at fair value of $10,319,691 and 10,329,691 9,176,683 $9,166,683)

Non-marketable equity securities 155,584 195,865

Loans held for sale - 24,676

Loans 22,807,969 23,866,042

Allowance for credit losses (159,615) (257,323)

Loans, net 22,648,354 23,608,719

Bank owned life insurance 308,912 294,629

Operating lease equipment, net 659,935 663,517

Goodwill 77,637 77,637

Other assets 619,136 571,051

Total assets $ 35,306,271 $ 35,010,493



LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Demand deposits:

Non-interest bearing $ 9,158,281 $ 7,008,838

Interest bearing 3,268,709 3,020,039

Savings and money market 12,460,507 12,659,740

Time 3,228,776 4,807,199

Total deposits 28,116,273 27,495,816

Federal funds purchased 199,000 180,000

FHLB advances 2,431,014 3,122,999

Notes and other borrowings 721,527 722,495

Other liabilities 741,783 506,171

Total liabilities 32,209,597 32,027,481



Commitments and contingencies



Stockholders' equity:

Common stock, par value $0.01 per share,400,000,000 shares authorized; 90,049,326 and 900 931 93,067,500 shares issued and outstanding

Paid-in capital 885,873 1,017,518

Retained earnings 2,239,963 2,013,715

Accumulated other comprehensive loss (30,062) (49,152)

Total stockholders' equity 3,096,674 2,983,012

Total liabilities and stockholders' equity $ 35,306,271 $ 35,010,493

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(In thousands, except per share data)

Three Months Ended

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

2021

2021

2020

2021

2020

Interest income:

Loans

$

194,689

$

202,520

$

208,646

$

602,544

$

656,943

Investment securities

38,243

37,674

44,604

114,418

151,596

Other

1,413

1,607

1,322

4,613

7,950

Total interest income

234,345

241,801

254,572

721,575

816,489

Interest expense:

Deposits

14,273

17,316

37,681

53,965

170,690

Borrowings

24,950

26,174

29,412

77,937

87,407

Total interest expense

39,223

43,490

67,093

131,902

258,097

Net interest income before provision for credit losses

195,122

198,311

187,479

589,673

558,392

Provision for (recovery of) credit losses

(11,842)

(27,534)

29,232

(67,365)

180,074

Net interest income after provision for credit losses

206,964

225,845

158,247

657,038

378,318

Non-interest income:

Deposit service charges and fees

5,553

5,417

4,040

15,870

11,927

Gain on sale of loans, net

1,403

2,234

2,953

5,391

10,745

Gain (loss) on investment securities, net

(664)

4,155

7,181

5,856

10,564

Lease financing

13,212

13,522

13,934

39,222

45,565

Other non-interest income

5,974

7,429

8,184

22,192

19,140

Total non-interest income

25,478

32,757

36,292

88,531

97,941

Non-interest expense:

Employee compensation and benefits

57,224

56,459

48,448

172,971

156,212

Occupancy and equipment

11,760

11,492

12,170

35,127

36,440

Deposit insurance expense

3,552

4,222

5,886

15,224

15,095

Professional fees

2,312

2,139

2,436

6,363

8,771

Technology and telecommunications

16,687

16,851

15,435

49,279

42,056

Depreciation of operating lease equipment

12,944

12,834

12,315

37,995

37,137

Other non-interest expense

13,563

14,455

11,937

42,756

38,154

Total non-interest expense

118,042

118,452

108,627

359,715

333,865

Income before income taxes

114,400

140,150

85,912

385,854

142,394

Provision for income taxes

27,459

36,176

19,353

96,125

30,278

Net income

$

86,941

$

103,974

$

66,559

$

289,729

$

112,116

Earnings per common share, basic

$

0.94

$

1.12

$

0.70

$

3.12

$

1.17

Earnings per common share, diluted

$

0.94

$

1.11

$

0.70

$

3.12

$

1.17

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(In thousands, except per share data)

Three Months Ended Nine Months Ended

September June 30, September September September 30, 30, 30, 30,

2021 2021 2020 2021 2020

Interest income:

Loans $ 194,689 $ 202,520 $ 208,646 $ 602,544 $ 656,943

Investment 38,243 37,674 44,604 114,418 151,596 securities

Other 1,413 1,607 1,322 4,613 7,950

Total interest 234,345 241,801 254,572 721,575 816,489 income

Interest expense:

Deposits 14,273 17,316 37,681 53,965 170,690

Borrowings 24,950 26,174 29,412 77,937 87,407

Total interest 39,223 43,490 67,093 131,902 258,097 expense

Net interestincome before 195,122 198,311 187,479 589,673 558,392 provision forcredit losses

Provision for(recovery of) (11,842) (27,534) 29,232 (67,365) 180,074 credit losses

Net interestincome after 206,964 225,845 158,247 657,038 378,318 provision forcredit losses

Non-interest income:

Deposit service 5,553 5,417 4,040 15,870 11,927 charges and fees

Gain on sale of 1,403 2,234 2,953 5,391 10,745 loans, net

Gain (loss) oninvestment (664) 4,155 7,181 5,856 10,564 securities, net

Lease financing 13,212 13,522 13,934 39,222 45,565

Other non-interest 5,974 7,429 8,184 22,192 19,140 income

Total non-interest 25,478 32,757 36,292 88,531 97,941 income

Non-interest expense:

Employeecompensation and 57,224 56,459 48,448 172,971 156,212 benefits

Occupancy and 11,760 11,492 12,170 35,127 36,440 equipment

Deposit insurance 3,552 4,222 5,886 15,224 15,095 expense

Professional fees 2,312 2,139 2,436 6,363 8,771

Technology and 16,687 16,851 15,435 49,279 42,056 telecommunications

Depreciation ofoperating lease 12,944 12,834 12,315 37,995 37,137 equipment

Other non-interest 13,563 14,455 11,937 42,756 38,154 expense

Total non-interest 118,042 118,452 108,627 359,715 333,865 expense

Income before 114,400 140,150 85,912 385,854 142,394 income taxes

Provision for 27,459 36,176 19,353 96,125 30,278 income taxes

Net income $ 86,941 $ 103,974 $ 66,559 $ 289,729 $ 112,116

Earnings percommon share, $ 0.94 $ 1.12 $ 0.70 $ 3.12 $ 1.17 basic

Earnings percommon share, $ 0.94 $ 1.11 $ 0.70 $ 3.12 $ 1.17 diluted

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Three Months Ended September 30, 2021

Three Months Ended June 30, 2021

Three Months Ended September 30, 2020

Average Balance

Interest (1)

Yield/ Rate (1)(2)

Average Balance

Interest (1)

Yield/ Rate (1)(2)

Average Balance

Interest (1)

Yield/ Rate (1)(2)

Assets:

Interest earning assets:

Loans

$

22,879,654

$

197,995

3.45

%

$

22,996,564

$

205,940

3.59

%

$

23,447,514

$

212,388

3.61

%

Investment securities (3)

10,452,255

38,939

1.49

%

9,839,422

38,338

1.56

%

9,065,478

45,351

2.00

%

Other interest earning assets

750,700

1,413

0.75

%

1,380,317

1,607

0.47

%

552,515

1,322

0.95

%

Total interest earning assets

34,082,609

238,347

2.79

%

34,216,303

245,885

2.88

%

33,065,507

259,061

3.13

%

Allowance for credit losses

(171,381)

(215,151)

(272,464)

Non-interest earning assets

1,856,608

1,732,676

1,897,723

Total assets

$

35,767,836

$

35,733,828

$

34,690,766

Liabilities and Stockholders' Equity:

Interest bearing liabilities:

Interest bearing demand deposits

$

3,038,038

$

1,701

0.22

%

$

3,069,945

$

2,594

0.34

%

$

2,800,421

$

4,127

0.59

%

Savings and money market deposits

13,554,572

10,029

0.29

%

13,541,237

11,307

0.33

%

10,664,462

15,853

0.59

%

Time deposits

2,866,746

2,543

0.35

%

3,380,582

3,415

0.41

%

6,519,852

17,701

1.08

%

Total interest bearing deposits

19,459,356

14,273

0.29

%

19,991,764

17,316

0.35

%

19,984,735

37,681

0.75

%

Federal funds purchased

70,054

15

0.08

%

-

-

-

%

53,587

14

0.10

%

FHLB and PPPLF borrowings

2,647,314

15,678

2.35

%

2,873,922

16,922

2.36

%

4,117,181

20,146

1.95

%

Notes and other borrowings

721,638

9,257

5.13

%

721,753

9,252

5.13

%

722,271

9,252

5.12

%

Total interest bearing liabilities

22,898,362

39,223

0.68

%

23,587,439

43,490

0.74

%

24,877,774

67,093

1.07

%

Non-interest bearing demand deposits

8,912,960

8,163,879

6,186,718

Other non-interest bearing liabilities

752,774

851,044

803,498

Total liabilities

32,564,096

32,602,362

31,867,990

Stockholders' equity

3,203,740

3,131,466

2,822,776

Total liabilities and stockholders' equity

$

35,767,836

$

35,733,828

$

34,690,766

Net interest income

$

199,124

$

202,395

$

191,968

Interest rate spread

2.11

%

2.14

%

2.06

%

Net interest margin

2.33

%

2.37

%

2.32

%

--------------

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Three Months Ended Three Months Ended Three Months Ended September 30, 2021 June 30, 2021 September 30, 2020

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

Assets:

Interestearning assets:

Loans $ 22,879,654 $ 197,995 3.45 % $ 22,996,564 $ 205,940 3.59 % $ 23,447,514 $ 212,388 3.61 %

Investmentsecurities ^ 10,452,255 38,939 1.49 % 9,839,422 38,338 1.56 % 9,065,478 45,351 2.00 %(3)

Otherinterest 750,700 1,413 0.75 % 1,380,317 1,607 0.47 % 552,515 1,322 0.95 %earningassets

Totalinterest 34,082,609 238,347 2.79 % 34,216,303 245,885 2.88 % 33,065,507 259,061 3.13 %earningassets

Allowance for (171,381) (215,151) (272,464) credit losses

Non-interestearning 1,856,608 1,732,676 1,897,723 assets

Total assets $ 35,767,836 $ 35,733,828 $ 34,690,766

Liabilitiesand Stockholders'Equity:

Interestbearing liabilities:

Interestbearing $ 3,038,038 $ 1,701 0.22 % $ 3,069,945 $ 2,594 0.34 % $ 2,800,421 $ 4,127 0.59 %demanddeposits

Savings andmoney market 13,554,572 10,029 0.29 % 13,541,237 11,307 0.33 % 10,664,462 15,853 0.59 %deposits

Time deposits 2,866,746 2,543 0.35 % 3,380,582 3,415 0.41 % 6,519,852 17,701 1.08 %

Totalinterest 19,459,356 14,273 0.29 % 19,991,764 17,316 0.35 % 19,984,735 37,681 0.75 %bearingdeposits

Federal funds 70,054 15 0.08 % - - - % 53,587 14 0.10 %purchased

FHLB andPPPLF 2,647,314 15,678 2.35 % 2,873,922 16,922 2.36 % 4,117,181 20,146 1.95 %borrowings

Notes andother 721,638 9,257 5.13 % 721,753 9,252 5.13 % 722,271 9,252 5.12 %borrowings

Totalinterest 22,898,362 39,223 0.68 % 23,587,439 43,490 0.74 % 24,877,774 67,093 1.07 %bearingliabilities

Non-interestbearing 8,912,960 8,163,879 6,186,718 demanddeposits

Othernon-interest 752,774 851,044 803,498 bearingliabilities

Total 32,564,096 32,602,362 31,867,990 liabilities

Stockholders' 3,203,740 3,131,466 2,822,776 equity

Totalliabilitiesand $ 35,767,836 $ 35,733,828 $ 34,690,766 stockholders'equity

Net interest $ 199,124 $ 202,395 $ 191,968 income

Interest rate 2.11 % 2.14 % 2.06 %spread

Net interest 2.33 % 2.37 % 2.32 %margin

--------------

(1) On a tax-equivalent basis where applicable

(2) Annualized

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

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Nine Months Ended September 30,

2021

2020

Average Balance

Interest (1)

Yield/ Rate (1)(2)

Average Balance

Interest (1)

Yield/ Rate (1)(2)

Assets:

Interest earning assets:

Loans

$

23,139,389

$

612,756

3.54

%

$

23,278,042

$

668,187

3.83

%

Investment securities (3)

9,792,350

116,464

1.59

%

8,501,513

153,987

2.42

%

Other interest earning assets

1,063,476

4,613

0.58

%

654,623

7,950

1.62

%

Total interest earning assets

33,995,215

733,833

2.88

%

32,434,178

830,124

3.42

%

Allowance for credit losses

(213,352)

(222,085)

Non-interest earning assets

1,771,639

1,874,709

Total assets

$

35,553,502

$

34,086,802

Liabilities and Stockholders' Equity:

Interest bearing liabilities:

Interest bearing demand deposits

$

3,017,301

7,069

0.31

%

$

2,475,388

15,808

0.85

%

Savings and money market deposits

13,299,066

33,463

0.34

%

10,509,559

71,056

0.90

%

Time deposits

3,520,674

13,433

0.51

%

7,040,101

83,826

1.59

%

Total interest bearing deposits

19,837,041

53,965

0.36

%

20,025,048

170,690

1.14

%

Federal funds purchased

26,245

17

0.09

%

89,033

412

0.62

%

FHLB and PPPLF borrowings

2,863,093

50,158

2.34

%

4,496,407

66,284

1.97

%

Notes and other borrowings

721,897

27,762

5.13

%

548,851

20,711

5.03

%

Total interest bearing liabilities

23,448,276

131,902

0.75

%

25,159,339

258,097

1.37

%

Non-interest bearing demand deposits

8,194,570

5,292,702

Other non-interest bearing liabilities

783,618

791,057

Total liabilities

32,426,464

31,243,098

Stockholders' equity

3,127,038

2,843,704

Total liabilities and stockholders' equity

$

35,553,502

$

34,086,802

Net interest income

$

601,931

$

572,027

Interest rate spread

2.13

%

2.05

%

Net interest margin

2.36

%

2.35

%

--------------

BANKUNITED, INC. AND SUBSIDIARIES

AVERAGE BALANCES AND YIELDS

(Dollars in thousands)

Nine Months Ended September 30,

2021 2020

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

Assets:

Interestearning assets:

Loans $ 23,139,389 $ 612,756 3.54 % $ 23,278,042 $ 668,187 3.83 %

Investmentsecurities ^ 9,792,350 116,464 1.59 % 8,501,513 153,987 2.42 %(3)

Otherinterest 1,063,476 4,613 0.58 % 654,623 7,950 1.62 %earningassets

Totalinterest 33,995,215 733,833 2.88 % 32,434,178 830,124 3.42 %earningassets

Allowance for (213,352) (222,085) credit losses

Non-interestearning 1,771,639 1,874,709 assets

Total assets $ 35,553,502 $ 34,086,802

Liabilitiesand Stockholders'Equity:

Interestbearing liabilities:

Interestbearing $ 3,017,301 7,069 0.31 % $ 2,475,388 15,808 0.85 %demanddeposits

Savings andmoney market 13,299,066 33,463 0.34 % 10,509,559 71,056 0.90 %deposits

Time deposits 3,520,674 13,433 0.51 % 7,040,101 83,826 1.59 %

Totalinterest 19,837,041 53,965 0.36 % 20,025,048 170,690 1.14 %bearingdeposits

Federal funds 26,245 17 0.09 % 89,033 412 0.62 %purchased

FHLB andPPPLF 2,863,093 50,158 2.34 % 4,496,407 66,284 1.97 %borrowings

Notes andother 721,897 27,762 5.13 % 548,851 20,711 5.03 %borrowings

Totalinterest 23,448,276 131,902 0.75 % 25,159,339 258,097 1.37 %bearingliabilities

Non-interestbearing 8,194,570 5,292,702 demanddeposits

Othernon-interest 783,618 791,057 bearingliabilities

Total 32,426,464 31,243,098 liabilities

Stockholders' 3,127,038 2,843,704 equity

Totalliabilitiesand $ 35,553,502 $ 34,086,802 stockholders'equity

Net interest $ 601,931 $ 572,027 income

Interest rate 2.13 % 2.05 %spread

Net interest 2.36 % 2.35 %margin

--------------

(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 September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Basic earnings per common share:

Numerator:

Net income

$

86,941

$

66,559

$

289,729

$

112,116

Distributed and undistributed earnings allocated to participating securities

(1,112)

(2,896)

(3,701)

(4,816)

Income allocated to common stockholders for basic earnings per common share

$

85,829

$

63,663

$

286,028

$

107,300

Denominator:

Weighted average common shares outstanding

92,053,714

92,405,239

92,787,824

92,918,030

Less average unvested stock awards

(1,208,304)

(1,183,564)

(1,218,416)

(1,164,317)

Weighted average shares for basic earnings per common share

90,845,410

91,221,675

91,569,408

91,753,713

Basic earnings per common share

$

0.94

$

0.70

$

3.12

$

1.17

Diluted earnings per common share:

Numerator:

Income allocated to common stockholders for basic earnings per common share

$

85,829

$

63,663

$

286,028

$

107,300

Adjustment for earnings reallocated from participating securities

2

4

5

3

Income used in calculating diluted earnings per common share

$

85,831

$

63,667

$

286,033

$

107,303

Denominator:

Weighted average shares for basic earnings per common share

90,845,410

91,221,675

91,569,408

91,753,713

Dilutive effect of stock options and certain shared-based awards

182,448

171,054

152,675

142,008

Weighted average shares for diluted earnings per common share

91,027,858

91,392,729

91,722,083

91,895,721

Diluted earnings per common share

$

0.94

$

0.70

$

3.12

$

1.17

BANKUNITED, INC. AND SUBSIDIARIES

EARNINGS PER COMMON SHARE

(In thousands except share and per share amounts)

Three Months Ended September Nine Months Ended September 30, 30,

2021 2020 2021 2020

Basic earnings per common share:

Numerator:

Net income $ 86,941 $ 66,559 $ 289,729 $ 112,116

Distributed andundistributedearnings (1,112) (2,896) (3,701) (4,816) allocated toparticipatingsecurities

Income allocatedto commonstockholders for $ 85,829 $ 63,663 $ 286,028 $ 107,300 basic earningsper common share

Denominator:

Weighted averagecommon shares 92,053,714 92,405,239 92,787,824 92,918,030 outstanding

Less averageunvested stock (1,208,304) (1,183,564) (1,218,416) (1,164,317) awards

Weighted averageshares for basic 90,845,410 91,221,675 91,569,408 91,753,713 earnings percommon share

Basic earnings $ 0.94 $ 0.70 $ 3.12 $ 1.17 per common share

Diluted earnings per common share:

Numerator:

Income allocatedto commonstockholders for $ 85,829 $ 63,663 $ 286,028 $ 107,300 basic earningsper common share

Adjustment forearningsreallocated from 2 4 5 3 participatingsecurities

Income used incalculating $ 85,831 $ 63,667 $ 286,033 $ 107,303 diluted earningsper common share

Denominator:

Weighted averageshares for basic 90,845,410 91,221,675 91,569,408 91,753,713 earnings percommon share

Dilutive effectof stock optionsand certain 182,448 171,054 152,675 142,008 shared-basedawards

Weighted averageshares for 91,027,858 91,392,729 91,722,083 91,895,721 diluted earningsper common share

Diluted earnings $ 0.94 $ 0.70 $ 3.12 $ 1.17 per common share

BANKUNITED, INC. AND SUBSIDIARIES

SELECTED RATIOS

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Financial ratios (4)

Return on average assets

0.96

%

0.76

%

1.09

%

0.44

%

Return on average stockholders' equity

10.8

%

9.4

%

12.4

%

5.3

%

Net interest margin (3)

2.33

%

2.32

%

2.36

%

2.35

%

BANKUNITED, INC. AND SUBSIDIARIES

SELECTED RATIOS



Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Financial ratios^ (4)

Return on average assets 0.96 % 0.76 % 1.09 % 0.44 %

Return on average 10.8 % 9.4 % 12.4 % 5.3 %stockholders' equity

Net interest margin^ (3) 2.33 % 2.32 % 2.36 % 2.35 %

September 30, 2021

December 31, 2020

Asset quality ratios

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

1.21

%

1.02

%

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

0.80

%

0.71

%

Allowance for credit losses to total loans

0.70

%

1.08

%

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

57.69

%

105.26

%

Net charge-offs to average loans (4)

0.19

%

0.26

%

--------------

September 30, December 31, 2021 2020

Asset quality ratios

Non-performing loans to total loans^ (1)(5) 1.21 % 1.02 %

Non-performing assets to total assets ^(2)(5) 0.80 % 0.71 %

Allowance for credit losses to total loans 0.70 % 1.08 %

Allowance for credit losses to non-performing 57.69 % 105.26 %loans^ (1)(5)

Net charge-offs to average loans^ (4) 0.19 % 0.26 %

--------------

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 and nine month periods.

Non-performing loans and assets include the guaranteed portion of(5) non-accrual SBA loans totaling $49.1 million or 0.22% of total loans and 0.14% of total assets, at September 30, 2021; and $51.3 million or 0.22% of total loans and 0.15% of total assets, at December 31, 2020.

September 30, 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

8.6

%

9.6

%

8.6

%

9.5

%

5.0

%

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

13.4

%

14.9

%

12.6

%

13.9

%

6.5

%

Total risk-based capital

15.3

%

15.4

%

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 13.3% and 14.8%, respectively, at September 30, 2021.

Non-GAAP Financial Measures

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 the dates indicated (dollars in thousands):

September 30, 2021 December 31, 2020 Required to be Considered BankUnited, BankUnited, BankUnited, BankUnited, Well Inc. N.A. Inc. N.A. Capitalized

Capital ratios

Tier 1 8.6 % 9.6 % 8.6 % 9.5 % 5.0 %leverage

CommonEquity Tier1 ("CET1") 13.4 % 14.9 % 12.6 % 13.9 % 6.5 %risk-basedcapital

Totalrisk-based 15.3 % 15.4 % 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 13.3% and 14.8%, respectively, at September 30, 2021.

Non-GAAP Financial Measures

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 the dates indicated (dollars in thousands):

September June 30, December 31, 30, 2021 2021 2020

Total loans (GAAP) $ 22,807,969 $ 22,885,074 $ 23,866,042

Less: Government insured residential 1,913,497 1,863,723 1,419,074loans

Less: PPP loans 332,548 491,960 781,811

Less: MWL 877,006 1,018,267 1,259,408

Total loans, excluding governmentinsured residential loans, PPP loans $ 19,684,918 $ 19,511,124 $ 20,405,749and MWL (non-GAAP)



ACL $ 159,615 $ 175,642 $ 257,323



ACL to total loans (GAAP) 0.70 % 0.77 % 1.08 %



ACL to total loans, excludinggovernment insured residential 0.81 % 0.90 % 1.26 %loans, PPP loans and MWL (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):

September 30, December 31, 2021 2020

Total stockholders' equity (GAAP) $ 3,096,674 $ 2,983,012

Less: goodwill 77,637 77,637

Tangible stockholders' equity (non-GAAP) $ 3,019,037 $ 2,905,375



Common shares issued and outstanding 90,049,326 93,067,500



Book value per common share (GAAP) $ 34.39 $ 32.05



Tangible book value per common share $ 33.53 $ 31.22 (non-GAAP)

View source version on businesswire.com: https://www.businesswire.com/news/home/20211021005209/en/

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