BankUnited is uniting the north and south again. The company owns Florida's BankUnited, which provides standard banking offerings through about 100 branches. In early 2012, BankUnited acquired the three-branch New York private bank Herald National. BankUnited was formed in 2009 following the demise of the former BankUnited FSB, which collapsed under the weight of bad mortgages. A team of private investors didn't miss a beat. They bought BankUnited from the FDIC, injected $900 million in fresh capital, and assumed its $12.8 billion in assets and $8.3 billion in deposits. The company took itself public via an initial public offering (IPO) in 2011; it was the first IPO of a rescued bank during the economic crisis.
BankUnited raised some $783 million in its IPO, nearly 20% more than it sought in its pricing. The funds are helping the bank expand, both in Florida (where it operates in about a dozen counties) and into select new markets (such as New York). CEO Kanas,the former head of North Fork Bank, led a similar expansion for North Fork in the first half of the decade and will likely use his experience to repeat the strategy with BankUnited.
The $71.4 million acquisition of Herald National marked the company's first post-IPO acquisition. At the time of the purchase, BankUnited converted to a bank holding company. It also converted the charter of subsidiary BankUnited from a thrift to a national commercial bank. Herald National will be made into a subsidiary of the bank in mid-2012.
The company hopes to use its capital strength and expertise to take advantage of the weakened markets in Florida, which have seen considerably slowed-down lending. It has been growing its loan portfolio, both through originations and acquisitions, with a primary focus on commercial and commercial real estate lending. (It also invests in residential real estate, but does not acquire or write subprime residential loans.)
The growth of BankUnited's loan portfolio has helped increase the company's interest revenues, but profits were impacted in 2011 by an equity-based compensation charge. The company has also earned an atypical amount of noninterest revenues -- some $186 million -- related to its acquisition of the failed bank and its assets.
In 2010 BankUnited expanded its offerings and diversified its loan portfolio when it acquired a small business lending platform from Butler Capital Corporation. It also bought a municipal leasing business from Koch Financial Corporation. The company now offers national equipment financing services through United Capital Business Lending and municipal leasing via Pinnacle Public Finance. BankUnited also provides wealth management through insurance agency BankUnited Investment Services.
Financier Wilbur Ross, who serves on BankUnited's board of directors, owns 15% of the company through WL Ross & Co. – less