) reported its fourth quarter 2012 earnings of 61 cents per
share, substantially beating the Zacks Consensus Estimate of 48
cents. This also compares favorably with the year-ago earnings of
For full year 2012, BankUnited recorded earnings per share of
$2.05, exceeding the earnings of 62 cents recorded in 2011.
Moreover, the earnings were ahead of the Zacks Consensus Estimate
Better-than-expected results were primarily aided by augmented
top line, partly offset by elevated operating expenses. Further,
the company witnessed loan and deposit growth. Yet, a marginal
decline in capital ratios was on the downside.
Net income for the reported quarter came in at $61.4 million, up
48.7% from $41.3 million in the year-ago period. For 2012,
net income stood at $207.4 million, rising substantially from
$63.2 million in 2011.
BankUnited's total revenue reached $207.8 million, improving
10.6% from $188.0 million in the year-ago quarter. Moreover,
total revenue surpassed the Zacks Consensus Estimate of $165.0
million by 26.0%
For 2012, total revenue came in at $810.1 million, rising 1.1%
from $801.3 million in 2011. However, total revenue surpassed the
Zacks Consensus Estimate of $670 million by 20.9%.
Net interest income (before provision for loan losses) surged
24.1% year over year to $174.6 million. The elevation was mainly
attributable to higher interest income and lower interest
expenses. Also, net interest margin increased 16 basis points
(bps) from the prior-year quarter to 6.70%.
Non-interest income stood at $5.5 million, declining 58.8% from
the prior-year quarter. The fall was primarily due to lower
accretion of discount on the Federal Deposit Insurance
Corporation (FDIC) indemnification asset along with reduced FDIC
reimbursement of costs of resolution of covered assets, net gain
on indemnification asset and lower mortgage insurance income.
These were partly offset by higher income from resolution of
covered assets, service charges and fees along with other income.
Non-interest expense was $78.7 million, up 3.8% from the
prior-year quarter. The rise was mainly a result of higher
occupancy and equipment expenses, deposit insurance costs,
telecommunications and data processing expenditure along with
other expenses. However, lower employee compensation and
benefits, impairment of other real estate owned costs, other real
estate owned expenses, foreclosure expenses and professional fees
were the partially offsetting factors.
Asset quality remained robust during the quarter. The ratio of
total nonperforming loans to total loans dipped 8 bps year over
year to 0.62%. Likewise, net charge offs plunged 72.6% year over
year to nearly $3.0 million. On the other hand, provision for
loan losses decreased 75.0% to $1.0 million from $4.0 million in
the year-ago quarter.
Loans and Deposits
BankUnited's total loans, net of discount and deferred fees and
costs, in the reported quarter stood at $5.6 billion, up 36.6%
from $4.1 billion as of Dec 31, 2011. The augmentation largely
came from increases in new loans, partly offset by reduced
Total deposits for the quarter stood at $8.5 billion, up 14.9%
from $7.4 billion as of Dec 31, 2011. The increase was primarily
due to the higher levels of demand deposits as well as savings
and money market deposits.
Profitability and Capital Ratios
BankUnited's profitability and capital ratios were mixed. As of
Dec 31, 2012, tier 1 leverage ratio was 13.16%, up from 13.06% as
of Dec 31, 2011. However, Tier 1 risk-based capital ratio was
33.60%, down from 41.62% as of Dec 31, 2011. Total risk-based
capital ratio came in at 34.88%, dipping from 42.89% as of Dec
Profitability ratios show improvement. The annualized return on
average assets was 1.95%, increasing from 1.45% in the prior-year
quarter. As of Dec 31, 2012, annualized return on average
stockholders' equity came in at 13.80%, rising from 10.80% as of
Dec 31, 2011.
Performance of Other Major Regional Banks
) fourth-quarter earnings came in line with the Zacks Consensus
Estimate. Top-line growth, continued improvement in credit
quality and robust capital ratios were the primary highlights of
the quarter. However, higher operating expenses marginally
subdued the results.
The fourth-quarter earnings of
SunTrust Banks Inc.
Fifth Third Bancorp
) marginally surpassed the Zacks Consensus Estimate.
Better-than-expected quarterly results benefited primarily from
the growth in top line.
The company continues to grow organically with the opening of new
branches. Moreover, we are quite impressed with the company's
decent top-line growth as well as efforts to contain its
expenses. Nevertheless, unsettling macro economic factors remain
BankUnited currently retains a Zacks Rank #2 (Buy).
BANKUNITED INC (BKU): Free Stock Analysis
FIFTH THIRD BK (FITB): Free Stock Analysis
KEYCORP NEW (KEY): Free Stock Analysis Report
SUNTRUST BKS (STI): Free Stock Analysis
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