BankUnited, Inc. Reports 2020 Results
BankUnited, Inc. (NYSE: BKU) reported strong Q4 2020 results with net income of $85.7 million, or $0.89 per diluted share, representing a quarter-over-quarter increase from $66.6 million. Annual net income for 2020 was $197.9 million, down from $313.1 million in 2019, impacted by CECL accounting and COVID-19. Improvements in deposit mix and reduced credit costs contributed to a net interest income increase of $5.9 million QoQ. The average cost of total deposits decreased to 0.43%. Book value per share rose to $32.05. The Board reinstated a $44.9 million share repurchase program.
- Net income increased to $85.7 million for Q4 2020, up from $66.6 million in Q3 2020.
- Net interest income rose by $5.9 million QoQ, demonstrating effective deposit mix improvements.
- Average cost of total deposits declined to 0.43%, improving margin.
- Book value per share increased to $32.05 from $31.01 in the prior quarter.
- Reinstated share repurchase program of $44.9 million after suspension.
- 2020 annual net income of $197.9 million was significantly lower than $313.1 million in 2019.
- Results negatively affected by CECL accounting and higher credit loss provisions due to COVID-19.
- Non-performing loans increased to $244.5 million, or 1.02% of total loans.
BankUnited, Inc. (the “Company”) (NYSE: BKU) today announced financial results for the quarter and year ended December 31, 2020.
“Overall, this was an excellent quarter. We saw improvement in the economic outlook leading to a reduction in credit costs and continued to execute on our core strategy of improving the deposit mix, lowering the cost of funds and growing net interest income," said Rajinder Singh, Chairman, President and Chief Executive Officer.
For the quarter ended December 31, 2020, the Company reported net income of
For the year ended December 31, 2020, the Company reported net income of
Financial Highlights
-
Net interest income increased by
$5.9 million compared to the immediately preceding quarter ended September 30, 2020 and by$8.1 million compared to the quarter ended December 31, 2019. The net interest margin, calculated on a tax-equivalent basis, was2.33% for the quarter ended December 31, 2020 compared to2.32% for the immediately preceding quarter. The net interest margin was2.41% for the quarter ended December 31, 2019. -
The average cost of total deposits continued to decline, dropping by
0.14% to0.43% for the quarter ended December 31, 2020 compared to0.57% for the quarter ended September 30, 2020. The average cost of total deposits was1.48% for the quarter ended December 31, 2019. On a spot basis, the average annual percentage yield ("APY") on total deposits declined to0.36% at December 31, 2020 from0.49% at September 30, 2020 and1.42% at December 31, 2019. -
For the quarter ended December 31, 2020, the Company recorded a net recovery of credit losses of
$1.6 million compared to a provision for credit losses of$29.2 million for the immediately preceding quarter ended September 30, 2020. The reduction in the provision for credit losses reflected improvements in forecasted economic conditions, which offset the impact of some further downward risk rating migration and increases in specific reserves. The provision for credit losses was$178.4 million for the year ended December 31, 2020. At December 31, 2020, the allowance for credit losses ("ACL") was$257 million , or1.08% of the loan portfolio, compared to$274 million , or1.15% at September 30, 2020. The reduction in the ACL as a percentage of loans was attributable primarily to charge-offs taken during the quarter, coupled with the lower provision for credit losses. -
Pre-tax, pre-provision net revenue ("PPNR") was
$105.3 million for the quarter ended December 31, 2020 compared to$104.1 million for the quarter ended December 31, 2019 and$115.1 million for the immediately preceding quarter ended September 30, 2020. PPNR for the quarter ended December 31, 2020 was impacted by year-end adjustments to certain compensation accruals. For the year ended December 31, 2020, PPNR improved to$427.8 million from$412.9 million for the year ended December 31, 2019. -
Average non-interest bearing demand deposits grew by
$966 million for the quarter ended December 31, 2020 compared to the immediately preceding quarter and by$2.9 billion compared to the quarter ended December 31, 2019. At December 31, 2020, non-interest bearing demand deposits represented25% of total deposits, compared to18% of total deposits at December 31, 2019. Total deposits grew by$899 million and$3.1 billion during the quarter and year ended December 31, 2020, respectively, of which$219 million and$2.7 billion respectively was non-interest bearing. Higher cost time deposits continued to runoff, declining by$1.1 billion and$2.5 billion for the quarter and year ended December 31, 2020, respectively. -
Loans on deferral totaled
$207 million or less than1% of total loans at December 31, 2020. Loans modified under the CARES Act totaled$587 million at December 31, 2020. In the aggregate, this represents$794 million or3% of the total loan portfolio at December 31, 2020, down from$3.6 billion or15% of total loans that were granted an initial 90 day deferral as reported at the end of the second quarter. As of December 31, 2020, commercial loans on short-term payment deferral totaled$63 million and commercial loans subject to CARES Act modifications totaled$575 million or3% of the total commercial portfolio. Residential loans still on deferral were$144 million and those modified under the CARES Act were$12 million , for a total of$156 million or2% of the residential portfolio at December 31, 2020. -
Book value per common share and tangible book value per common share at December 31, 2020 increased to
$32.05 and$31.22 , respectively, from$31.01 and$30.17 , respectively at September 30, 2020 and$31.33 and$30.52 , respectively at December 31, 2019. -
On January 20, 2021, the Company’s Board of Directors reinstated the share repurchase program that the Company suspended on March 16, 2020. Authorization to repurchase up to approximately
$44.9 million in shares of its outstanding common stock remains under the 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 at any time
Loans and Leases
A comparison of loan and lease portfolio composition at the dates indicated follows (dollars in thousands):
|
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
|||||||||||||||
Residential and other consumer loans |
$ |
6,348,222 |
|
|
26.6 |
% |
|
$ |
5,940,900 |
|
|
25.1 |
% |
|
$ |
5,661,119 |
|
|
24.5 |
% |
Multi-family |
1,639,201 |
|
|
6.9 |
% |
|
1,810,126 |
|
|
7.6 |
% |
|
2,217,705 |
|
|
9.6 |
% |
|||
Non-owner occupied commercial real estate |
4,963,273 |
|
|
20.8 |
% |
|
4,910,835 |
|
|
20.7 |
% |
|
5,030,904 |
|
|
21.7 |
% |
|||
Construction and land |
293,307 |
|
|
1.2 |
% |
|
263,381 |
|
|
1.1 |
% |
|
243,925 |
|
|
1.1 |
% |
|||
Owner occupied commercial real estate |
2,000,770 |
|
|
8.4 |
% |
|
2,051,577 |
|
|
8.6 |
% |
|
2,062,808 |
|
|
8.9 |
% |
|||
Commercial and industrial |
4,447,383 |
|
|
18.6 |
% |
|
4,427,351 |
|
|
18.6 |
% |
|
4,655,349 |
|
|
20.1 |
% |
|||
PPP |
781,811 |
|
|
3.3 |
% |
|
829,798 |
|
|
3.5 |
% |
|
— |
|
|
— |
% |
|||
Pinnacle |
1,107,386 |
|
|
4.6 |
% |
|
1,157,706 |
|
|
4.9 |
% |
|
1,202,430 |
|
|
5.2 |
% |
|||
Bridge - franchise finance |
549,733 |
|
|
2.3 |
% |
|
606,222 |
|
|
2.4 |
% |
|
627,482 |
|
|
2.6 |
% |
|||
Bridge - equipment finance |
475,548 |
|
|
2.0 |
% |
|
530,516 |
|
|
2.2 |
% |
|
684,794 |
|
|
3.0 |
% |
|||
Mortgage warehouse lending ("MWL") |
1,259,408 |
|
|
5.3 |
% |
|
1,250,903 |
|
|
5.3 |
% |
|
768,472 |
|
|
3.3 |
% |
|||
|
$ |
23,866,042 |
|
|
100.0 |
% |
|
$ |
23,779,315 |
|
|
100.0 |
% |
|
$ |
23,154,988 |
|
|
100.0 |
% |
Operating lease equipment, net |
$ |
663,517 |
|
|
|
|
$ |
676,321 |
|
|
|
|
$ |
698,153 |
|
|
|
|||
Growth in residential and other consumer loans for the quarter was mainly attributable to GNMA early buyout loans. At December 31, 2020, September 30, 2020 and December 31, 2019, the residential portfolio included
In the aggregate, commercial loans declined by
During the quarter ended December 31, 2020, the Company began processing forgiveness applications with the SBA, resulting in a
Mortgage warehouse commitments totaled
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 December 31, 2020 (dollars in thousands):
|
Non-Performing Loans |
|
Currently Under Short-Term Deferral |
|
CARES Act Modification |
||||||
Residential and other consumer (1) |
$ |
28,828 |
|
|
$ |
144,189 |
|
|
$ |
12,050 |
|
Commercial: |
|
|
|
|
|
||||||
CRE - Property Type: |
|
|
|
|
|
||||||
Retail |
16,566 |
|
|
28,542 |
|
|
18,526 |
|
|||
Hotel |
35,390 |
|
|
1,055 |
|
|
343,492 |
|
|||
Office |
9,436 |
|
|
— |
|
|
47,949 |
|
|||
Multi-family |
24,090 |
|
|
— |
|
|
15,776 |
|
|||
Other |
7,379 |
|
|
1,789 |
|
|
— |
|
|||
Owner occupied commercial real estate |
23,152 |
|
|
8,432 |
|
|
6,198 |
|
|||
Commercial and industrial |
54,584 |
|
|
2,191 |
|
|
117,836 |
|
|||
Bridge - franchise finance |
45,028 |
|
|
20,797 |
|
|
24,816 |
|
|||
Total commercial |
215,625 |
|
|
62,806 |
|
|
574,593 |
|
|||
Total |
$ |
244,453 |
|
|
$ |
206,995 |
|
|
$ |
586,643 |
|
(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 December 31, 2020 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
The following table presents criticized and classified commercial loans at the dates indicated (in thousands):
|
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
||||||
Special mention |
$ |
711,516 |
|
|
$ |
951,981 |
|
|
$ |
72,881 |
|
Substandard - accruing |
1,758,654 |
|
|
1,376,718 |
|
|
180,380 |
|
|||
Substandard - non-accruing |
203,758 |
|
|
187,247 |
|
|
185,906 |
|
|||
Doubtful |
11,867 |
|
|
938 |
|
|
— |
|
|||
Total |
$ |
2,685,795 |
|
|
$ |
2,516,884 |
|
|
$ |
439,167 |
|
The following table presents the ACL at the dates indicated, related ACL coverage ratios, as well as net charge-off rates for the years ended December 31, 2020 and 2019 (dollars in thousands):
|
ACL |
|
ACL to Total Loans |
|
ACL to Non-Performing Loans |
|
Net Charge-offs to Average Loans |
|||||
December 31, 2019 (incurred loss) |
$ |
108,671 |
|
|
0.47 |
% |
|
53.07 |
% |
|
0.05 |
% |
January 1, 2020 (initial date of CECL adoption) |
$ |
135,976 |
|
|
0.59 |
% |
|
66.40 |
% |
|
N/A |
|
September 30, 2020 (expected loss) |
$ |
274,128 |
|
|
1.15 |
% |
|
136.86 |
% |
|
0.25 |
% |
December 31, 2020 (expected loss) |
$ |
257,323 |
|
|
1.08 |
% |
(1) |
105.26 |
% |
|
0.26 |
% |
(1) |
ACL to total loans, excluding government insured residential loans, PPP loans and MWL, which carry nominal or no reserves, was |
The ACL at December 31, 2020 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 December 2020, 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 from September 30, 2020 to December 31, 2020 related primarily to charge-offs taken during the quarter, coupled with the lower provision for credit losses.
For the quarter ended December 31, 2020, the Company recorded a net recovery of credit losses of
The following table summarizes the activity in the ACL for the periods indicated (in thousands):
|
Three Months Ended December 31, |
|
Years Ended December 31, |
||||||||||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||||
Beginning balance |
$ |
274,128 |
|
|
$ |
108,462 |
|
|
$ |
108,671 |
|
|
$ |
109,931 |
|
Cumulative effect of adoption of CECL |
— |
|
|
— |
|
|
27,305 |
|
|
— |
|
||||
Balance after adoption of CECL |
274,128 |
|
|
108,462 |
|
|
135,976 |
|
|
109,931 |
|
||||
Provision (recovery) |
1,244 |
|
|
(469) |
|
|
182,339 |
|
|
8,904 |
|
||||
Charge-offs |
(18,848) |
|
|
(3,556) |
|
|
(69,602) |
|
|
(17,541) |
|
||||
Recoveries |
799 |
|
|
4,234 |
|
|
8,610 |
|
|
7,377 |
|
||||
Ending balance |
$ |
257,323 |
|
|
$ |
108,671 |
|
|
$ |
257,323 |
|
|
$ |
108,671 |
|
Net interest income
Net interest income for the quarter ended December 31, 2020 was
Interest income decreased by
The Company’s net interest margin, calculated on a tax-equivalent basis, increased by
-
The average rate paid on interest bearing deposits decreased to
0.58% for the quarter ended December 31, 2020, from0.75% for the quarter ended September 30, 2020. This decline reflected continued initiatives taken to lower rates paid on deposits in response to declines in general market interest rates and the re-pricing of term deposits. We expect the cost of interest bearing deposits to continue to decline; at December 31, 2020, approximately$1.0 billion or21% of the time deposit portfolio, with an average rate of1.61% , has not yet repriced since March 2020 when the Fed last cut rates. The majority of these CDs will mature in the first quarter of 2021. -
The tax-equivalent yield on investment securities decreased to
1.82% for the quarter ended December 31, 2020 from2.00% for the quarter ended September 30, 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 decreased to
3.55% for the quarter ended December 31, 2020, from3.61% for the quarter ended September 30, 2020. Factors contributing to this decrease included the impact of runoff of loans originated in a higher rate environment, originations at lower prevailing market rates and interest income reversed on loans placed on non-accrual during the quarter. -
The average rate paid on FHLB and PPPLF borrowings increased to
2.07% for the quarter ended December 31, 2020, from1.95% for the quarter ended September 30, 2020, reflecting the maturity of short-term, lower rate FHLB advances and the payoff of all PPPLF borrowings. - 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.
The Company's net interest margin, calculated on a tax-equivalent basis, was
Non-interest expense
Non-interest expense totaled
-
Compensation and benefits increased by
$12.5 million for the quarter ended December 31, 2020 compared to the immediately preceding quarter. This increase included an increase of$6.6 million in variable compensation accruals related to stronger than initially anticipated operating results over the second half of the year; a$2.2 million vacation accrual related to rollover vacation days provided to employees in response to COVID-19; and an increase of$2.5 million in the accrual related to liability classified share awards stemming from an increase in the stock price. - Cost reductions stemming from our BankUnited 2.0 initiative contributed to the declining trend in occupancy and equipment expense and other non-interest expense.
- The increasing trend in technology and telecommunications expense is reflective of investments in digital and data analytics capabilities and in the infrastructure to support cloud migration.
- The increasing trend in deposit insurance expense reflects an increase in the assessment rate.
-
For the quarter and year ended December 31, 2020, non-interest expense included approximately
$2.8 million and$4.8 million , respectively, in costs directly related to our response to the COVID-19 pandemic.
Earnings Conference Call and Presentation
A conference call to discuss quarterly results will be held at 9:00 a.m. ET on Thursday, January 21, 2021 with Chairman, President and Chief Executive Officer, Rajinder P. Singh, and Chief Financial Officer, Leslie N. Lunak.
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://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 9281414. A replay of the call will be available from 12:00 p.m. ET on January 21st through 11:59 p.m. ET on January 28th by calling (855) 859-2056 (domestic) or (404) 537-3406 (international). The conference ID for the replay is 9281414. 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
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, 2019 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) |
|||||||
|
December 31,
|
|
December 31,
|
||||
ASSETS |
|
|
|
||||
Cash and due from banks: |
|
|
|
||||
Non-interest bearing |
$ |
20,233 |
|
|
$ |
7,704 |
|
Interest bearing |
377,483 |
|
|
206,969 |
|
||
Cash and cash equivalents |
397,716 |
|
|
214,673 |
|
||
Investment securities (including securities recorded at fair value of |
9,176,683 |
|
|
7,769,237 |
|
||
Non-marketable equity securities |
195,865 |
|
|
253,664 |
|
||
Loans held for sale |
24,676 |
|
|
37,926 |
|
||
Loans |
23,866,042 |
|
|
23,154,988 |
|
||
Allowance for credit losses |
(257,323) |
|
|
(108,671) |
|
||
Loans, net |
23,608,719 |
|
|
23,046,317 |
|
||
Bank owned life insurance |
294,629 |
|
|
282,151 |
|
||
Operating lease equipment, net |
663,517 |
|
|
698,153 |
|
||
Goodwill and other intangible assets |
77,637 |
|
|
77,674 |
|
||
Other assets |
571,051 |
|
|
491,498 |
|
||
Total assets |
$ |
35,010,493 |
|
|
$ |
32,871,293 |
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Liabilities: |
|
|
|
||||
Demand deposits: |
|
|
|
||||
Non-interest bearing |
$ |
7,008,838 |
|
|
$ |
4,294,824 |
|
Interest bearing |
3,020,039 |
|
|
2,130,976 |
|
||
Savings and money market |
12,659,740 |
|
|
10,621,544 |
|
||
Time |
4,807,199 |
|
|
7,347,247 |
|
||
Total deposits |
27,495,816 |
|
|
24,394,591 |
|
||
Federal funds purchased |
180,000 |
|
|
100,000 |
|
||
FHLB advances |
3,122,999 |
|
|
4,480,501 |
|
||
Notes and other borrowings |
722,495 |
|
|
429,338 |
|
||
Other liabilities |
506,171 |
|
|
486,084 |
|
||
Total liabilities |
32,027,481 |
|
|
29,890,514 |
|
||
|
|
|
|
||||
Commitments and contingencies |
|
|
|
||||
|
|
|
|
||||
Stockholders' equity: |
|
|
|
||||
Common stock, par value |
931 |
|
|
951 |
|
||
Paid-in capital |
1,017,518 |
|
|
1,083,920 |
|
||
Retained earnings |
2,013,715 |
|
|
1,927,735 |
|
||
Accumulated other comprehensive loss |
(49,152) |
|
|
(31,827) |
|
||
Total stockholders' equity |
2,983,012 |
|
|
2,980,779 |
|
||
Total liabilities and stockholders' equity |
$ |
35,010,493 |
|
|
$ |
32,871,293 |
|
BANKUNITED, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED (In thousands, except per share data) |
|||||||||||||||||||
|
Three Months Ended |
|
Years Ended |
||||||||||||||||
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
||||||||||||
|
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||||||
Interest income: |
|
|
|
|
|
|
|
|
|
||||||||||
Loans |
$ |
207,232 |
|
|
$ |
208,646 |
|
|
$ |
242,642 |
|
|
$ |
864,175 |
|
|
$ |
981,408 |
|
Investment securities |
42,260 |
|
|
44,604 |
|
|
62,006 |
|
|
193,856 |
|
|
280,560 |
|
|||||
Other |
1,628 |
|
|
1,322 |
|
|
4,762 |
|
|
9,578 |
|
|
19,902 |
|
|||||
Total interest income |
251,120 |
|
|
254,572 |
|
|
309,410 |
|
|
1,067,609 |
|
|
1,281,870 |
|
|||||
Interest expense: |
|
|
|
|
|
|
|
|
|
||||||||||
Deposits |
29,290 |
|
|
37,681 |
|
|
88,289 |
|
|
199,980 |
|
|
385,180 |
|
|||||
Borrowings |
28,464 |
|
|
29,412 |
|
|
35,810 |
|
|
115,871 |
|
|
143,905 |
|
|||||
Total interest expense |
57,754 |
|
|
67,093 |
|
|
124,099 |
|
|
315,851 |
|
|
529,085 |
|
|||||
Net interest income before provision for credit losses |
193,366 |
|
|
187,479 |
|
|
185,311 |
|
|
751,758 |
|
|
752,785 |
|
|||||
Provision for (recovery of) credit losses |
(1,643) |
|
|
29,232 |
|
|
(469) |
|
|
178,431 |
|
|
8,904 |
|
|||||
Net interest income after provision for credit losses |
195,009 |
|
|
158,247 |
|
|
185,780 |
|
|
573,327 |
|
|
743,881 |
|
|||||
Non-interest income: |
|
|
|
|
|
|
|
|
|
||||||||||
Deposit service charges and fees |
4,569 |
|
|
4,040 |
|
|
4,150 |
|
|
16,496 |
|
|
16,539 |
|
|||||
Gain on sale of loans, net |
2,425 |
|
|
2,953 |
|
|
1,899 |
|
|
13,170 |
|
|
12,119 |
|
|||||
Gain on investment securities, net |
7,203 |
|
|
7,181 |
|
|
7,438 |
|
|
17,767 |
|
|
21,174 |
|
|||||
Lease financing |
13,547 |
|
|
13,934 |
|
|
13,857 |
|
|
59,112 |
|
|
66,631 |
|
|||||
Other non-interest income |
7,536 |
|
|
8,184 |
|
|
10,412 |
|
|
26,676 |
|
|
30,741 |
|
|||||
Total non-interest income |
35,280 |
|
|
36,292 |
|
|
37,756 |
|
|
133,221 |
|
|
147,204 |
|
|||||
Non-interest expense: |
|
|
|
|
|
|
|
|
|
||||||||||
Employee compensation and benefits |
60,944 |
|
|
48,448 |
|
|
55,744 |
|
|
217,156 |
|
|
235,330 |
|
|||||
Occupancy and equipment |
11,797 |
|
|
12,170 |
|
|
13,697 |
|
|
48,237 |
|
|
56,174 |
|
|||||
Deposit insurance expense |
6,759 |
|
|
5,886 |
|
|
4,142 |
|
|
21,854 |
|
|
16,991 |
|
|||||
Professional fees |
2,937 |
|
|
2,436 |
|
|
2,621 |
|
|
11,708 |
|
|
20,352 |
|
|||||
Technology and telecommunications |
16,052 |
|
|
15,435 |
|
|
13,334 |
|
|
58,108 |
|
|
47,509 |
|
|||||
Depreciation of operating lease equipment |
12,270 |
|
|
12,315 |
|
|
13,610 |
|
|
49,407 |
|
|
48,493 |
|
|||||
Loss on debt extinguishment |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
3,796 |
|
|||||
Other non-interest expense |
12,565 |
|
|
11,937 |
|
|
15,860 |
|
|
50,719 |
|
|
58,444 |
|
|||||
Total non-interest expense |
123,324 |
|
|
108,627 |
|
|
119,008 |
|
|
457,189 |
|
|
487,089 |
|
|||||
Income before income taxes |
106,965 |
|
|
85,912 |
|
|
104,528 |
|
|
249,359 |
|
|
403,996 |
|
|||||
Provision for income taxes |
21,228 |
|
|
19,353 |
|
|
15,072 |
|
|
51,506 |
|
|
90,898 |
|
|||||
Net income |
$ |
85,737 |
|
|
$ |
66,559 |
|
|
$ |
89,456 |
|
|
$ |
197,853 |
|
|
$ |
313,098 |
|
Earnings per common share, basic |
$ |
0.89 |
|
|
$ |
0.70 |
|
|
$ |
0.91 |
|
|
$ |
2.06 |
|
|
$ |
3.14 |
|
Earnings per common share, diluted |
$ |
0.89 |
|
|
$ |
0.70 |
|
|
$ |
0.91 |
|
|
$ |
2.06 |
|
|
$ |
3.13 |
|
BANKUNITED, INC. AND SUBSIDIARIES AVERAGE BALANCES AND YIELDS (Dollars in thousands) |
||||||||||||||||||||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Three Months Ended
|
|||||||||||||||||||||||||||
|
Average
|
|
Interest
|
|
Yield/
|
|
Average
|
|
Interest
|
|
Yield/
|
|
Average
|
|
Interest
|
|
Yield/
|
|||||||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Loans |
$ |
23,706,859 |
|
|
$ |
210,896 |
|
|
3.55 |
% |
|
$ |
23,447,514 |
|
|
$ |
212,388 |
|
|
3.61 |
% |
|
$ |
22,986,427 |
|
|
$ |
246,458 |
|
|
4.27 |
% |
Investment securities (3) |
9,446,389 |
|
|
42,966 |
|
|
1.82 |
% |
|
9,065,478 |
|
|
45,351 |
|
|
2.00 |
% |
|
7,929,948 |
|
|
62,948 |
|
|
3.18 |
% |
||||||
Other interest earning assets |
726,273 |
|
|
1,628 |
|
|
0.89 |
% |
|
552,515 |
|
|
1,322 |
|
|
0.95 |
% |
|
627,001 |
|
|
4,762 |
|
|
3.01 |
% |
||||||
Total interest earning assets |
33,879,521 |
|
|
255,490 |
|
|
3.01 |
% |
|
33,065,507 |
|
|
259,061 |
|
|
3.13 |
% |
|
31,543,376 |
|
|
314,168 |
|
|
3.97 |
% |
||||||
Allowance for credit losses |
(280,243) |
|
|
|
|
|
|
(272,464) |
|
|
|
|
|
|
(110,503) |
|
|
|
|
|
||||||||||||
Non-interest earning assets |
1,817,476 |
|
|
|
|
|
|
1,897,723 |
|
|
|
|
|
|
1,655,342 |
|
|
|
|
|
||||||||||||
Total assets |
$ |
35,416,754 |
|
|
|
|
|
|
$ |
34,690,766 |
|
|
|
|
|
|
$ |
33,088,215 |
|
|
|
|
|
|||||||||
Liabilities and Stockholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest bearing demand deposits |
$ |
2,903,300 |
|
|
$ |
3,637 |
|
|
0.50 |
% |
|
$ |
2,800,421 |
|
|
$ |
4,127 |
|
|
0.59 |
% |
|
$ |
1,947,034 |
|
|
$ |
6,485 |
|
|
1.32 |
% |
Savings and money market deposits |
11,839,631 |
|
|
14,517 |
|
|
0.49 |
% |
|
10,664,462 |
|
|
15,853 |
|
|
0.59 |
% |
|
10,416,964 |
|
|
41,705 |
|
|
1.59 |
% |
||||||
Time deposits |
5,360,630 |
|
|
11,136 |
|
|
0.83 |
% |
|
6,519,852 |
|
|
17,701 |
|
|
1.08 |
% |
|
7,016,192 |
|
|
40,099 |
|
|
2.27 |
% |
||||||
Total interest bearing deposits |
20,103,561 |
|
|
29,290 |
|
|
0.58 |
% |
|
19,984,735 |
|
|
37,681 |
|
|
0.75 |
% |
|
19,380,190 |
|
|
88,289 |
|
|
1.81 |
% |
||||||
Short term borrowings |
20,707 |
|
|
6 |
|
|
0.12 |
% |
|
53,587 |
|
|
14 |
|
|
0.10 |
% |
|
115,928 |
|
|
505 |
|
|
1.73 |
% |
||||||
FHLB and PPPLF borrowings |
3,698,666 |
|
|
19,207 |
|
|
2.07 |
% |
|
4,117,181 |
|
|
20,146 |
|
|
1.95 |
% |
|
5,244,495 |
|
|
30,011 |
|
|
2.27 |
% |
||||||
Notes and other borrowings |
722,581 |
|
|
9,251 |
|
|
5.12 |
% |
|
722,271 |
|
|
9,252 |
|
|
5.12 |
% |
|
404,086 |
|
|
5,294 |
|
|
5.24 |
% |
||||||
Total interest bearing liabilities |
24,545,515 |
|
|
57,754 |
|
|
0.94 |
% |
|
24,877,774 |
|
|
67,093 |
|
|
1.07 |
% |
|
25,144,699 |
|
|
124,099 |
|
|
1.96 |
% |
||||||
Non-interest bearing demand deposits |
7,152,967 |
|
|
|
|
|
|
6,186,718 |
|
|
|
|
|
|
4,292,943 |
|
|
|
|
|
||||||||||||
Other non-interest bearing liabilities |
772,277 |
|
|
|
|
|
|
803,498 |
|
|
|
|
|
|
686,027 |
|
|
|
|
|
||||||||||||
Total liabilities |
32,470,759 |
|
|
|
|
|
|
31,867,990 |
|
|
|
|
|
|
30,123,669 |
|
|
|
|
|
||||||||||||
Stockholders' equity |
2,945,995 |
|
|
|
|
|
|
2,822,776 |
|
|
|
|
|
|
2,964,546 |
|
|
|
|
|
||||||||||||
Total liabilities and stockholders' equity |
$ |
35,416,754 |
|
|
|
|
|
|
$ |
34,690,766 |
|
|
|
|
|
|
$ |
33,088,215 |
|
|
|
|
|
|||||||||
Net interest income |
|
|
$ |
197,736 |
|
|
|
|
|
|
$ |
191,968 |
|
|
|
|
|
|
$ |
190,069 |
|
|
|
|||||||||
Interest rate spread |
|
|
|
|
2.07 |
% |
|
|
|
|
|
2.06 |
% |
|
|
|
|
|
2.01 |
% |
||||||||||||
Net interest margin |
|
|
|
|
2.33 |
% |
|
|
|
|
|
2.32 |
% |
|
|
|
|
|
2.41 |
% |
||||||||||||
(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) |
||||||||||||||||||||||
|
|
Years Ended December 31, |
||||||||||||||||||||
|
|
2020 |
|
2019 |
||||||||||||||||||
|
|
Average
|
|
Interest (1) |
|
Yield/
|
|
Average
|
|
Interest (1) |
|
Yield/
|
||||||||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loans |
|
$ |
23,385,832 |
|
|
$ |
879,082 |
|
|
3.76 |
% |
|
$ |
22,553,250 |
|
|
$ |
998,130 |
|
|
4.43 |
% |
Investment securities (2) |
|
8,739,023 |
|
|
196,954 |
|
|
2.25 |
% |
|
8,231,858 |
|
|
284,849 |
|
|
3.46 |
% |
||||
Other interest earning assets |
|
672,634 |
|
|
9,578 |
|
|
1.42 |
% |
|
555,992 |
|
|
19,902 |
|
|
3.58 |
% |
||||
Total interest earning assets |
|
32,797,489 |
|
|
1,085,614 |
|
|
3.31 |
% |
|
31,341,100 |
|
|
1,302,881 |
|
|
4.16 |
% |
||||
Allowance for credit losses |
|
(236,704) |
|
|
|
|
|
|
(112,890) |
|
|
|
|
|
||||||||
Non-interest earning assets |
|
1,860,322 |
|
|
|
|
|
|
1,625,579 |
|
|
|
|
|
||||||||
Total assets |
|
$ |
34,421,107 |
|
|
|
|
|
|
$ |
32,853,789 |
|
|
|
|
|
||||||
Liabilities and Stockholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest bearing demand deposits |
|
$ |
2,582,951 |
|
|
19,445 |
|
|
0.75 |
% |
|
$ |
1,824,803 |
|
|
25,054 |
|
|
1.37 |
% |
||
Savings and money market deposits |
|
10,843,894 |
|
|
85,572 |
|
|
0.79 |
% |
|
10,922,819 |
|
|
197,942 |
|
|
1.81 |
% |
||||
Time deposits |
|
6,617,939 |
|
|
94,963 |
|
|
1.43 |
% |
|
6,928,499 |
|
|
162,184 |
|
|
2.34 |
% |
||||
Total interest bearing deposits |
|
20,044,784 |
|
|
199,980 |
|
|
1.00 |
% |
|
19,676,121 |
|
|
385,180 |
|
|
1.96 |
% |
||||
Short term borrowings |
|
71,858 |
|
|
418 |
|
|
0.58 |
% |
|
124,888 |
|
|
2,802 |
|
|
2.24 |
% |
||||
FHLB and PPPLF borrowings |
|
4,295,882 |
|
|
85,491 |
|
|
1.99 |
% |
|
5,089,524 |
|
|
119,901 |
|
|
2.36 |
% |
||||
Notes and other borrowings |
|
592,521 |
|
|
29,962 |
|
|
5.06 |
% |
|
403,704 |
|
|
21,202 |
|
|
5.25 |
% |
||||
Total interest bearing liabilities |
|
25,005,045 |
|
|
315,851 |
|
|
1.26 |
% |
|
25,294,237 |
|
|
529,085 |
|
|
2.09 |
% |
||||
Non-interest bearing demand deposits |
|
5,760,309 |
|
|
|
|
|
|
3,950,612 |
|
|
|
|
|
||||||||
Other non-interest bearing liabilities |
|
786,337 |
|
|
|
|
|
|
662,590 |
|
|
|
|
|
||||||||
Total liabilities |
|
31,551,691 |
|
|
|
|
|
|
29,907,439 |
|
|
|
|
|
||||||||
Stockholders' equity |
|
2,869,416 |
|
|
|
|
|
|
2,946,350 |
|
|
|
|
|
||||||||
Total liabilities and stockholders' equity |
|
$ |
34,421,107 |
|
|
|
|
|
|
$ |
32,853,789 |
|
|
|
|
|
||||||
Net interest income |
|
|
|
$ |
769,763 |
|
|
|
|
|
|
$ |
773,796 |
|
|
|
||||||
Interest rate spread |
|
|
|
|
|
2.05 |
% |
|
|
|
|
|
2.07 |
% |
||||||||
Net interest margin |
|
|
|
|
|
2.35 |
% |
|
|
|
|
|
2.47 |
% |
||||||||
(1) |
On a tax-equivalent basis where applicable |
|
(2) |
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 December 31, |
|
Years Ended December 31, |
||||||||||||
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Basic earnings per common share: |
|
|
|
|
|
|
|
||||||||
Numerator: |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
85,737 |
|
|
$ |
89,456 |
|
|
$ |
197,853 |
|
|
$ |
313,098 |
|
Distributed and undistributed earnings allocated to participating securities |
(4,015) |
|
|
(3,971) |
|
|
(8,882) |
|
|
(13,371) |
|
||||
Income allocated to common stockholders for basic earnings per common share |
$ |
81,722 |
|
|
$ |
85,485 |
|
|
$ |
188,971 |
|
|
$ |
299,727 |
|
Denominator: |
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding |
92,725,905 |
|
|
95,000,894 |
|
|
92,869,736 |
|
|
96,581,290 |
|
||||
Less average unvested stock awards |
(1,160,984) |
|
|
(1,065,813) |
|
|
(1,163,480) |
|
|
(1,127,275) |
|
||||
Weighted average shares for basic earnings per common share |
91,564,921 |
|
|
93,935,081 |
|
|
91,706,256 |
|
|
95,454,015 |
|
||||
Basic earnings per common share |
$ |
0.89 |
|
|
$ |
0.91 |
|
|
$ |
2.06 |
|
|
$ |
3.14 |
|
Diluted earnings per common share: |
|
|
|
|
|
|
|
||||||||
Numerator: |
|
|
|
|
|
|
|
||||||||
Income allocated to common stockholders for basic earnings per common share |
$ |
81,722 |
|
|
$ |
85,485 |
|
|
$ |
188,971 |
|
|
$ |
299,727 |
|
Adjustment for earnings reallocated from participating securities |
(67) |
|
|
(41) |
|
|
(123) |
|
|
(175) |
|
||||
Income used in calculating diluted earnings per common share |
$ |
81,655 |
|
|
$ |
85,444 |
|
|
$ |
188,848 |
|
|
$ |
299,552 |
|
Denominator: |
|
|
|
|
|
|
|
||||||||
Weighted average shares for basic earnings per common share |
91,564,921 |
|
|
93,935,081 |
|
|
91,706,256 |
|
|
95,454,015 |
|
||||
Dilutive effect of stock options |
20,179 |
|
|
186,967 |
|
|
24,608 |
|
|
202,890 |
|
||||
Weighted average shares for diluted earnings per common share |
91,585,100 |
|
|
94,122,048 |
|
|
91,730,864 |
|
|
95,656,905 |
|
||||
Diluted earnings per common share |
$ |
0.89 |
|
|
$ |
0.91 |
|
|
$ |
2.06 |
|
|
$ |
3.13 |
|
BANKUNITED, INC. AND SUBSIDIARIES SELECTED RATIOS |
|||||||||||
|
Three Months Ended December 31, |
|
Years Ended December 31, |
||||||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||
Financial ratios (4) |
|
|
|
|
|
|
|
||||
Return on average assets |
0.96 |
% |
|
1.07 |
% |
|
0.57 |
% |
|
0.95 |
% |
Return on average stockholders’ equity |
11.6 |
% |
|
12.0 |
% |
|
6.9 |
% |
|
10.6 |
% |
Net interest margin (3) |
2.33 |
% |
|
2.41 |
% |
|
2.35 |
% |
|
2.47 |
% |
|
December 31, 2020 |
|
December 31, 2019 |
||
Asset quality ratios |
|
|
|
||
Non-performing loans to total loans (1)(5) |
1.02 |
% |
|
0.88 |
% |
Non-performing assets to total assets (2)(5) |
0.71 |
% |
|
0.63 |
% |
Allowance for credit losses to total loans |
1.08 |
% |
|
0.47 |
% |
Allowance for credit losses to non-performing loans (1)(5) |
105.26 |
% |
|
53.07 |
% |
Net charge-offs to average loans |
0.26 |
% |
|
0.05 |
% |
(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 period. |
|
(5) |
Non-performing loans and assets include the guaranteed portion of non-accrual SBA loans totaling |
|
December 31, 2020 |
|
December 31, 2019 |
|
Required to be Considered Well Capitalized |
|||||||||
|
BankUnited, Inc. |
|
BankUnited, N.A. |
|
BankUnited, Inc. |
|
BankUnited, N.A. |
|
||||||
Capital ratios |
|
|
|
|
|
|
|
|
|
|||||
Tier 1 leverage |
8.6 |
% |
|
9.5 |
% |
|
8.9 |
% |
|
9.3 |
% |
|
5.0 |
% |
Common Equity Tier 1 ("CET1") risk-based capital |
12.6 |
% |
|
13.9 |
% |
|
12.3 |
% |
|
12.9 |
% |
|
6.5 |
% |
Total risk-based capital |
14.7 |
% |
|
14.8 |
% |
|
12.8 |
% |
|
13.4 |
% |
|
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
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 adoption of the CECL accounting methodology, which may impact comparability of operating results to prior periods. This measure also provides a meaningful basis for comparison to other financial institutions and is a measure frequently cited by investors. The following table reconciles the non-GAAP financial measurement of PPNR to the comparable GAAP financial measurement of income before income taxes for the three months and year ended December 31, 2020 and 2019 and the three months ended September 30, 2020 (in thousands):
|
Three Months Ended
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Years Ended
|
||||||||||||
|
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
||||||||||
Income before income taxes (GAAP) |
$ |
106,965 |
|
|
$ |
85,912 |
|
|
$ |
104,528 |
|
|
$ |
249,359 |
|
|
$ |
403,996 |
|
Plus: Provision for (recovery of) credit losses |
(1,643) |
|
|
29,232 |
|
|
(469) |
|
|
178,431 |
|
|
8,904 |
|
|||||
PPNR (non-GAAP) |
$ |
105,322 |
|
|
$ |
115,144 |
|
|
$ |
104,059 |
|
|
$ |
427,790 |
|
|
$ |
412,900 |
|
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 December 31, 2020 (dollars in thousands):
Total loans (GAAP) |
$ |
23,866,042 |
|
Less: Government insured residential loans |
1,419,074 |
|
|
Less: PPP loans |
781,811 |
|
|
Less: MWL |
1,259,408 |
|
|
Total loans, excluding government insured residential loans, PPP loans and MWL (non-GAAP) |
$ |
20,405,749 |
|
|
|
||
ACL |
$ |
257,323 |
|
|
|
||
ACL to total loans (GAAP) |
1.08 |
% |
|
|
|
||
ACL to total loans, excluding government insured residential loans, PPP loans and MWL (non-GAAP) |
1.26 |
% |
|
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):
|
December 31, 2020 |
|
September 30, 2020 |
|
December 31, 2019 |
||||||
Total stockholders’ equity |
$ |
2,983,012 |
|
|
$ |
2,864,824 |
|
|
$ |
2,980,779 |
|
Less: goodwill and other intangible assets |
77,637 |
|
|
77,641 |
|
|
77,674 |
|
|||
Tangible stockholders’ equity |
$ |
2,905,375 |
|
|
$ |
2,787,183 |
|
|
$ |
2,903,105 |
|
|
|
|
|
|
|
||||||
Common shares issued and outstanding |
93,067,500 |
|
|
92,388,641 |
|
|
95,128,231 |
|
|||
|
|
|
|
|
|
||||||
Book value per common share |
$ |
32.05 |
|
|
$ |
31.01 |
|
|
$ |
31.33 |
|
|
|
|
|
|
|
||||||
Tangible book value per common share |
$ |
31.22 |
|
|
$ |
30.17 |
|
|
$ |
30.52 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20210121005156/en/
FAQ
What were BankUnited's Q4 2020 earnings per share?
How much did BankUnited's net income increase in Q4 2020?
What was the impact of COVID-19 on BankUnited's 2020 financial results?
What is BankUnited's average cost of total deposits as of December 31, 2020?
Is there a share repurchase program for BankUnited?
