BankUnited unloads nearly all of its remaining taxi loans
BankUnited in Miami Lakes, Fla., sold $79 million of taxi-medallion loans in the fourth quarter, which it said accounted for nearly all of the troubled loans that had been left after earlier sales.
Separately, the $32.2 billion-asset company on Wednesday reported fourth-quarter net income of $60 million, or 59 cents per share, which was a penny better than the mean estimate of analysts compiled by FactSet Research Systems. The results exclude the impact of the sale of another loan portfolio that involved a loss-share agreement with the Federal Deposit Insurance Corp.
In the fourth quarter of 2017, BankUnited posted net income of $418 million, $3.79 per share, as a result of the federal income tax cut.
BankUnited did not disclose the sale price or the buyer of its taxi-loan portfolio. The company recorded a loan-loss provision of $14 million for the time it held the taxi loans during the quarter. That reduced net income by 10 cents per share.
Also during the fourth quarter, BankUnited sold a portfolio of covered real estate and other loans with an unpaid balance of $265.2 million. The sale generated a loss of $9 million, based on the cumulative effect of the amortization of an indemnification asset, loan accretion and other factors. BankUnited, which received approval in November to sell the portfolio, did not disclose the sale price or the buyer in this case, either. The portfolio had been covered by an FDIC loss-share agreement since 2009.
“This quarter was a pivotal one for BankUnited, positioning us well for the future,” Chairman and CEO Rajinder Singh said in a news release.
Net interest income rose 21% to $282 million. Net loans rose 3% to $21.9 billion. The yield on total interest-earning assets increased 103 basis points to 5.59%.
Noninterest income fell 28% to $33 million on lower gains on the sale of loans, lower gains on investment securities, and less income from the resolution of covered assets.
Noninterest expense climbed 53% to $246 million, largely because of the amortization of the indemnification asset.