Bankunited, Inc. · NYSE:BKU
Bankunited — Q4 2023 Earnings Presentation
33 slides from Bankunited's earnings presentation, Jan 26, 2024
Slide 1: Q4 2023 – Supplemental Information
January 26, 2024 Q4 2023 – Supplemental Information 1 Exhibit 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the current views of BankUnited, Inc. (“BankUnited,” “BKU” or the “Company”) with respect to, among other things, future events and
Slide 3: Quarterly Highlights
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Slide 4: Execution on Near-term Strategic Priorities
Improve Asset Mix Improve Funding Profile 2 Maintain Robust Liquidity and Capital Improve Net Interest Margin Execution on Near-term Strategic Priorities Manage Expenses 5 4 3 4 1 • Wholesale funding down $228 million • Non-brokered deposits grew by $604 million • NIDDA at 26% of deposits • Period e
Slide 5: Topics of Current Interest
Topics of Current Interest Capital • CET1 ratios of 11.4% at the holding company and 13.1% at the bank • Pro-forma holding company CET1 of 10.0% including AOCI • AOCI improved $50 million quarter-over-quarter • Book value and tangible book value per share of $34.66 and $33.62 Deposits and Funding •
Slide 6: Highlights from Fourth Quarter Earnings
Highlights from Fourth Quarter Earnings Change From ($ in millions, except per share data) Q4’23 Q3’23 Q4’22 Q3’23 Q4’22 Key Highlights Net Interest Income $217 $215 $243 $2 $(26) Provision for Credit Losses $19 $33 $40 $(14) $(21) Total Non-interest Income $17 $28 $27 $(11) $(10) Includes $6.5 mill
Slide 7: Deposits
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Slide 8: Deposit Mix and Cost of Deposits Impacted by Current Rate Environment
Deposit Mix and Cost of Deposits Impacted by Current Rate Environment ($ in millions) $6,820 $7,347 $4,807 $3,384 $4,268 $5,190 $5,164 $11,262 $10,622 $12,660 $13,369 $13,061 $10,276 $11,136 $1,771 $2,131 $3,020 $3,709 $2,142 $3,290 $3,403 $3,621 $4,295 $7,009 $8,976 $8,038 $7,357 $6,835 $23,474 $24
Slide 9: Cost of Funds Trend
Cost of Funds Trend 9 1.42% 0.36% 0.16% 1.92% 2.84% 3.18% 1.75% 0.25% 0.25% 4.50% 5.50% 5.50% Spot APY - Total Deposits Target Federal Funds Rate Upper Bound 12/31/19 12/31/20 12/31/21 12/31/22 09/30/23 12/31/23 (1.00)% —% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% Spot Average Annual Percentage Yield (“AP
Slide 10: Loans and the Allowance for Credit Losses
Loans and the Allowance for Credit Losses 10
Slide 11: Prudently Underwritten and Well-Diversified Loan Portfolio
11 Prudently Underwritten and Well-Diversified Loan Portfolio At December 31, 2023 ($ in millions) Loan Portfolio Over Time $5,661 $6,348 $8,368 $8,901 $8,381 $8,209 $7,493 $6,896 $5,702 $5,700 $5,742 $5,819 $6,718 $6,448 $6,735 $8,305 $8,508 $8,907 $768 $1,259 $1,092 $525 $408 $433 $2,515 $2,915 $1
Slide 12: High Quality CRE Portfolio
High Quality CRE Portfolio At December 31, 2023 ($ in millions) Property Type Balance % of Total CRE FL NY Tri State Other Wtd. Avg. DSCR Wtd. Avg. LTV Office $ 1,753 30 % 60 % 24 % 16 % 1.67 65.0 % Warehouse/Industrial 1,341 24 % 56 % 8 % 36 % 2.04 52.0 % Multifamily 839 14 % 50 % 50 % — % 1.98 45.
Slide 13: Manageable CRE Maturity Risk
Manageable CRE Maturity Risk At December 31, 2023 ($ in millions) Property Type Maturing in the Next 12 Months % Maturing in the Next 12 Months Fixed Rate or Swapped Maturing in the Next 12 Months Fixed Rate to Borrower as a % of Total Portfolio Office $ 314 18 % $ 187 11 % Warehouse/Industrial 171
Slide 14: CRE Office Portfolio - Additional Information
CRE Office Portfolio - Additional Information At December 31, 2023 14 • 18% of the total office portfolio is medical office • $88 million in office payoffs this quarter; total exposure declined by $78 million • Rent rollover in next 12 months approximately 11% of the total office portfolio; 14% for
Slide 15: Granular, Diversified Commercial & Industrial Portfolio
Granular, Diversified Commercial & Industrial Portfolio At December 31, 2023 ($ in millions) Industry Balance(1) % of Portfolio Finance and Insurance $ 1,695 19.0 % Manufacturing 875 9.8 % Educational Services 753 8.5 % Wholesale Trade 694 7.8 % Utilities 654 7.3 % Health Care and Social Assistance
Slide 16: Drivers of Change in the ACL - Current Quarter
Drivers of Change in the ACL - Current Quarter ($ in millions) $196.1 $13.4 $(1.6) $(9.6) $3.6 $0.8 $202.7 Risk Rating Migration and Specific Reserves Economic Forecast Net Charge- Offs ACL 12/31/23 ACL 09/30/23 0.82%0.80%% of Total Loans 16 • Current market adjustment • Changes to forward path of e
Slide 17: Drivers of Change in the ACL - Year to Date
Drivers of Change in the ACL - Year to Date ($ in millions) $147.9 $58.5 $16.2 $(20.7) $33.6 $(22.4) $(8.6) $(1.8) $202.7 Risk Rating Migration and Specific Reserves Economic Forecast Net Charge- Offs Change in Qualitative Overlay ACL 12/31/23 ACL 12/31/22 0.82%0.59%% of Total Loans 17 • Current mar
Slide 18: Allocation of the ACL
Allocation of the ACL ($ in millions) December 31, 2022 September 30, 2023 December 31, 2023 Balance % of Loans Balance % of Loans Balance % of Loans Residential $ 11.7 0.13 % $ 8.0 0.10 % $ 7.6 0.09 % Commerical: Commercial real estate 24.8 0.43 % 34.8 0.61 % 41.3 0.71 % Commercial and industrial 9
Slide 19: Asset Quality Metrics
Asset Quality Metrics 19 Non-Performing Loans to Total Loans Non-Performing Assets to Total Assets Net Charge-offs to Average Loans 0.88% 1.02% 0.87% 0.42% 0.56% 0.52% 0.68% 0.80% 0.68% 0.26% 0.40% 0.35% Incl. guaranteed portion of non-accrual SBA loans Excl. guaranteed portion of non-accrual SBA lo
Slide 20: Non-Performing Loans by Portfolio Segment
Non-Performing Loans by Portfolio Segment ($ in millions) 20 $205 $244 $206 $105 $137 $127 $19 $29 $29 $21 $21 $21 $24 $60 $30 $3 $65 $43 $58 $22 $48 $34 $21 $7 $14 $45 $33 $13 $18 $17 $46 $51 $46 $40 $38 $42 $16 $16 $10 $9 $9 $6 Non-Guaranteed Portion of SBA Guaranteed Portion of SBA Franchise Equi
Slide 21: Criticized and Classified Loans
Criticized and Classified Loans ($ in millions) 21 Commercial Real Estate(1) Commercial(1)(2) Special Mention Substandard Accruing Substandard Non-accruing and Doubtful 12/31/19 12/31/20 12/31/21 12/31/22 09/30/23 12/31/23 $— $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 12/31/19 12/31/20 12/3
Slide 22: Criticized and Classified CRE Loans by Property Type
Criticized and Classified CRE Loans by Property Type ($ in millions) 22 December 31, 2023 $116 $55 $89 $146 $77 $3 $16 Multifamily Hotel Retail Office Construction & Land Other SBA $146 $14 $73 $91 $2 $30 $98 $40 $63 $90 $42 $16 $15 December 31, 2022September 30, 2023
Slide 23: Asset Quality - Delinquencies
Asset Quality - Delinquencies ($ in millions) 23 Commercial(1) CRE(3) 12/31/19 12/31/20 12/31/21 12/31/22 09/30/23 12/31/23 $— $20 $40 $60 $80 $100 Residential(2) 12/31/19 12/31/20 12/31/21 12/31/22 09/30/23 12/31/23 $— $20 $40 $60 $80 $100 30-59 Days PD 60-89 Days PD 90 Days+ PD 12/31/19 12/31/20 1
Slide 24: Residential Portfolio Overview
Residential Portfolio Overview At December 31, 2023 24 Residential Loan Product Type FICO Distribution(1) Breakdown by LTV 1. Excludes government insured residential loans. FICOs are refreshed routinely. LTVs are typically based on valuation at origination Prior 19% 2019 4% 2020 13%2021 43% 2022 16%
Slide 25: Investment Portfolio
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Slide 26: High Quality, Short-Duration Securities Portfolio
High Quality, Short-Duration Securities Portfolio ($ in millions) December 31, 2022 September 30, 2023 December 31, 2023 Portfolio Net Unrealized Loss Fair Value Net Unrealized Loss Fair Value Net Unrealized Loss Fair Value US Government and Agency $ (146) $ 2,780 $ (144) $ 2,642 $ (115) $ 2,656 Pri
Slide 27: High Quality, Short-Duration Securities Portfolio
High Quality, Short-Duration Securities Portfolio At December 31, 2023 Strong credit enhancement levels Private Label RMBS Subordination Wtd. Avg. Stress Scenario LossRating Min Max Avg. AAA 3.0 92.0 17.7 2.2 AA 20.2 34.2 24.8 5.3 A 27.3 28.2 27.7 5.7 Wtd. Avg. 4.2 88.4 18.2 2.4 Private Label CMBS S
Slide 28: Appendix - Additional Information
Appendix - Additional Information 28
Slide 29: Strong Capital Position
Strong Capital Position 29 6.5% 6.5% 13.1% 11.4%11.7% 10.0% 12.4% 11.4%11.8% Required to be Considered Well Capitalized CET1 CET1 including AOCI CET1 Peer Median(1)(2) CCAR Stress Test Trough BankUnited, N.A BankUnited, Inc —% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 1. Peer information based on Septem
Slide 30: Liquidity
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Slide 31: Ample Liquidity Coverage of Uninsured Deposits
Ample Liquidity Coverage of Uninsured Deposits ($ in millions) 31 Insured Deposits Total Deposits $ 26,538 Estimated Uninsured Deposits $ 12,360 Less: Collateralized deposits (3,048) Less: Affiliate deposits (318) Adjusted Uninsured Deposits $ 8,994 Estimated Insured and Collateralized Deposits $ 17
Slide 32: Non-GAAP Financial Measures
Non-GAAP Financial Measures 32
Slide 33: Non-GAAP Financial Measures
Non-GAAP Financial Measures 33 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 c