BankUnited in Miami Lakes, Fla., reported lower quarterly profit because of rising noninterest expenses and a higher loan-loss provision.
The $17 billion-asset company reported on Thursday that its net income fell 10% from a year earlier, to $48.5 million. Earnings per share of 46 cents met the average estimate of analysts polled by Bloomberg.
Noninterest expenses increased by 25%, to $106.6 million, due in part to a $15 million amortization of an indemnified asset tied to failed bank acquisitions. Employee compensation increased 15%, while occupancy and equipment expenses also were higher.
Net interest income increased by just 1%, to $165.9 million. The net interest margin compressed by 147 basis points, to 4.67%, primarily because new loans were originated at yields lower than those in the covered loan portfolio.
The company recorded a loan-loss provision of $7.2 million to cover for loan growth. A year earlier, the provision was $4.9 million.
BankUnited also said it sold $303 million of auto loans during the second quarter as it exited that business, resulting in a $2.2 million pretax gain.
Noninterest income rose 55%, to $20.5 million, due to higher service charges and fees as well as gains from selling covered commercial and consumer loans.