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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

 

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2004

 

or

 

¨   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Commission File No. 1-13921

 

BankUnited Financial Corporation

(Exact name of registrant as specified in its charter)

 

Florida   65-0377773

(State or other jurisdiction of

incorporation or organization)

  

(I.R.S. Employer

Identification Number)

 

255 Alhambra Circle, Coral Gables, Florida 33134

(Address of principal executive offices) (Zip Code)

 

(305) 569-2000

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    Yes  x    No  ¨

 

The number of shares outstanding of the registrant’s common stock at the close of business on May 5, 2004 was 29,444,797 shares of Class A Common Stock, $.01 par value, and 536,562 shares of Class B Common Stock, $.01 par value.

 

This Form 10-Q contains 36 pages.

The Index to Exhibits appears on page 36.

 

Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

 

FORM 10-Q REPORT FOR THE QUARTER ENDED MARCH 31, 2004

 

TABLE OF CONTENTS

 

     Page No.
PART I—FINANCIAL INFORMATION     

Item 1.    Financial Statements

     

Consolidated Statements of Financial Condition as of March 31, 2004 and September 30, 2003 (unaudited)

    3

Consolidated Statements of Income (unaudited) for the Three and Six Months Ended
March 31, 2004 and 2003

    4

Consolidated Statements of Stockholders’ Equity (unaudited) for the Six Months Ended March 31, 2004 and 2003

    5

Consolidated Statements of Cash Flows (unaudited) for the Six Months Ended March 31, 2004 and 2003

    6

Condensed Notes to Consolidated Financial Statements (unaudited)

    7

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

    16

Item 3.    Quantitative and Qualitative Disclosures About Market Risk

    31

Item 4.    Controls and Procedures

    32
PART II—OTHER INFORMATION     

Item 2.    Changes in Securities and Use of Proceeds

    33

Item 4.    Submission of Matters to a Vote of Security Holders

    33

Item 6.    Exhibits and Reports on Form 8-K

    33

 

2

Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

 

     March 31,
2004
     September 30,
2003
  
     (Dollars in thousands,
except share data)		  
Assets:                 

Cash

    $ 36,763     $ 28,810  

Federal Home Loan Bank overnight deposits

      7,485       195,365  

Federal funds sold

      829       2,723  

Investments available for sale, at fair value

      339,506       296,677  

Mortgage-backed securities available for sale, at fair value

      2,226,105       2,064,981  

Mortgage loans held for sale

      123,590       286,796  

Loans held in portfolio

      4,555,023       3,925,077  

Add: Unearned discounts, premiums and deferred fees, net

      44,883       36,806  

Less: Allowance for loan losses

      (22,665 )     (22,295 )
    
 

Loans held in portfolio, net

      4,577,241       3,939,588  
    
 

FHLB stock and other earning assets

      131,130       123,431  

Office properties and equipment, net

      22,198       20,278  

Real estate owned

      2,975       4,290  

Accrued interest receivable

      29,142       28,452  

Mortgage servicing rights

      13,585       12,930  

Goodwill

      28,353       28,353  

Bank-owned life insurance

      86,204       84,155  

Prepaid expenses and other assets

      24,897       28,314  
    
 

Total assets

    $ 7,650,003     $ 7,145,143  
    
 
Liabilities and Stockholders’ Equity:                 

Liabilities:

                 

Interest bearing deposits

    $ 3,190,898     $ 3,038,594  

Non-interest bearing deposits

      235,346       197,512  

Securities sold under agreements to repurchase

      738,567       517,297  

Advances from Federal Home Loan Bank

      2,614,319       2,460,291  

Senior notes

      —         200,000  

Convertible debt

      120,000       —    

Trust preferred securities and subordinated debentures

      165,544       162,219  

Interest payable

      13,180       14,331  

Advance payments by borrowers for taxes and insurance

      27,000       47,081  

Payable for securities purchased pending settlement

      25,359       —    

Accrued expenses and other liabilities

      41,714       60,445  
    
 

Total liabilities

      7,171,927       6,697,770  
    
 

Commitments and Contingencies (See notes 8 and 9)

                 

Stockholders’ Equity:

                 

Preferred Stock, $0.01 par value

      8       7  

    Authorized shares—10,000,000
Issued shares—793,405 and 739,007
Outstanding shares—766,685 and 712,287
Treasury shares—26,720

      (528 )     (528 )

Class A common stock, $0.01 par value

      297       295  

    Authorized shares—60,000,000
Issued shares—29,736,553 and 29,476,616
Outstanding shares—29,399,061 and 29,139,124
Treasury shares—337,492

      (2,891 )     (2,891 )

Class B common stock, $0.1 par value

      6       6  

    Authorized shares—3,000,000
Issued shares—622,762 and 580,262
Outstanding shares—536,562
Treasury shares—86,200 and 43,700

      (1,010 )     (485 )

Additional paid-in capital

      331,795       328,017  

Retained earnings

      139,778       116,370  

Deferred compensation

      1,039       794  

Accumulated other comprehensive income

      9,582       5,788  
    
 

Total stockholders’ equity

      478,076       447,373  
    
 

Total liabilities and stockholders’ equity

    $ 7,650,003     $ 7,145,143  
    
 

 

See accompanying condensed notes to consolidated financial statements

 

 

3

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BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF INCOME

 

   

For the Three

Months Ended
March 31,

    

For the Six

Months Ended

March 31, 

  
    2004
     2003
     2004
     2003
  
    (Dollars and shares in thousands,
except per share data)		  

Interest income:

                                

Interest and fees on loans

   $ 55,095     $ 58,421     $ 109,456     $ 119,634  

Interest on mortgage-backed securities

     20,189       19,296       39,986       32,967  

Interest on short-term investments

     123       110       215       227  

Interest and dividends on long-term investments and other interest-earning assets

     4,932       3,463       9,383       6,722  
   
 
 
 

Total interest income

     80,339       81,290       159,040       159,550  
   
 
 
 

Interest expense:

                                

Interest on deposits

     17,902       21,112       36,172       43,756  

Interest on borrowings

     25,151       24,754       51,151       47,886  

Preferred dividends of subsidiary trusts

     2,322       5,259       4,674       10,135  
   
 
 
 

Total interest expense

     45,375       51,125       91,997       101,777  
   
 
 
 

Net interest income before provision for loan losses

     34,964       30,165       67,043       57,773  

Provision for loan losses

     1,200       1,250       2,175       2,550  
   
 
 
 

Net interest income after provision for loan losses

     33,764       28,915       64,868       55,223  
   
 
 
 

Non-interest income:

                                

Loan servicing fees, net of amortization

     (317 )     (1,090 )     (1,090 )     (1,882 )

Impairment of mortgage servicing rights

     (1,200 )     —         (1,200 )     —    

Loan fees

     994       1,146       1,933       2,190  

Deposit fees

     1,044       991       2,163       2,020  

Other fees

     459       312       939       604  

Net (loss) gain on sale of investments and mortgage-backed securities

     333       158       (262 )     755  

Net gain on sale of loans and other assets

     1,528       1,702       3,280       3,768  

Insurance and investment services income

     1,184       626       2,126       1,320  

Other

     1,084       2,212       2,282       3,022  
   
 
 
 

Total non-interest income

     5,109       6,057       10,171       11,797  
   
 
 
 

Non-interest expenses:

                                

Employee compensation and benefits

     10,004       9,708       20,065       18,369  

Occupancy and equipment

     4,332       3,005       8,036       5,953  

Telecommunications and data processing

     1,409       1,209       2,793       2,419  

Advertising and promotion expense

     1,287       1,256       2,438       2,443  

Professional fees-legal and accounting

     1,024       1,200       2,344       2,347  

Loan closing fees

     672       709       1,415       2,202  

Loan servicing expense

     131       362       287       847  

Postage and courier

     447       349       869       666  

Insurance

     370       289       727       569  

Other operating expenses

     1,526       3,224       1,341       3,731  
   
 
 
 

Total non-interest expenses

     21,202       21,311       40,315       39,546  
   
 
 
 

Income before income taxes

     17,671       13,661       34,724       27,474  

Provision for income taxes

     5,633       4,055     <