BankUnited, Inc. Q1 FY2026 earnings call

1. Business is seasonal: Deposits decline mid - late Dec, bottom in first quarter, rebound late first quarter, grow in second quarter. Loan production slow in first quarter, picks up in Q2 and Q3, biggest in Q4. 2. Earnings, EPS, ROA affected by seasonality. 3. This year's earnings decline similar to last year's in ballpark. 4. Deposits: Non - broker deposits grew $277 million this quarter, $1.4 billion over last 12 months. NIDDA grew $875 million over last year. 5. Loans: Over last year grew $906 million, this quarter grew $9 million, non - core loans continue to shrink. 6. Credit: NPLs down $98 million (26%), criticized and classifieds down $146 million (12%), coverage ratio improved. 7. Provision: Used $8 million in qualitative factors due to geopolitical uncertainty. 8. Buyback: Bought back 1.3 million shares, still has under $200 million dry powder. 9. Deposit strategy: Three major goals - top - tier NIDDA growth, being payment processor and transactional bank with good pricing discipline and cross - selling, managing deposit costs. 10. Loan details: Cree portfolio now just under 30% of overall book, well - balanced, office book showing improvement. 11. Year - over - year trends: Net income up 5%, PPNR up 10%, ROA up 6%, EPS up 6%, NIM up 18 basis points.

Earnings in first quarter came in at $62 million, EPS was 83 cents. Last year, earnings were $58 million and EPS was 78 cents. NIM was at 299 last year it was 281. PPNR was $106 million last year $95.2 million. Non - broker deposits grew $277 million this quarter, net growth about $7 million, over last 12 months grew $1.4 billion. Loans over last year grew $906 million, this quarter grew only $9 million. NPLs were down $98 million (26%), criticized and classifieds were down $146 million (12%). Coverage ratio of ACL to NPLs improved from 59 to 76%.

No change to guidance. Still feel good about full - year guidance. Expect NIDDA growth quarter to be strong in second quarter. Provisioning still cautious with qualitative factors considered, but guidance remains as provided.

1. Geopolitical uncertainty may impact provisioning. 2. Competition in deposit and lending markets. 3. Fed rate changes and their impact on margin if not as expected. 4. Loan pricing and credit spreads could be a risk to margin and guidance.

Q: Dave Rochester with Kantor asked about the title business, including outlook, average relationship size, additions to salespeople and technological enhancements, and competitive landscape.

A: Title business outlook positive, average relationship size about $3 million, added people in front and back office, have technology projects, more competition but larger banks not replicating, small banks competing.

Q: Jared Shaw with Barclays asked about guidance if Fed doesn't cut, provision $8 million qualitative overlay, and fee income.

A: Fed cuts not a big impact, guidance still holds, $8 million qualitative overlay is front - loaded, fee income varies by production, FX income growing, service charges on deposit growth expected, syndication revenue good.

Q: David Chiaverini with Jefferies asked about credit quality, industries of charged - off loans, and NCOs.

A: Charge - offs in healthcare and transportation, NCOs front - loaded.

Q: Michael Rose with Raymond James asked about deposit beta expectations and second quarter margin.

A: Deposit beta hard to manage without Fed cuts, second quarter margin follows past pattern of dipping then rebounding.

Q: Woody Lay with KBW asked about credit improvement, resolution of loans, and influence on outlook.

A: Credit improvement from loan resolutions, influence based on granular loan knowledge.

Q: John Armstrong with RBC Capital Markets asked about C&I decline, commercial lending pipelines, and deposit pricing room.

A: C&I decline related to market segments, good growth in some segments, deposit pricing room limited without Fed cuts.

Q: David Bishop with Hovde Group asked about earning asset yield and impact of energy costs.

A: Earning asset yield affected by competition and asset mix changes, energy costs impact everything but not heavily in portfolio.

Q: Steven Scouten with Piper Sandler asked about economic scenarios for loan loss reserve and ROA improvement driver.

A: Use Moody's scenarios and internal views, ROA improvement driven by NIDDA growth.