BankUnited’s results, first look
January 24, 2008 – 5:10 pmIt was another bad quarter for BankUnited in Florida.
Non-performing assets jumped:
The ratio of non-performing assets as a percentage of total assets increased to 2.99% at Dec. 31, 2007, up from 1.39% at Sept. 30, 2007. The allowance for loan loss was $117.7 million at Dec. 31, 2007, compared to $58.6 million at Sept. 30, 2007, and $39.2 million at Dec. 31, 2006. The allowance for loan losses as a percentage of total loan portfolio was 0.93% at Dec. 31, 2007, compared to 0.46% at Sept. 30, 2007, and 0.34% at Dec. 31, 2006.
The majority of loans on its balance sheet carry negative amortization:
As of Dec. 31, 2007, BankUnited’s option-ARM balances totaled $7.5 billion, which represented 70% of total residential loans and 59% of total loans. For the quarter ended Dec. 31, 2007, the growth in negative amortization was $47 million, compared to $48 million for the quarter ended Sept. 30, 2007. Of the $7.5 billion in option-ARM balances, $6.9 billion had negative amortization of $317 million, or 4.2%, of the option-ARM portfolio.
Excluding the provision for loan losses, “operating earnings” were $17.3 million. Negative Amortization, that is interest income from option ARM loans recorded on the income statement not actually received in cash, was $48 million……back that out and the company’s operating earnings were negative.
More later.
Posted in Uncategorized |
One Response to “BankUnited’s results, first look”
They were confident as could be on the cc. Reserved 65 million while actual losses were just 6 million. $20 of tangible bv., deposits increasing,interest rates(costs) declining,neg ams not resetting in mass for several more years as per the 5 year reset provisions, high ficos, etc. Strong capital ratios.They say the stock is the bargain of a century.
What is going to cause the disasater here? The stock is priced for a wipe out. Things will have to get alot worse quickly…
By Tracyorsandy on Jan 26, 2008