Continued Franchise Momentum Drives NIM Expansion, Stronger Funding Mix and Improved Credit Trends
MIAMI LAKES, Fla.--(BUSINESS WIRE)--October 21, 2026--
BankUnited, Inc. (the "Company") $(BKU)$ today announced financial results for the quarter ended September 30, 2026.
Chairman, President and Chief Executive Officer Rajinder Singh commented, "We delivered another quarter of solid performance, with continued deposit momentum and net interest margin expanding to 3.16%, ahead of our guidance. Benefiting from a strong economy, we remain focused on increasing profitability and creating long-term shareholder value."
Third Quarter Financial Highlights
Quarter Ended Change From
---------------------------------- --------------------
($ in millions
except per
share data) 3Q26 2Q26 3Q25 2Q26 3Q25
----- ----- ----- ---- ----
Net Income $ 72.2 $ 70.7 $ 71.9 $ 1.5 $ 0.3
Adjusted Net
Income(1, 2) $ 73.9 $ 70.0 $ 71.4 $ 3.9 $ 2.5
Diluted EPS $ 1.01 $ 0.97 $ 0.95 $0.04 $0.06
Adjusted
Diluted EPS(1,
2) $ 1.03 $ 0.96 $ 0.94 $0.07 $0.09
PPNR(1) $105.9 $109.9 $109.5 $(4.0) $(3.6)
ROA(3) 0.82% 0.81% 0.82% 0.01% --%
ROE(3) 9.6% 9.3% 9.5% 0.3% 0.1%
Net Interest
Margin(3) 3.16% 3.06% 3.00% 0.10% 0.16%
--------------- ----- ----- ----- ---- ----
Performance Net Interest Margin (NIM) of 3.16%, up 16 bps from a year ago and
Highlights up 10 bps from prior quarter. Diluted EPS of $1.01, up $0.06 from
a year ago and $0.04 from prior quarter. Adjusted Diluted EPS(1,
2) of $1.03, up $0.09 from a year ago and $0.07 from prior
quarter. Approximately 2.1 million shares repurchased in Q3 for
an aggregate of $97.0 million.
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Deposits Non-Interest Demand Deposits (NIDDA): Average NIDDA up $824
million, or 10%, from a year ago and remained stable from prior
quarter, continuing to serve as a key funding source despite
ending balance fluctuations. Ending NIDDA up $488 million, or 6%,
from a year ago and down $821 million, or 8%, from prior quarter
primarily due to seasonal normalization following elevated
inflows in Q2. Represents 32.2% of total deposits, up from 30.1%
a year ago. Average Total Deposits (excluding brokered): Up $1.0
billion from a year ago and down $385 million from prior
quarter.
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Loans Average Core Loans increased $706 million, or 4%, from a year ago
and decreased $147 million, or 1%, from prior quarter. Total
Average Loans remained stable from a year ago and decreased by
$314 million from the prior quarter due to continued purposeful
runoff in non-core loans.
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Credit Criticized and Classified Loans decreased $176 million, or 14%,
from a year ago and decreased $10 million, or 1%, from prior
quarter. Net Charge-Offs ratio remained low, 0.11%, in both the
current and prior quarter, and down from 0.25% a year ago. NPLs
down $116 million, or 30%, from a year ago, and up $40 million,
or 18%, from the prior quarter.
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______________________________________
(1) Represents a non-GAAP measure. See "Non-GAAP Financial Measures" section
for a reconciliation of non-GAAP financial measures to GAAP financial
measures.
(2) Excludes the impact of securities sales.
(3) Annualized for the three months ended September 30, 2026, June 30, 2026,
and September 30, 2025.
Net Interest Income & Margin
Net Interest Income Net Interest Margin (NIM)
------------------------------------ --------------------------------------
Up $5.3 million Up $10.5 million Up 10 bps from Up 16 bps from 3Q
or 2% from prior or 4% from 3Q prior quarter 2025
quarter 2025
Net interest income and margin increased from the prior quarter due to the following factors:
-- Deposit pricing continued to improve, contributing to lower funding
costs; average cost of deposits improved by 6 bps to 1.99%.
-- The tax equivalent yield on investment securities benefited from the
sale of lower-yielding securities and reinvestment into higher-yielding
securities, which improved the overall yield of the investment
portfolio.
-- Tax equivalent yields on commercial loans increased 5 bps from the
prior quarter, reflecting favorable loan repricing and improved
commercial loan portfolio mix.
Net interest income and margin also increased from a year ago due to the following factors:
-- Average NIDDA grew by $824 million while average interest bearing
liabilities declined by $1.0 billion; average cost of deposits improved
by 39 bps from a year ago.
-- Partially offset by lower tax-equivalent asset yields, as variable-rate
loans and securities repriced downward faster than the benefit from lower
funding costs and favorable funding mix dynamic due to lower SOFR/Fed
funds basis.
Non-Interest Income and Non-Interest Expense
The following table summarizes non-interest income and non-interest expense for the periods presented (in millions):
Three Months Ended
-------------------------
3Q26 2Q26 3Q25
----- ----- -----
Deposit service charges and fees $ 6.4 $ 6.3 $ 5.4
Gain (loss) on investment securities,
net (2.3) 0.9 0.6
Lease financing, net 1.7 3.9 4.2
Capital markets income 6.3 8.1 6.3
Other non-interest income:
Loan service charges 3.8 4.0 4.0
Commercial card income 1.5 1.8 1.6
BOLI income 1.1 3.0 2.5
Other 1.3 1.2 1.0
----- ----- -----
Non-interest income $ 19.8 $ 29.2 $ 25.6
Non-interest expense $174.6 $174.6 $166.2
-- Non-interest income decreased from prior quarter and from a year ago
due to the following factors:
-- Loss on sale of investment securities primarily driven by the
strategic sale of lower-yielding securities of approximately $1.0
billion and the redeployment of proceeds into higher-yielding
investments to improve the portfolio's earning potential.
-- BOLI income decreased $1.9 million from prior quarter and $1.4
million from a year ago reflecting less favorable market
performance impacting returns on one of our policies.
-- Lease financing income decreased $2.2 million from prior quarter
and decreased $2.5 million from a year ago primarily due to a $1.1
million loss on equipment disposition recognized during the
quarter, compared to a $0.9 million gain in prior quarter and $0.2
million gain a year ago.
-- Capital Markets income decreased $1.8 million from prior quarter,
driven by market conditions and shifts in loan production
timelines.
-- Non-interest expense remained flat compared to the prior quarter, and
increased compared to a year ago primarily as a result of increases in
employee compensation and deposit-related costs due to competition.
Loans
-- Average CRE loans increased by $75 million, or 1%, from prior quarter
and increased by $624 million, or 10%, from a year ago.
-- Average C&I loans decreased by $306 million, or 4%, from prior quarter
and decreased by $91 million, or 1%, from a year ago.
-- Average MWL (Mortgage Warehouse Lending) loans increased by $133
million, or 18%, from prior quarter and $226 million, or 35%, from a year
ago.
-- Average Residential loans decreased by $151 million, or 2%, from the
prior quarter and $621 million, or 9%, from a year ago; consistent with
our balance sheet repositioning strategy.
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