) fourth-quarter 2013 earnings per share of 50 cents beat the
Zacks Consensus Estimate of 46 cents primarily on the back of
lower expenses. However, results lagged the prior-year quarter
figure of 61 cents.
For the full year 2013, BankUnited recorded earnings per share of
$2.01 versus $2.05 in 2012. However, earnings for the year
surpassed the Zacks Consensus Estimate of $1.95.
Results were primarily aided by growth in non-interest income,
partially offset by a decline in net interest income and higher
operating expenses. Growth in loan and deposit balances was a
tailwind for the quarter. However, capital ratios and
Net income for the quarter came in at $52.4 million, down 16.2%
from $62.5 million in the year-ago period. However, for the full
year, net income came in at $208.9 million, declining 1.1% from
$211.3 billion in 2012.
BankUnited's total revenue was $194.5 million, down 6.4% year
over year. For the full year, total revenue was $770.0 million,
down 5.0% from $810.1 million in 2012.
Net interest income (excluding provision for loan loses)
decreased 5.9% year over year to $164.3 million. The decline was
primarily due a drop in interest income partially offset by lower
interest expense. Moreover, net interest margin decreased 148
basis points (bps) from the prior-year quarter to 5.24%.
Non-interest income increased 6.4% from the prior-year quarter to
$5.9 million. The rise was primarily due to higher income from
resolution of covered assets, lower loss on sale of loans of as
well as increased other fee income, partially offset by accretion
of Federal Deposit Insurance Corporation (FDIC) indemnification
Non-interest expense upped 7.0% year over year to $84.2 million.
The rise mainly resulted from an increase in all the components
except foreclosure and other real estate owned expenditures as
well as deposit insurance cost.
Asset quality was a mixed bag during the quarter. The ratio of
total nonperforming loans to total loans was 0.39% as of Dec 31,
2013, down 23 bps from Dec 31, 2012.
Net charge-offs to average loans was 0.31% as of Dec 31, 2013, up
14 bps from 0.17% as of Dec 31, 2012. However, provision for loan
losses increased substantially to $12.5 million from $1.0 million
in the prior-year quarter.
Loans and Deposits
As of Dec 31, 2013, net loans, net of premium, discount and
deferred fees and costs, were $9.1 billion, up 61.5% from $5.6
billion as of Dec 31, 2012. The increase largely came from rise
in new loans, partly offset by reduced covered loans.
Total deposits were $10.5 billion, up 23.4% from $8.5 billion as
of Dec 31, 2012.
Profitability and Capital Ratios
BankUnited's capital and profitability ratios deteriorated in the
quarter. As of Dec 31, 2013, Tier 1 leverage ratio was 12.42%,
compared with 13.16% as of Dec 31, 2012. Tier 1 risk-based
capital ratio was 21.06% versus 33.60% as of Dec 31, 2012. Total
risk-based capital ratio came in at 21.93% against 34.88% as of
Dec 31, 2012.
The return on average assets came in at 1.41%, declining from
1.95% as of Dec 31, 2012. As of Dec 31, 2013, return on average
stockholder equity came in at 10.84%, decreasing from 13.80% as
of Dec 31, 2012.
Performance of Other Major Regional Banks
) surpassed the Zacks Consensus Estimate in fourth-quarter 2013.
The encouraging results were primarily driven by a decline in
provision for credit losses and lower expenses for both the
Northern Trust Corp.
) lagged the Zacks Consensus Estimate due to higher expenses.
Persistent top-line pressure, rising expenses and intensely
competitive markets are expected to weigh upon the company's
financials in the near term. However, given its steady balance
sheet position, BankUnited is well poised to grow both
organically and inorganically in the coming quarters.
Currently, BankUnited carries a Zacks Rank #4 (Sell).
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BANKUNITED INC (BKU): Free Stock Analysis
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