<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 5-43936
BANKUNITED FINANCIAL CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
FLORIDA 65-0377773
------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
255 ALHAMBRA CIRCLE, CORAL GABLES 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
--- ---
The number of shares outstanding of the registrant's common stock at the close
of business on August 9, 1996 was 5,451,008 shares of Class A Common Stock,
$.01 par value, and 251,515 shares of Class B Common Stock, $.01 par value.
This Form 10-Q contains 26 pages.
The Index to Exhibits appears on page 23.
<PAGE> 2
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
Form 10-Q Report for the Quarter Ended June 30, 1996
INDEX
<TABLE>
<CAPTION>
PAGE NO.
--------
<S> <C> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
--------------------
Statements of Consolidated Financial Condition as of
(unaudited) June 30, 1996 and September 30, 1995 3
Statements of Consolidated Operations (unaudited)
for the Three and Nine Months Ended June 30, 1996
and June 30, 1995 4-5
Statements of Consolidated Cash Flows (unaudited)
for the Nine Months Ended June 30, 1996 and
June 30, 1995 6
Condensed Notes to Consolidated Financial
Statements (unaudited) 7
Item 2. Management's Discussion and Analysis of
---------------------------------------
Financial Condition and Results of Operations 9
----------------------------------------------
PART II - OTHER INFORMATION
Item 5. Other Information 21
-----------------
Item 6. Exhibits and Reports on Form 8-K 21
--------------------------------
2
</TABLE>
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<TABLE>
<CAPTION>
(Unaudited)
June 30, September 30,
1996 1995
----------- -------------
(Dollars in thousands)
<S> <C> <C>
ASSETS
Cash and due from banks $ 5,176 $ 2,517
Federal Home Loan Bank overnight deposits 10,379 31,813
Federal funds 200 400
Tax certificates (net of reserves of $645 at June 30, 1996 and
$569 at September 30, 1995) 49,520 39,544
Investments, held to maturity, net (market value of
approximately $11 at June 30, 1996 and $4,686
at September 30, 1995) 11 4,686
Investments, available for sale, net at market 7,657 --
Mortgage-backed securities, held to maturity, net (market
value of approximately $14,857 at June 30, 1996
and $50,670 at September 30, 1995) 15,526 50,934
Mortgage-backed securities available for sale, net at market 57,435 2,064
Loans receivable, net 629,567 452,612
Mortgage loans held for sale (market value of approximately
$217 at September 30, 1995) -- 216
Other interest earning assets 12,225 12,325
Office properties and equipment, net 2,554 2,119
Real estate owned, net 998 1,975
Accrued interest receivable 6,534 5,573
Prepaid expenses and other assets 3,749 1,637
-------- --------
Total assets $801,531 $608,415
======== ========
LIABILITIES
Deposits $470,237 $310,074
Advances from Federal Home Loan Bank 244,000 241,000
Subordinated notes 775 775
Interest payable (primarily on deposits and advances
from the Federal Home Loan Bank) 1,411 1,169
Advance payments by borrowers for taxes and insurance 2,955 3,732
Accrued expenses and other liabilities 12,493 5,920
-------- --------
Total liabilities 731,871 562,670
-------- --------
STOCKHOLDERS' EQUITY
Preferred stock, Series B,C,C-II,1993 and 9%,
$.01 par value. Authorized shares - 10,000,000; issued
and outstanding shares - 2,665,547 at June 30, 1996
and 2,679,107 at September 30, 1995 27 27
Class A Common Stock, $.01 par value. Authorized shares
15,000,000; issued and outstanding shares - 5,451,008
at June 30, 1996 and 1,835,170 at September 30, 1995 54 18
Class B Common Stock, $.01 par value. Authorized shares
3,000,000; issued and outstanding shares - 251,515 at
June 31, 1996 and 232,324 at September 30, 1995 3 2
Additional paid-in capital 62,044 38,835
Retained earnings 7,967 6,838
Net unrealized (losses) gains on securities available for sale, net of tax (435) 25
-------- --------
Total stockholders' equity 69,660 45,745
-------- --------
Total liabilities and stockholders' equity $801,531 $608,415
======== ========
</TABLE>
SEE CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
3
<PAGE> 4
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
(Unaudited)
Three months ended June 30,
-------------------------------
1996 1995
--------------- --------------
(In Thousands, Except Earnings Per Share)
<S> <C> <C>
Interest income:
Interest and fees on loans $10,937 $ 7,874
Interest on mortgage-backed securities 1,236 1,004
Interest on short-term investments 520 280
Interest and dividends on long-term investments
and other earning assets 934 745
------- -------
Total interest income 13,627 9,903
Interest expense:
Interest on deposits 5,523 5,220
Interest on borrowings 3,381 1,506
------- -------
Total interest expense 8,904 6,726
Net interest income before provision for loan losses 4,723 3,177
Provision for loan losses 75 75
------- -------
Net interest income after provision for loan losses 4,648 3,102
------- -------
Non-interest income:
Service fees 151 115
Gain on sale of loans and mortgage-backed securities 5 99
Gain on sale of other assets 1 1
Other 41 -
------- -------
Total non-interest income 198 215
------- -------
Non-interest expense:
Employee compensation and benefits 1,138 912
Occupancy and equipment 446 478
Insurance 279 275
Professional fees - legal and accounting 210 242
Real estate owned expenses 7 135
Other operating expenses 926 780
------- -------
Total non-interest expenses 3,006 2,822
------- -------
Income before income taxes and preferred stock dividends 1,840 495
Income taxes 706 181
------- -------
Net income before preferred stock dividends 1,134 314
Preferred stock dividends 537 502
------- -------
Net income after preferred stock dividends $ 597 $ (188)
======= =======
Earnings per share
Primary $ 0.10 $ (0.09)
======= =======
Fully-diluted $ 0.10 $ (0.09)
======= =======
Weighted average number of common share equivalents
assumed outstanding during the period:
Primary 5,947 2,027
======= =======
Fully diluted 5,947 2,027
======= =======
</TABLE>
SEE CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4
<PAGE> 5
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
(Unaudited)
Nine months ended June 30,
---------------------------
1996 1995
------------ -------------
(In Thousands, Except Earnings Per Share)
<S> <C> <C>
Interest income:
Interest and fees on loans $29,135 $22,454
Interest on mortgage-backed securities 3,023 3,168
Interest on short-term investments 1,969 660
Interest and dividends on long-term investments
and other earning assets 2,826 2.424
------- --------
Total interest income 36,953 28,706
Interest expense:
Interest on deposits 14,555 13,380
Interest on borrowings 10,379 5,197
------- --------
Total interest expense 24,934 18,577
Net interest income before provision for loan losses 12,019 10,129
Provision for loan losses (225) 340
------- --------
Net interest income after provision for loan losses 12,244 9,789
------- --------
Non-interest income:
Service fees 432 306
Gain on sale of loans and mortgage-backed securities 8 240
Gain on sale of other assets (6) 264
Other 51 6
------- --------
Total non-interest income 485 816
------- --------
Non-interest expense:
Employee compensation and benefits 3,161 2,829
Occupancy and equipment 1,232 1,367
Insurance 748 783
Professional fees - legal and accounting 687 751
Real estate owned expenses 54 401
Other operating expenses 2,416 2,466
------- --------
Total non-interest expenses 8,298 8,597
------- --------
Income before income taxes and preferred stock dividends 4,431 2,008
Income taxes 1,693 731
------- --------
Net income before preferred stock dividends 2,738 1,277
Preferred stock dividends 1,609 1,507
------- --------
Net income after preferred stock dividends $ 1,129 $ (230)
======= ========
Earnings per share
Primary $ 0.28 $ (0.11)
======= ========
Fully-diluted $ 0.28 $ (0.11)
======= ========
Weighted average number of common share equivalents
assumed outstanding during the period:
Primary 3,997 2,017
======= ========
Fully diluted 3,997 2,017
======= ========
</TABLE>
SEE CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5
<PAGE> 6
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
(Unaudited)
Nine Months Ended June 30,
--------------------------
1996 1995
--------- ----------
(Dollars in thousands)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 2,738 $ 1,277
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:
Provision for loan losses (225) 340
Provision for losses on tax certificates 107 107
Depreciation and amortization 432 404
Amortization of discounts and premiums on investments 11 3
Amortization of discounts and premiums on mortgage-backed securities 114 53
Amortization of discounts and premiums on loans (2,147) (155)
Loans originated for sale (4,067) (1,956)
Increase in accrued interest receivable (750) (163)
Increase (decrease) in interest payable on deposits and FHLB advances 198 (66)
Increase (decrease) in accrued expenses 129 (272)
Increase (decrease) in accrued taxes (2,642) 87
Increase (decrease) in deferred taxes (469) 33
Increase in other liabilities 9,348 9,146
Decrease in prepaid expenses and other assets 427 656
Gain on sales of mortgage securities -- (231)
Proceeds from sale of loans 4,292 1,868
Recovery on loans 941 --
Gain on sales of loans (9) (11)
Loss (gain) on sales of real estate owned (148) 45
Loss on sales of other assets 7 --
Gain on sale of servicing rights -- (262)
--------- ---------
Net cash provided by operating activities 8,287 10,903
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net increase in loans (168,073) (20,449)
Proceeds from sale of real estate owned 1,790 3,853
Purchase of investment securities (3,510) (2,405)
Purchase of mortgage-backed securities (19,228) (11,931)
Purchase of other earning assets (650) --
Proceeds from sale of loan servicing -- 262
Proceeds from repayments of investment securities 4,675 6,625
Proceeds from repayments of mortgage-backed securities 7,588 4,277
Proceeds from repayments of other earning assets 750 --
Proceeds from sale of mortgage-backed securities -- 9,947
Proceeds from sale of investment securities 2,097 --
Purchases of premises and equipment (874) (773)
Net increase in tax certificates (10,083) (6,956)
Purchase of Bank of Florida, net of acquired cash equivalents 1,521 --
--------- ---------
Net cash used in investing activities (183,997) (17,550)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits 132,875 68,429
Net increase (decrease) in other borrowings 3,000 (44,400)
Net proceeds from issuance of common stock 23,246 172
Dividends paid on preferred stock (1,609) (1,507)
Increase (decrease) in advances from borrowers for taxes and insurance (777) 443
--------- ---------
Net cash provided by financing activities 156,735 23,137
--------- ---------
Increase (decrease) in cash and cash equivalents (18,975) 16,490
Cash and cash equivalents at beginning of period 34,730 16,762
--------- ---------
Cash and cash equivalents at end of period $ 15,755 $ 33,252
========= =========
SUPPLEMENTAL DISCLOSURES:
Interest paid on deposits and borrowings $ 24,934 $ 18,643
========= =========
Income taxes paid $ 4,325 $ 610
========= =========
Transfers from loans to real estate owned $ 849 $ 1,691
========= =========
Transfers from real estate owned to loans $ 184 $ --
========= =========
Transfers of mortgage-backed securities from held-to-maturity to
available for sale $ 31,780 $ --
========= =========
</TABLE>
SEE CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6
<PAGE> 7
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation and Principles of Consolidation
-----------------------------------------------------
The accompanying unaudited consolidated financial statements have been prepared
in conformity with Rule 10-01 of Regulation S-X of the Securities and Exchange
Commission and therefore do not include information or footnotes necessary for
a complete presentation of financial position, results of operations and cash
flows in conformity with generally accepted accounting principles ("GAAP").
However, all adjustments (consisting of normal recurring accruals) which, in
the opinion of management, are necessary for a fair presentation of the
financial statements of BankUnited Financial Corporation and its subsidiaries
(the "Company") have been included. Operating results for the three month and
nine month period ended June 30, 1996 are not necessarily indicative of the
results which may be expected for the year ended September 30, 1996. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's Annual Report on Form 10-K for
fiscal year ended September 30, 1995.
2. Accounting Policies
-------------------
ALLOWANCE FOR LOAN LOSSES
The Company adopted Statement of Financial Accounting No. 114 ("SFAS No. 114")
"Accounting by Creditors for Impairment of a Loan" and Statement of Financial
Accounting No. 118 "Accounting by Creditors for Impairment of a Loan - Income
Recognition and Disclosures," effective October 1, 1995. The impact to the
Company's financial condition and statement of operations was not material due
to the composition of the Company's loan portfolio (primarily residential
mortgages) and the Company's policy for establishing its allowance for loan
losses.
MORTGAGE-BAKED SECURITIES
In December 1995, the Company transferred $31.8 million of mortgage-backed
securities to its available-for-sale portfolio from its held-to-maturity
portfolio. The transfer was made as allowed by the Financial Accounting
Standards Board "A Guide to Implementation of Statement 115 on Accounting for
Certain Investments in Debt and Equity Securities."
MORTGAGE SERVICING RIGHTS
The Company adopted Statement of Financial Accounting Standards No. 122
"Accounting for Mortgage Servicing Rights," effective October 1, 1995. The
impact to the Company's financial condition and results of operations was not
material due to the small number of mortgage loans sold with servicing retained
by the Company.
3. Contingencies
-------------
The Company is a party to certain claims and litigation arising in the ordinary
course of business. In the opinion of management, the resolution of such
claims and litigation will not materially affect the Company's consolidated
financial position or results of operations.
7
<PAGE> 8
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
In order to increase the Savings Association Insurance Fund ("SAIF") of the
Federal Deposit Insurance Corporation ("FDIC") to its minimum required reserve
ratio of 1.25%, a proposal has been made to impose a special one-time
assessment of 75 to 80 basis points on all SAIF-insured deposits, held as of
March 31, 1995. This one-time assessment is intended to recapitalize the SAIF
to the required level of 1.25% of insured deposits, and may be payable in
fiscal 1996. The annual FDIC insurance premium of BankUnited, FSB (the "Bank")
would thereafter be reduced.
If the assessment is made at the currently proposed rate, the effect on the
Company would be an after-tax charge of approximately $1.3 million ($1.9
million if the Company's former west coast branches are included in the
assessment). Should this occur, management believes that current capital is
sufficient to ensure that the Bank will remain a well-capitalized institution.
Stockholder's Equity
- --------------------
In February 1996, the Company sold 3,565,000 shares of Class A Common Stock in
a secondary offering. The net proceeds were approximately $23.0 million.
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
The following discussion and analysis presents a review of the consolidated
operating results of BankUnited Financial Corporation (the "Company") for the
three month and nine month periods ended June 30, 1996 and 1995 and the
financial condition of BankUnited at September 30, 1995 and June 30, 1996.
This discussion and analysis should be read in conjunction with the
Consolidated Financial Statements and Notes thereto contained in the Company's
Form 10-K Annual Report for the year ended September 30, 1995.
DISCUSSION OF FINANCIAL CONDITION CHANGES FROM SEPTEMBER 30, 1995 TO JUNE 30,
1996.
Assets
- ------
Total assets increased by $193.1 million, or 31.7%, from $608.4 million at
September 30, 1995, to $801.5 million at June 30, 1996, principally due to
loans receivable which increased $177.0 million primarily as a result of
residential loan purchases of $173.4 million and a commercial real estate bulk
loan purchase of $32.0 million. The Company also completed its acquisition of
the Bank of Florida on March 29, 1996. The Bank of Florida had total assets of
$28.1 million at March 29, 1996 after eliminating intercompany balances.
The Company's short-term investments consisting of Federal Home Loan Bank
("FHLB") overnight deposits and federal funds sold decreased by $21.6 million,
or 67.2%, to $10.6 million at June 30, 1996, from $32.2 million at September
30, 1995. This decrease is due primarily to investing these funds in higher
yielding loans.
The Company's tax certificate portfolio increased by $10.0 million, or 25.2%,
to $49.5 million at June 30, 1996, from $39.5 million at September 30, 1995.
The increase was attributable to seasonal purchases in June 1996.
Investments held to maturity declined from $4.7 million at September 30, 1995
to $11,000 at June 30, 1996 because the Federal Home Loan Bank called $4.7
million of callable notes.
Investments available for sale increased from none at September 30, 1995 to
$7.7 million at June 30, 1996 due primarily to investments acquired with the
Bank of Florida.
The Company's held-to-maturity mortgage-backed securities portfolio decreased
$35.4 million, or 69.5%, to $15.5 million at June 30, 1996 from $50.9 million
at September 30, 1995, primarily as a result of the Company's reclassifying
$31.8 million of held-to-maturity mortgage-backed securities to
available-for-sale in accordance with "A Guide to Implementation of Statement
115 on Accounting for Certain Investments in Debt and Equity Securities" issued
by the Financial Accounting Standards Board. The reclassified securities had a
market value of $916,000 in excess of their book value at the time of the
transfer.
The Company's available for sale mortgage-backed securities portfolio increased
$55.4 million to $57.4 million as of June 30, 1996 from $2.1 million as of
September 30, 1995: $31.8 million of the increase is due to the
reclassification from held to maturity discussed above; $8.5 million of the
increase is due to
9
<PAGE> 10
securities acquired with the Bank of Florida; and the remainder of the increase
is due to purchases made during the nine months ended June 30, 1996.
The Company's net loan portfolio increased by $177.0 million, or 39.1%, to
$629.6 million at June 30, 1996, from $452.6 million at September 30, 1995,
primarily from the purchase of $173.4 million of residential loans and a $32.0
million commercial real estate loan package. The commercial real estate loan
package was comprised of 23 loans in South Florida with principal balances
ranging from $450,000 to $3.8 million. In an effort to diversify its loan
portfolio and improve yields on loans receivable, the Company has taken steps
to increase significantly the amount of commercial real estate and business
loans in its portfolio.
Effective October 1, 1995, the Company adopted Statement of Financial Standards
("SFAS") No. 114, "Accounting by Creditors for Impairment of a Loan" as amended
by SFAS No. 118, "Accounting by Creditors for Impairment of a Loan - Income
Recognition and Disclosures ("SFAS No.114"). There was no impact on the
consolidated statement of operations upon implementation due to the composition
of the Company's loan portfolio (primarily residential or collateral dependent
loans) and the Company's policy for establishing the allowance for loan
losses. The only impact to the consolidated statement of condition and to
non-performing assets was to reclassify two loans totaling $300,000 previously
classified as insubstance foreclosures in real estate owned to non-accrual
loans. These loans were reclassified because the Company does not have
possession of the collateral which, under SFAS No. 114 is required for a loan
to be classified as real estate owned. SFAS No. 114 does not apply to large
groups of smaller balance homogenous loans that are collectively evaluated for
impairment. Loans collectively reviewed by the Company for impairment include
all residential and consumer loans that are past due not more than 60 days.
All other loans are reviewed based on specific criteria such as delinquency or
other factors that may come to the attention of management. The Company's
impaired loans within the scope of SFAS No.114 include all non-performing
loans.
The Company's process for evaluating the adequacy of the allowance for loan
losses has three basic elements: first is the identification of impaired loans;
second is the establishment of an appropriate loan loss allowance once
individual specific impaired loans are identified; and third is a methodology
for establishing loan losses based on the inherent risk in the remainder of the
loan portfolio.
The identification of impaired loans is achieved mainly through individual
reviews of all loans 60 or more days past due. Loss allowances are established
for specifically identified impaired loans based on the fair value of the
underlying collateral in accordance with SFAS No.114.
Impairment losses are included in the allowance for loan losses through a
charge to the provision for loan losses. Adjustments to impairment losses
resulting from changes in the fair value of an impaired loan's collateral are
included in the provision for loan losses. Upon disposition of an impaired
loan any related valuation allowance is removed from the allowance for loan
losses. The allowance for loan losses is adjusted by additions charged to
operations as a provision for loan losses and by loan recoveries, with actual
losses charged as reductions to the allowance.
Payments received on impaired loans are generally applied to principal and
interest based on contractual terms.
10
<PAGE> 11
Non-performing assets as of March 31, 1996 were $7.3 million which represents
an increase of $659,000 or 9.9% from $6.7 million as of September 30, 1995.
Management primarily attributes this rise to the increase in loans outstanding.
The allowance for loan losses increased $666,000 or 45.3% from $1.5 million as
of September 30, 1995 to $2.1 million as of June 30, 1996. The increase was
attributable primarily to the growth in the loan portfolio.
Real Estate Owned ("REO") declined from $1.975 million as of September 30, 1995
to $.998 million as of June 30, 1996. The decrease in REO was due to sale of
properties.
The following table sets forth information concerning the Company's
non-performing assets for the periods indicated.
<TABLE>
<CAPTION>
June 30, September 30,
1996 1995
-------- -------------
(Dollars in thousands)
<S> <C> <C>
Non-accrual loans (1) $4,379 $2,974
Restructured loans 931 1,070
Loans past due 90 days and still accruing -- 92
------ ------
Total non-performing loans 5,310 4,136
Non-accrual tax certificates 1,036 574
REO 998 1,975
------ ------
Total non-performing assets $7,344 $6,685
====== ======
Allowance for tax certificates $ 645 569
Allowance for loan losses 2,135 1,469
------ ------
Total allowance $2,780 $2,038
====== ======
Non-performing assets as a percentage of
total assets .92% 1.10%
Non-performing loans as a percentage of
total loans .84% .91%
Allowance for loan losses as a percentage of
total loans .44% .32%
Allowance for loan losses as a percentage of
non-performing loans 39.38% 35.52%
</TABLE>
___________
(1) In addition to the above, management had concerns as to the borrower's
ability to comply with present repayment terms on $191,000 and $959,000
of non-accrual loans as of June 30, 1996 and September 30, 1995,
respectively.
11
<PAGE> 12
Liabilities
- -----------
Deposits increased by $160.1 million, or 51.7%, to $470.2 million at June 30,
1996 from $310.1 million at September 30, 1995. Management believes the
increase in deposits is attributable to the Company offering competitive
interest rates and personalized service. In addition, the Company acquired
deposits of $27.3 million in the purchase of the Bank of Florida and opened
branches in Boca Raton, Florida in December, 1995 and Boynton Beach, Florida in
June 1996.
FHLB advances were $244.0 million at June 30, 1996 up $3.0 million from $241.0
million at September 30, 1995.
Capital
- -------
The Company's total stockholders' equity was $69.7 million at March 31, 1996 an
increase of $24.0 million or 52.3% from $45.7 million at September 30, 1995.
The increase is due primarily to issuance of 3,565,000 shares of Class A Common
Stock pursuant to a secondary stock offering. Net proceeds from the offering
were approximately $23.0 million. The Company's management is continually
exploring opportunities to leverage this additional capital by opening new
branches and/or by acquiring other financial institutions.
The Office of Thrift Supervision ("OTS") requires that the Bank meet minimum
regulatory tangible, core and risk-based capital requirements. Currently, the
Bank exceeds all regulatory capital requirements. The Bank's required, actual
and excess regulatory capital levels as of June 30, 1996 were as follows:
<TABLE>
<CAPTION>
REQUIRED ACTUAL EXCESS
--------------- ----------------- ----------------
% OF % OF % OF
AMOUNT ASSETS AMOUNT ASSETS AMOUNT ASSETS
------- ------ ------ ------ ------ ------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Tangible Capital $11,959 1.5% $55,183 6.9% $43,224 5.6%
Core Capital $23,918 3.0% $55,183 6.9% $31,265 4.1%
Risk-Based Capital $33,572 8.0% $58,321 13.9% $24,749 7.0%
</TABLE>
Liquidity and Capital Resources
- -------------------------------
OTS regulations require that savings institutions, such as the Bank, maintain
an average daily balance of liquid assets (e.g., cash, certain time deposits,
banker's acceptances and specified United States government, state or federal
agency obligations) equal to a monthly average of not less than 5% of its net
withdrawable deposits plus short-term borrowings. As of June 30, 1996, the
Bank's regulatory liquidity position was $37.9 million, or 5.9%, compared to
$50.4 million, or 10.7% as of September 1995. The Bank adjusts its liquidity
levels in order to meet funding needs for loan purchases and commitments,
deposit outflows, payment of real estate taxes on mortgage loan escrow
balances, and repayment of borrowings, when applicable. The Bank also adjusts
liquidity as appropriate to meet its asset and liability management objectives.
12
<PAGE> 13
COMPARISON OF OPERATING RESULTS FOR THE THREE AND NINE MONTHS ENDED JUNE 30,
1996 AND 1995.
COMPARISON OF THREE MONTHS ENDED JUNE 30, 1996 AND 1995
- -------------------------------------------------------
Net Income After Preferred Stock Dividends
- ------------------------------------------
The Company had net income after preferred stock dividends of $597,000 for the
three months ended June 30, 1996, compared to a loss of $188,000 for the three
months ended June 30, 1995. The increase was attributable to an increase in
net interest income before provisions for loan losses of $1.5 million offset by
a $184,000 increase in non-interest expense and a $17,000 decline in
non-interest income.
Net Interest Income
- -------------------
Net interest income increased $1.5 million or 48.7% to $4.7 million for the
three months ended June 30, 1996 from $3.2 million for the three months ended
June 30,1995. This increase is attributable to an increase in the net interest
rate spread of 8 basis points, to 2.10% for the three months ended June 30,
1996 from 2.02% for the three months ended June 30, 1995 and an increase in
average interest-earning assets of $199.5 million, or 36.9%, to $739.7 million
for the three months ended June 30, 1996 from $540.2 million for the three
months ended June 30, 1995, offset by an increase in average interest-bearing
liabilities of $168.3 million, or 33.2%, to $675.0 million for the three months
ended June 30, 1996 from $506.7 million for the three months ended June 30,
1995. Average earning assets increased primarily because of purchases of loans
and increased short term investments which were funded by an increase in
certificates of deposit and FHLB advances. The average yield on
interest-earning assets increased 4 basis points to 7.37% for the three months
ended June 30, 1996 from 7.33% for the three months ended June 30, 1995, and
the average cost of interest-bearing liabilities decreased 4 basis points to
5.27% for the three months ended June 30, 1996 from 5.31% for the three months
ended June 30, 1995. The average cost of interest bearing liabilities
decreased primarily because lower costing certificates of deposits and FHLB
advances represent a greater percentage of interest bearing liabilities.
The increase in interest income of $3.7 million, or 37.6%, to $13.6 million for
the three months ended June 30, 1996 from $9.9 million for the three months
ended June 30, 1995 reflects increases in interest and fees on loans of $3.1
million, or 38.9%, and interest on short-term investments of $240,000, or
85.7%. The average yield on loans increased to 7.58% for the three months
ended June 30, 1996 from 7.39% for the three months ended June 30, 1995 and the
average balance of loans receivable increased $151.0 million, or 35.4%, to
$577.5 million for the three months ended June 30, 1996. The average yield on
short-term investments decreased from 6.45% for the three months ended June 30,
1995 to 5.37% for the three months ended June 30, 1996 and the average balance
of short-term investments increased $21.1 million, or 122.9%, to $38.3 million
for the three months ended June 30, 1996.
The increase in interest expense of $2.2 million, or 32.4% to $8.9 million for
the three months ended June 30, 1996 from $6.7 million for the three months
ended June 30,1995 primarily reflects an increase in interest on borrowings of
$1.9 million, or 124.5%, to $3.4 million for the three months ended June 30,
1996. The average cost of borrowings decreased to 5.73% for the three months
ended June 30, 1996 from 6.07% for the three months ended June 30, 1995, and
the average balance of borrowings increased $135.4 million, or 138.1%, to
$233.5 million for the three months ended June 30, 1996. Borrowings increased
in the fourth quarter of fiscal 1995 to replace deposits sold with the
Company's branches on the west coast of Florida.
13
<PAGE> 14
Provision For Loan Losses
- -------------------------
The provision for loan losses for both the three months ended June 30, 1996 and
1995 was $75,000. Management believes that the allowance for loan losses is
adequate given the Company's collateral position and its loan review and
classifications.
Non-Interest Income
- -------------------
Other income for the three months ended June 30, 1996 was $198,000 compared
with $215,000 for the three months ended June 30, 1995. The three months ended
June 30, 1995 included a gain of $101,000 from the sale of $9.7 million of
mortgage-backed securities available for sale.
Non-Interest Expenses
- ---------------------
Operating expenses increased $184,000, or 6.5%, to $3.0 million for the three
months ended June 30, 1996 compared to $2.8 million for the three months ended
June 30, 1995. Employee compensation and benefits expense increased $226,000,
or 24.8% to $1.1 million for the three months ended June 30, 1996 from $912,000
for the three months ended June 30, 1995 due to additional personnel as a
result of the Bank of Florida purchase and an increase in performance based
compensation. Expenses associated with REO decreased $128,000, or 94.8% for
the three months ended June 30, 1996, as compared to the same period in 1995.
The decline primarily reflects a decrease in REO.
Income Taxes
- ------------
The income tax provision was $706,000 for the three months ended June 30, 1996,
compared to $181,000 for the three months ended June 30, 1995. The increase in
income taxes was primarily the result of the Company's higher pre-tax earnings
during the three months ended June 30, 1996, compared to that for the three
months ended June 30, 1995.
14
<PAGE> 15
Yields Earned and Rates Paid
- ----------------------------
The following tables set forth certain information relating to the categories
of the Company's interest-earning assets and interest-bearing liabilities for
the periods indicated. All yield and rate information is calculated on an
annualized basis. Yield and rate information for a period is average
information for the period calculated by dividing the income or expense item
for the period by the average balances during the period of the appropriate
balance sheet item. Net interest margin is net interest income divided by
average interest-earning assets. Non-accrual loans are included in asset
balances for the appropriate period, whereas recognition of interest on such
loans is discontinued and any remaining accrued interest receivable is
reversed, in conformity with federal regulations. The yields and net interest
margins appearing in the following table have been calculated on a pre-tax
basis.
<TABLE>
<CAPTION>
Three Months Ended June 30,
-----------------------------------------------------------------------
1996 1995
----------------------------------- ---------------------------------
Average Average
Balance Interest Yield/Rate Balance Interest Yield/Rate
------- -------- ---------- ------- -------- ----------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Loans receivable, net $577,486 $10,937 7.58% $426,530 $7,874 7.39%
Mortgage-backed securities 73,618 1,236 6.72 57,563 1,004 6.98
Short-term investments (1) 38,297 520 5.37 17,180 280 6.45
Tax certificates 30,628 594 7.76 33,902 648 7.65
Long-term investments and
FHLB stock, net 19,671 340 6.94 5,025 97 7.76
-------- ------- ---- -------- ----- ----
Total interest-earning assets 739,700 13,627 7.37 540,200 9,903 7.33
-------- ------- ---- -------- ----- ----
Interest-bearing liabilities:
NOW/money market 42,582 272 2.57 36,252 202 2.23
Savings 62,285 678 4.38 62,251 729 4.70
Certificates of deposit 336,633 4,573 5.46 310,148 4,289 5.55
FHLB advances and other
borrowings 233,511 3,381 5.73 98,089 1,506 6.07
-------- ------- ---- -------- ----- ----
Total interest-bearing
liabilities 675,011 8,904 5.27 506,740 6,726 5.31
-------- ------- ---- -------- ----- ----
Excess of interest-earning assets
over interest-bearing liabilities $ 64,689 $ 33,460
======== ========
Net interest income $ 4,723 $3,177
======== ======
Interest rate spread 2.10% 2.02%
===== =====
Net interest margin 2.56% 2.35%
===== =====
Ratio of interest-earning assets to
interest-bearing liabilities 109.58% 106.60%
======= =======
</TABLE>
________
(1) Short-term investments include FHLB overnight deposits, securities
purchased under agreements to resell, federal funds sold and certificates
of deposit.
15
<PAGE> 16
Rate/Volume Analysis
- --------------------
The following table presents, for the periods indicated, the change in interest
income and the changes in interest expense attributable to the changes in
interest rates and the changes in the volume of interest-earning assets and
interest-bearing liabilities. For each category of interest-earning assets and
interest-bearing liabilities, information is provided on changes attributable
to: (i) changes in volume (change in volume multiplied by prior year rate);
(ii) changes in rate (change in rate multiplied by prior year volume); (iii)
changes in rate/volume (change in rate multiplied by change in volume); and
(iv) total changes in rate and volume.
<TABLE>
<CAPTION>
Three Months ended June,
----------------------------------------------------
1996 vs. 1995
----------------------------------------------------
Increase (Decrease) Due to
-----------------------------------------------------
Changes Changes Changes Total
in in in Increase/
Volume Rate Rate/Volume (Decrease)
--------- ------- ----------- ---------
(Dollars in Thousands)
<S> <C> <C> <C> <C>
Interest income attributable to:
Loans $3,024 $ 85 $ (46) $3,063
Mortgage-backed securities 280 (38) (10) 232
Short-term investments (1) 344 (47) (57) 240
Tax certificates (62) 9 (1) (54)
Long-term investments and FHLB
stock 136 (7) 114 243
------ ---- ----- ------
Total interest-earning assets 3,722 2 0 3,724
------ ---- ----- ------
Interest expense attributable to:
NOW/money market 35 30 5 70
Savings -- (51) 0 (51)
Certificates of deposit 365 (76) (5) 284
FHLB advances and other
borrowings 2,070 (81) (114) 1,875
------ ---- ----- ------
Total interest-bearing liabilities 2,470 (178) (114) 2,178
------ ---- ----- ------
Increase (decrease) in net interest
income $1,252 $ 180 $ 114 $1,546
====== ===== ===== ======
</TABLE>
____________
(1) Short-term investments include FHLB overnight deposits, securities
purchased under agreements to resell, federal funds sold and certificates
of deposit.
16
<PAGE> 17
COMPARISON OF NINE MONTHS ENDED JUNE 30, 1996 AND 1995
- ------------------------------------------------------
Net Income After Preferred Stock Dividends
- ------------------------------------------
The Company had a net income after preferred stock dividends of $1.1 million
for the nine months ended June 30, 1996, compared to a loss of $230,000 for the
nine months ended June 30, 1995. The increase was attributable to an increase
in net interest income before provision for loan losses of $1.9 million, a
decline in the provision (credit) for loan losses of $565,000 primarily as a
result of a recovery from a legal settlement in the nine months ended June 30,
1996 and a $299,000 reduction in non-interest expense, which were offset by a
$331,000 decline in non-interest income.
Net Interest Income
- -------------------
Net interest income increased $1.9 million or 18.7%, to $12.0 million for the
nine months ended June 30, 1996 from $10.1 million for the nine months ended
June 30, 1995. The increase is attributable to an increase in the average
interest-earning assets of $130.1 million, or 24.4%, to $664.5 million for the
nine months ended June 30, 1996 from $534.4 million for the nine months ended
June 30, 1995, offset by a decline in the net interest rate spread of 17 basis
points, to 2.01% for the nine months ended June 30, 1996 from 2.18% for the
nine months ended June 30, 1995. Average earning assets increased primarily
because of purchases of loans and increased short term investments which were
funded by an increase in certificates of deposit and FHLB advances. The average
yield on interest-earning assets increased 25 basis points to 7.41% for the
nine months ended June 30, 1996 from 7.16% for the nine months ended June 30,
1995, and the average cost of interest-bearing liabilities increased 42 basis
points to 5.40% for the nine months ended June 30, 1996 from 4.98% for the nine
months ended June 30, 1995. The average cost of interest bearing liabilities
increased primarily because higher costing certificates of deposits represent a
greater percentage of interest bearing liabilities.
The increase in interest income of $8.2 million, or 28.7%, to $37.0 million for
the nine months ended June 30, 1996 from $28.7 million for the nine months
ended June 30, 1995 reflects increases in interest and fees on loans of $6.7
million, or 29.8%, and interest on short-term investments of $1.3 million, or
198.3%. The average yield on loans increased to 7.62% for the nine months
ended June 30, 1996 from 7.19% for the nine months ended June 30, 1995 and the
average balance of loans receivable increased $93.8 million, or 22.5%, to
$510.1 million for the nine months ended June 30, 1996. The average yield on
short-term investments decreased from 6.22% for the nine months ended June 30,
1995 to 5.55% for the nine months ended June 30, 1996 and the average balance
of short-term investments increased $32.6 million, or 233.2%, to $46.6 million
for the nine months ended June 30, 1996.
The increase in interest expense of $6.4 million, or 34.2% to $24.9 million for
the nine months ended June 30, 1996 from $18.6 million for the nine months
ended June 30, 1995 primarily reflects an increase in interest on borrowings of
$5.2 million, or 99.7%, to $10.4 million for the nine months ended June 30,
1996. The average cost of borrowings decreased from 6.15% for the nine months
ended June 30, 1995 to 5.83% for the nine months ended June 30, 1996, and the
average balance of borrowings increased $122.7 million, or 110.2%, to $234.1
million for the nine months ended June 30, 1996. Borrowings increased in the
fourth quarter of fiscal 1995 to replace deposits sold with the Company's
branches on the west coast of Florida.
17
<PAGE> 18
Provision For Loan Losses
- -------------------------
In December 1995, the Company recorded a recovery of approximately $1 million
as a result of a legal settlement relating to certain loans previously
purchased. Consequently, the Company recorded a $225,000 credit for the
provision for loan losses for the nine months ended June 30, 1996, compared to
a $340,000 charge for the nine months ended June 30, 1995.
Non-Interest Income
- -------------------
Non-interest income for the nine months ended June 30, 1996 was $485,000
compared with $816,000 for the nine months ended June 30, 1995. The nine
months ended June 30, 1995 included a gain of $263,000 from the sale of $23.7
million of mortgage servicing rights and a gain of $240,000 from the sale of
$9.8 million of mortgage-backed securities.
Non-Interest Expenses
- ---------------------
Operating expenses decreased $299,000, or 3.5%, to $8.3 million for the nine
months ended June 30, 1996 compared to $8.6 million for the nine months ended
June 30, 1995. In general, expenses declined because the Company sold its three
west coast of Florida branches in July, 1995. Employee compensation and
benefits expense increased $332,000, or 11.7% to $3.2 million for the nine
months ended June 30, 1996 from $2.8 million for the nine months ended June 30,
1995 due to an increase in performance based compensation. Expenses associated
with REO decreased $347,000, or 86.5% for the nine months ended June 30, 1996
as compared to the same period in 1995. The decline primarily reflects a
decrease in REO.
Income Taxes
- ------------
The income tax provision was $1.7 million for the nine months ended June 30,
1996, compared to $731,000 for the nine months ended June 30, 1995. The
increase in income taxes was primarily the result of the Company's higher
pre-tax earnings during the nine months ended June 30, 1995, compared to that
for the nine months ended June 30, 1995.
18
<PAGE> 19
Yields Earned and Rates Paid
- ----------------------------
The following tables set forth certain information relating to the categories
of the Company's interest-earning assets and interest-bearing liabilities for
the periods indicated. All yield and rate information is calculated on an
annualized basis. Yield and rate information for a period is average
information for the period calculated by dividing the income or expense item
for the period by the average balances during the period of the appropriate
balance sheet item. Net interest margin is net interest income divided by
average interest-earning assets. Non-accrual loans are included in asset
balances for the appropriate period, whereas recognition of interest on such
loans is discontinued and any remaining accrued interest receivable is
reversed, in conformity with federal regulations. The yields and net interest
margins appearing in the following table have been calculated on a pre-tax
basis.
<TABLE>
<CAPTION>
Nine Months Ended June 30,
-----------------------------------------------------------------------------
1996 1995
----------------------------------- -------------------------------------
Average Average
Balance Interest Yield/Rate Balance Interest Yield/Rate
------- -------- ---------- ------- -------- ----------
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Interest-earning assets:
Loans receivable, net $510,128 $29,135 7.62% $416,335 $22,454 7.19%
Mortgage-backed securities 59,643 3,023 6.76 60,602 3,168 6.97
Short-term investments (1) 46,602 1,969 5.55 13,986 660 6.22
Tax certificates 31,487 1,941 8.22 36,516 2,051 7.49
Long-term investments and
FHLB stock, net 16,644 885 7.09 6,930 373 7.21
-------- ------- ---- -------- ------- ----
Total interest-earning assets 664,504 36,953 7.41 534,369 28,706 7.16
-------- ------- ---- -------- ------- ----
Interest-bearing liabilities:
NOW/money market 30,256 511 2.26 44,526 699 2.10
Savings 55,981 1,828 4.36 56,616 1,791 4.23
Certificates of deposit 292,812 12,216 5.57 284,062 10,890 5.13
FHLB advances and other
borrowings 234,111 10,379 5.83 111,378 5,197 6.15
-------- ------- ---- -------- ------- ----
Total interest-bearing
liabilities 613,160 24,934 5.40 496,582 18,577 4.98
-------- ------- ---- -------- ------- ----
Excess of interest-earning assets
over interest-bearing liabilities $ 51,344 $ 37,787
======== ========
Net interest income $12,019 $10,129
======= =======
Interest rate spread 2.01% 2.18%
===== =====
Net interest margin 2.43% 2.53%
===== =====
Ratio of interest-earning assets to
interest-bearing liabilities 108.37% 107.61%
========= =========
</TABLE>
________
(1) Short-term investments include FHLB overnight deposits, securities
purchased under agreements to resell, federal funds sold and certificates
of deposit.
19
<PAGE> 20
Rate/Volume Analysis
- --------------------
The following table presents, for the periods indicated, the change in interest
income and the changes in interest expense attributable to the changes in
interest rates and the changes in the volume of interest-earning assets and
interest-bearing liabilities. For each category of interest-earning assets and
interest-bearing liabilities, information is provided on changes attributable
to: (i) changes in volume (change in volume multiplied by prior year rate);
(ii) changes in rate (change in rate multiplied by prior year volume); (iii)
changes in rate/volume (change in rate multiplied by change in volume); and
(iv) total changes in rate and volume.
<TABLE>
<CAPTION>
Nine Months ended June
----------------------------------------------------
1996 vs. 1995
----------------------------------------------------
Increase (Decrease) Due to
-----------------------------------------------------
Changes Changes Changes Total
in in in Increase/
Volume Rate Rate/Volume (Decrease)
--------- ------- ----------- ---------
(Dollars in Thousands)
<S> <C> <C> <C> <C>
Interest income attributable to:
Loans $5,540 $1,062 $ 79 $6,681
Mortgage-backed securities (51) (96) 2 (145)
Short-term investments (1) 1,547 (71) (166) 1,310
Tax certificates (282) 200 (28) (110)
Long-term investments and FHLB
stock 440 (1) 72 511
------ ------ ----- ------
Total interest-earning assets 7,194 1,094 (41) 8,247
------- ------ ----- ------
Interest expense attributable to:
NOW/money market (223) 52 (17) (188)
Savings (18) 56 (1) 37
Certificates of deposit 346 951 29 1,326
FHLB advances and other
borrowings 5,745 (267) (296) 5,182
------ ------ ----- ------
Total interest-bearing liabilities 5,850 792 (285) 6,357
------ ------ ----- ------
Increase (decrease) in net interest
income $1,344 $ 302 $ 244 $1,890
====== ===== ===== ======
</TABLE>
____________
(1) Short-term investments include FHLB overnight deposits, securities
purchased under agreements to resell, federal funds sold and certificates
of deposit.
20
<PAGE> 21
PART II - OTHER INFORMATION
ITEM 5. OTHER INFORMATION
-----------------
On July 15, 1996 the Company entered into a definitive agreement to
acquire Hollywood, Florida based Suncoast Savings and Loan
Association, FSA ("Suncoast"). Under terms of the agreement, one
share of the Company's Class A Common Stock will be issued for each
share of Suncoast Common Stock in a tax free exchange. The Company
currently has 5,451,008 shares of Class A Common Stock outstanding
and expects to issue approximately 1,996,930 additional shares in
connection with the merger. Likewise, the 920,000 outstanding
shares of Suncoast Preferred Stock will be exchanged for a new issue
of Company Preferred Stock having substantially similar terms to the
Suncoast Preferred Stock. The transaction, which is subject to
shareholder and regulatory approvals and various other conditions
including completion of due diligence reviews, will be accounted for
as a purchase and is expected to close by December 1996.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
(a) Exhibits.
11 Calculation of Earnings Per Share.
27.1 Financial Data Schedule
(b) Reports on Form 8-K.
The Company filed a current report on Form 8-K dated July 17,
1996 under item 5 thereof reporting the Company's entering
into a definitive agreement to acquire Suncoast Savings and
Loan Association, FSA.
21
<PAGE> 22
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed by the undersigned
thereunto duly authorized.
BANKUNITED FINANCIAL CORPORATION
Date: August 14, 1996 By: /s/ Samuel A. Milne
------------------------------------
Samuel A. Milne
Executive Vice President
and Chief Financial Officer
22
<PAGE> 23
BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES
Form 10-Q for the Quarter Ended June 30, 1996
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION> Sequentially
Exhibit No. Numbered Page
- ----------- -------------
<S> <C> <C>
11 Calculation of Earnings Per Share............... 24-25
27.1 Financial Data schedule ........................ 26
</TABLE>
23
<PAGE> 1
EXHIBIT 11
Calculation of Earnings Per Share
(In thousands, except per share data)
<TABLE>
<CAPTION>
For the Three
Months
Ended June 30,
-------------------
Calculation of Primary Earnings Per Common Share 1996 1995
------------------------------------------------ ------ ------
<S> <C> <C>
Net income before preferred stock dividends $1,134 $ 314
Preferred stock dividends (537) (502)
------ ------
Net income available to common shares $ 597 $ (188)
====== ======
Weighted average number of common shares outstanding
during the period 5,698 2,027
Assumed exercise of stock options (Modified Treasury
Stock Method) 249 --
------ ------
Weighted average number of common share equivalents
assumed outstanding during the period 5,947 2,027
====== ======
Primary earnings per share $0 .10 $(0.09)
====== ======
</TABLE>
<TABLE>
<CAPTION>
For the Three
Months
Ended June 30,
-------------------
Calculation of Fully Diluted Earnings Per Common Share 1996 1995
------------------------------------------------------ ------ ------
<S> <C> <C>
Net income before preferred stock dividends $1,134 $ 314
Preferred stock dividends (537) (502)
------ ------
Net income available to common shares $ 597 $ (188)
====== ======
Weighted average number of common shares outstanding
during the period 5,698 2,027
Assumed exercise of stock options (Modified Treasury
Stock Method) 249 --
------ ------
Weighted average number of fully diluted common share
equivalents assumed outstanding during the period 5,947 2,027
====== ======
Fully diluted earnings per share $ 0.10 $(0.09)
====== ======
</TABLE>
24
<PAGE> 2
EXHIBIT 11
Calculation of Earnings Per Share
(In thousands, except per share data)
<TABLE>
<CAPTION>
For the Three
Months
Ended June 30,
--------------------
Calculation of Primary Earnings Per Common Share 1996 1995
------------------------------------------------ ------- -------
<S> <C> <C>
Net before preferred stock dividends $ 2,738 $ 1,277
Preferred stock dividends (1,609) (1,507)
Reduction of interest expense due to assumed exercise
of stock options, net of taxes 3 --
------- -------
Net income available to common shares $ 1,132 $ (230)
======= =======
Weighted average number of common shares outstanding
during the period 3,739 2,017
Assumed exercise of stock options (Modified Treasury
Stock Method) 258 --
Weighted average number of common share equivalents
assumed outstanding during the period 3,997 2,017
======= =======
Primary earnings per share $ 0.28 $ (0.11)
======= =======
</TABLE>
<TABLE>
<CAPTION>
For the Three
Months
Ended June 30,
-------------------
Calculation of Fully Diluted Earnings Per Common Share 1996 1995
------------------------------------------------------ ------ ------
<S> <C> <C>
Net income before preferred stock dividends $ 2,738 $ 1,277
Preferred stock dividends (1,609) (1,507)
------- -------
Net income available to common shares $ 1,129 $ (230)
======= =======
Weighted average number of common shares outstanding
during the period 3,739 2,017
Assumed exercise of stock options (Modified Treasury
Stock Method) 258 --
------- -------
Weighted average number of fully diluted common share
equivalents assumed outstanding during the period 3,997 2,017
======= =======
Fully diluted earnings per share $ 0.28 $ (0.11)
======= =======
</TABLE>
25
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF BANK UNITED, FSB FOR THE SIX MONTHS ENDED MARCH 31,
1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> JUN-30-1996
<CASH> 5,176
<INT-BEARING-DEPOSITS> 10,379
<FED-FUNDS-SOLD> 200
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 65,092
<INVESTMENTS-CARRYING> 65,057
<INVESTMENTS-MARKET> 0
<LOANS> 631,702
<ALLOWANCE> 2,135
<TOTAL-ASSETS> 801,531
<DEPOSITS> 470,237
<SHORT-TERM> 244,000
<LIABILITIES-OTHER> 16,859
<LONG-TERM> 0
0
27
<COMMON> 57
<OTHER-SE> 69,576
<TOTAL-LIABILITIES-AND-EQUITY> 801,531
<INTEREST-LOAN> 29,135
<INTEREST-INVEST> 7,818
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 36,953
<INTEREST-DEPOSIT> 14,555
<INTEREST-EXPENSE> 24,934
<INTEREST-INCOME-NET> 12,019
<LOAN-LOSSES> (225)
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 8,298
<INCOME-PRETAX> 4,431
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,738
<EPS-PRIMARY> .28
<EPS-DILUTED> .28
<YIELD-ACTUAL> 2.43
<LOANS-NON> 5,310
<LOANS-PAST> 0
<LOANS-TROUBLED> 931
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 2,142
<CHARGE-OFFS> 3
<RECOVERIES> 85
<ALLOWANCE-CLOSE> 2,135
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
