Published on 18 Apr 2024 on Zacks via Yahoo Finance

BankUnited (BKU) Stock Up as Q1 Earnings Top, Provisions Fall

Shares of BankUnited, Inc. BKU gained 2.9% in response to better-than-expected first-quarter 2024 results. Quarterly earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 62 cents. In the prior-year quarter, the company had reported earnings of 70 cents. The just-reported quarter’s earnings included expenses related to FDIC special assessment.Results were aided by an increase in non-interest income and deposits and a decline in provisions. However, lower net interest income (NII) and loan balance, along with higher expenses, were the undermining factors.Net income was $48 million, down 9.3% year over year. Our estimate for the metric was $46.6 million.

Revenues Decline & Expenses Rise

Quarterly net revenues were $241.7 million, declining 1.1% year over year. However, the top line surpassed the Zacks Consensus Estimate of $239.84 million.NII was $214.9 million, decreasing 5.7%. The net interest margin (NIM) contracted 5 basis points (bps) to 2.57%. Our estimates for NII and NIM were $215.9 million and 2.61%, respectively.Non-interest income of $26.9 million jumped 62.5% from the prior-year quarter. The increase was mainly due to net gain on investment securities. We had projected non-interest income of $22.8 million.Non-interest expenses rose 4.2% to $159.2 million. The increase was mainly due to a rise in employee compensation and benefits costs, deposit insurance expenses, and other non-interest expenses. The expenses included $5.2 million related to the adjustment to FDIC special assessment. Our estimate for non-interest expenses was $160 million.As of Mar 31, 2024, total loans were $24.23 billion, down 1.7% from the prior quarter. Total deposits amounted to $27.03 billion, up 1.8%. Our estimates for total loans and total deposits were $23.73 billion and $26.65 billion, respectively.