Alfred R. Camner is a careful man, and the thrift company he founded 14 years ago reflects it.

Though $3.5 billion-asset BankUnited Financial Corp. is now one of Florida's two largest independent banking companies, "we're pretty vanilla," said Mr. Camner, 54, in a recent interview.

For a conservative outfit, though, BankUnited has lately had quite a ride. Assets increased 67% in the last year as it opened branches, bought up small competitors, and wooed customers of Barnett Banks Inc., which NationsBank Corp. bought in January.

Now, however, with changes afoot in the economy, "we are not going to grow as rapidly as we have been," Mr. Camner said.

"We're very cautious."

And-there is no doubt about it-he is in charge. Not only is he chairman and chief executive, he also holds the controlling stock interest.

The company's primary strategy is to add branches in areas of market turmoil, rapid growth, or both.

The deposits gathered are mostly used to fund residential mortgages, which make up 90% of the loan portfolio. (Most of the rest is in commercial real estate.)

More than $2 billion, or some 80% of the residential loan portfolio, is adjustable-rate mortgages-many of which have been purchased in the secondary mortgage market at a premium.

The ARMs have been troubling the company of late as declining interest rates have prompted many borrowers to prepay and refinance.

As a result, net income declined in the second quarter to $1.2 million, down 8% from a year earlier. The interest rate spread fell 123 basis, points to 0.75%.

"We were significantly hurt by prepays that were unanticipated," Mr. Camner said. The company typically experiences about $300 million in prepayments in the second quarter; this year some $500 million was prepaid, officials said.

To address the situation, the company last month began offering customers incentives not to refinance, but rather to modify the terms of their mortgages. It is changing the composition of its portfolio by buying more fixed-rate mortgages as well as three-year and five-year adjustables.

BankUnited is also lowering the costs of deposits, by paying lower rates, and is working on other strategies to restructure the liability side of the balance sheet.

The company is also considering expanding its originations by building correspondent relationships outside Florida.

BankUnited-which bills itself as "Florida's premier bank"-still wants to add branches in high-growth South Florida markets. Its 25 branches are largely in Miami and in Dade, Broward, and Palm Beach counties. But Aug. 26 the company opened what it expects to be the first of many branches on Florda's west coast, in Naples.

And following an trend, BankUnited is pursuing more fee income. It began selling fixed annuities in January, and by mid-August had sold $5 million worth. With 40 licensed sales associates, additional products are to be added soon.

"We will be expanding the staff and the product offerings," said James A. Dougherty, BankUnited's chief operating officer. "We had relied in the past almost exclusively on our interest margin. Now we're wanting to increase fee income across the board."

Fee income should get a significant boost from the company's recent acquisition of $93.9 million-asset Central Bank of Miami, which brought four branches and a new international business line to BankUnited.

"We expect fee income to double immediately," Mr. Dougherty said.

BankUnited is also pursuing more commercial business, thanks again in part to relationships gained in the Central Bank purchase.

That deal followed one of similar size earlier this year. Bank-United bought Consumers Bancorp, also of Miami, which had assets of about $104 million.

BankUnited also recently bid to buy some of the former Barnett branches NationsBank Corp. was offering for sale. That bid was unsuccessful.

R. Harold Schroeder, an analyst with Keefe, Bruyette & Woods, said he had visited the company recently but does not follow it closely, because he is not "particularly attracted" to the model.

"This is a like a mutual fund that invests in mortgages, essentially," Mr. Schroeder said. There are other ways to invest in that sector, he observed.

However, he said, the franchise could be attractive to an acquirer wanting to establish a presence in South Florida fast.

Mr. Camner does not discourage speculation about selling the company. His position is that BankUnited is "not not-for-sale."

"If an offer comes in that we feel is right and makes sense, it certainly could happen," he said.

In the meantime, BankUnited will continue to concentrate on what it knows best: residential mortgages.

"We do what we know," said chief financial officer Clifford A. Hope, "and we do it well."

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