BankUnited in Miami Lakes, Fla., recorded double-digit earnings growth as revenue gains helped to make up for issues in its taxi medallion portfolio.
Net income for the $28.2 billion-asset company was $66.4 million in the second quarter, representing a year-over-year increase of 17%. Earnings per share were 60 cents and beat analysts’ average estimate of 56 cents, according to FactSet Research Systems.
"The second quarter was an excellent one for BankUnited, marked by margin expansion along with strong earnings and solid loan and deposit growth,” CEO Rajinder Singh said in a press release Wednesday.
Net interest income increased 11.8% to $239.6 million, driven by increases in average loan balances and average yields. The net interest margin expanded one basis point to 3.76%.
Total loans increased 11.3% to $19.6 billion at June 30. Much of that growth came from commercial and industrial and owner-occupied commercial real estate lending in its Florida and New York markets, as well as from its national platforms, including residential lending and mortgage warehouse lending operations.
The provision for loan losses was $13.6 million, compared with $14.3 million a year earlier. BankUnited’s provision for taxi medallion loans totaled $7.4 million, compared with $4.6 million a year earlier. BankUnited charged off $5.9 million in taxi medallion loans, compared with $1.1 million in the second quarter of 2016.
Noninterest income increased 3.4% to $28.9 million. Noninterest expenses increased 11.3% to $160.4 million. BankUnited said that was driven largely by a $7.6 million increase in amortization of a Federal Deposit Insurance Corp. indemnification asset and by a $4.6 million increase in employee compensation and benefits.