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BankUnited (BKU)

Filed: 20 Jan 22, 6:48am

Exhibit 99.1
 
BANKUNITED, INC. REPORTS 2021 RESULTS
 
Miami Lakes, Fla. — January 20, 2022 — BankUnited, Inc. (the “Company”) (NYSE: BKU) today announced financial results for the quarter and year ended December 31, 2021.
"We are pleased with the quarter, with earnings of $1.41 per share, over $1 billion of loan growth, our best loan growth quarter since the second quarter of 2016, over $1 billion in deposit growth and margin expansion of 11 basis points. Our outlook for the Company going into 2022 is optimistic." said Rajinder Singh, Chairman, President and Chief Executive Officer.
For the quarter ended December 31, 2021, the Company reported net income of $125.3 million, or $1.41 per diluted share, compared to $86.9 million or $0.94 per diluted share for the immediately preceding quarter ended September 30, 2021 and $85.7 million, or $0.89 per diluted share, for the quarter ended December 31, 2020.
For the year ended December 31, 2021, the Company reported net income of $415.0 million, or $4.52 per diluted share, compared to $197.9 million, or $2.06 per diluted share, for the year ended December 31, 2020. The return on average stockholders' equity for the year ended December 31, 2021 was 13.3%, while the return on average assets was 1.16%.
Financial Highlights
Total loans, excluding the runoff of PPP loans, grew by $1.0 billion for the quarter ended December 31, 2021, our largest loan growth quarter since the second quarter of 2016.
The net interest margin, calculated on a tax-equivalent basis, expanded to 2.44% for the quarter ended December 31, 2021 from 2.33% for both the immediately preceding quarter and for the quarter ended December 31, 2020. Net interest income increased by $10.9 million compared to the immediately preceding quarter ended September 30, 2021 and by $12.6 million compared to the quarter ended December 31, 2020.
Total deposits increased by $1.3 billion during the quarter ended December 31, 2021. Average non-interest bearing demand deposits grew by $418 million for the quarter ended December 31, 2021, compared to the immediately preceding quarter and by $2.2 billion compared to the quarter ended December 31, 2020. At December 31, 2021, non-interest bearing demand deposits represented 30% of total deposits, compared to 25% of total deposits at December 31, 2020. Non-interest bearing demand deposits declined by $183 million during the quarter ended December 31, 2021.
The average cost of total deposits was 0.19% for the quarter ended December 31, 2021 compared to 0.20% for the immediately preceding quarter ended September 30, 2021. The average cost of total deposits was 0.43% for the quarter ended December 31, 2020. On a spot basis, the average annual percentage yield ("APY") on total deposits declined to 0.16% at December 31, 2021 from 0.19% at September 30, 2021 and 0.36% at December 31, 2020.
Criticized and classified loans continued to decline. During the quarter ended December 31, 2021, total criticized and classified loans declined by $367 million. The ratio of non-performing loans to total loans declined to 0.87% at December 31, 2021 from 1.21% at September 30, 2021. Loans currently under short-term deferral totaled $11 million and loans modified under the CARES Act totaled $194 million for a total of $205 million at December 31, 2021, down from a total of $285 million at September 30, 2021.
For the quarter ended December 31, 2021, the Company recorded a provision for credit losses of $0.2 million compared to a recovery of $(11.8) million for the immediately preceding quarter ended September 30, 2021 and a recovery of credit losses of $(1.6) million for the quarter ended December 31, 2020. For the years ended December 31, 2021 and 2020, the provision for (recovery of) credit losses was $(67.1) million and $178.4 million, respectively. Year over year volatility in the provision is related to the expected economic impact of the onset of the COVID-19 pandemic in 2020 and subsequent economic recovery in 2021.
1


As previously reported, during the quarter ended December 31, 2021, the Bank reached a settlement with the Florida Department of Revenue related to certain tax matters for the 2009-2019 tax years and recorded a tax benefit of $43.9 million, net of federal impact. Unrelated to the Florida settlement, the Bank recorded an additional $25.2 million tax benefit related to a reduction in the liability for unrecognized tax benefits arising from expiration of statutes of limitation in the Federal and certain state jurisdictions.
The following table details $40.4 million of notable items that impacted income before income taxes for the quarter ended December 31, 2021 (income (expense) in thousands):
Gain on sale of single-family residential loans$18,216 
Discontinuance of cash flow hedges(44,833)
Special employee bonus(6,809)
Professional fees related to tax settlement(4,198)
Impairment of operating lease equipment(2,813)
$(40,437)
Book value per common share and tangible book value per common share continued to accrete, increasing to $35.47 and $34.56, respectively, at December 31, 2021 from $34.39 and $33.53, respectively, at September 30, 2021 and $32.05 and $31.22, respectively at December 31, 2020.
During the quarter ended December 31, 2021, the Company repurchased approximately 4.4 million shares of its common stock for an aggregate purchase price of $181.8 million, at a weighted average price of $41.45 per share.
Loans and Leases
A comparison of loan and lease portfolio composition at the dates indicated follows (dollars in thousands):
December 31, 2021September 30, 2021December 31, 2020
Residential and other consumer loans$8,368,380 35.2 %$7,827,224 34.3 %$6,348,222 26.6 %
Multi-family1,154,738 4.9 %1,181,935 5.2 %1,639,201 6.9 %
Non-owner occupied commercial real estate4,381,610 18.4 %4,537,078 19.9 %4,963,273 20.8 %
Construction and land165,390 0.7 %163,988 0.7 %293,307 1.2 %
Owner occupied commercial real estate1,944,658 8.2 %2,012,376 8.8 %2,000,770 8.4 %
Commercial and industrial4,790,275 20.2 %4,166,914 18.3 %4,447,383 18.6 %
PPP248,505 1.0 %332,548 1.5 %781,811 3.3 %
Pinnacle919,641 3.9 %932,865 4.1 %1,107,386 4.6 %
Bridge - franchise finance342,124 1.4 %396,589 1.7 %549,733 2.3 %
Bridge - equipment finance357,599 1.5 %379,446 1.7 %475,548 2.0 %
Mortgage warehouse lending ("MWL")1,092,133 4.6 %877,006 3.8 %1,259,408 5.3 %
$23,765,053 100.0 %$22,807,969 100.0 %$23,866,042 100.0 %
Operating lease equipment, net$640,726 $659,935 $663,517 
In the aggregate, commercial loans, excluding the runoff of PPP loans, grew by $500 million during the quarter ended December 31, 2021. The largest increase was in commercial and industrial loans, including owner-occupied commercial real estate which grew by $556 million for the quarter, followed by mortgage warehouse lending which grew by $215 million for the quarter. MWL line utilization was 56% at December 31, 2021 compared to 51% at September 30, 2021 and 62% at December 31, 2020. Commercial real estate portfolio segments in the aggregate declined by $181 million. Balances for Pinnacle and Bridge declined by $13 million and $76 million, respectively. Residential and other consumer loans grew by $541 million during the quarter ended December 31, 2021. GNMA early buyout loans grew by $110 million, totaling $2.0 billion at December 31, 2021.

2


Asset Quality and the Allowance for Credit Losses ("ACL")
The following table presents information about non-performing loans, loans on deferral and CARES Act modifications at December 31, 2021 (in thousands):
Non-Performing LoansCurrently Under Short-Term DeferralCARES Act Modification
Residential and other consumer (1)
$28,577 $10,601 $22,264 
Commercial:
CRE by Property Type:
Retail18,152 — — 
Hotel18,282 — 14,828 
Office814 — — 
Multi-family10,865 — 7,315 
Other7,167 — — 
Owner occupied commercial real estate20,453 — 15,109 
Commercial and industrial68,720 — 106,625 
Bridge - franchise finance32,87927,881
Total commercial177,332— 171,758
Total$205,909 $10,601 $194,022 
(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 December 31, 2021 and "CARES Act modification" refers to loans subject to longer-term modifications that, were it not for the provisions of the CARES Act, which expired on January 1, 2022, would likely have been reported as TDRs. Non-performing loans may include some loans that have been modified under the CARES Act. All of the loans that have rolled off of modification to date have paid off or resumed regular payments.
Non-performing loans totaled $205.9 million or 0.87% of total loans at December 31, 2021, compared to $276.7 million or 1.21% of total loans at September 30, 2021 and $244.5 million or 1.02% of total loans at December 31, 2020. Non-performing loans included $46.1 million, $49.1 million and $51.3 million of the guaranteed portion of SBA loans on non-accrual status, representing 0.19% of total loans at December 31, 2021 and 0.22% of total loans at both September 30, 2021 and December 31, 2020.
The following table presents criticized and classified commercial loans at the dates indicated (in thousands):
December 31, 2021September 30, 2021December 31, 2020
Special mention$148,593 $153,373 $711,516 
Substandard - accruing1,136,378 1,432,801 1,758,654
Substandard - non-accruing129,579 227,055 203,758
Doubtful47,754 16,447 11,867 
Total$1,462,304 $1,829,676 $2,685,795 

3


The following table presents the ACL and related ACL coverage ratios at the dates indicated and net charge-off rates for the years ended December 31, 2021 and 2020 (dollars in thousands):
ACL
ACL to Total Loans (1)
ACL to Non-Performing LoansNet Charge-offs to Average Loans
December 31, 2020$257,323 1.08 %105.26 %0.26 %
September 30, 2021$159,615 0.70 %57.69 %
December 31, 2021$126,457 0.53 %61.41 %0.29 %
(1)    ACL to total loans, excluding government insured residential loans, PPP loans and MWL, which carry nominal or no reserves, was 0.62%, 0.81% and 1.26% at December 31, 2021, September 30, 2021 and December 31, 2020, respectively.

The ACL at December 31, 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 December 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 December 31, 2021, the Company recorded a provision for credit losses of $0.2 million, which included a provision of $1.1 million related to funded loans offset by recoveries of provision related to unfunded loan commitments and accrued interest receivable. The decline in the ACL for the quarter ended December 31, 2021 was primarily attributable to charge-offs, the substantial majority of which were previously reserved for.
The following table summarizes the activity in the ACL for the periods indicated (in thousands):
Three Months Ended December 31,Years Ended December 31,
 2021202020212020
Beginning balance$159,615 $274,128 $257,323 $108,671 
Cumulative effect of adoption of CECL— — — 27,305 
Balance after adoption of CECL159,615 274,128 257,323 135,976 
Provision (recovery)1,067 1,244 (64,456)182,339 
Net charge-offs(34,225)(18,049)(66,410)(60,992)
Ending balance$126,457 $257,323 $126,457 $257,323 
Net interest income
Net interest income for the quarter ended December 31, 2021 was $206.0 million compared to $195.1 million for the immediately preceding quarter ended September 30, 2021 and $193.4 million for the quarter ended December 31, 2020. Interest income increased by $3.5 million for the quarter ended December 31, 2021 compared to the immediately preceding quarter, and decreased by $13.2 million compared to the quarter ended December 31, 2020. Interest expense decreased by $7.4 million compared to the immediately preceding quarter and by $25.9 million compared to the quarter ended December 31, 2020.
The Company’s net interest margin, calculated on a tax-equivalent basis, increased by 0.11% to 2.44% for the quarter ended December 31, 2021, from 2.33% for the immediately preceding quarter ended September 30, 2021. Factors impacting the net interest margin for the quarter ended December 31, 2021 included:
The average rate paid on FHLB and FRB advances decreased to 1.86% for the quarter ended December 31, 2021, from 2.35% for the quarter ended September 30, 2021. This decrease resulted from the termination and maturity of higher cost cash flow hedges and related borrowings during the quarter ended December 31, 2021.
The average rate paid on interest bearing deposits decreased to 0.27% for the quarter ended December 31, 2021, from 0.29% for the quarter ended September 30, 2021. This decline reflected continued initiatives taken to lower rates paid on deposits, including the re-pricing of term deposits, partially offset by the issuance of some callable CDs in anticipation of rising rates.
The tax-equivalent yield on investment securities increased to 1.54% for the quarter ended December 31, 2021 from 1.49% for the quarter ended September 30, 2021. This increase resulted primarily from slower prepayment speeds on securities purchased at a premium.
4


The tax-equivalent yield on loans increased to 3.50% for the quarter ended December 31, 2021, from 3.45% for the quarter ended September 30, 2021.
Non-interest income and Non-interest expense
Non-interest income totaled $45.6 million for the quarter ended December 31, 2021 compared to $25.5 million for the immediately preceding quarter ended September 30, 2021 and $35.3 million for the quarter ended December 31, 2020. The main reason for the increase in non-interest income for the quarter ended December 31, 2021 compared to the immediately preceding quarter was an increase in the gain on sale of loans. During the quarter, the Company sold a portfolio of single-family residential loans for a gain of $18.2 million.
Non-interest expense totaled $187.9 million for the quarter ended December 31, 2021 compared to $118.0 million for the immediately preceding quarter ended September 30, 2021 and $123.3 million for the quarter ended December 31, 2020. Non-interest expense totaled $547.6 million and $457.2 million for the year ended December 31, 2021 and 2020, respectively. The following table details notable items that impacted non-interest expense for the quarter ended December 31, 2021 (in thousands):
Discontinuance of cash flow hedges$(44,833)
Special employee bonus(6,809)
Professional fees related to tax settlement(4,198)
Impairment of operating lease equipment(2,813)
$(58,653)
Employee compensation and benefits increased by $13.3 million for the quarter ended December 31, 2021 compared to the immediately preceding quarter. The Company paid a special bonus in the fourth quarter to substantially all of its employees, in recognition of their hard work and efforts in the challenging environment we have faced over the past two years. Employees, regardless of their position in the organization, shared equally in the bonus payout, which totaled $6.8 million. Additionally, there was an increase of $4.6 million in variable compensation accruals for both incentives and regular annual discretionary bonuses in the fourth quarter.
Professional fees increased by $5.7 million for the quarter ended December 31, 2021 compared to the immediately preceding quarter. The increase is primarily a result of $4.2 million related to the tax settlement with the Florida Department of Revenue discussed above.
A loss on discontinuance of cash flow hedges totaling $44.8 million resulted from the termination of $401 million notional of pay fixed interest rate swaps at a weighted average pay rate of 3.24% during the quarter ended December 31, 2021.
Depreciation and impairment of operating lease equipment included $2.8 million resulting from impairment charges related to certain sand cars in the operating lease equipment portfolio.
Earnings Conference Call and Presentation
A conference call to discuss quarterly results will be held at 9:00 a.m. ET on Thursday, January 20, 2022 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 https://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 1618956. A replay of the call will be available from 12:00 p.m. ET on January 20th through 11:59 p.m. ET on January 27th by calling (855) 859-2056 (domestic) or (404) 537-3406 (international). The conference ID for the replay is 1618956. 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 $35.8 billion at December 31, 2021, is the bank holding company of BankUnited, N.A., a national bank headquartered in Miami Lakes, Florida with 63 banking centers in 13 Florida counties and 4 banking centers in the New York metropolitan area at December 31, 2021.
5


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).
Contact
BankUnited, Inc.
Investor Relations:
Leslie N. Lunak, 786-313-1698
llunak@bankunited.com
Source: BankUnited, Inc.
6


BANKUNITED, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(In thousands, except share and per share data) 
December 31,
2021
December 31,
2020
ASSETS  
Cash and due from banks:  
Non-interest bearing$19,143 $20,233 
Interest bearing295,714 377,483 
Cash and cash equivalents314,857 397,716 
Investment securities (including securities recorded at fair value of $10,054,198 and $9,166,683)10,064,198 9,176,683 
Non-marketable equity securities135,859 195,865 
Loans held for sale— 24,676 
Loans23,765,053 23,866,042 
Allowance for credit losses(126,457)(257,323)
Loans, net23,638,596 23,608,719 
Bank owned life insurance309,477 294,629 
Operating lease equipment, net640,726 663,517 
Goodwill77,637 77,637 
Other assets634,046 571,051 
Total assets$35,815,396 $35,010,493 
LIABILITIES AND STOCKHOLDERS’ EQUITY  
Liabilities:  
Demand deposits:  
Non-interest bearing$8,975,621 $7,008,838 
Interest bearing3,709,493 3,020,039 
Savings and money market13,368,745 12,659,740 
Time3,384,243 4,807,199 
Total deposits29,438,102 27,495,816 
Federal funds purchased199,000 180,000 
FHLB advances1,905,000 3,122,999 
Notes and other borrowings721,416 722,495 
Other liabilities514,117 506,171 
Total liabilities32,777,635 32,027,481 
Commitments and contingencies
Stockholders' equity:
Common stock, par value $0.01 per share, 400,000,000 shares authorized; 85,647,986 and 93,067,500 shares issued and outstanding856 931 
Paid-in capital707,503 1,017,518 
Retained earnings2,345,342 2,013,715 
Accumulated other comprehensive loss(15,940)(49,152)
Total stockholders' equity3,037,761 2,983,012 
Total liabilities and stockholders' equity$35,815,396 $35,010,493 

7


BANKUNITED, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
(In thousands, except per share data)
Three Months EndedYears Ended
 December 31,September 30,December 31,December 31,December 31,
 20212021202020212020
Interest income:    
Loans$198,275 $194,689 $207,232 $800,819 $864,175 
Investment securities38,201 38,243 42,260 152,619 193,856 
Other1,397 1,413 1,628 6,010 9,578 
Total interest income237,873 234,345 251,120 959,448 1,067,609 
Interest expense:
Deposits13,631 14,273 29,290 67,596 199,980 
Borrowings18,227 24,950 28,464 96,164 115,871 
Total interest expense31,858 39,223 57,754 163,760 315,851 
Net interest income before provision for credit losses206,015 195,122 193,366 795,688 751,758 
Provision for (recovery of) credit losses246 (11,842)(1,643)(67,119)178,431 
Net interest income after provision for credit losses205,769 206,964 195,009 862,807 573,327 
Non-interest income:
Deposit service charges and fees5,815 5,553 4,569 21,685 16,496 
Gain on sale of loans, net19,003 1,403 2,425 24,394 13,170 
Gain (loss) on investment securities, net590 (664)7,203 6,446 17,767 
Lease financing14,041 13,212 13,547 53,263 59,112 
Other non-interest income6,173 5,974 7,536 28,365 26,676 
Total non-interest income45,622 25,478 35,280 134,153 133,221 
Non-interest expense:
Employee compensation and benefits70,561 57,224 60,944 243,532 217,156 
Occupancy and equipment12,817 11,760 11,797 47,944 48,237 
Deposit insurance expense3,471 3,552 6,759 18,695 21,854 
Professional fees8,023 2,312 2,937 14,386 11,708 
Technology and telecommunications18,221 16,687 16,052 67,500 58,108 
Discontinuance of cash flow hedges44,833 — — 44,833 — 
Depreciation and impairment of operating lease equipment15,769 12,944 12,270 53,764 49,407 
Other non-interest expense14,165 13,563 12,565 56,921 50,719 
Total non-interest expense187,860 118,042 123,324 547,575 457,189 
Income before income taxes63,531 114,400 106,965 449,385 249,359 
Provision (benefit) for income taxes(61,724)27,459 21,228 34,401 51,506 
Net income$125,255 $86,941 $85,737 $414,984 $197,853 
Earnings per common share, basic$1.42 $0.94 $0.89 $4.52 $2.06 
Earnings per common share, diluted$1.41 $0.94 $0.89 $4.52 $2.06 

8


BANKUNITED,��INC. AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS
(Dollars in thousands)
Three Months Ended December 31, 2021Three Months Ended
September 30, 2021
Three Months Ended December 31, 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$22,919,535 $201,345 3.50 %$22,879,654 $197,995 3.45 %$23,706,859 $210,896 3.55 %
Investment securities (3)
10,113,026 38,889 1.54 %10,452,255 38,939 1.49 %9,446,389 42,966 1.82 %
Other interest earning assets1,184,056 1,397 0.47 %750,700 1,413 0.75 %726,273 1,628 0.89 %
Total interest earning assets34,216,617 241,631 2.81 %34,082,609 238,347 2.79 %33,879,521 255,490 3.01 %
Allowance for credit losses(149,319)(171,381)(280,243)
Non-interest earning assets1,767,850 1,856,608 1,817,476 
Total assets$35,835,148 $35,767,836 $35,416,754 
Liabilities and Stockholders' Equity:
Interest bearing liabilities:
Interest bearing demand deposits$3,058,355 $1,481 0.19 %$3,038,038 $1,701 0.22 %$2,903,300 $3,637 0.50 %
Savings and money market deposits13,460,084 9,619 0.28 %13,554,572 10,029 0.29 %11,839,631 14,517 0.49 %
Time deposits3,399,302 2,531 0.30 %2,866,746 2,543 0.35 %5,360,630 11,136 0.83 %
Total interest bearing deposits19,917,741 13,631 0.27 %19,459,356 14,273 0.29 %20,103,561 29,290 0.58 %
Federal funds purchased56,793 13 0.09 %70,054 15 0.08 %20,707 0.12 %
FHLB and PPPLF borrowings1,909,450 8,957 1.86 %2,647,314 15,678 2.35 %3,698,666 19,207 2.07 %
Notes and other borrowings721,525 9,257 5.13 %721,638 9,257 5.13 %722,581 9,251 5.12 %
Total interest bearing liabilities22,605,509 31,858 0.56 %22,898,362 39,223 0.68 %24,545,515 57,754 0.94 %
Non-interest bearing demand deposits9,330,805 8,912,960 7,152,967 
Other non-interest bearing liabilities785,254 752,774 772,277 
Total liabilities32,721,568 32,564,096 32,470,759 
Stockholders' equity3,113,580 3,203,740 2,945,995 
Total liabilities and stockholders' equity$35,835,148 $35,767,836 $35,416,754 
Net interest income$209,773 $199,124 $197,736 
Interest rate spread2.25 %2.11 %2.07 %
Net interest margin2.44 %2.33 %2.33 %
(1)    On a tax-equivalent basis where applicable
(2)    Annualized
(3)    At fair value except for securities held to maturity








9


BANKUNITED, INC. AND SUBSIDIARIES
AVERAGE BALANCES AND YIELDS
(Dollars in thousands)
Years Ended December 31,
20212020
Average
Balance
Interest (1)
Yield/
Rate (1)
Average
Balance
Interest (1)
Yield/
Rate (1)
Assets:
Interest earning assets:
Loans$23,083,973 $814,101 3.53 %$23,385,832 $879,082 3.76 %
Investment securities (2)
9,873,178 155,353 1.57 %8,739,023 196,954 2.25 %
Other interest earning assets1,093,869 6,010 0.55 %672,634 9,578 1.42 %
Total interest earning assets34,051,020 975,464 2.86 %32,797,489 1,085,614 3.31 %
Allowance for credit losses(197,212)(236,704)
Non-interest earning assets1,770,685 1,860,322 
Total assets$35,624,493 $34,421,107 
Liabilities and Stockholders' Equity:
Interest bearing liabilities:
Interest bearing demand deposits$3,027,649 8,550 0.28 %$2,582,951 19,445 0.75 %
Savings and money market deposits13,339,651 43,082 0.32 %10,843,894 85,572 0.79 %
Time deposits3,490,082 15,964 0.46 %6,617,939 94,963 1.43 %
Total interest bearing deposits19,857,382 67,596 0.34 %20,044,784 199,980 1.00 %
Federal funds purchased33,945 30 0.09 %71,858 418 0.58 %
FHLB and PPPLF borrowings2,622,723 59,116 2.25 %4,295,882 85,491 1.99 %
Notes and other borrowings721,803 37,018 5.13 %592,521 29,962 5.06 %
Total interest bearing liabilities23,235,853 163,760 0.70 %25,005,045 315,851 1.26 %
Non-interest bearing demand deposits8,480,964 5,760,309 
Other non-interest bearing liabilities784,031 786,337 
Total liabilities32,500,848 31,551,691 
Stockholders' equity3,123,645 2,869,416 
Total liabilities and stockholders' equity$35,624,493 $34,421,107 
Net interest income$811,704 $769,763 
Interest rate spread2.16 %2.05 %
Net interest margin2.38 %2.35 %
(1)    On a tax-equivalent basis where applicable
(2)    At fair value except for securities held to maturity


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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,
c2021202020212020
Basic earnings per common share:  
Numerator: 
Net income$125,255 $85,737 $414,984 $197,853 
Distributed and undistributed earnings allocated to participating securities(2,059)(4,015)(5,991)(8,882)
Income allocated to common stockholders for basic earnings per common share$123,196 $81,722 $408,993 $188,971 
Denominator:
Weighted average common shares outstanding88,123,835 92,725,905 91,612,243 92,869,736 
Less average unvested stock awards(1,193,180)(1,160,984)(1,212,055)(1,163,480)
Weighted average shares for basic earnings per common share86,930,655 91,564,921 90,400,188 91,706,256 
Basic earnings per common share$1.42 $0.89 $4.52 $2.06 
Diluted earnings per common share:
Numerator:
Income allocated to common stockholders for basic earnings per common share$123,196 $81,722 $408,993 $188,971 
Adjustment for earnings reallocated from participating securities(234)(67)(585)(123)
Income used in calculating diluted earnings per common share$122,962 $81,655 $408,408 $188,848 
Denominator:
Weighted average shares for basic earnings per common share86,930,655 91,564,921 90,400,188 91,706,256 
Dilutive effect of stock options— 20,179 134 24,608 
Weighted average shares for diluted earnings per common share86,930,655 91,585,100 90,400,322 91,730,864 
Diluted earnings per common share$1.41 $0.89 $4.52 $2.06 

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BANKUNITED, INC. AND SUBSIDIARIES
SELECTED RATIOS
 Three Months Ended December 31,Years Ended December 31,
 2021202020212020
Financial ratios (4)
    
Return on average assets1.39 %0.96 %1.16 %0.57 %
Return on average stockholders’ equity16.0 %11.6 %13.3 %6.9 %
Net interest margin (3)
2.44 %2.33 %2.38 %2.35 %
 December 31, 2021September 30, 2021December 31, 2020
Asset quality ratios  
Non-performing loans to total loans (1)(5)
0.87 %1.21 %1.02 %
Non-performing assets to total assets (2)(5)
0.58 %0.80 %0.71 %
Allowance for credit losses to total loans0.53 %0.70 %1.08 %
Allowance for credit losses to non-performing loans (1)(5)
61.41 %57.69 %105.26 %
Net charge-offs to average loans
0.29 %0.26 %
(1)    We define non-performing loans to include non-accrual loans and loans other than purchased credit deteriorated and government insured residential loans that are past due 90 days or more and still accruing. Contractually delinquent purchased credit deteriorated and government insured residential loans on which interest continues to be accrued are excluded from non-performing loans.
(2)    Non-performing assets include non-performing loans, OREO and other repossessed assets.
(3)    On a tax-equivalent basis.
(4) Annualized for the three month periods.
(5)    Non-performing loans and assets include the guaranteed portion of non-accrual SBA loans totaling $46.1 million or 0.19% of total loans and 0.13% of total assets at December 31, 2021; and $51.3 million or 0.22% of total loans and 0.15% of total assets at December 31, 2020.

December 31, 2021December 31, 2020Required to be Considered Well Capitalized
BankUnited, Inc.BankUnited, N.A.BankUnited, Inc.BankUnited, N.A.
Capital ratios
Tier 1 leverage8.4 %9.6 %8.6 %9.5 %5.0 %
Common Equity Tier 1 ("CET1") risk-based capital12.6 %14.5 %12.6 %13.9 %6.5 %
Total risk-based capital14.3 %14.9 %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 12.5% and 14.4%, respectively, at December 31, 2021.
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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):
December 31, 2021September 30, 2021December 31, 2020
Total loans (GAAP)$23,765,053$22,807,969$23,866,042
Less: Government insured residential loans2,023,2211,913,4971,419,074
Less: PPP loans248,505332,548781,811
Less: MWL1,092,133877,0061,259,408
Total loans, excluding government insured residential loans, PPP loans and MWL (non-GAAP)$20,401,194$19,684,918$20,405,749
ACL$126,457$159,615$257,323
ACL to total loans (GAAP)0.53 %0.70 %1.08 %
ACL to total loans, excluding government insured residential loans, PPP loans and MWL (non-GAAP)0.62 %0.81 %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, 2021September 30, 2021December 31, 2020
Total stockholders’ equity (GAAP)$3,037,761 $3,096,674 $2,983,012 
Less: goodwill77,637 77,637 77,637 
Tangible stockholders’ equity (non-GAAP)$2,960,124 $3,019,037 $2,905,375 
 
Common shares issued and outstanding85,647,986 90,049,326 93,067,500 
 
Book value per common share (GAAP)$35.47 $34.39 $32.05 
 
Tangible book value per common share (non-GAAP)$34.56 $33.53 $31.22 
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