SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of
the Securities Exchange Act of 1934
Date of Report: April 19, 1999
BANKUNITED FINANCIAL CORPORATION
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
FLORIDA 5-43936 65-0377773
- --------------- ------------------------ -------------------
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
255 ALHAMBRA CIRCLE, CORAL GABLES, FLORIDA 33134
---------------------------------------------------
(Address of principal executive offices) (ZIP Code)
Registrant's telephone number, including area code: (305) 569-2000
<PAGE>
Item 5. OTHER EVENTS.
Attached hereto as Exhibit 20.1 is a press release announcing
a significant restructuring by the Registrant and a second quarter
loss.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
20.1 Press Release dated April 19, 1999, announcing a significant
restructuring by the Registrant and a second quarter loss.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
BANKUNITED FINANCIAL CORPORATION
By: /s/ DIANE DELELLA
-----------------------------------------
Diane DeLella
Senior Vice President, Chief Financial
Officer and Controller
Dated: April 19, 1999
<PAGE>
BANKUNITED FINANCIAL CORPORATION
FORM 8-K
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. PAGE
- ------- ------------
<S> <C> <C>
20.1 Press Release dated April 19, 1999 announcing a significant
restructuring by the Registrant and a second quarter loss.
</TABLE>
Exhibit 20.1
[GRAPHIC OMITTED]
- -------------------------------------------------------------------------------
N E W S R E L E A S E
- -------------------------------------------------------------------------------
For Immediate Release Contact: Deborah Koch
April 19, 1999 305-569-2000
BANKUNITED REPORTS SIGNIFICANT RESTRUCTURING;
ANNOUNCES SECOND QUARTER LOSS
AND DISCUSSES NEW STRATEGY
CORAL GABLES, FL - - - In connection with BankUnited's recently announced
restructuring, including other charges, BankUnited Financial Corporation, parent
company of BankUnited, FSB, today reported a net loss after preferred stock
dividends of $11.1 million for the three months ended March 31, 1999 versus net
income of $2.1million for the quarter ended March 31, 1998; net loss for the six
months ended March 31, 1999 was $10.9 million versus net income of $3.8 million
for the six month period ended March 31, 1998. Basic and diluted earnings were
($0.61) and ($0.61) per share, respectively, for the second quarter of fiscal
1999 versus $0.14 and $0.13 per share for the same period in the prior year; and
($0.60) and ($0.60) per share, respectively, for the six month period versus
$0.27 and $0.26 per share for the six month period ended March 31, 1998. Total
assets reached $3.9 billion and book value per share is $9.76 and tangible book
value per share is $8.01, at March 31, 1999.
Included in the pre-tax loss for the second quarter of 1999 were: a special
charge of $15.1 million related to the previously announced restructuring of
bank operations; an increase in the provision for loan losses of $6.3 million;
an increase in provision for tax certificate investments of $1.1 million; and
certain other miscellaneous charges of $2.0 million.
"During the quarter we made a clear determination to change BankUnited's overall
strategy and move it toward an asset-generating entity," said Alfred R. Camner,
Chairman and Chief Executive Officer. He continued, "After a careful review, we
have made some hard decisions relating to business lines. We have determined to
significantly reduce our dependence on the purchase of residential mortgages in
the secondary market, and in particular, we have decided to cease purchasing
adjustable-rate one-year CMT product, which has previously been a mainstay of
our organization."
He further stated, "Our earnings have been severely hampered during the past
several quarters due to the high levels of prepayments associated with the CMT
mortgage product which we acquired in the secondary market. As a result,
included in the $15.1 million restructuring charge, is a $14.8 million
(MORE)
<PAGE>
chargeoff to account for the accelerated amortization of practically the entire
remaining loan acquisition premium for that CMT mortgage portfolio and a related
security. We have also discontinued indirect consumer lending and tax
certificate investing because it was clear from our review that we could not
anticipate future benefits from continuing these lines of business."
Camner continued, "BankUnited maintains a strong capital position, with core and
risk-based capital ratios of 8.03% and 16.58% , respectively. These ratios put
us in an excellent position to execute our new strategy toward commercial
banking and allow us to take advantage of the recent significant consolidation
of commercial banks in the South Florida market."
Concerning the charges, Mr. Camner noted, "The increase in the provision for
loan losses of $6.3 million resulted primarily from a revaluation of the loan
portfolio because of current economic conditions including, in particular, those
in Latin America and their possible affect on the South Florida economy. The
additional provision for the tax certificate portfolio related to a reevaluation
of that portfolio, as well as a consideration of the effect from on the
discontinuance by BankUnited of investing in this area. Included in the other
miscellaneous charges of $2.0 million was $1.0 million for Year 2000 costs."
Mehdi Ghomeshi, President and Chief Operating Officer, said, "Our strategy is
customer-focused, information-based and profit-driven with activities and
resources dedicated to supporting this strategy. We have restructured and
created new business lines building them around key customer segments:
/bullet/ Our new Business Banking unit will serve the financial needs of
businesses with annual sales of $5 million and less. New deposit and credit
products, including flat fee business checking and commercial mortgages, have
been developed.
/bullet/ The Professional and Executive Banking unit will provide customized
products and individualized service to meet the personal and business needs of
this market segment.
/bullet/ The Retail Banking division's new strategy is to develop compelling
value propositions that optimize performance by leveraging key drivers such as
average account size, transaction intensity and delivery channel usage. In the
next two weeks we will be introducing two new relationship products which will
encourage customers to maintain their entire relationship with us. A new
checking and savings product line will be introduced as well.
/bullet/ The Consumer Credit division has been expanded to support our strategy
of generating additional earning assets. Key initiatives include the
introduction of new products, as well as systems enhancements that will speed
credit decisions and loan closings.
/bullet/ Key to the expansion of our Corporate and Commercial Real Estate
division has been the addition of seasoned Relationship Managers whose
experience in this market will allow them to develop strong, profitable
relationships with top-tier developers and corporations.
(MORE)
<PAGE>
/bullet/ Within our Residential Mortgage area, we have hired a Mortgage Product
Specialist to develop innovative products that we will offer to key customer
segments. We have also re-engineered our process to deliver mortgage products
seamlessly."
"We realize that beyond expanding our product array and business lines, we must
provide superior customer service to distinguish BankUnited from our
competitors. In order to accomplish this, we have increased our focus on
training and have expanded our number of dedicated sales managers. We are
committed to cross-selling our existing customers on our new product lines which
will add value to their experience at BankUnited and contribute positively to
our bottom line."
"BankUnited enjoys a strong core deposit base, and is making significant
progress in reducing its cost of deposits, while maintaining that base. Now is
the time for BankUnited to take an aggressive leap toward the future," Ghomeshi
said. "We are the largest Florida-based bank, and it is time to demonstrate our
abilities to service our customers with an ever-widening array of services and
value-added products."
BankUnited, FSB is the principal subsidiary of BankUnited Financial Corporation
and is the largest financial institution headquartered in Florida. It operates
26 banking offices throughout Miami-Dade, Broward, Palm Beach and Collier
Counties. Additional branch offices in Deerfied Beach and Plantation will open
in the next 60 days.
BankUnited Financial Corporation is traded on the NASDAQ National Market. Its
common stock trades under the symbol BKUNA. BankUnited Capital II trust
preferred securities trade on NASDAQ under the symbol BKUNZ. BankUnited Capital
III trust preferred securities trade on the New York Stock Exchange under the
symbol BUFPrC.
This press release may contain certain forward-looking statements, which are
based on management's expectations regarding factors that may impact the
Company's earnings in future periods. Factors that could cause future results to
vary materially from current management expectations include, but are not
limited to, general economic conditions, changes in interest rates, deposit
flows, loan demand, real estate values and competition; changes in accounting
principles, policies or guidelines, changes in legislation or regulation; and
other economic, competitive, governmental, regulatory and technological facts
affecting the Company's operations, pricing, products and services.
# # #
Distributed by: Citigate Gordon Diaz-Balart, 305-831-6500
Andrew Skobinsky
<PAGE>
<TABLE>
<CAPTION>
BANKUNITED FINANCIAL CORPORATION
THREE AND SIX MONTHS ENDED MARCH 31, 1999 EARNINGS RELEASE
- ----------------------------------------------------------------------------------------------------------------------------------
FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED
MARCH 31, MARCH 31,
- ----------------------------------------------------------------------------------------------------------------------------------
1999 1998 1999 1998
- ----------------------------------------------------------------------------------------------------------------------------------
(in thousands, except earnings per share)
<S> <C> <C> <C> <C>
Total interest income $ 48,253 (1) $ 53,248 $ 106,398 $ 94,698
Total interest expense 46,698 41,888 94,754 73,971
--------- -------- ----------- -----------
Net interest income 1,555 11,360 11,644 20,727
Provision for loan losses 6,336 400 6,736 1,050
--------- -------- ----------- -----------
Net interest income (expense) after provision for loan losses (4,781) 10,960 4,908 19,677
Net gain (loss) on sale of assets 2 424 (7) 1,539
Total other income 1,207 591 2,509 1,120
Total other expense 13,936 (2) 8,170 24,158 15,195
--------- -------- ----------- -----------
Income (loss) before income taxes and preferred stock dividends (17,508) 3,805 (16,748) 7,141
Provision (benefit) for income taxes (6,578) 1,513 (6,214) 2,874
--------- -------- ----------- -----------
Net income (loss) before preferred stock dividend (10,930) 2,292 (10,534) 4,267
Preferred stock dividends 196 182 384 514
--------- -------- ----------- -----------
Net income (loss) after preferred stock dividends $ (11,126) $ 2,110 $ (10,918) $ 3,753
========= ======== =========== ===========
Basic earnings (loss) per common share: $ (0.61) $ 0.14 $ (0.60) $ 0.27
========= ======== =========== ===========
Weighted average common shares 18,255 14,976 18,222 13,963
========= ======== =========== ===========
Diluted earnings (loss) per common share: $ (0.61) $ 0.13 $ (0.60) $ 0.26
========= ======== =========== ===========
Weighted average diluted common shares 18,255 16,029 18,222 15,470
========= ======== =========== ===========
Return on average equity (21.89)% 6.09 % (10.56)% 5.99 %
Return on average assets (1.15)% 0.29 % (0.56)% 0.31 %
Net interest yield on earning assets 0.13 % 1.45 % 0.75 % 1.55 %
Net interest spread (0.01)% 1.26 % 0.61 % 1.33 %
</TABLE>
<TABLE>
<CAPTION>
-----------------------------
AS OF MARCH 31,
-----------------------------
1999 1998
-----------------------------
<S> <C> <C>
Total assets $ 3,918,701 $ 3,326,968
Loans receivable,net 2,936,378 2,526,435
Mortgage-backed securities 344,495 475,291
Deposits 2,240,124 1,833,904
Borrowings 1,225,307 1,079,466
Trust preferred securities 218,500 218,500
Stockholders' equity 188,256 154,303
Book value per common share 9.76 9.43
Tangible book value per common share 8.01 8.18
</TABLE>
(1) Includes a $14.8 million charge for amortization of premiums on purchased
loans.
(2) Includes a $2.1 million charge related to tax certificate investments and
Year 2000 expenses.
