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What changed in BankUnited, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of BankUnited, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+277 added−319 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-28)

Top changes in BankUnited, Inc.'s 2025 10-K

277 paragraphs added · 319 removed · 220 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeSince the inception of these initiatives in 2020, 154 college and high school students have participated and 46 of them have been hired for full time roles at the Bank. Through BankUnited's exclusive partnership with Florida International University, the ATOM Pink Tank program, a six-month leadership, mentorship, and research development program was created to empower female students pursuing STEM careers.
Biggest changeOur exclusive partnership with Florida International University’s ATOM Pink Tank program, a six‑month leadership and research initiative for STEM students, has produced 78 graduates to date. Since inception, 25% of student participants have joined the Bank in roles across the organization.
The statutory factors that the Federal Reserve is required to consider in considering an application include the financial and managerial resources of the parties and the future prospects of the combined organization, the effects of the transaction on competition, the convenience and needs of the community, including the record of performance of the parties under the CRA, the effectiveness of the acquiring company in combating money-laundering activities and the impact of the transaction on the financial stability of the U.S. banking or financial system.
The statutory factors that the Federal Reserve is required to consider in considering an application include the financial and managerial resources of the parties and the future prospects of the combined organization, the effects of the transaction on competition, the convenience and credit needs of the community, including the record of performance of the parties under the CRA, the effectiveness of the acquiring company in combating money-laundering activities and the impact of the transaction on the financial stability of the U.S. banking or financial system.
For banking organizations with assets of $10 billion or more, such as the Bank, the CFPB has exclusive rule making and examination, and primary enforcement authority under certain federal consumer protection financial laws. In addition, states are permitted to adopt consumer protection laws and regulations that are stricter than those regulations promulgated by the CFPB.
For banking organizations with assets of $10 billion or more, such as the Bank, the CFPB has exclusive rule making and examination, and 8 primary enforcement authority under certain federal consumer protection financial laws. In addition, states are permitted to adopt consumer protection laws and regulations that are stricter than those regulations promulgated by the CFPB.
Bank regulators routinely examine institutions for compliance with these obligations and they must consider an institution's compliance in connection with the regulatory review of applications, including applications for banking mergers and acquisitions. The regulatory authorities have imposed "cease and desist" orders and civil money penalty sanctions against institutions found to be violating these obligations. The U.S.
Bank regulators routinely examine institutions for compliance with these obligations and they must consider an institution's compliance in connection with the regulatory review 7 of applications, including applications for banking mergers and acquisitions. The regulatory authorities have imposed "cease and desist" orders and civil money penalty sanctions against institutions found to be violating these obligations. The U.S.
CFPB The CFPB is tasked with establishing and implementing rules and regulations under certain federal consumer protection laws with respect to the conduct of providers of certain consumer financial products and services. The CFPB has rulemaking 8 authority over many of the statutes governing products and services offered to bank and thrift consumers.
CFPB The CFPB is tasked with establishing and implementing rules and regulations under certain federal consumer protection laws with respect to the conduct of providers of certain consumer financial products and services. The CFPB has rulemaking authority over many of the statutes governing products and services offered to bank and thrift consumers.
Financial institutions must take reasonable steps to conduct enhanced scrutiny of account relationships to guard against money laundering and to report any suspicious transactions, and law enforcement authorities have been granted 7 access to certain financial information maintained by financial institutions.
Financial institutions must take reasonable steps to conduct enhanced scrutiny of account relationships to guard against money laundering and to report any suspicious transactions, and law enforcement authorities have been granted access to certain financial information maintained by financial institutions.
The CRA requires federal bank regulators to take into account the bank's record in meeting the needs of its service areas when considering an application by a bank to establish or relocate a branch or to conduct certain mergers or acquisitions.
The CRA requires federal bank regulators to take into account the bank's record in meeting the needs of its geographic service areas when considering an application by a bank to establish or relocate a branch or to conduct certain mergers or acquisitions.
The regulatory agency's assessment of the institution's CRA performance is made available to the public. Following its most recent CRA performance evaluation in October 2024, BankUnited received an overall rating of "Satisfactory." A new interagency CRA rule was published in February 2024 imposing additional data collection and reporting requirements on financial institutions.
The regulatory agency's assessment of the institution's CRA performance is made available to the public. Following the OCC's most recent CRA performance evaluation in October 2024, BankUnited received an overall rating of "Satisfactory." A new interagency CRA rule was published in February 2024 imposing additional data collection and reporting requirements on financial institutions.
Failure to meet capital guidelines could subject the institution to a variety of enforcement remedies by federal bank regulatory agencies, including termination of deposit insurance by the FDIC, restrictions on certain business activities, and appointment of the FDIC as conservator or receiver. As of December 31, 2024, BankUnited, Inc. and BankUnited were well-capitalized.
Failure to meet capital guidelines could subject the institution to a variety of enforcement remedies by federal bank regulatory agencies, including termination of deposit insurance by the FDIC, restrictions on certain business activities, and appointment of the FDIC as conservator or receiver. As of December 31, 2025, BankUnited, Inc. and BankUnited were well-capitalized.
The Community Reinvestment Act The CRA is intended to encourage financial institutions to help meet the credit needs of their service areas, including low and moderate-income neighborhoods, consistent with safe and sound operations. The federal bank regulators examine and assign each bank a public CRA rating.
The Community Reinvestment Act The CRA is intended to encourage financial institutions to help meet the credit needs of their geographic service areas, including low and moderate-income neighborhoods, consistent with safe and sound operations. The federal bank prudential regulators examine and assign each bank a public CRA rating.
The information posted on our website is not incorporated into this Annual Report. In addition, the SEC maintains a website that contains reports and other information filed with the SEC. The website can be accessed at http://www.sec.gov. 11
The information posted on our website is not incorporated into this Annual Report. In addition, the SEC maintains a website that contains reports and other information filed with the SEC. The website can be accessed at http://www.sec.gov. 10
The regulators have the power to, among other things: • enjoin "unsafe or unsound" practices; • require affirmative actions to correct any violation or practice; • issue administrative orders that can be judicially enforced; • refer significant compliance violations to the U.S.
The regulators have the power to, among other things: • enjoin "unsafe or unsound" practices; • require affirmative actions to correct any violation or practice; • issue administrative orders that can be judicially enforced; • refer allegations of significant consumer compliance violations to the U.S.
Justice Department; • direct increases in capital; • direct the sale of subsidiaries or other assets; • limit dividends and distributions; • restrict growth; • assess civil monetary penalties; • remove officers and directors; • terminate deposit insurance; and • appoint a conservator or receiver.
Justice Department; • direct increases in capital; • direct the sale of subsidiaries or other assets; • limit dividends and distributions; • restrict growth, including new retail branch openings; • assess civil monetary penalties; • remove officers and directors; • terminate deposit insurance; and • appoint a conservator or receiver.
Our future strategy may include organic expansion into other markets, but no specific additional markets have been identified at this time. Pinnacle offers municipal financing and the Bank provides mortgage warehouse financing on a national basis. We also offer a suite of commercial deposit, treasury solutions and cash management products nationally.
Our future strategy may include organic expansion into other markets, but no specific additional markets have been identified at this time. Through our NTS and HOA businesses, we offer a suite of commercial deposit, treasury solutions and cash management products nationally.
As a member of the FHLB, BankUnited is required to acquire and hold shares of capital stock in the FHLB of Atlanta. BankUnited is in compliance with this requirement.
Any advances from an FHLB must be secured by specified types of collateral. As a member of the FHLB, BankUnited is required to acquire and hold shares of capital stock in the FHLB of Atlanta. BankUnited is in compliance with this requirement.
We do not charge consumer overdraft or NSF fees. Our Markets Our largest banking markets are Florida and the Tri-State market of New York, New Jersey and Connecticut, concentrated in the New York Metropolitan area. We believe both represent long-term attractive banking markets.
We do not charge consumer overdraft or NSF fees. Our Markets Our largest banking market is Florida, followed by the Tri-State market of New York, concentrated in the New York Metropolitan area. We believe both represent long-term attractive banking markets. In Florida, our focus is on urban markets including the Miami-Dade, Broward, Palm Beach, Tampa, Orlando and Jacksonville markets.
In Florida, our focus is on urban markets including the Miami-Dade, Broward, Palm Beach, Tampa, Orlando and Jacksonville markets. 2 We have more recently entered the Atlanta and Dallas markets, in Atlanta with a wholesale banking office focused on the Southeastern United States, and in Dallas with a retail branch as well as full-service wholesale banking capabilities.
We have more recently entered the Atlanta, Dallas and Charlotte markets; in Charlotte with a wholesale banking office focused on the Southeastern United States, and in Atlanta and Dallas with a retail branches as well as full-service wholesale 2 banking capabilities.
Competition Our primary markets are highly competitive, containing not only a large number of community and regional banks, but also a significant presence of the country's largest commercial banks.
The Bank also provides mortgage warehouse financing and through Pinnacle and BFG, we also offer municipal, equipment and franchise financing; all on a national basis. Competition Our primary markets are highly competitive, containing not only a large number of community and regional banks, but also a significant presence of the country's largest commercial banks.
BankUnited is a member of the Federal Home Loan Bank of Atlanta. Each FHLB provides a central credit facility primarily for its member institutions, as well as other entities involved in home mortgage lending. Any advances from an FHLB must be secured by specified types of collateral.
This reserve requirement may be met by holding cash in banking offices or on deposit at a Federal Reserve Bank. BankUnited is a member of the Federal Home Loan Bank of Atlanta. Each FHLB provides a central credit facility primarily for its member institutions, as well as other entities involved in home mortgage lending.
Item 1. Business Overview BankUnited, Inc., with total consolidated assets of $35.2 billion at December 31, 2024, is a bank holding company with one direct wholly-owned subsidiary, BankUnited, collectively, the Company.
Item 1. Business Overview BankUnited, Inc., with total consolidated assets of $35.0 billion at December 31, 2025, is a bank holding company with one direct wholly-owned subsidiary, BankUnited, collectively, the Company. BankUnited, a national banking association headquartered in Miami Lakes, Florida, with operations in Florida, New York Tri-State, Dallas, Atlanta, and Charlotte.
A preliminary injunction against the final rule was issued in March 2024; the ultimate resolution of this matter remains uncertain. Human Capital Resources At December 31, 2024, we had 1,662 full-time employees and 18 part-time employees. None of our employees are parties to a collective bargaining agreement.
The agencies issued their intent to rescind the CRA interagency rule and reinstate the 1995 CRA rule in March 2025. Human Capital Resources At December 31, 2025, we employed 1,785 full-time employees and 18 part-time employee, with an average tenure of 6.5 years. None of our employees are parties to a collective bargaining agreement.
The Bank provides certain commercial lending and deposit products through national platforms and certain consumer deposit products through an online channel.
BankUnited provides a full range of consumer and commercial banking products and services to individuals, small businesses, middle-market companies, large corporations and institutions, and offers certain commercial lending and deposit products through national platforms and certain consumer deposit products through an online channel.
The Company solicits employee feedback through periodic employee engagement surveys conducted by an outside firm. 87% of employees participated in our last engagement survey and 82% of participants responded favorably to questions designed to gauge the level of overall engagement.
Communication & Engagement We collect employee feedback through periodic engagement surveys conducted by an independent firm. In the most recent survey, 87% of employees participated and 82% responded favorably to engagement‑related questions. We support transparent communication through regular CEO updates, town halls, and the Leadership Chat Series, an interactive forum connecting employees with BankUnited executives.
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BankUnited, a national banking association headquartered in Miami Lakes, Florida, provides a full range of commercial lending and both commercial and consumer deposit services through banking centers located in Florida, the New York metropolitan area and Dallas, Texas, and a comprehensive suite of wholesale products to customers through an Atlanta office focused on the Southeast region.
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Our human capital strategy focuses on attracting, developing, and retaining a skilled and high‑performing workforce, recognizing the critical role employees play in the long‑term success of our business. We hire based on qualifications and capabilities and value the diverse perspectives and experiences of our employees.
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Pursuant to the regulations of the Federal Reserve, all banks, including BankUnited, are required to maintain average daily reserves at mandated ratios against their transaction accounts. In addition, reserves must be maintained on certain non-personal time deposits. This reserve requirement may be met by holding cash in banking offices or on deposit at a Federal Reserve Bank.
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We provide competitive compensation and a comprehensive benefits package, including a Company‑sponsored 401(k) program, tuition reimbursement, flexible spending and health savings accounts with Company contributions, paid time off, paid parental leave, paid holidays, flexible work arrangements, and hybrid/remote opportunities for eligible roles.
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We believe that our employees are our greatest asset and vital to our success. As such, we seek to hire and retain the best candidate for each position, without regard to age, gender, ethnicity, or other specific trait, but with an appreciation for a diversity of perspectives and experience.
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Corporate Responsibility & Culture We are committed to maintaining a safe and supportive workplace where employees feel valued and engaged. Our culture is reinforced through iCARE™, an enterprise‑wide initiative promoting community involvement, mentorship, and employee connection. The program is supported by a 14 member iCARE™ Council and 30 iCARE™ Ambassadors who drive employee engagement and participation across the organization.
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We have designed a compensation structure including an array of benefit plans and programs that we believe is attractive to our current and prospective employees. We have a Company sponsored 401(k) Retirement Savings Program, a tuition reimbursement program, flexible spending accounts and health savings accounts with Company contributions.
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In 2025, our employees contributed 4,409 volunteer hours, a 7% increase from 2024, supporting more than 250 community organizations. In addition to volunteerism, the Bank provided $3.5 million in grants, sponsorships, and contributions. We also invest in education and workforce development through partnerships with nine universities offering scholarships, internships, and student programs that have benefited more than 250 students.
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BankUnited offers paid time off, paid parental leave, paid holidays, flexible work schedules and hybrid and remote job opportunities for some positions. Our goal is to create a safe and inclusive workplace where individuals are valued, feel free to express themselves, are empowered to succeed and are able to grow both personally and professionally.
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Additional information on our iCARE™ initiatives is available in our annual iCARE™ Report and Social Impact Report on our Investor Relations website. Health, Wellness and Safety Our Wellness Program supports the mental, physical, emotional, social, financial, and occupational well‑being of our employees.
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At December 31, 2024, 33% of the members of our Board of Directors were female and 44% were of diverse nationality or ethnicity.
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The BankUnited Corporate Center provides an on‑site fitness facility and access to screenings such as dermatology, physicals, vision and dental exams, mammograms, and vaccination clinics. Additional offerings include nutrition counseling, therapeutic programs, meditation, and live or virtual fitness classes.
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Approximately 56% of our workforce was female. 9 The following chart presents additional information about the composition of our workforce at December 31, 2024: iCARE™ Under the umbrella of our iCARE™ initiative, we have a number of programs intended to foster a culture that promotes employee engagement and community involvement.
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Employees who participate in the program are eligible for reduced medical insurance premiums. 9 In 2025, BankUnited received recognition as “The Nation’s Best and Brightest in Wellness” by the National Association of Business Resources and “Healthiest Employer in South Florida” by the Florida Department of Health and Worksite Wellness Committee.
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Our iCARE™ Council, consisting of 13 employees with a variety of backgrounds and perspectives across different divisions in our organization oversees the continued evolution of iCARE™ and 22 employees serving as iCARE™ ambassadors promote engagement in iCARE™ programs across the organization. Employees are encouraged to participate in interactive events, cultural celebrations, an enterprise-wide mentorship program and community volunteer opportunities.
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Career Growth and Development Through our Go for More™ Academy, we offer development, training, and leadership programs, including Rising Leader, EXCELerate, and the FIU Leadership Institute, along with internal learning opportunities such as Toastmasters and the Go for More™ Book Club. Employees also utilize self‑service learning platforms including MindTools and Udemy.
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In 2024, our employees reported a total of 4,112 volunteer hours, up 17% from 2023, serving 209 community organizations. Our employees are given paid time to participate in community volunteer opportunities. BankUnited has partnered with nine universities in our local markets to provide scholarships, internships, and other educational programs for high school and college students.
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In 2025, 228 employees participated in internal programs and 1,634 employees engaged with self‑service learning platforms. Our mentoring programs involved 213 employees, generating 609 hours of mentoring and receiving an average rating of 4.7 out of 5 stars. BankUnited received the 2026 Training MVP Award from Training Magazine.
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The Pink Tank participants receive weekly guidance and mentorship by BankUnited employees throughout the ten-week research and competition stage. The students connect with BankUnited professionals of all levels and disciplines. Since the inception of this initiative, 61 students have completed the program and 20 new students have been selected for the 2024-2025 cohort.
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Our Kudos Employee Recognition platform furthers real‑time, peer‑driven acknowledgment and strengthens our culture of appreciation. Available Information Our website address is www.bankunited.com.
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To date, BankUnited has hired seven students and garnered participation of over 55 BankUnited employees representing 20 departments across the Bank. Through iCARE™ we engage and encourage our employees to participate in various Bank sponsored community programs and events.
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These community programs include BankUnited's "Adopt A Neighborhood" in Florida focused on providing support to under-served communities, the "Entrepreneurship Program" in New York where we provide workforce development in partnership with a local university, and the "Heir’s Program" where we brought together a consortium of expertise to provide legal services and education to predominantly minority families seeking to maintain property in family lineage.
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The iCARE™ Ventures program, working with local partners, endeavors to support, promote and strengthen local entrepreneurship and small business growth in our communities. Our employees also participate in a variety of community and collection drives throughout the year.
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In 2024, the Back to School and Holiday Toy drive collected over 2,000 items for children, and the Thanksgiving drive provided over 140,000 meals to individuals and families in need. Health, Wellness and Safety Our award-winning Wellness Program incorporates initiatives that address the mental, physical, intellectual, occupational, social, emotional, financial and spiritual components of wellness.
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The BankUnited Corporate Center has an on-site fitness facility, and we provide our employees with on-site health screenings, skin cancer screenings, on-site mobile physicals, eye exams, dental exams, mammograms, and vaccine clinics.
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Employees can choose to participate in nutrition counseling, music 10 and art therapy, live and streaming fitness classes, meditation sessions, live and virtual learning opportunities with local hospitals providing subject matter experts with a variety of specialties. We offer safety programs including adult, child and pet first aid and CPR courses.
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For participation in our Wellness Program, we offer our employees a reduced premium rate for medical insurance coverage. In recognition of our employee wellness programs, BankUnited was listed in the top ten among America's Top 100 Healthiest Employers by Springbuk HR Technology in both 2023 and 2024.
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In 2024, BankUnited was listed as number one among New York City’s Top 100 Healthiest Employers between 1,000 and 4,999 employees by Springbuk HR Technology Magazine. BankUnited also achieved the 2024 Best Wellness Employer gold certification developed by Wellness Workdays in collaboration with experts from Harvard Medical School.
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Career Growth and Development Our Go for More ™ Academy provides an extensive menu of training and resources that enable employees to develop their skills and that promote collaboration and career development. The School of Leadership, which includes the Rising Leaders Program, EXCELerate and Situational Leadership coursework, provides our employees with career development opportunities at all levels .
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Through our Discover Coaching program, we offer a personalized approach where employees meet one-on-one with an internal coach to promote individual growth, skill development, leadership development, and problem solving. BankUnited's extensive list of professional development opportunities earned us the 2025 Training Apex Award through Training Magazine. A total of 382 employees completed these programs in 2024.
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We believe mentoring is key to career growth and development. I n 2024 280 employees enrolled in our mentoring programs and a total of 1,102 mentoring hours were reported. Our employees rated their overall mentorship program satisfaction with a score of 4.8 stars out of 5 stars. Communication & Engagement Employee engagement is a key contributor to our success.
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The Company schedules regular CEO update video calls, town hall meetings and other engagement programs such as the Leadership Chat Series, a live and interactive webinar with BankUnited executives and our employees. Our Kudos Employee Recognition platform encourages employees to recognize one another's contributions and accomplishments. Available Information Our website address is www.bankunited.com.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

54 edited+9 added−21 removed184 unchanged
Biggest changeIf interest bearing liabilities mature or reprice more quickly than interest earning assets in a period of rising rates, net interest income will be reduced. If interest earning assets mature or reprice more quickly than interest bearing liabilities, falling interest rates could reduce net interest income.
Biggest changeChanges in interest rates can increase or decrease our net interest income, because different types of assets and liabilities may react differently, and at different times, to market interest rate changes. In a rising interest rate environment, if interest‑bearing liabilities mature or reprice more rapidly than interest‑earning assets, our net interest income may decline.
There is also a risk that BankUnited’s deposit insurance premiums will further increase if failures of insured depository institutions further deplete the DIF or if the FDIC changes its view of the risk BankUnited poses to the DIF or otherwise increases the assessment rate adjustment applicable to BankUnited’s deposits.
There is also a risk that BankUnited’s deposit insurance premiums will further increase if failures of insured depository institutions deplete the DIF or if the FDIC changes its view of the risk BankUnited poses to the DIF or otherwise increases the assessment rate adjustment applicable to BankUnited’s deposits.
Factors that could detrimentally impact our access to liquidity at an acceptable price, or at all include, but are not limited to: (i) national, to a lesser extent global, and regional economic and market conditions; (ii) interest rates; (iii) competition for depositor funds from banks and other investment alternatives; (iv) the availability of sufficient collateral that is acceptable to the FHLB and the Federal Reserve Bank, both of which are significant sources of contingent liquidity for us; (v) fiscal and monetary policy; (vi) public and market perception of BankUnited specifically, peer banks and the banking sector more broadly; (vii) our ability to access the capital markets as a potential liquidity source; and (viii) regulatory requirements or changes.
Factors that could detrimentally impact our access to liquidity at an acceptable price, or at all include, but are not limited to: (i) national, to a lesser extent global, and regional economic and market conditions; (ii) interest rates; (iii) competition for depositor funds from banks and other investment alternatives; (iv) the availability of sufficient collateral that is acceptable to the FHLB and the Federal Reserve Bank, both of which are significant sources of contingent liquidity for us; (v) fiscal and monetary policy; (vi) public and market perception of 16 BankUnited specifically, peer banks and the banking sector more broadly; (vii) our ability to access the capital markets as a potential liquidity source; and (viii) regulatory requirements or changes.
Factors that may be considered in determining the amount of the ACL include, but are not necessarily limited to, product or collateral type, industry, geography, internal risk rating, credit characteristics such as credit scores or collateral values, delinquency rates, historical or expected credit loss patterns and other quantitative and qualitative factors considered by management to have an impact on the adequacy of the ACL and the ability of borrowers to repay their loans.
Factors that may be considered in 13 determining the amount of the ACL include, but are not necessarily limited to, product or collateral type, industry, geography, internal risk rating, credit characteristics such as credit scores or collateral values, delinquency rates, historical or expected credit loss patterns and other quantitative and qualitative factors considered by management to have an impact on the adequacy of the ACL and the ability of borrowers to repay their loans.
Additionally, due to their size or particular technology capabilities, many competitors may offer a broader range of products and services or may be able to offer better pricing for certain products and services than we can. 12 Our ability to compete successfully depends on a number of factors, including but not limited to (i) the ability to develop, maintain and build upon long-term customer relationships; (ii) our ability to pro-actively and quickly respond to technological change and emerging or unanticipated innovations in financial services; (iii) our ability to attract and retain talent; (iv) our ability to expand our market position or successfully enter new markets; (v) the scope, relevance and pricing of our products and services and our ability to respond quickly to changing customer preferences; (vi) the rate at which we introduce new products and services relative to our competitors; (vii) customer satisfaction with our level of service; and (viii) industry and general economic trends.
Additionally, due to their size or particular technology capabilities, many competitors may offer a broader range of products and services or may be able to offer better pricing for certain products and services than we can. 11 Our ability to compete successfully depends on a number of factors, including but not limited to (i) the ability to develop, maintain and build upon long-term customer relationships; (ii) our ability to pro-actively and quickly respond to technological change and emerging or unanticipated innovations in financial services; (iii) our ability to attract and retain talent; (iv) our ability to expand our market position or successfully enter new markets; (v) the scope, relevance and pricing of our products and services and our ability to respond quickly to changing customer preferences; (vi) the rate at which we introduce new products and services relative to our competitors; (vii) customer satisfaction with our level of service; and (viii) industry and general economic trends.
While we offer programs and products to our commercial customers that allow them to increase the amount of their deposits that are insured, not all depositors choose to take 18 advantage of these programs and products. Uninsured deposits may be more subject to unanticipated outflows than insured deposits, particularly during times of systemic or institution-specific stress.
While we offer programs and products to our commercial customers that allow them to increase the amount of their deposits that are insured, not all depositors choose to take advantage of these programs and products. Uninsured deposits may be more subject to unanticipated outflows than insured deposits, particularly during times of systemic or institution-specific stress.
Our business is highly dependent on the successful and uninterrupted functioning of our information technology, internet and network connectivity and telecommunications systems. We rely on these systems and connectivity to process new and renewed loans, gather deposits, process customer and other transactions, provide customer service, facilitate collections, facilitate remote work and share data across our organization.
Our business is highly dependent on the successful and uninterrupted functioning of our information technology, internet and network connectivity and telecommunications systems. We rely on these systems and connectivity to process new and 18 renewed loans, gather deposits, process customer and other transactions, provide customer service, facilitate collections, facilitate remote work and share data across our organization.
Our business, financial condition and results of operations may be materially, adversely impacted by these and other negative effects of such events. Both physical and transitional risks related to climate change or societal and governmental responses to climate change could adversely affect our business and performance, including indirectly through impacts on our customers.
Our business, financial condition and results of operations may be materially, adversely impacted by these and other negative effects of such events. Both physical and transitional risks related to climate change or societal and governmental responses, could adversely affect our business reputation and performance, including indirectly through impacts on our customers.
We are exposed to the risk that, at the end of the lease term or in the event of early termination, the value of the asset will be lower than expected, resulting in reduced future lease income over the remaining life of the asset 16 or a lower sale value, which could lead to impairment charges or operating losses.
We are exposed to the risk that, at the end of the lease term or in the event of early termination, the value of the asset will be lower than expected, resulting in reduced future lease income over the remaining life of the asset or a lower sale value, which could lead to impairment charges or operating losses.
Various federal and state laws and regulations limit the amount of dividends that a bank may pay to its parent company. In addition, our right to participate in a distribution of assets upon the liquidation or reorganization of a subsidiary may be subject to the prior claims of the subsidiary’s depositors and other creditors.
Various 17 federal and state laws and regulations limit the amount of dividends that a bank may pay to its parent company. In addition, our right to participate in a distribution of assets upon the liquidation or reorganization of a subsidiary may be subject to the prior claims of the subsidiary’s depositors and other creditors.
See Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations—Interest Rate Risk" for a discussion on the methodology and assumptions used by the Company in managing its interest rate risk. 17 Liquidity Risk A failure to maintain adequate liquidity could adversely affect our ability to sustain normal operations, our financial condition and results of operations.
See Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations—Interest Rate Risk" for a discussion on the methodology and assumptions used by the Company in managing its interest rate risk. Liquidity Risk A failure to maintain adequate liquidity could adversely affect our ability to sustain normal operations, our financial condition and results of operations.
Generative and Agentic AI are emerging technologies that present both opportunities and risks to users. While our current use of AI is not material to our operations, its evolving use is subject to risks that algorithms and datasets are flawed or may be 21 insufficient, poorly suited to purpose or contain biased information.
Generative and Agentic AI are emerging technologies that present both opportunities and risks to users. While our current use of AI is not material to our operations, its evolving use is subject to risks that algorithms and datasets are flawed or may be insufficient, poorly suited to purpose or contain biased information.
Since a high percentage of our assets and liabilities are interest bearing or otherwise sensitive in value to changes in interest rates, changes in rates, in the shape of the yield curve or in spreads between different types of rates can have a material impact on our financial condition and results of operations and the values of our assets and liabilities.
Since a high percentage of our assets and liabilities are interest bearing or otherwise sensitive in value to changes in interest rates, changes in rates, in the shape of the yield curve or in spreads between different types of rates can have a material impact 15 on our financial condition and results of operations and the values of our assets and liabilities.
The expanded adoption of AI may exacerbate the frequency and effectiveness of cybersecurity incidents. In addition, we expect our third-party service providers to increasingly incorporate AI capabilities into their product offerings; our third party risk management framework may be inadequate to fully mitigate the associated risks.
The expanded adoption of AI may exacerbate the frequency and effectiveness of cybersecurity incidents. In addition, we expect our third-party service providers 20 to increasingly incorporate AI capabilities into their product offerings; our third party risk management framework may be inadequate to fully mitigate the associated risks.
If real estate values or fundamentals underlying commercial or residential real estate decline, we could experience higher delinquencies and charge-offs beyond that provided for in the ACL. The underlying collateral for a significant portion of the securities in our investment portfolio also consists of commercial or residential real estate.
If real estate values or fundamentals underlying commercial or residential real estate decline, we could experience higher delinquencies and charge-offs beyond that provided for in the ACL. 14 The underlying collateral for a significant portion of the securities in our investment portfolio also consists of commercial or residential real estate.
The ineffectiveness of our enterprise risk management framework in mitigating the impact of known risks or the emergence of previously unknown or unanticipated risks may result in our incurring losses in the future that could adversely impact our financial condition and results of operations.
The ineffectiveness of our enterprise risk management framework in mitigating the impact of known risks or 23 the emergence of previously unknown or unanticipated risks may result in our incurring losses in the future that could adversely impact our financial condition and results of operations.
These factors could result in further deterioration in the fundamentals underlying the 15 commercial real estate market and the deterioration in value of some of our loans or the underlying collateral and ultimately to higher loan losses.
These factors could result in further deterioration in the fundamentals underlying the commercial real estate market and the deterioration in value of some of our loans or the underlying collateral and ultimately to higher loan losses.
We are subject to complex and evolving laws and regulations governing the privacy and protection of personal information of individuals (including customers, employees, suppliers and other third parties).
We are 22 subject to complex and evolving laws and regulations governing the privacy and protection of personal information of individuals (including customers, employees, suppliers and other third parties).
Net interest income is the difference between the interest income we earn on loans, investments and other interest earning assets, and the interest we pay on interest bearing liabilities, such as deposits and borrowings.
Net interest income represents the difference between the interest income we earn on loans, investments and other interest earning assets, and the interest we pay on interest bearing liabilities, such as deposits and borrowings.
We are also subject to credit risk that is embedded in our securities portfolio. Our credit risk management framework inclusive of our underwriting standards, procedures and policies may not prevent us from incurring substantial credit losses, particularly if economic or market conditions deteriorate.
Credit losses are inherent in the business of making loans. We are also subject to credit risk that is embedded in our securities portfolio. Our credit risk management framework inclusive of our underwriting standards, procedures and policies may not prevent us from incurring substantial credit losses, particularly if economic or market conditions deteriorate.
Private parties may also have the ability to challenge an institution's performance under fair lending laws in private class action litigation. The FDIC's restoration plan and any future related increased assessments could adversely affect our earnings. Insured depository institutions such as BankUnited are required to pay deposit insurance premiums to the FDIC, which maintains a DIF.
Private parties may also have the ability to challenge an institution's performance under fair lending laws in private class action litigation. Any future FDIC assessments could adversely affect our earnings. Insured depository institutions such as BankUnited are required to pay deposit insurance premiums to the FDIC, which maintains a DIF.
These perceptions about us could cause our business to be negatively affected and exacerbate the other risks that we face. In addition, adverse reputational impacts on third parties with whom we have important relationships may adversely impact our reputation.
These perceptions about us could cause our business to be negatively affected and exacerbate the other risks that we face. In addition, adverse reputational impacts on third parties with whom we have important relationships may adversely impact our reputation. Adverse reputational impacts or events may also increase our litigation risk.
The processes we use to forecast future performance and estimate expected credit losses, including in hypothetical periods of stress, the effects of changing interest rates, sources and uses of liquidity, real estate values, and economic trends and indicators on our financial condition and results of operations depend upon the use of analytical and forecasting tools and models.
The processes we use to forecast future performance and estimate expected credit losses, fair values of certain assets and liabilities and other significant accounting estimates, including in hypothetical periods of stress, the effects of changing interest rates, sources and uses of liquidity, real estate values, and economic trends and indicators on our financial condition and results of operations depend upon the use of analytical and forecasting tools and models.
The occurrence of a hurricane or other natural disaster, a man-made catastrophe such as terrorist activity, pandemic outbreaks and other health emergencies, political or social unrest, government shutdowns, geopolitical conflicts such as those currently occurring in the Middle East or Ukraine or other man-made or natural disasters could disrupt our operations or those of our clients or our work-force, result in damage to our facilities, jeopardize our ability to continue to provide essential services to our customers and negatively affect our customers and the local economies in which we operate.
The occurrence of a hurricane or other natural disaster, a man-made catastrophe such as terrorist activity, pandemic outbreaks and other health emergencies, political or social unrest, government shutdowns, U.S sovereign credit rating deterioration, geopolitical conflicts or other man-made or natural disasters could disrupt our operations or those of our clients or our work-force, result in damage to our facilities, jeopardize our ability to continue to provide essential services to our customers and negatively affect our customers and the local economies in which we operate.
Interest rates are highly sensitive to many factors over which we have no control and which we may not be able to anticipate, including general economic conditions and the monetary and fiscal policies of various governmental bodies, particularly the Federal Reserve Board.
Interest rates are highly sensitive to many factors beyond our control and which we may not be able to anticipate, including general economic conditions and the monetary and fiscal policies of various governmental authorities, particularly the Federal Reserve Board.
A rapid or unanticipated increase or decrease in interest rates, changes in the shape of the yield curve or in spreads between rates could have an adverse effect on our net interest margin and results of operations.
Rapid or unanticipated movements in interest rates, changes in the shape of the yield curve, or changes in spreads between different types of interest rates could have an adverse effect on our net interest margin and results of operations.
As a lender, we are exposed to the risk that our customers will be unable to repay their loans according to their terms and that the collateral securing the payment of their loans, if any, may be insufficient to ensure repayment. Credit losses are inherent 14 in the business of making loans.
Credit Risk As a lender, our business is highly susceptible to credit risk. As a lender, we are exposed to the risk that our customers will be unable to repay their loans according to their terms and that the collateral securing the payment of their loans, if any, may be insufficient to ensure repayment.
The impact of changes in interest rates on our business and financial performance may be exacerbated if the extent or pace of those changes are beyond historical norms. Our earnings and cash flows depend to a great extent upon the level of our net interest income.
The impact of changes in interest rates on our business and financial performance may be exacerbated if the magnitude, direction, or pace of those changes exceeds historical experience or market expectations. Our earnings and cash flows depend to a great extent upon the level of our net interest income.
Financial or operational difficulties of a third-party service provider could adversely affect our operations if those difficulties interfere with the service provider's ability to serve us effectively or at all. Replacing these third-party service providers could create significant delays and expense.
Financial or operational difficulties of a third-party service provider could adversely affect our operations if those difficulties interfere with the service provider's ability to serve us effectively or at all. Replacing these third-party service providers could create significant delays and expense. Accordingly, use of such third party service providers creates an unavoidable material inherent risk to our business operations.
Any future additional assessments or increases in FDIC insurance premiums may adversely affect our financial condition or results of operations. 23 We are subject to laws regarding the privacy, information security and protection of personal information and any violation of these laws or another incident involving personal, confidential or proprietary information of individuals could damage our reputation, lead to monetary settlements or penalties and otherwise adversely affect our operations and financial condition.
We are subject to laws regarding the privacy, information security and protection of personal information and any violation of these laws or another incident involving personal, confidential or proprietary information of individuals could damage our reputation, lead to monetary settlements or penalties and otherwise adversely affect our operations and financial condition.
Changes in the values of assets and liabilities brought about by changes in interest rates, even those that do not directly impact reported GAAP or regulatory capital levels, may impact investors' perceptions of the value of the Company, rating agency opinions, or customers' perceptions of the stability of the Company leading to unanticipated deposit outflows.
Changes in the values of assets and liabilities brought about by changes in interest rates, even those that do not directly impact reported GAAP or regulatory capital levels, may affect investors’ perceptions of the value of the Company, rating agency opinions, or customers’ perceptions of the Company’s financial strength and stability, which could result in unanticipated deposit outflows or other adverse effects.
The measures that they maintain to mitigate the risk of such activity may be different from our own and, in many cases, we do not have any control over the types of security measures they may choose to implement.
Each of these third parties may be targets of the same types of cybersecurity incidents described above. The measures that they maintain to mitigate the risk of such activity may be different from our own and, in many cases, we do not have any control over the types of security measures they may choose to implement.
Accordingly, use of such third party service providers creates an unavoidable material inherent risk to our business operations. 20 We are at risk of cybersecurity incidents, defined as any unauthorized occurrence, or series of related unauthorized occurrences, on or conducted through our information systems, including those of third-party service providers that we rely on, that jeopardizes the confidentiality, integrity or availability of those information systems or information residing therein.
We are at risk of cybersecurity incidents, defined as any unauthorized occurrence, or series of related unauthorized occurrences, on or conducted through our information systems, including those of third-party service providers that we rely on, that jeopardizes the confidentiality, integrity or availability of those information systems or information residing therein.
Our enterprise risk management framework is designed to identify, measure, mitigate and manage the risks to which we are subject, as well as any losses stemming from such risks.
Our enterprise risk management framework may not be effective in mitigating the risks to which we are subject, or in reducing the potential for losses in connection with such risks. Our enterprise risk management framework is designed to identify, measure, mitigate and manage the risks to which we are subject, as well as any losses stemming from such risks.
Any cybersecurity incident involving the misappropriation, loss or other unauthorized disclosure of confidential customer information could severely damage our reputation, erode confidence in the security of our systems, products and services, expose us to the risk of litigation and liability, disrupt our operations and have a material adverse effect on our business.
Any cybersecurity incident involving the misappropriation, loss or other unauthorized disclosure of confidential customer information could severely damage our reputation, erode confidence in the security of our systems, products and services, expose us to the risk of litigation and liability, disrupt our operations and have a material adverse effect on our business. 19 In addition, we interact with and rely on financial counterparties for whom we process transactions and who process transactions for us and rely on other third-party service providers, as discussed above.
Competitive conditions may also impact the interest rates we are able to earn on new loans or are required to pay on deposits, negatively impacting both our ability to grow loans and deposits and our net interest income. Our ability to manage interest rate risk could be negatively impacted by unpredictable behavior of depositors in various interest rate environments.
Competitive conditions may also impact the interest rates we are able to earn on new loans or are required to pay on deposits, negatively impacting both our ability to grow loans and deposits and our net interest income.
NRSROs regularly evaluate us, and their ratings are based on a number of factors, including our financial strength and conditions affecting the financial services industry generally.
A downgrade of our credit rating could increase our cost of capital or place limitations on business activities. NRSROs regularly evaluate us, and their ratings are based on a number of factors, including our financial strength and conditions affecting the financial services industry generally.
The loss of service of one or more of our executive officers or key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition or operating results.
The loss of service of one or more of our executive officers or key personnel, or the inability to recruit and retain qualified personnel in the future, could have an adverse effect on our business, financial condition or operating results. 12 The actual or perceived financial stability of other financial institutions and in particular other regional and mid-size banks could adversely affect our business, market valuation and results of operations.
Any future regulatory or legislative action resulting from the comprehensive review could impact the future amount, terms and availability of liquidity provided by the FHLBs to their members, including BankUnited.
The FHFA, the primary regulator of the FHLB system, is actively implementing recommendations from its 2023 comprehensive review of the FHLB system. Any future regulatory or legislative action resulting from the comprehensive, multi-year implementation effort could impact the future amount, terms and availability of liquidity provided by the FHLBs to their members, including BankUnited.
A flat or inverted yield curve or tightening credit spreads may limit our ability to add higher yielding assets to the balance sheet and reduce the spread between rates paid on interest bearing liabilities and those earned on interest earning assets, placing downward pressure on our net interest margin and net interest income.
A flat or inverted yield curve or tightening credit spreads may constrain our ability to deploy assets at favorable yields and may reduce the spread between the yield on interest‑earning assets and the cost of interest-bearing liabilities, placing downward pressure on our net interest margin and net interest income.
We are exposed to the risk of fraud or theft by employees or outsiders and to operational errors, including clerical or record-keeping errors, the impact of ineffective processes and controls or faulty or disabled technology.
We are exposed to the risk of fraud or theft by employees or outsiders and to operational errors, including clerical or record-keeping errors, the impact of ineffective processes and controls or faulty or disabled technology. Events such as these could cause us to suffer financial loss, the loss of customers, regulatory action and damage to our reputation.
Events such as these could cause us to suffer financial loss, the loss of customers, regulatory action and damage to our reputation. 19 Because the nature of the financial services business involves a high volume of transactions, certain errors may be repeated or compounded before they are discovered and successfully rectified.
Because the nature of the financial services business involves a high volume of transactions, certain errors may be repeated or compounded before they are discovered and successfully rectified.
An increase in interest rates may also reduce the demand for loans and lower-priced deposit products, decrease loan repayment rates and negatively affect borrowers' ability to meet their obligations. A decrease in the general level of interest rates may affect us through, among other things, increased prepayments on higher-yielding fixed rate loans and mortgage-backed securities.
A decrease in the general level of interest rates may affect us through, among other things, increased prepayments on higher‑yielding fixed‑rate loans and mortgage‑backed securities.
Newly enacted laws, regulations, or executive orders may significantly impact the regulatory framework in which we operate and may require material changes to our business processes in short time frames.
The current administration's regulatory reform agenda has impacted, and we expect it will continue to impact, the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies. Newly enacted laws, regulations, or executive orders may significantly impact the regulatory framework in which we operate and may require material changes to our business processes in short time frames.
The inability to raise additional capital on favorable terms when needed could have a materially adverse effect on our business, financial condition and results of operations. A downgrade of our credit rating could increase our cost of capital or place limitations on business activities.
The inability to raise additional capital on favorable terms when needed could have a materially adverse effect on our business, financial condition and results of operations. In addition, the issuance of equity to raise capital may dilute the shares of our current shareholders.
If our ESG practices do not meet evolving rules and regulations or stakeholder expectations, then our reputation or our ability to attract or retain employees, customers and investors could be negatively impacted. Credit Risk As a lender, our business is highly susceptible to credit risk.
If our ESG practices fail to meet these evolving rules or expectations, our reputation and ability to attract or retain employees, customers, and investors could be negatively impacted.
We depend on our executive officers and other key and skilled personnel to execute our business strategy and could be harmed by the loss of their services or the inability to attract new talent. We believe that our continued growth and future success will depend in large part on the skills of our senior management team and other key personnel.
Failure to attract and retain employees may adversely impact our ability to successfully execute our business strategy We believe that our continued growth and future success will depend in large part on the skills of our senior management team and other key personnel.
C ompetition, general labor market dynamics and the evolving transition around remote and hybrid work may also present challenges in recruiting and 13 retaining talent.
Our success also depends on the experience and skills of other key personnel and on their relationships with the customers and communities they serve. C ompetition, general labor market dynamics and the evolving transition around remote and hybrid work may also present challenges in recruiting and retaining talent.
While inflation trended down in the second half of 2024, it remains a key economic concern. Inflationary trends and a higher sustained interest rate environment could lead to an increase in our operating expenses or those of our clients, in turn impacting borrowers' ability to repay their obligations to us. Loan demand could also be negatively impacted.
We may be negatively affected by the volatility and uncertainty related to inflation and the effects of inflation. Prolonged periods of inflation may lead to an increase in our operating expenses or those of our clients, in turn impacting borrowers' ability to repay their obligations to us. Loan demand could also be negatively impacted.
The modeling techniques we use to manage interest rate risk are based on a wide variety of assumptions generally derived from historical data and patterns, and may fail to accurately predict the impact of future movements in interest rates on our financial performance.
The modeling and measurement techniques we use to assess and manage interest rate risk rely on a variety of assumptions, many of which are based on historical relationships, trends, and expectations, and may not accurately reflect or predict the impact of future interest rate movements or economic conditions.
Increased competition among financial services companies may adversely affect our ability to market our products and services. Technology has lowered barriers to entry and made it possible for financial services providers to compete in our markets without a physical footprint and enabled non-bank providers to offer products and services traditionally provided by banks.
Technology has lowered barriers to entry and made it possible for financial services providers to compete in our markets without a physical footprint and enabled non-bank providers to offer a growing variety of traditional and nontraditional alternatives, such as crowdfunding, digital wallets. cryptocurrencies, and money transfer services.
Our deposit costs tend to be correlated with short-term rates; increases in short-term interest rates or generally tightening liquidity conditions may exert upward pressure on our cost of deposits. Changes in interest rates can increase or decrease our net interest income, because different types of assets and liabilities may react differently, and at different times, to market interest rate changes.
Our deposit costs are generally correlated with short‑term interest rates; increases in short-term interest rates or generally tightening liquidity conditions may exert upward pressure on the rates we must pay to attract and retain deposits.
We believe we have taken a balanced approach to these practices in consideration of the views of various stakeholders; however, stakeholder expectations and priorities, and in some cases externally imposed requirements around ESG, continue to evolve, are uncertain, and sometimes conflicting.
Divergent ideological and social views may create competing stakeholder, legislative, and regulatory scrutiny around ESG practices, potentially increasing costs or affecting operations. While we strive to take a balanced approach, stakeholder expectations and externally imposed requirements continue to evolve, remain uncertain, and are sometimes conflicting.
Consumers and businesses may change their behavior as a result of their concerns about climate change or in response to governmental efforts to address it. We and our customers may need to respond to new laws and regulations as well as consumer and business preferences resulting from climate change concerns.
Governmental efforts to mitigate climate change and shifting consumer and business preference resulting from climate change concerns may require us and our customers to respond to new laws and regulations which may lead to cost increases, asset value reductions and operating process changes, as well as negatively impact our reputation.
Removed
Concerns over the long-term impacts of climate change have led and may continue to lead to governmental efforts to mitigate those impacts; that governmental response could directly or indirectly impact our business or that of our customers.
Added
Increased competition among financial services companies may adversely affect our ability to market our products and services.
Removed
We and our customers may face cost increases, asset value reductions and operating process changes. The impact on our customers will likely vary depending on their specific attributes, including reliance on or role in carbon intensive activities. Among the impacts to us could be a drop in demand for our products and services, particularly in certain sectors.
Added
These impacts will vary depending on the customers' specific attributes, including reliance on or role in carbon intensive activities and may also affect us directly through a drop in demand for our products and services, reductions in creditworthiness, declines in collateral values, and the rising property and casualty insurance costs related to physical risks brought on by weather events or climate change, particularly in one of our primary market areas in Florida coastal areas which may increase our vulnerability to the ultimate impacts of climate change as compared to some of our competitors and our efforts to account for these risks may not fully protect us from negative impacts of new laws, regulations, behavioral changes, or evolving expectations of stakeholders including investors, customers, regulators, employees, and ratings agencies regarding our ESG practices.
Removed
In addition, we could face reductions in creditworthiness on the part of some customers or in the value of assets securing loans. In particular, our clients' operations may be adversely impacted by the rising cost of property and casualty insurance related to physical risks brought on by weather events or climate change.
Added
In a declining interest rate environment, if interest‑earning assets mature or reprice more rapidly than interest‑bearing liabilities, our net interest income may likewise be adversely affected. An increase in interest rates may also reduce the demand for loans and lower‑cost deposit products, slow loan repayment activity, and negatively affect borrowers’ ability to meet their contractual obligations.
Removed
Our efforts to take these risks into account in making lending and other decisions may not be effective in protecting us from the negative impact of new laws and regulations or changes in consumer or business behavior.
Added
In addition, our ability to manage interest rate risk may be adversely affected by changes in depositor behavior that differ from historical patterns, including changes in the timing, magnitude, or sensitivity of deposit movements in response to interest rate changes.
Removed
One of our primary market areas is the state of Florida, particularly in coastal areas; as such, we may have an increased vulnerability to the ultimate impacts of climate change as compared to some of our competitors.
Added
Assumptions regarding depositor behavior are an integral component of our interest rate risk management processes, and changes in customer behavior, increased availability of alternative financial products, technological advances that facilitate the movement of funds, and ongoing changes in the financial services industry have made such behavior more difficult to predict. .
Removed
Although our Chairman, President and Chief Executive Officer has entered into an employment agreement with us, he may not complete the term of his employment agreement or renew upon expiration.
Added
Widespread adoption and rapid evolution of, as well as developments in the regulatory landscape relating to emerging technologies, including AI, automated decision-making, and digital assets, such as cryptocurrencies, including stablecoins, tokens and other crypto assets that utilize distributed ledger technology, create additional strategic risks, could negatively impact our ability to compete and require substantial expenditures to the extent we were to modify or adapt our existing products and services.
Removed
Other members of our senior management team are not subject to employment agreements, and some members of our senior management team have reached or are approaching what might be considered normal retirement age.
Added
As new technologies evolve and mature, our businesses and results of operations could be adversely impacted, including as a result of new competitors and increased volatility in deposits and/or significant long-term reduction in deposits.
Removed
Our Board of Directors and senior management team are actively engaged in ongoing succession planning, however, our succession planning efforts may not be adequate to ensure continuity of qualified senior management. Our success also depends on the experience and skills of other key personnel and on their relationships with the customers and communities they serve.
Added
Inability to meet new statutory requirements within the prescribed periods could adversely affect our business, financial condition and results of operations, as well as impact our reputation. 21 Our ability to expand through acquisition or de novo branching requires regulatory approvals, and failure to obtain them may restrict our growth.
Removed
The actual or perceived financial stability of other financial institutions and in particular other regional and mid-size banks could adversely affect our business, market valuation and results of operations.
Added
Any future increases in FDIC insurance premiums or additional assessments may adversely affect our financial condition or results of operations.
Removed
Evolving expectations of stakeholders including investors, customers, regulators, employees and ratings agencies with respect to our ESG practices and those of our customers may impose additional costs on us, impact our reputation in the market or expose us to emerging risks.
Removed
Divergent ideological and social views may create competing stakeholder, legislative, and regulatory scrutiny around ESG practices that may impact our reputation or operations or result in increased costs.
Removed
Assumptions about depositor behavior are integral to interest rate risk modeling and management; technological advances enabling depositors to move money more quickly and to do business with a wide variety of financial services providers not in physical proximity to those depositors as well as the evolving landscape of the financial services industry has made predictive modeling of depositor behavior increasingly difficult.
Removed
In 2023, the FHFA, the primary regulator of the FHLB system, completed a comprehensive review of the FHLB system. The review recommended a re-evaluation of many aspects of the regulatory and statutory framework governing the FHLB system and set forth some recommended revisions to that framework.
Removed
In addition, we interact with and rely on financial counterparties for whom we process transactions and who process transactions for us and rely on other third-party service providers, as discussed above. Each of these third parties may be targets of the same types of cybersecurity incidents described above.
Removed
We expect the newly elected Trump administration will seek to implement a regulatory reform agenda that is significantly different than that of the previous administration, impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies and at least temporarily injecting a heightened level of regulatory uncertainty.
Removed
Inability to meet new statutory requirements within the prescribed periods could adversely affect our business, financial condition and results of operations, as well as impact our reputation. 22 A number of new or modified rules or policies related to capital requirements for banks with more than $100 billion in assets, liquidity, and bank mergers and acquisitions have been proposed; if these or similar rules are enacted, there could be a material direct or indirect impact on our business including but not limited to our financial position, results of operations and capital.
Removed
Given the initial posture of the incoming administration, there is significant uncertainty about whether certain of these proposed rules will be enacted in substantially their proposed forms, in modified form, or at all. Our ability to expand through acquisition or de novo branching requires regulatory approvals, and failure to obtain them may restrict our growth.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Company has designated the MAT to assess and oversee the management and reporting of identified potentially material cybersecurity threats or incidents. The MAT convenes when a qualifying cybersecurity threat is identified by the CIO, the CISO, or their designees in accordance with established processes and procedures.
Biggest changeThe MAT convenes when a qualifying cybersecurity threat is identified by the CIO, the CISO, or their designees in accordance with established processes and procedures. The MAT has the responsibility to determine whether a cybersecurity threat or incident is material and oversee appropriate reporting.
As a federally regulated institution, the Company strongly supports an environment that facilitates and abides by the Confidentiality, Integrity, and Availability security principles. Our risk-based policies, procedures, and practices are integrated into our overall risk management program and have been implemented across the organization to manage and mitigate risks from cybersecurity threats.
As a federally regulated institution, the Company strongly supports an environment that facilitates and abides by the Confidentiality, Integrity, and Availability security principles. 24 Our risk-based policies, procedures, and practices are integrated into our overall risk management program and have been implemented across the organization to manage and mitigate risks from cybersecurity threats.
The training program includes, but is not limited to, ongoing and targeted training on topics such as social engineering, mobile security, data handling and protection, password security and incident reporting. All employees are required to participate in the training. In 2022, Clarium Managed Services, LLC conducted a Cybersecurity Assessment for the Bank.
The training program includes, but is not limited to, ongoing and targeted training on topics such as social engineering, mobile security, data handling and protection, password security and incident reporting. All employees are required to participate in the training. In 2025, Clarium Managed Services, LLC conducted a Cybersecurity Assessment for the Bank.
At the management level, the CISO leads the ongoing technical and business functions that include cybersecurity, information assurance, network security, systems engineering, and information security management. A dedicated information security division reports to the CISO.
At the management level, the CISO provides oversight of the ongoing technical and business functions that include cybersecurity, information assurance, network security, systems engineering, and information security management. A dedicated information security division reports to the CISO.
The assessment gauged the overall Cybersecurity Risk Posture of the Bank and resulted in a score of 4.8 on a scale of 0 to 5. The next independent evaluation is planned for 2025. In the last three fiscal years, the Company has not identified any material cybersecurity incidents.
The assessment gauged the overall Cybersecurity Risk Posture of the Bank and resulted in a score of 5 on a scale of 0 to 5. In the last three fiscal years, the Company has not identified any material cybersecurity incidents.
The CISO holds multiple designations from the International Information System Security Certification Consortium, including Certified Information Systems Security Professional and has been a member of various boards including IT, Cybersecurity and Enterprise Risk Committees. Organizationally, the CISO reports to the CRO and provides reporting directly to the Risk Committee of the Board of Directors.
The CISO holds multiple designations from the International Information System Security Certification Consortium, including Certified Information Systems Security Professional and has been a member of various boards including IT, Cybersecurity and Enterprise Risk Committees.
No specific identified cybersecurity threats or incidents, including those resulting from any previous cybersecurity incidents, have materially affected, or are reasonably likely to materially affect, the Company, including its business strategy, results of operations or financial condition.
No specific identified cybersecurity threats or incidents, including those resulting from any previous cybersecurity incidents, have materially affected, or are reasonably likely to materially affect, the Company, including its business strategy, results of operations or financial condition. See Item 1A "Risk Factors" for a further discussion of our cybersecurity risks.
Other SMEs or technical experts may advise, consult with and provide information to the MAT as needed. In addition to the specific subject matter expertise and experience of the CISO and CIO, these executives have broad financial, legal, risk management, industry, regulatory and SEC compliance, and general leadership experience, which enable the MAT to effectively carry out its responsibilities.
In addition to the specific subject matter expertise and experience of the CISO and CIO, these executives have broad financial, legal, risk management, industry, regulatory and SEC compliance, and general leadership experience, which enable the MAT to effectively carry out its responsibilities.
See Item 1A "Risk Factors" for a further discussion of our cybersecurity risks. 26 Cybersecurity Governance The Risk Committee of the Board of Directors is ultimately responsible for oversight of cybersecurity risk, the Company's information risk management function, and the effective implementation of its cybersecurity program.
Cybersecurity Governance The Risk Committee of the Board of Directors is ultimately responsible for oversight of cybersecurity risk, the Company's information risk management function, and the effective implementation of its cybersecurity program.
The MAT has the responsibility to determine whether a cybersecurity threat or incident is material and oversee appropriate reporting. The MAT is also responsible for communicating to the Risk Committee any material cybersecurity threats or incidents. The CISO, CIO, CRO, CFO, CAO, and General Counsel comprise the MAT.
The MAT is also responsible for communicating to the Risk Committee any material cybersecurity threats or incidents. The CISO, CIO, CRO, CFO, CAO, and General Counsel comprise the MAT. Other SMEs or technical experts may advise, consult with and provide information to the MAT as needed.
Added
Organizationally, the CISO reports to the CRO and provides reporting directly to the Risk Committee of the Board of Directors. 25 The Company has designated the MAT to assess and oversee the management and reporting of identified potentially material cybersecurity threats or incidents.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties BankUnited's corporate headquarters is located in leased office space in Miami Lakes, Florida. We also lease office space in New York, New Jersey, certain other areas in Florida, Dallas and Atlanta. Our subsidiaries lease office space in Baltimore, Maryland and Scottsdale, Arizona.
Biggest changeItem 2. Properties BankUnited's corporate headquarters is located in leased office space in Miami Lakes, Florida. We also lease office space in New York, New Jersey, certain other areas in Florida, Dallas, Atlanta and North Carolina. Our subsidiaries lease office space in Baltimore, Maryland and Scottsdale, Arizona.
At December 31, 2024, we provided banking services at 55 banking centers located in Florida, New York and Texas. We believe that our facilities are in good condition and are adequate to meet our operating needs for the foreseeable future.
At December 31, 2025, we provided banking services at 55 banking centers located in Florida, New York, Texas, and Atlanta. We believe that our facilities are in good condition and are adequate to meet our operating needs for the foreseeable future.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn the opinion of management, based upon advice of legal counsel, the likelihood is remote that the adverse impact of these proceedings, either individually or in the aggregate, would be material to the Company’s consolidated financial position, results of operations or cash flows. Item 4. Mine Safety Disclosures None. 27 PART II
Biggest changeIn the opinion of management, based upon advice of legal counsel, the likelihood is remote that the adverse impact of these proceedings, either individually or in the aggregate, would be material to the Company’s consolidated financial position, results of operations or cash flows. Item 4. Mine Safety Disclosures None. 26 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIndex 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 BankUnited, Inc. 100.00 99.09 123.26 101.46 101.13 123.54 S&P 500 Index 100.00 118.40 152.39 124.79 157.59 197.02 KBW Nasdaq Regional Banking Index 100.00 90.28 122.86 113.96 113.02 127.43 Recent Sales of Unregistered Securities None. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. 29 Item 6. Reserved
Biggest changeIndex 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 BankUnited, Inc. 100.00 124.39 102.38 102.05 124.67 150.72 S&P 500 Index 100.00 128.71 105.40 133.10 166.40 196.16 KBW Nasdaq Regional Banking Index 100.00 136.64 127.17 126.66 143.38 152.71 28 Recent Sales of Unregistered Securities None.
The Company expects to continue its policy of paying regular cash dividends on a quarterly basis. 28 Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on an initial investment of $100 in our common stock between December 31, 2019 and December 31, 2024, with the comparative cumulative total return of such amount on the S&P 500 Index and the KBW Nasdaq Regional Bank Index over the same period.
The Company expects to continue its policy of paying regular cash dividends on a quarterly basis. 27 Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on an initial investment of $100 in our common stock between December 31, 2020 and December 31, 2025, with the comparative cumulative total return of such amount on the S&P 500 Index and the KBW Nasdaq Regional Bank Index over the same period.
As of February 26, 2025, there were 574 stockholders of record of our common stock. Equity Compensation Plan Information The information set forth under the caption "Equity Compensation Plan Information" in our definitive proxy statement for the Company's 2025 annual meeting of stockholders (the "Proxy Statement") is incorporated herein by reference.
As of February 24, 2026, there were 539 stockholders of record of our common stock. Equity Compensation Plan Information The information set forth under the caption "Equity Compensation Plan Information" in our definitive proxy statement for the Company's 2026 annual meeting of shareholders (the "Proxy Statement") is incorporated herein by reference.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders of Record Shares of our common stock trade on the NYSE under the symbol "BKU". The last sale price of our common stock on the NYSE on February 26, 2025 was $37.18 per share.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information and Holders of Record Shares of our common stock trade on the NYSE under the symbol "BKU". The last sale price of our common stock on the NYSE on February 24, 2026 was $47.79 per share.
Dividend Policy The Company declared a quarterly dividend of $0.29 and $0.27 per share on its common stock for each of the four quarters in the years ended December 31, 2024 and 2023, respectively, resulting in total dividends for the years ended December 31, 2024 and 2023, of $87.0 million and $80.5 million, or $1.16 and 1.08 per common share, respectively.
Dividend Policy The Company declared a quarterly dividend of $0.31 and $0.29 per share on its common stock for each of the four quarters in the years ended December 31, 2025 and 2024, respectively, resulting in total dividends for the years ended December 31, 2025 and 2024, of $93.8 million and $87.0 million, or $1.24 and $1.16 per common share, respectively.
Dividends from the Bank are the principal source of funds for the payment of dividends on our common stock. The Bank is subject to certain restrictions that may limit its ability to pay dividends to us. See "Business—Regulation and Supervision—Regulatory Limits on Dividends and Distributions".
The Bank is subject to certain restrictions that may limit its ability to pay dividends to us. See "Business—Regulation and Supervision—Regulatory Limits on Dividends and Distributions".
Added
The Company's Board of Directors has authorized an increase of $0.02 per share in the Company's common stock dividend for future quarterly dividends, to $0.33 per common shares. Dividends from the Bank are the principal source of funds for the payment of dividends on our common stock.
Added
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Issuer Purchases of Equity Securities Period Total number of shares purchased (1) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs (2)(3) October 1 - October 31, 2025 98,851 $ 36.96 98,851 $ 96,346,725 November 1 - November 30, 2025 635,149 $ 39.28 635,149 $ 71,398,342 December 1 - December 31, 2025 349,900 $ 45.51 349,900 $ 55,476,049 Total 1,083,900 $ 41.08 1,083,900 (1) The total number of shares purchased during the periods indicated includes shares purchased as part of a publicly announced program.
Added
(2) On July 22, 2025, the Company's Board of Directors authorized the repurchase of up to $100 million in shares of its outstanding common stock. No time limit was set for the completion of the share repurchase program, and the program may be suspended or discontinued without prior notice at any time.
Added
The authorization does not require the Company to acquire any specified number of common shares. (3) On January 20, 2026, the Company's Board of Directors authorized the repurchase of up to $200 million in shares of its outstanding common stock in addition to shares remaining available for purchase under the repurchase program approved on July 22, 2025.
Added
No time limit was set for the completion of the share repurchase program and the program may be suspended or discontinued without prior notice at any time. The authorization does not require the Company to acquire any specified number of common shares. 29 Item 6. Reserved

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

124 edited+32 added−56 removed56 unchanged
Biggest changeThe following table provides an analysis of the ACL, provision for (recovery of) credit losses related to the funded portion of loans and net charge-offs by loan segment for the periods indicated (dollars in thousands): CRE C&I Pinnacle - Municipal Finance Franchise and Equipment Finance Residential and MWL Total Balance at December 31, 2021 $ 28,811 $ 67,950 $ 170 $ 20,339 $ 9,187 $ 126,457 Provision for credit losses 2,371 62,289 3 6,293 2,858 73,814 Charge-offs (9,531) (38,921) — (13,191) (412) (62,055) Recoveries 3,100 5,872 — 650 108 9,730 Balance at December 31, 2022 24,751 97,190 173 14,091 11,741 147,946 Impact of adoption of ASU 2022-02 — (1,671) — (6) (117) (1,794) Balance at January 1, 2023 24,751 95,519 173 14,085 11,624 146,152 Provision for (recovery of) credit losses 17,192 62,053 70 3,394 (3,785) 78,924 Charge-offs (1,228) (26,539) — (7,247) — (35,014) Recoveries 623 11,372 — 623 9 12,627 Balance at December 31, 2023 41,338 142,405 243 10,855 7,848 202,689 Provision for (recovery of) credit losses 34,946 23,455 (127) (3,806) 4,518 58,986 Charge-offs (6,202) (47,912) — (5,710) (126) (59,950) Recoveries 376 20,006 — 1,042 4 21,428 Balance at December 31, 2024 $ 70,458 $ 137,954 $ 116 $ 2,381 $ 12,244 $ 223,153 Net Charge-offs to Average Loans Year Ended December 31, 2022 0.12 % 0.45 % — % 2.08 % — % 0.22 % Year Ended December 31, 2023 0.01 % 0.18 % — % 1.53 % — % 0.09 % Year Ended December 31, 2024 0.10 % 0.31 % — % 1.53 % — % 0.16 % 57 The following table shows the distribution of the ACL at the dates indicated (dollars in thousands): December 31, 2024 December 31, 2023 Total % (1) Total % (1) Non-owner occupied commercial real estate $ 52,104 23.3 % $ 32,810 21.6 % Construction and land 18,354 2.3 % 8,528 2.0 % CRE 70,458 41,338 Owner occupied commercial real estate 16,126 8.0 % 17,642 7.9 % Commercial and industrial 121,828 28.9 % 124,763 28.3 % Pinnacle - municipal finance 116 3.0 % 243 3.6 % Franchise and equipment finance 2,381 0.9 % 10,855 1.5 % 140,451 153,503 Residential and MWL 12,244 33.6 % 7,848 35.1 % $ 223,153 100.0 % $ 202,689 100.0 % (1) Represents percentage of loans receivable in each category to total loans receivable.
Biggest changeThe following table provides an analysis of the ACL, the provision for credit losses related to the funded portion of loans and net charge-offs by loan segment for the periods indicated (dollars in thousands): CRE C&I Pinnacle - Municipal Finance Franchise and Equipment Finance Residential and MWL Total Balance at December 31, 2022 $ 24,751 $ 97,190 $ 173 $ 14,091 $ 11,741 $ 147,946 Impact of adoption of ASU 2022-02 — (1,671) — (6) (117) (1,794) Balance at January 1, 2023 24,751 95,519 173 14,085 11,624 146,152 Provision for credit losses 17,192 62,053 70 3,394 (3,785) 78,924 Charge-offs (1,228) (26,539) — (7,247) — (35,014) Recoveries 623 11,372 — 623 9 12,627 Balance at December 31, 2023 41,338 142,405 243 10,855 7,848 202,689 Provision for credit losses 34,946 23,455 (127) (3,806) 4,518 58,986 Charge-offs (6,202) (47,912) — (5,710) (126) (59,950) Recoveries 376 20,006 — 1,042 4 21,428 Balance at December 31, 2024 70,458 137,954 116 2,381 12,244 223,153 Provision for credit losses 6,389 64,474 (10) (2,233) (269) 68,351 Charge-offs (18,532) (62,270) — — (208) (81,010) Recoveries 29 8,479 — 812 11 9,331 Balance at December 31, 2025 $ 58,344 $ 148,637 $ 106 $ 960 $ 11,778 $ 219,825 Net Charge-offs to Average Loans Year Ended December 31, 2023 0.01 % 0.18 % — % 1.53 % — % 0.09 % Year Ended December 31, 2024 0.10 % 0.31 % — % 1.53 % — % 0.16 % Year Ended December 31, 2025 0.29 % 0.62 % — % (0.54) % — % 0.30 % The following table shows the distribution of the ACL at the dates indicated (dollars in thousands): December 31, 2025 December 31, 2024 Total % (1) Total % (1) CRE $ 58,344 28.1 % $ 70,458 25.6 % C&I 148,637 37.1 % 137,954 36.9 % Pinnacle - municipal finance 106 2.6 % 116 3.0 % Franchise and equipment finance 960 0.4 % 2,381 0.9 % Total Commercial 208,047 210,909 Residential and MWL 11,778 31.8 % 12,244 33.6 % $ 219,825 100.0 % $ 223,153 100.0 % (1) Represents percentage of loans receivable in each category to total loans receivable. 54 The following table presents the ACL as a percentage of loans at the dates indicated, by portfolio sub-segment: December 31, 2025 December 31, 2024 Commercial: CRE 0.86 % 1.13 % C&I 1.65 % 1.54 % Franchise and equipment finance 0.93 % 1.12 % Total commercial 1.30 % 1.37 % Pinnacle - municipal finance 0.02 % 0.02 % Residential and MWL 0.15 % 0.15 % 0.91 % 0.92 % ACL to non-performing loans 58.99 % 89.01 % ACL to CRE office loans 2.03 % 2.30 % Changes in the ACL during the year ended December 31, 2025, are depicted in the chart below (dollars in millions): Changes in the ACL during the year ended December 31, 2025 As depicted in the chart above, the most significant factors impacting the ACL for the year ended December 31, 2025, were increases in specific reserves, partially offset by net charge-offs.
Numerous additional variables and assumptions not explicitly stated, including but not limited to detailed commercial and residential property forecasts, projected stock market volatility indices and a variety of additional assumptions about market interest rates and spreads also contributed to the overall impact economic conditions and the economic forecast had on the ACL estimate.
Numerous additional variables and assumptions not explicitly stated, including but not limited to detailed commercial and residential property forecasts, projected stock market performance and volatility indices and a variety of additional assumptions about market interest rates and spreads also contributed to the overall impact economic conditions and the economic forecast had on the ACL estimate.
Expected credit losses are estimated on a collective basis for groups of loans that share similar risk characteristics. For loans that do not share similar risk characteristics with other loans such as collateral dependent loans, expected credit losses are estimated on an individual basis.
Expected credit losses are estimated on a collective basis for groups of loans that share similar risk characteristics. For loans that do not share similar risk characteristics with other loans such as collateral dependent loans, expected credit losses are 53 estimated on an individual basis.
See Note 13 to the consolidated financial statements for more information about the Company's and the Bank's regulatory capital ratios. 65 Interest Rate Risk A principal component of the Company’s risk of loss arising from adverse changes in the fair value of financial instruments, or market risk, is interest rate risk, including the risk that assets and liabilities with similar re-pricing characteristics may not reprice at the same time or to the same degree.
See Note 13 to the consolidated financial statements for more information about the Company's and the Bank's regulatory capital ratios. 60 Interest Rate Risk A principal component of the Company’s risk of loss arising from adverse changes in the fair value of financial instruments, or market risk, is interest rate risk, including the risk that assets and liabilities with similar re-pricing characteristics may not reprice at the same time or to the same degree.
Competition for deposits and loans in our markets is intense with respect to the variety and quality of products and services offered, delivery channels, service levels and pricing.
Competition for deposits and loans in our markets is intense with respect to the variety and quality of products and services offered, 30 delivery channels, service levels and pricing.
None of the unrealized losses were attributable to credit loss impairments. 40 The external ratings distribution of our AFS securities portfolio at the dates indicated is depicted in the charts below: December 31, 2024 December 31, 2023 We evaluate the credit quality of individual securities in the portfolio quarterly to determine whether we expect to recover the amortized cost basis of the investments in unrealized loss positions.
None of the unrealized losses were attributable to credit loss impairments. 40 The external ratings distribution of our AFS securities portfolio at the dates indicated is depicted in the charts below: December 31, 2025 December 31, 2024 We evaluate the credit quality of individual securities in the portfolio quarterly to determine whether we expect to recover the amortized cost basis of the investments in unrealized loss positions.
Same day available liquidity inc ludes cash, secured funding such as borrowing capacity at the Federal Home Loan Bank of Atlanta and the Federal Reserve, and unencumbered securities. Additional sources of liquidity include cash flows from operations, wholesale deposits, cash flow from the Bank's amortizing securities and loan portfolios, repurchase agreements and the sale of investment securities.
Same day available liquidity inc ludes cash, secured funding such as borrowing capacity at the Federal Home Loan Bank of Atlanta and the Federal Reserve, and unpledged securities. Additional sources of liquidity include cash flows from operations, wholesale deposits, cash flow from the Bank's amortizing securities and loan portfolios, repurchase agreements and the sale of investment securities.
A single economic scenario or a probability weighted blend of economic scenarios may be used. The models ingest numerous national, regional and MSA level variables and data points. At December 31, 2024 and 2023, we used a combination of weighted third-party provided economic scenarios in calculating the quantitative portion of the ACL.
A single economic scenario or a probability weighted blend of economic scenarios may be used. The models ingest numerous national, regional and MSA level variables and data points. At December 31, 2025 and 2024, we used a combination of weighted third-party provided economic scenarios in calculating the quantitative portion of the ACL.
Due to their unique risk profiles, MWL and municipal finance are excluded from this ratio. Contractually delinquent government insured residential loans are typically GNMA early Buyout Loans and are excluded from non-performing loans as defined in the table above due to their government guarantee.
Due to their unique risk profiles, MWL and municipal finance are excluded from this ratio. Contractually delinquent government insured residential loans are typically Buyout Loans and are excluded from non-performing loans as defined in the table above due to their government guarantee.
Management's discussion and analysis presents the more significant factors that affected our financial condition as of December 31, 2024, and results of operations for the year then ended, including in comparison to the prior year ended December 31, 2023.
Management's discussion and analysis presents the more significant factors that affected our financial condition as of December 31, 2025, and results of operations for the year then ended, including in comparison to the prior year ended December 31, 2024.
Estimates that are particularly susceptible to change that may have a material impact on the amount of the ACL include: • our evaluation of current conditions; • our determination of a reasonable and supportable economic forecast or weighting of various forecast paths and selection of the reasonable and supportable forecast period; • our evaluation of historical loss experience and selection of historical loss data used in formulating our ACL estimate; since we have limited company specific historical loss data, our modeling techniques also leverage broad external data sets for this purpose; • our evaluation of changes in composition and characteristics of the loan portfolio, including internal risk ratings; 34 • our estimate of expected prepayments; • the value of underlying collateral, which may impact loss severity and certain cash flow assumptions for collateral-dependent, criticized and classified loans; in the current environment, especially with respect to certain commercial real estate sectors like office, current and projected collateral values may be particularly challenging to estimate; • our selection and evaluation of qualitative factors; and • our estimate of expected cash flows on AFS debt securities in unrealized loss positions.
Estimates that are particularly susceptible to change that may have a material impact on the amount of the ACL include: • our evaluation of current conditions; • our determination of a reasonable and supportable economic forecast or weighting of various forecast paths and selection of the reasonable and supportable forecast period; • our evaluation of historical loss experience and selection of historical loss data used in formulating our ACL estimate; since we have limited company specific historical loss data, our modeling techniques also leverage broad external data sets for this purpose; • our evaluation of changes in composition and characteristics of the loan portfolio, including internal risk ratings; • our estimate of expected prepayments; • the value of underlying collateral, which may impact loss severity and certain cash flow assumptions for collateral-dependent, criticized and classified loans; in the current environment, especially with respect to certain commercial real estate sectors like office, current and projected collateral values may be particularly challenging to estimate; and • our selection and evaluation of qualitative factors.
The following table presents the impact on forecasted net interest income compared to a "most likely" scenario, based on the consensus forward curve, in static balance sheet, parallel rate shock scenarios of plus and minus 100 and 200 basis points at December 31, 2024 and 2023: Down 200 Down 100 Plus 100 Plus 200 Policy Limits: In year 1 (12) % (8) % (8) % (12) % In year 2 (15) % (11) % (11) % (15) % Model Results at December 31, 2024 - increase (decrease) In year 1 (4.2) % (1.7) % 1.5 % 2.7 % In year 2 (3.4) % (1.2) % 0.6 % 1.0 % Model Results at December 31, 2023 - increase (decrease) In year 1 (4.7) % (1.6) % 1.0 % 2.1 % In year 2 (6.0) % (2.3) % 1.5 % 2.0 % EVE Simulation The following table illustrates the modeled change in EVE in the indicated scenarios at December 31, 2024 and 2023: Down 200 Down 100 Plus 100 Plus 200 Policy Limits (20.0) % (10.0) % (10.0) % (20.0) % Model Results at December 31, 2024 - increase (decrease): 16.9 % 10.0 % (7.1) % (14.8) % Model Results at December 31, 2023 - increase (decrease): 15.2 % 9.5 % (8.8) % (17.4) % All of the modeled results at December 31, 2024, are within ALM policy limits. 66 The Company uses many assumptions in estimating the impact of changes in interest rates on forecasted net interest income and EVE.
The following table presents the impact on forecasted net interest income compared to a "most likely" scenario, based on the consensus forward curve, in static balance sheet, parallel rate shock scenarios of plus and minus 100 and 200 basis points at the dates indicated: Down 200 Down 100 Plus 100 Plus 200 Policy Limits: In year 1 (12) % (8) % (8) % (12) % In year 2 (15) % (11) % (11) % (15) % Model Results at December 31, 2025 - increase (decrease) In year 1 (4.7) % (1.9) % 1.9 % 3.4 % In year 2 (8.8) % (3.8) % 3.3 % 6.2 % Model Results at December 31, 2024 - increase (decrease) In year 1 (4.2) % (1.7) % 1.5 % 2.7 % In year 2 (3.4) % (1.2) % 0.6 % 1.0 % EVE Simulation The following table illustrates the modeled change in EVE in the indicated scenarios at the dates indicated: Down 200 Down 100 Plus 100 Plus 200 Policy Limits (20.0) % (10.0) % (10.0) % (20.0) % Model Results at December 31, 2025 - increase (decrease): 7.1 % 5.3 % (3.5) % (7.8) % Model Results at December 31, 2024 - increase (decrease): 16.9 % 10.0 % (7.1) % (14.8) % All of the modeled results at December 31, 2025 are within ALM policy limits. 61 The Company uses many assumptions in estimating the impact of changes in interest rates on forecasted net interest income and EVE.
We have also invested in highly-rated structured products, including private-label commercial and residential MBS, collateralized loan obligations, single family real estate-backed securities and non-mortgage asset-backed securities that, while somewhat less liquid, are generally pledgeable at either the FHLB or the FRB and provide us with attractive yields. Investment grade municipal securities provide liquidity and attractive tax-equivalent yields.
We have also invested in highly-rated structured products, including private-label commercial and residential MBS, CLOs, single family real estate-backed securities and non-mortgage asset-backed securities that, while somewhat less liquid, are generally pledgeable at either the FHLB or the FRB and provide us with attractive yields. Investment grade municipal securities provide liquidity and attractive tax-equivalent yields.
Some of the measures currently used to dimension liquidity risk and manage liquidity are the ratio of available liquidity to uninsured/non-collateralized deposits, a wholesale funding ratio, the ratio of available operational liquidity (which excludes availability at the FRB) to volatile liabilities, a liquidity stress test coverage ratio, the loan to deposit ratio, a one-year liquidity ratio, a measure of available on-balance sheet liquidity, the ratio of FHLB advances to total assets and large depositor concentrations.
Some of the measures currently used to dimension liquidity risk and manage liquidity are a wholesale funding ratio, the ratio of available liquidity to uninsured/non-collateralized deposits, the ratio of available operational liquidity (which excludes availability at the FRB) to volatile liabilities, a liquidity stress test coverage ratio, the loan to deposit ratio, a one-year liquidity ratio, a measure of available on-balance sheet liquidity, the ratio of brokered deposits to total deposits and large depositor concentrations.
For additional disclosure related to the fair values of investment securities, see Note 14 to the consolidated financial statements. 42 The following table shows the weighted average prospective yields based on current rates, categorized by scheduled maturity, for AFS investment securities as of December 31, 2024. Scheduled maturities have been adjusted for anticipated prepayments when applicable.
For additional disclosure related to the fair values of investment securities, see Note 14 to the consolidated financial statements. 41 The following table shows the weighted average prospective yields based on current rates, categorized by scheduled maturity, for AFS investment securities as of December 31, 2025. Scheduled maturities have been adjusted for anticipated prepayments when applicable.
Refer to Item 7 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K filed with the SEC on February 20, 2024, for a discussion and analysis of the more significant factors that affected the year ended December 31, 2023, including in comparison to the year ended December 31, 2022.
Refer to Item 7 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K filed with the SEC on February 28, 2025, for a discussion and analysis of the more significant factors that affected the year ended December 31, 2024, including in comparison to the year ended December 31, 2023.
The estimate of the ACL at December 31, 2024, was informed by forecasted economic scenarios published in December 2024, a wide variety of additional economic data, information about borrower financial condition and collateral values, and other relevant information.
The quantitative estimate of the ACL at December 31, 2025, was informed by forecasted economic scenarios published in December 2025, a wide variety of additional economic data, information about borrower financial condition and collateral values, and other relevant information.
Management continually reviews and refines its interest rate risk management process in response to changes in the interest rate environment, the economic climate and observed customer behavior.
Management continually reviews and refines its interest rate risk management processes in response to changes in the interest rate environment, the economic climate and observed customer behavior.
Expected credit losses are estimated over the contractual terms of the loans, adjusted for expected prepayments, generally excluding expected extensions, renewals, and modifications. For the substantial majority of portfolio segments and subsegments, including residential loans other than government insured loans, and most commercial and commercial real estate loans, expected losses are estimated using a factor based methodology and econometric models.
Expected credit losses are estimated over the contractual terms of the loans, adjusted for expected prepayments, generally excluding expected extensions, renewals, and modifications. For the substantial majority of portfolio segments and subsegments, including residential loans other than government insured loans and most commercial and commercial real estate loans, expected losses are estimated using econometric models.
The quantitative portion of the ACL at December 31, 2024, was modeled using a weighting of baseline, downside and upside third-party economic scenarios, with the highest weighting ascribed to the baseline scenario and lower weightings ascribed equally to the downside and upside scenarios.
The quantitative portion of the ACL at December 31, 2025, was modeled using a weighting of baseline, downside and upside third-party economic scenarios, with the highest weighting ascribed to the baseline scenario and lower weightings ascribed to the downside and upside scenarios.
Collateralized and affiliate deposits are included in these amounts. Time deposit accounts with balances of $250,000 or more totaled $779 million and $941 million at December 31, 2024 and 2023, respectively.
Collateralized and affiliate deposits are included in these amounts. Time deposit accounts with balances of $250,000 or more totaled $774 million and $779 million at December 31, 2025 and 2024, respectively.
Additionally, as discussed in Note 15 to the consolidated financial statements, the Bank had $262 million in outstanding commitments to fund loans and $4.7 billion in unfunded commitments under existing lines of credit at December 31, 2024. Many of these commitments are expected to expire without being fully funded and, therefore, also do not necessarily represent future cash requirements.
Additionally, as discussed in Note 15 to the consolidated financial statements, the Bank had $145 million in outstanding commitments to fund loans and $5.2 billion in unfunded commitments under existing lines of credit at December 31, 2025. Many of these commitments are expected to expire without being fully funded and, therefore, also do not necessarily represent future cash requirements.
Approximately 64% of our total deposits were commercial or municipal deposits at December 31, 2024. Brokered deposits totaled $5.2 billion and $5.3 billion at December 31, 2024 and 2023, respectively. Brokered deposits are generally insured and typically a readily available source of funds, however, they are typically higher cost and in some circumstances, credit sensitive.
Approximately 69% of our total deposits were commercial or municipal deposits at December 31, 2025. Brokered deposits totaled $4.9 billion and $5.2 billion at December 31, 2025 and 2024, respectively. Brokered deposits are generally insured and typically a readily available source of funds, however, they are typically higher cost and in some circumstances, credit sensitive.
Yields on tax-exempt securities have been calculated on a tax-equivalent basis, based on a federal income tax rate of 21%: Within One Year After One Year Through Five Years After Five Years Through Ten Years After Ten Years Total U.S. Treasury securities — % 4.34 % 2.54 % — % 3.52 % U.S.
Yields on tax-exempt securities have been calculated on a tax-equivalent basis, based on a federal income tax rate of 21%: Within One Year After One Year Through Five Years After Five Years Through Ten Years After Ten Years Total U.S. Treasury securities — % 2.04 % 4.02 % — % 3.55 % U.S.
The tax-equivalent adjustment for tax-exempt loans was $12.2 million, $13.4 million and $12.7 million for the years ended December 31, 2024, 2023 and 2022, respectively. The tax-equivalent adjustment for tax-exempt investment securities was $3.3 million, $3.6 million and $3.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.
The tax-equivalent adjustment for tax-exempt loans was $11.0 million, $12.2 million and $13.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. The tax-equivalent adjustment for tax-exempt investment securities was $2.8 million, $3.3 million and $3.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Deposits A breakdown of deposits at the dates indicated is shown below: December 31, 2024 December 31, 2023 The Company has a diverse deposit book by industry sector. At December 31, 2024, our largest industry vertical was title insurance, with approximately $3.6 billion in total deposits. Deposits in the HOA vertical totaled $1.8 billion at December 31, 2024.
Deposits A breakdown of deposits at the dates indicated is shown below: December 31, 2025 December 31, 2024 The Company has a diverse deposit book by industry sector. At December 31, 2025, our largest industry vertical was title insurance, with approximately $4.4 billion in total deposits. Deposits in the HOA vertical totaled $2.3 billion at December 31, 2025.
DSCR calculations do not include pro-forma rental payments on in-place leases that are currently in initial rent abatement periods. Included in New York tri-state multifamily loans in the tables above is approximately $116 million of rent regulated exposure as of December 31, 2024.
DSCR calculations do not include secondary forms of repayment or pro-forma rental payments on in-place leases that are currently in initial rent abatement periods. Included in New York tri-state multifamily loans in the tables above is approximately $106 million of rent regulated exposure as of December 31, 2025.
Further discussion of factors impacting the net interest margin for the year ended December 31, 2024 compared to the year ended December 31, 2023 follows: • The tax-equivalent yield on loans increased to 5.78% for the year ended December 31, 2024, from 5.42% for the year ended December 31, 2023 .
Further discussion of factors impacting the net interest margin for the year ended December 31, 2025 compared to the year ended December 31, 2024 follows: • The tax-equivalent yield on loans decreased to 5.48% for the year ended December 31, 2025, from 5.78% for the year ended December 31, 2024 .
For the year ended December 31, 2024 compared to the year ended December 31, 2023, average NIDDA grew by $148 million while average FHLB advances declined by $2.5 billion. Within interest bearing deposits, there was a shift from generally higher priced time deposits to generally lower priced forms of interest bearing deposits.
For the year ended December 31, 2025 compared to the year ended December 31, 2024, average NIDDA grew by $844 million while average FHLB advances declined by $914 million. Within interest bearing deposits, there was a shift from generally higher priced time deposits to generally lower priced forms of interest bearing deposits.
The following table presents a breakdown of the 1-4 single family residential mortgage portfolio, excluding government insured residential loans, categorized between fixed rate loans and ARMs at the dates indicated (dollars in thousands): December 31, 2024 December 31, 2023 Amortized Cost Percent of Total Amortized Cost Percent of Total Fixed rate loans $ 3,557,649 55 % $ 3,757,442 54 % ARM loans 2,951,273 45 % 3,145,571 46 % $ 6,508,922 100 % $ 6,903,013 100 % 49 Loan Maturities The following table sets forth, as of December 31, 2024, the maturity distribution of our loan portfolio by category, excluding government insured residential loans.
The following table presents a breakdown of the 1-4 single family residential mortgage portfolio, excluding government insured residential loans, categorized between fixed rate loans and ARMs at the dates indicated (dollars in thousands): December 31, 2025 December 31, 2024 Amortized Cost Percent of Total Amortized Cost Percent of Total Fixed rate loans $ 3,298,268 54 % $ 3,557,649 55 % ARM loans 2,793,691 46 % 2,951,273 45 % $ 6,091,959 100 % $ 6,508,922 100 % Loan Maturities The following table sets forth, as of December 31, 2025, the maturity distribution of our loan portfolio by category, excluding government insured residential loans.
The ratio of tangible common equity/tangible assets increased to 7.8%. The charts below present the Company's and the Bank's regulatory capital ratios at the dates indicated: BankUnited, Inc. December 31, 2024 December 31, 2023 33 BankUnited, N.A.
The ratio of tangible common equity to tangible assets increased to 8.5%. The charts below represent the Company's and the Bank's regulatory capital ratios at the dates indicated: BankUnited, Inc. December 31, 2025 December 31, 2024 BankUnited, N.A.
Resolution of these loans is generally accomplished through the re-securitization and sale of the loans after they re-perform, either through modification or self-cure, or through pursuit of the applicable guarantee. Operating lease equipment, net Operating lease equipment, net totaled $224 million and $372 million at December 31, 2024 and 2023, respectively.
Resolution of these loans is generally accomplished through the re-securitization and sale of the loans after they re-perform, either through modification or self-cure, or through pursuit of the applicable guarantee. Operating lease equipment, net Operating lease equipment, net totaled $171 million and $224 million at December 31, 2025 and 2024, respectively, consisting primarily of railcars and other transportation equipment.
Residential mortgages The following table shows the composition of residential loans at the dates indicated (in thousands): December 31, 2024 December 31, 2023 1-4 single family residential $ 6,508,922 $ 6,903,013 Government insured residential 1,071,892 1,306,014 $ 7,580,814 $ 8,209,027 The 1-4 single family residential loan portfolio, excluding government insured residential loans, is primarily comprised of prime jumbo loans purchased through established correspondent channels. 1-4 single family residential mortgage loans are primarily closed-end, first lien jumbo mortgages for the purchase or re-finance of owner occupied property.
Residential mortgages The following table shows the composition of residential loans at the dates indicated (in thousands): December 31, 2025 December 31, 2024 1-4 single family residential $ 6,091,959 $ 6,508,922 Government insured residential 891,041 1,071,892 $ 6,983,000 $ 7,580,814 The 1-4 single family residential loan portfolio, excluding government insured residential loans, is primarily comprised of prime jumbo loans purchased through established correspondent channels. 1-4 single family residential mortgage loans are primarily closed-end, first lien jumbo mortgages for the purchase or re-finance of owner occupied property.
We remain committed to keeping the duration of our securities portfolio short; relatively short effective portfolio duration helps mitigate interest rate risk. T he estimated effective duration of the investment portfolio was 1.85 years and the estimated weighted average life of the portfolio was 5.6 years as of December 31, 2024. Approximately 69% of the securities portfolio is floating rate.
We remain committed to keeping the duration of our securities portfolio short; relatively short effective portfolio duration helps mitigate interest rate risk. T he estimated effective duration of the investment portfolio was 1.73 years and the estimated weighted average life of the portfolio was 5.1 years as of December 31, 2025.
Our liquidity management framework incorporates a robust contingency funding plan and liquidity stress test. 64 The following tables present some of the Company's liquidity measures, where applicable, their related policy limits and operating risk thresholds at the dates indicated: December 31, 2024 Policy Limit Available liquidity to uninsured/non-collateralized deposits 150% Wholesale funding/total assets 25.7% December 31, 2024 Operating Threshold Available operational liquidity/volatile liabilities 2.52x ≥1.30x Liquidity stress test coverage ratio 2.14x ≥1.50x FHLB advances/total assets 10.9% ≤20% One year liquidity ratio 2.85x ≥1.00x Loan to deposit ratio 87.2% ≤100% Top 20 uninsured depositors to total deposits (excluding brokered & municipal deposits) 13.4% ≤15% Available on-balance sheet liquidity 8.9% ≥5% As a holding company, BankUnited, Inc. is a corporation separate and apart from its banking subsidiary, and therefore, provides for its own liquidity.
Our liquidity management framework incorporates a robust contingency funding plan and liquidity stress testing framework. 59 The following tables present some of the Company's liquidity measures, where applicable, their related policy limits and operating risk thresholds at the dates indicated: December 31, 2025 Policy Limit Wholesale funding/total assets 20.0% December 31, 2025 Operating Threshold Available operational liquidity/volatile liabilities 2.77x ≥1.30x Liquidity stress test coverage ratio 2.31x ≥1.50x One year liquidity ratio 3.47x ≥1.00x Loan to deposit ratio 82.7% ≤100% Top 20 uninsured depositors to total deposits (excluding brokered & municipal deposits) 11.2% ≤15% Available on-balance sheet liquidity 8.2% ≥5% Available liquidity to uninsured/non-collateralized deposits 138% ≥100% As a holding company, BankUnited, Inc. is a corporation separate and apart from its banking subsidiary, and therefore, provides for its own liquidity.
Homogenous groups of smaller balance commercial loans may be monitored collectively. The credit quality and risk rating of commercial loans as well as our underwriting and portfolio management practices are regularly reviewed by our internal independent credit review department. We believe internal risk rating is the best indicator of the credit quality of commercial loans.
The credit quality and risk rating of commercial loans as well as our underwriting and portfolio management practices are regularly reviewed by our internal independent credit review department. We believe internal risk rating is the best indicator of the credit quality of commercial loans.
Some of the high-level data points informing the baseline scenario, which was the scenario most heavily weighted, used in estimating the quantitative portion of the ACL at December 31, 2024, included: • Labor market assumptions, which reflected national unemployment peaking at 4.2% and • Annualized growth in national GDP troughing at 1.5%.
Some of the high-level data points informing the baseline scenario used in estimating the quantitative portion of the ACL at December 31, 2025, included: • Labor market assumptions, which reflected national unemployment peaking at 4.8% and • Annualized growth in national GDP averaging 2.1%.
The following table presents information about the contractual balance and maturities of outstanding FHLB advances, as of December 31, 2024 (dollars in thousands): Amount Weighted Average Rate Maturing in: 2025 - One month or less $ 2,500,000 4.53 % 2025 - Over one month 430,000 4.60 % Total contractual balance outstanding $ 2,930,000 The table above reflects contractual maturities of outstanding advances and does not incorporate the impact that interest rate swaps designated as cash flow hedges have on the duration or cost of borrowings.
The following table presents information about the contractual balance and maturities of outstanding FHLB advances, as of December 31, 2025 (dollars in thousands): Amount Weighted Average Rate Maturing in: 2026 - One month or less $ 1,475,000 3.81 % 2026 - Over one month 80,000 3.81 % Total contractual balance outstanding $ 1,555,000 The table above reflects contractual maturities of outstanding advances and does not incorporate the impact that interest rate swaps designated as cash flow hedges have on the duration or cost of borrowings.
The following charts present information about the 1-4 single family residential portfolio, excluding government insured loans, by FICO distribution, LTV distribution and vintage at December 31, 2024: FICO Distribution LTV Distribution Vintage The following graph presents delinquency trends for residential loans, excluding government insured residential loans, over the periods indicated (in millions): Residential Delinquencies FICO scores are generally updated semi-annually and were most recently updated in the third quarter of 2024.
We also consider original LTV and most recently available FICO score to be significant indicators of credit quality for the 1-4 single family residential portfolio, excluding government insured residential loans. 51 The following charts present information about the 1-4 single family residential portfolio, excluding government insured loans, by FICO distribution, LTV distribution and vintage at December 31, 2025: FICO Distribution LTV Distribution Vintage The following graph presents delinquency trends for residential loans, excluding government insured residential loans, over the periods indicated (in millions): Residential Delinquencies FICO scores are generally updated semi-annually and were most recently updated in the third quarter of 2025.
Loans with LTVs higher than 80% may be extended to selected credit-worthy borrowers. We perform due diligence on the purchased loans for credit, compliance, counterparty, payment history and property valuation. We have a dedicated residential credit risk management function, and the residential portfolio is monitored by our internal credit review function. Residential mortgage loans are not individually risk rated.
We perform due diligence on the purchased loans for credit, compliance, counterparty, payment history and property valuation. We have a dedicated residential credit risk management function, and the residential portfolio is monitored by our internal credit review function. Residential mortgage loans are not individually risk rated.
Interest rate derivatives designated as cash flow or fair value hedging instruments are tools we may use to manage interest rate risk. These derivative instruments are used to mitigate exposure to changes in interest cash flows or the fair value of financial instruments caused by fluctuations in benchmark interest rates, as well as to manage duration of liabilities.
These derivative instruments are used to mitigate exposure to changes in interest cash flows or the fair value of financial instruments caused by fluctuations in benchmark interest rates, as well as to manage duration of liabilities.
We regularly engage with bond managers to monitor trends in underlying collateral, including potential downgrades and subsequent cash flow diversions, liquidity, ratings migration, and any other relevant developments. We do not intend to sell securities in significant unrealized loss positions at December 31, 2024.
We regularly engage with bond managers to monitor trends in underlying collateral, including potential downgrades and subsequent cash flow diversions, liquidity, ratings migration, and any other relevant developments. We have not sold, and do not anticipate the need to sell, securities in unrealized loss positions to generate liquidity.
We believe we have now identified the population of potential problem CRE office loans. 51 The following table provides additional information about special mention and substandard accruing loans at the dates indicated (dollars in thousands). All of these loans are performing. Non-performing loans are discussed further in the section entitled "Non-performing Assets" below.
The following table provides additional information about special mention and substandard accruing loans at the dates indicated (dollars in thousands). All of these loans are performing. Non-accrual loans are discussed further in the section entitled "Non-performing Assets" below.
Total deposits grew by $1.3 billion and non-brokered deposits grew by $1.4 billion during the year ended December 31, 2024.
Total deposits grew by $1.5 billion and non-brokered deposits grew by $1.8 billion during the year ended December 31, 2025.
We are strategically focused on reducing the level of brokered deposits in the future. 60 The following graph presents trends in the deposit mix and cost of deposits (in millions): Quarterly cost of deposits 1.48% 0.43% 0.19% 1.42% 2.96% 2.72% Non-interest bearing as a % of total deposits 17.6% 25.5% 30.5% 29.2% 25.8% 27.3% Non-interest bearing demand deposits grew by 11%, or $781 million during the year ended December 31, 2024.
We are strategically focused on reducing the level of brokered deposits in the future. 56 The following graph presents trends in the deposit mix and cost of deposits (in millions): Quarterly average cost of deposits 2.18% 2.72% 2.96% Non-interest bearing as a % of total deposits 31.0% 27.3% 25.8% Spot average APY of total deposits 2.1% 2.6% 3.2% Non-interest bearing demand deposits grew by 20%, or $1.5 billion during the year ended December 31, 2025.
The Company is not the servicer of these loans. 48 The following charts present the distribution of the 1-4 single family residential mortgage portfolio by product type at the dates indicated: December 31, 2024 December 31, 2023 See Note 4 to the consolidated financial statements for information about the geographic distribution of the 1-4 single family residential portfolio.
The balance of Buyout Loans totaled $858 million at December 31, 2025. 46 The following charts present the distribution of the 1-4 single family residential mortgage portfolio by product type at the dates indicated: December 31, 2025 December 31, 2024 See Note 4 to the consolidated financial statements for information about the geographic distribution of the 1-4 single family residential portfolio.
The most significant estimate impacting the Company's financial statements is the ACL. Accounting policies are an integral part of our financial statements. A thorough understanding of these accounting policies is essential when reviewing our reported results of operations and our financial position.
Use of alternative assumptions may have resulted in significantly different estimates. Actual results may differ from these estimates. The most significant estimate impacting the Company's financial statements is the ACL. Accounting policies are an integral part of our financial statements. A thorough understanding of these accounting policies is essential when reviewing our reported results of operations and our financial position.
The loan-to-deposit ratio improved to 87.2% at December 31, 2024 from 92.8% at December 31, 2023. 39 Investment Securities The following table shows the amortized cost and carrying value, which, with the exception of investment securities held to maturity, is fair value, of investment securities at the dates indicated (in thousands): December 31, 2024 December 31, 2023 Amortized Cost Carrying Value Amortized Cost Carrying Value U.S.
The loan-to-deposit ratio was 82.7% at December 31, 2025 compared to 87.2% at December 31, 2024. 39 Investment Securities The following table shows the amortized cost and carrying value, which is fair value, of investment securities at the dates indicated (in thousands): December 31, 2025 December 31, 2024 Amortized Cost Carrying Value Amortized Cost Carrying Value U.S.
The majority of our investment securities are classified within level 2 of the fair value hierarchy. U.S. Treasury securities and marketable equity securities are classified within level 1 of the hierarchy.
The substantial majority of our investment securities are eligible to be pledged at either the FHLB or FRB. The majority of our investment securities are classified within level 2 of the fair value hierarchy. U.S. Treasury securities and marketable equity securities are classified within level 1 of the hierarchy.
Interest income, yields, spread and margin have been calculated on a tax-equivalent basis for loans and investment securities that are exempt from federal income taxes, at a federal tax rate of 21% (dollars in thousands): Years Ended December 31, 2024 2023 2022 Average Balance Interest (1) Yield/ Rate (1) Average Balance Interest (1) Yield/ Rate (1) Average Balance Interest (1) Yield/ Rate (1) Loans $ 24,269,787 $ 1,402,132 5.78 % $ 24,558,430 $ 1,331,578 5.42% $ 23,937,857 $ 947,386 3.96 % Investment securities (2) 9,064,521 501,006 5.53 % 9,228,718 491,851 5.33% 10,081,701 283,081 2.81 % Other interest earning assets 745,885 37,553 5.03 % 986,186 51,152 5.19% 675,068 15,709 2.33 % Total interest earning assets 34,080,193 1,940,691 5.69 % 34,773,334 1,874,581 5.39% 34,694,626 1,246,176 3.59 % Allowance for credit losses (224,673) (171,618) (132,033) Non-interest earning assets 1,502,205 1,749,981 1,721,570 Total assets $ 35,357,725 $ 36,351,697 $ 36,284,163 Liabilities and Stockholders' Equity: Interest bearing liabilities: Interest bearing demand deposits $ 4,077,852 $ 152,809 3.75 % $ 2,905,968 $ 86,759 2.99 % $ 2,538,906 $ 13,919 0.55 % Savings and money market deposits 11,043,510 451,352 4.09 % 10,704,470 382,432 3.57 % 12,874,240 130,705 1.02 % Time deposits 4,757,675 211,411 4.44 % 5,169,458 191,114 3.70 % 3,338,671 35,348 1.06 % Total interest bearing deposits 19,879,037 815,572 4.10 % 18,779,896 660,305 3.52 % 18,751,817 179,972 0.96 % Short-term borrowings — — — % 35,403 1,611 4.55 % 157,979 2,723 1.72 % FHLB advances 3,823,579 158,750 4.15 % 6,331,685 285,026 4.50 % 4,383,507 97,763 2.23 % Notes and other borrowings 709,422 36,528 5.15 % 716,633 36,835 5.14 % 721,223 37,033 5.13 % Total interest bearing liabilities 24,412,038 1,010,850 4.14 % 25,863,617 983,777 3.80 % 24,014,526 317,491 1.32 % Non-interest bearing demand deposits 7,239,161 7,091,029 8,861,111 Other non-interest bearing liabilities 968,163 848,023 708,473 Total liabilities 32,619,362 33,802,669 33,584,110 Stockholders' equity 2,738,363 2,549,028 2,700,053 Total liabilities and stockholders' equity $ 35,357,725 $ 36,351,697 $ 36,284,163 Net interest income $ 929,841 $ 890,804 $ 928,685 Interest rate spread 1.55 % 1.59 % 2.27 % Net interest margin 2.73 % 2.56 % 2.68 % (1) On a tax-equivalent basis where applicable.
Interest income, yields, spread and margin have been calculated on a tax-equivalent basis for loans and investment securities that are exempt from federal income taxes, at a federal tax rate of 21% (dollars in thousands): Years Ended December 31, 2025 2024 2023 Average Balance Interest (1) Yield/ Rate (1) Average Balance Interest (1) Yield/ Rate (1) Average Balance Interest (1) Yield/ Rate (1) Loans $ 23,765,232 $ 1,302,438 5.48 % $ 24,269,787 $ 1,402,132 5.78% $ 24,558,430 $ 1,331,578 5.42% Investment securities (2) 9,362,652 472,331 5.04 % 9,064,521 501,006 5.53% 9,228,718 491,851 5.33% Other interest earning assets 783,417 31,878 4.07 % 745,885 37,553 5.03% 986,186 51,152 5.19% Total interest earning assets 33,911,301 1,806,647 5.33 % 34,080,193 1,940,691 5.69% 34,773,334 1,874,581 5.39% Allowance for credit losses (226,362) (224,673) (171,618) Non-interest earning assets 1,380,186 1,502,205 1,749,981 Total assets $ 35,065,125 $ 35,357,725 $ 36,351,697 Liabilities and Stockholders' Equity: Interest bearing liabilities: Interest bearing demand deposits $ 5,473,316 $ 180,918 3.31 % $ 4,077,852 $ 152,809 3.75 % $ 2,905,968 $ 86,759 2.99 % Savings and money market deposits 10,305,664 341,042 3.31 % 11,043,510 451,352 4.09 % 10,704,470 382,432 3.57 % Time deposits 3,804,507 142,375 3.74 % 4,757,675 211,411 4.44 % 5,169,458 191,114 3.70 % Total interest bearing deposits 19,583,487 664,335 3.39 % 19,879,037 815,572 4.10 % 18,779,896 660,305 3.52 % Short-term borrowings — — — % — — — % 35,403 1,611 4.55 % FHLB advances 2,909,589 111,126 3.82 % 3,823,579 158,750 4.15 % 6,331,685 285,026 4.50 % Notes and other borrowings 571,046 29,752 5.21 % 709,422 36,528 5.15 % 716,633 36,835 5.14 % Total interest bearing liabilities 23,064,122 805,213 3.49 % 24,412,038 1,010,850 4.14 % 25,863,617 983,777 3.80 % Non-interest bearing demand deposits 8,083,605 7,239,161 7,091,029 Other non-interest bearing liabilities 931,540 968,163 848,023 Total liabilities 32,079,267 32,619,362 33,802,669 Stockholders' equity 2,985,858 2,738,363 2,549,028 Total liabilities and stockholders' equity $ 35,065,125 $ 35,357,725 $ 36,351,697 Net interest income $ 1,001,434 $ 929,841 $ 890,804 Interest rate spread 1.84 % 1.55 % 1.59 % Net interest margin 2.95 % 2.73 % 2.56 % (1) On a tax-equivalent basis where applicable.
The following table presents information about the Company's non-performing loans and non-performing assets at the dates indicated (dollars in thousands): December 31, 2024 December 31, 2023 Non-accrual loans: Commercial: Non-owner occupied commercial real estate $ 54,169 $ 290 Construction and land 31,758 — Owner occupied commercial real estate 3,803 289 Commercial and industrial 92,475 33,941 Franchise and equipment finance 6,010 23,678 Guaranteed portion of SBA 34,328 41,756 Non-guaranteed portion of SBA 4,071 5,984 Total commercial loans 226,614 105,938 Residential 23,500 20,513 Total non-accrual loans 250,114 126,451 Loans past due 90 days and still accruing 593 593 Total non-performing loans 250,707 127,044 OREO and other non-performing assets 5,482 3,536 Total non-performing assets $ 256,189 $ 130,580 Non-performing loans to total loans 1.03 % 0.52 % Non-performing loans, excluding the guaranteed portion of non-accrual SBA loans, to total loans 0.89 % 0.35 % Non-performing assets to total assets 0.73 % 0.37 % Non-performing assets, excluding the guaranteed portion of non-accrual SBA loans, to total assets 0.63 % 0.25 % ACL to total loans 0.92 % 0.82 % Commercial ACL to commercial loans (1) 1.37 % 1.29 % ACL to non-performing loans 89.01 % 159.54 % Net charge-offs to average loans 0.16 % 0.09 % (1) For purposes of this ratio, commercial loans includes the C&I and CRE sub-segments, as well as franchise and equipment finance.
The following table presents information about the Company's non-performing loans and non-performing assets at the dates indicated (dollars in thousands): December 31, 2025 December 31, 2024 Non-accrual loans: Commercial: Non-owner occupied commercial real estate $ 67,348 $ 54,169 Construction and land 29,662 31,758 Owner occupied commercial real estate 23,706 3,803 Commercial and industrial 187,068 92,475 Franchise and equipment finance 2,516 6,010 Guaranteed portion of SBA 37,926 34,328 Non-guaranteed portion of SBA 1,516 4,071 Total commercial loans 349,742 226,614 Residential 22,876 23,500 Total non-accrual loans 372,618 250,114 Loans past due 90 days and still accruing — 593 Total non-performing loans 372,618 250,707 OREO and other non-performing assets 4,829 5,482 Total non-performing assets $ 377,447 $ 256,189 Non-performing loans to total loans 1.54 % 1.03 % Non-performing loans, excluding the guaranteed portion of non-accrual SBA loans, to total loans 1.38 % 0.89 % Non-performing assets to total assets 1.08 % 0.73 % Non-performing assets, excluding the guaranteed portion of non-accrual SBA loans, to total assets 0.97 % 0.63 % ACL to total loans 0.91 % 0.92 % Commercial ACL to commercial loans (1) 1.30 % 1.37 % ACL to non-performing loans 58.99 % 89.01 % Net charge-offs to average loans 0.30 % 0.16 % (1) For purposes of this ratio, commercial loans includes the C&I and CRE sub-segments, as well as franchise and equipment finance.
This increase resulted primarily from the reset of coupon rates on variable rate securities, purchases of higher-yielding securities and paydowns and sales of lower-yielding securities. 37 • The average cost of interest bearing deposits increased to 4.10% for the year ended December 31, 2024, from 3.52% for the year ended December 31, 2023.
This decrease resulted primarily from the reset of coupon rates on variable rate securities. 37 • The average cost of interest bearing deposits decreased to 3.39% for the year ended December 31, 2025, from 4.10% for the year ended December 31, 2024.
Some of the more significant assumptions used by the Company in estimating the impact of changes in interest rates on forecasted net interest income and EVE at December 31, 2024 were: • Prepayment speeds for loans, with CPRs ranging from 6.6% to 11.5% depending on loan characteristics and the magnitude of the modeled rate shock; • Prepayment speeds for investment securities, with CPRs ranging from 4.3% to 7.7% depending on individual security collateral and characteristics and the magnitude of the modeled rate shock; • Deposit decay rates ranging between 16% and 19%; • Overall non-maturity interest bearing deposit beta of 75%; Derivative Financial Instruments and Hedging Activities Management continually evaluates a variety of hedging strategies that are available to manage interest rate risk.
Some of the more significant assumptions used by the Company in estimating the impact of changes in interest rates on forecasted net interest income and EVE at December 31, 2025 were: • Prepayment speeds for loans, with CPRs ranging from 5.6% to 12.03% depending on loan characteristics and the magnitude of the modeled rate shock; • Prepayment speeds for investment securities, with CPRs ranging from 5.24% to 13.5% depending on individual security collateral and characteristics and the magnitude of the modeled rate shock; • Deposit decay rates ranging between 10.8% and 16.4%, depending on the magnitude of the modeled rate shock; and • Overall non-maturity interest bearing deposit beta of 80%.
Non-Performing Loans to Total Loans Non-Performing Assets to Total Assets Net Charges-Offs to Average Loans The following graph presents the trend in non-performing loans by portfolio segment over the periods indicated (in millions): Commercial loans are placed on non-accrual status when (i) management has determined that full repayment of all contractual principal and interest is in doubt, or (ii) the loan is past due 90 days or more as to principal or interest unless the loan is well secured and in the process of collection.
The following charts present non-performing CRE loans by property type at the dates indicated (in millions): December 31, 2025 December 31, 2024 Commercial loans are placed on non-accrual status when (i) management has determined that full repayment of all contractual principal and interest is in doubt, or (ii) the loan is past due 90 days or more as to principal or interest unless the loan is well secured and in the process of collection.
At December 31, 2024, the ratio of estimated insured and collateralized deposits to total deposits was 63%, compared to 66% at December 31, 2023, and the ratio of available liquidity to estimated uninsured, uncollateralized deposits was 150% compared to 152% at December 31, 2023.
At December 31, 2025, the ratio of estimated insured and collateralized deposits to total deposits was 59% and the ratio of available liquidity to estimated uninsured, uncollateralized deposits was 138%.
The following chart provides a comparison of net interest margin, the average yield on interest earning assets and the average rate paid on interest bearing liabilities for the years ended December 31, 2024 and 2023 (on tax equivalent basis): ◦ Consistent with industry trends, higher prevailing interest rates and restrictive monetary policy, the average cost of total deposits increased by 0.46% to 3.01% for the year ended December 31, 2024, from 2.55% for the year ended December 31, 2023, although the average cost of deposits has declined over the latter half of the year.
The following chart provides a comparison of net interest margin, the average yield on interest earning assets, and the average rate on interest bearing liabilities for the years ended December 31, 2025 and 2024 (on a tax equivalent basis): • The average cost of total deposits declined by 0.61% to 2.40% for the year ended December 31, 2025, from 3.01% for the year ended December 31, 2024.
The decrease in deposit insurance expense was primarily attributable to a $35.4 million FDIC special assessment incurred during the year ended December 31, 2023. An additional $5.2 million FDIC special assessment was incurred during the year ended December 31, 2024.
The decrease in deposit insurance expense was primarily attributable to a $5.2 million FDIC special assessment incurred during the year ended December 31, 2024. A lower base assessment rate for the year ended December 31, 2025 compared to the year ended December 31, 2024, also contributed to the decline in deposit insurance expense.
At December 31, 2024, the ratio of the ACL to loans was 0.92% compared to 0.82% at December 31, 2023. The ACL to loans ratio for commercial portfolio sub-segments including C&I, CRE, and franchise and equipment finance was 1.37% at December 31, 2024, up from 1.29% at December 31, 2023.
At December 31, 2025, the ratio of the ACL to loans was 0.91%, compared to 0.92% at December 31, 2024. The commercial ACL ratio, inclusive of C&I, CRE, and franchise and equipment finance was 1.30% at December 31, 2025 compared to 1.37% at December 31, 2024.
The unrealized losses resulted primarily from a sustained period of higher interest rates, and in some cases, wider spreads compared to the levels at which securities were purchased.
Investment securities available for sale in unrealized loss positions at December 31, 2025 had an aggregate fair value of $4.4 billion. The unrealized losses resulted primarily from a sustained period of higher interest rates, and in some cases, wider spreads compared to the levels at which securities were purchased.
Overall CRE exposure is modest in comparison to peer banks as presented in the charts below: CRE / Total Loans (1)(2) CRE / Total Risk Based Capital (1)(2) (1) BKU information as of December 31, 2024 (2) CRE peer median information based on September 30, 2024 Call Report data for banks with total assets between $10 billion and $100 billion 44 The following tables present the distribution of commercial real estate loans by property type, along with weighted average DSCRs and LTVs at the dates indicated (dollars in thousands): December 31, 2024 Amortized Cost Percent of Total CRE FL New York Tri-State Other Weighted Average DSCR Weighted Average LTV Office $ 1,769,344 28 % 57 % 23 % 20 % 1.57 65.2 % Warehouse/Industrial 1,374,738 22 % 54 % 8 % 38 % 1.83 47.2 % Multifamily 838,341 13 % 51 % 49 % — % 2.01 50.1 % Retail 1,098,314 19 % 49 % 29 % 22 % 1.73 57.3 % Hotel 482,378 8 % 79 % 9 % 12 % 1.84 44.7 % Construction and Land 561,989 9 % 36 % 47 % 17 % N/A N/A Other 89,088 1 % 74 % 11 % 15 % 1.93 46.9 % $ 6,214,192 100 % 54 % 25 % 21 % 1.76 55.0 % December 31, 2023 Amortized Cost Percent of Total CRE FL New York Tri-State Other Weighted Average DSCR Weighted Average LTV Office $ 1,752,801 30 % 60 % 24 % 16 % 1.67 65.0 % Warehouse/Industrial 1,341,229 24 % 56 % 8 % 36 % 2.04 52.0 % Multifamily 838,692 14 % 50 % 50 % — % 1.98 45.5 % Retail 818,409 14 % 54 % 29 % 17 % 1.67 58.8 % Hotel 491,853 8 % 78 % 3 % 19 % 1.89 49.0 % Construction and Land 495,992 9 % 56 % 42 % 2 % N/A N/A Other 80,257 1 % 71 % 13 % 16 % 1.94 47.4 % $ 5,819,233 100 % 58 % 25 % 17 % 1.80 56.0 % The geographic mix of the portfolio has remained relatively consistent year-over-year, with the majority in Florida, although the geographic distribution has become somewhat more diverse with the percentage outside of Florida and the New York tri-state market growing.
Overall CRE exposure is modest in comparison to peer banks as presented in the charts below: CRE / Total Loans (1) CRE / Total Risk Based Capital (1) (1) Call Report data for banks with total assets between $10 billion and $100 billion The following tables present the distribution of commercial real estate loans by property type, along with weighted average DSCRs and LTVs at the dates indicated (dollars in thousands): December 31, 2025 Amortized Cost Percent of Total CRE FL New York Tri-State Other Weighted Average DSCR Weighted Average LTV Office $ 1,426,728 21 % 61 % 20 % 19 % 1.70 64.8 % Warehouse/Industrial 1,562,342 23 % 47 % 7 % 46 % 1.86 48.2 % Multifamily 943,851 14 % 48 % 44 % 8 % 1.91 52.2 % Retail 1,543,815 23 % 38 % 25 % 37 % 1.80 58.8 % Hotel 483,267 7 % 78 % 10 % 12 % 1.62 46.9 % Construction and Land 705,664 10 % 30 % 34 % 36 % N/A N/A Other 145,204 2 % 49 % 2 % 49 % 2.96 47.0 % $ 6,810,871 100 % 48 % 22 % 30 % 1.82 55.3 % December 31, 2024 Amortized Cost Percent of Total CRE FL New York Tri-State Other Weighted Average DSCR Weighted Average LTV Office $ 1,769,344 28 % 57 % 23 % 20 % 1.57 65.2 % Warehouse/Industrial 1,374,738 22 % 54 % 8 % 38 % 1.83 47.2 % Multifamily 838,341 13 % 51 % 49 % — % 2.01 50.1 % Retail 1,098,314 19 % 49 % 29 % 22 % 1.73 57.3 % Hotel 482,378 8 % 79 % 9 % 12 % 1.84 44.7 % Construction and Land 561,989 9 % 36 % 47 % 17 % N/A N/A Other 89,088 1 % 74 % 11 % 15 % 1.93 46.9 % $ 6,214,192 100 % 54 % 25 % 21 % 1.76 55.0 % 43 Geographic distribution in the table above is based on location of the underlying collateral property.
See "Item 1A - Risk Factors" for additional discussion of risks to the execution of our strategic priorities. 2024 Performance Highlights: In evaluating our financial performance, we consider improvement in the funding mix and the composition of earning assets, the level of and trends in net interest income and the net interest margin, the cost of deposits, trends in non-interest income and non-interest expense, performance ratios such as the return on average equity and return on average assets and asset quality ratios, including the ratio of non-performing loans to total loans, non-performing assets to total assets, trends in criticized and classified assets and portfolio delinquency and charge-off trends.
Overview 2025 Performance Highlights In evaluating our financial performance, we consider (i) the funding mix and the composition of interest earning assets; (ii) the level of and trends in net interest income and the net interest margin; (iii) the cost of deposits, trends in non-interest income and non-interest expense; (iv) performance ratios such as the return on average equity and return on average assets and trends in those metrics; and (v) asset quality metrics, including the level of criticized and classified assets, the ratios of non-performing loans to total loans and non-performing assets to total assets, delinquency and net charge-off rates, as well as trends in those metrics.
Pinnacle provides essential-use equipment financing to state and local governmental entities on a national basis directly and through vendor programs and alliances, offering a full array of financing structures including equipment lease purchase agreements and direct (private placement) bond re-fundings and loan agreements. 47 The franchise and equipment finance portfolio is comprised of loans originated by Bridge including (i) franchise acquisition, expansion and equipment financing facilities and (ii) transportation equipment finance.
The Pinnacle portfolio consists of essential-use equipment financing to state and local governmental entities on a national basis directly and through vendor programs and alliances, with financing structures including equipment lease purchase agreements, direct (private placement) bond re-fundings and loan agreements.
BankUnited, Inc.’s main sources of funds include management fees and dividends from the Bank, access to capital markets and, to a lesser extent, its own securities portfolio. There are regulatory limitations that may affect the ability of the Bank to pay dividends to BankUnited, Inc.
BankUnited, Inc.’s main sources of funds include management fees and dividends from the Bank and access to capital markets. There are regulatory limitations that may affect the ability of the Bank to pay dividends to BankUnited, Inc. Management believes that such limitations will not impact our ability to meet our ongoing cash obligations.
Our strategic priorities, focused on improving core profitability, include: • Grow core customer relationships on both sides of the balance sheet; • Continue to improve the funding profile - growth in core deposit relationships is paramount: ◦ Grow NIDDA as a percentage of total deposits ◦ Pay down high-cost wholesale borrowings; • Improve the asset mix, transitioning to a mix of assets with higher risk-adjusted returns: ◦ As lower-yielding residential mortgages amortize and pay off, replace them with higher yielding core C&I and CRE loans within established risk parameters ◦ Continue to de-emphasize the BFG and Pinnacle portfolios; • Play where we can win, focusing on sectors where our delivery model is a differentiator; • Innovate with solutions that solve customer pain points; • Invest in organic growth capabilities - people, processes, products and technology - while managing expense growth; • Prioritize nimble technology architecture and digital capabilities; • Retain the ability to pivot nimbly when opportunities arise; • Maintain robust liquidity and capital levels; • Continue to closely monitor and manage credit; • While our primary growth strategy is organic, we will continue to monitor the M&A landscape.
Our strategic priorities, focused on improving core profitability, include: • Grow core customer relationships on both sides of the balance sheet; • Continue to improve the funding profile - growth in core deposit relationships is paramount: ◦ Grow NIDDA particularly in national deposit verticals, middle-market and small business; ◦ Invest in payments technology and leverage treasury solutions to enhance deposit acquisition and promote customer retention; • Improve the asset mix, transitioning to a mix of assets with higher risk-adjusted returns: ◦ Rebalance the loan portfolio toward higher-yielding commercial lending as lower-yielding residential loans roll off, driving NIM expansion through mix shift; ◦ Continue to de-emphasize the BFG portfolio; • Focus on key markets and geographies, specifically Florida, Texas, Georgia and New Jersey; • Play where we can win, focusing on sectors where our delivery model is a differentiator; • Innovate with solutions that solve customer pain points; • Invest in organic growth capabilities - people, processes, products and technology - while managing expense growth; • Prioritize nimble technology architecture and digital capabilities; • Retain the ability to pivot nimbly when opportunities arise; • Maintain robust liquidity and capital levels, while returning excess capital to shareholders as appropriate; • Continue to closely monitor and manage credit; • While our primary growth strategy is organic, we will continue to monitor the M&A landscape.
Non-GAAP Financial Measures Tangible book value per common share is a non-GAAP financial measure. Management believes this measure is relevant to understanding the capital position and performance of the Company. Disclosure of this non-GAAP financial measure also provides a meaningful basis for comparison to other financial institutions as it is a metric commonly used in the banking industry.
Disclosure of this non-GAAP financial measure also provides a meaningful basis for comparison to other financial institutions as it is a metric commonly used in the banking industry. PPNR is a non-GAAP financial measure.
The decline in depreciation of operating lease equipment for the year ended December 31, 2024 was primarily attributable to the continued decline in the size of the operating lease equipment portfolio as discussed above.
The decline in depreciation of operating lease equipment for the year ended December 31, 2025 was primarily attributable to the continued decline in the size of the operating lease equipment portfolio as discussed above. Other non-interest expense for the year ended December 31, 2025 included $3.8 million of write downs of previously capitalized software.
The following table presents the components of the provision for credit losses for the periods indicated (in thousands): Years Ended December 31, 2024 2023 2022 Amount related to funded portion of loans $ 58,986 $ 78,924 $ 73,814 Amount related to off-balance sheet credit exposures (3,914) 8,683 1,467 Other — — (127) Total provision for credit losses $ 55,072 $ 87,607 $ 75,154 The most significant factors impacting the provision for credit losses for the year ended December 31, 2024 included (i) risk rating migration and increases in certain specific reserves; and (ii) an increase in qualitative loss factors, partially offset by an improved economic forecast.
The following table presents the components of the provision for credit losses for the periods indicated (in thousands): Years Ended December 31, 2025 2024 2023 Amount related to funded portion of loans $ 68,351 $ 58,986 $ 78,924 Amount related to off-balance sheet credit exposures (411) (3,914) 8,683 Total provision for credit losses $ 67,940 $ 55,072 $ 87,607 The most significant factor impacting the provision for credit losses for the year ended December 31, 2025 was an increase in specific reserves, partially offset by; (i) changes in portfolio composition and borrower financial performance, (ii) improvements in the economic forecast, and (iii) routine modeling and assumption updates.
At December 31, 2024, the Company had $4.0 billion in term deposits with a contractual maturity of 12 months or less. The majority of term deposits and FHLB advances are expected to roll over into new instruments; this amount therefore does not represent future anticipated cash requirements.
The majority of term deposits and FHLB advances are expected to roll over into new instruments; this amount therefore does not represent future anticipated cash requirements.
There were no impairment charges recognized during the years ended December 31, 2024, 2023, and 2022. 55 Non-Performing Assets Non-performing assets generally consist of (i) non-accrual loans, (ii) accruing loans that are more than 90 days contractually past due as to interest or principal, excluding PCD loans for which management has a reasonable basis for an expectation about future cash flows and government insured residential loans, and (iii) OREO and other non-performing assets.
Note 4 to the consolidated financial statements presents additional information about key credit quality indicators and delinquency status of the loan portfolio. 52 Non-Performing Assets Non-performing assets consist of (i) non-accrual loans, (ii) accruing loans that are more than 90 days contractually past due as to interest or principal, excluding PCD loans for which management has a reasonable basis for an expectation about future cash flows and government insured residential loans, and (iii) OREO and other non-performing assets.
Government agency and sponsored enterprise commercial MBS 557,489 495,753 561,557 497,859 Private label residential MBS and CMOs 2,491,033 2,238,046 2,596,231 2,295,730 Private label commercial MBS 1,822,881 1,784,029 2,282,833 2,198,743 Single family real estate-backed securities 335,047 327,081 383,984 366,255 Collateralized loan obligations 1,131,088 1,132,699 1,122,799 1,112,824 Non-mortgage asset-backed securities 96,865 94,454 106,095 102,780 State and municipal obligations 110,388 104,010 107,176 102,618 SBA securities 74,900 72,702 106,237 103,024 Investment securities held to maturity — — 10,000 10,000 $ 9,507,041 9,101,416 $ 9,379,428 8,844,632 Marketable equity securities 28,828 32,722 $ 9,130,244 $ 8,877,354 Our investment strategy is focused on ensuring adequate liquidity, maintaining a suitable balance of high credit quality, diverse assets, managing interest rate risk, and generating acceptable returns given our established risk parameters.
Government agency and sponsored enterprise commercial MBS 576,295 534,363 557,489 495,753 Private label residential MBS and CMOs 2,683,881 2,490,828 2,491,033 2,238,046 Private label commercial MBS 2,182,983 2,168,110 1,822,881 1,784,029 Single family real estate-backed securities 227,711 225,892 335,047 327,081 Collateralized loan obligations 780,847 780,944 1,131,088 1,132,699 Non-mortgage asset-backed securities 59,942 58,765 96,865 94,454 State and municipal obligations 115,193 109,520 110,388 104,010 SBA securities 59,526 57,815 74,900 72,702 $ 9,525,046 $ 9,257,917 $ 9,507,041 $ 9,101,416 Marketable equity securities 5,734 28,828 $ 9,263,651 $ 9,130,244 Our investment strategy is focused on ensuring adequate liquidity, maintaining a suitable balance of high credit quality, diverse assets, managing interest rate risk, and generating acceptable returns given our established risk parameters.
The following table presents the Company's material contractual cash requirements for the following 12 months, as of December 31, 2024 (in thousands): Term deposits (1) $ 4,044,428 FHLB advances (1) 2,936,657 Notes and other borrowings (1) 425,618 Operating lease obligations 16,852 $ 7,423,555 (1) Includes interest to be paid on the outstanding contractual obligations.
The following table presents the Company's material contractual cash requirements for the following 12 months, as of December 31, 2025 (in thousands): Term deposits (1) $ 3,915,490 FHLB advances (1) 1,558,138 Notes and other borrowings (1) 18,577 Operating lease obligations 17,172 $ 5,509,377 (1) Includes interest to be paid on the outstanding contractual obligations.
Total deposits grew by $1.3 billion and non-brokered deposits grew by $1.4 billion. Average NIDDA increased by $148 million for the year ended December 31, 2024. ◦ Loan portfolio composition shifted from residential to core commercial categories during the year ended December 31, 2024.
Average NIDDA increased by $844 million for the year ended December 31, 2025. • Wholesale funding, including FHLB advances and brokered deposits, declined by $1.7 billion for the year ended December 31, 2025. • Loan portfolio composition continued to shift from residential to core commercial categories during the year ended December 31, 2025.
See Note 6 to the consolidated financial statements for more information about these costs. Income Taxes The provision for income taxes for the years ended December 31, 2024, 2023 and 2022 was $83.9 million, $58.4 million and $90.2 million, respectively. The Company's effective income tax rate was 26.52%, 24.64% and 24.03% for the years ended 2024, 2023 and 2022, respectively.
Income Taxes The provision for income taxes for the years ended December 31, 2025, 2024 and 2023 was $93.4 million , $83.9 million and $58.4 million, respectively. The Company's effective income tax rate was 25.82%, 26.52% and 24.64% for the years ended 2025, 2024 and 2023, respectively.
ACL The ACL represents management's estimate of current expected credit losses, or the amount of amortized cost basis not expected to be collected, on our loan portfolio and the amount of credit loss impairment on our AFS securities portfolio.
ACL The ACL represents management's estimate of current expected credit losses, or the amount of amortized cost basis not expected to be collected, on our loan portfolio. Determining the amount of the ACL is considered a critical accounting estimate because of its complexity and because it requires extensive judgment and estimation.
Our servicers evaluate each residential loan in default to determine the most effective loss mitigation strategy, which may be modification, short sale, or foreclosure, and pursue the alternative most suitable to the consumer and to mitigate losses to the Bank. 56 Analysis of the Allowance for Credit Losses The ACL is management's estimate of the amount of expected credit losses over the life of the loan portfolio, or the amount of amortized cost basis not expected to be collected, at the balance sheet date.
Our servicers evaluate each residential loan in default to determine the most effective loss mitigation strategy, which may be modification, short sale, or foreclosure, and pursue the alternative most suitable to the consumer and to mitigate losses to the Bank.
Management also has the ability to exert substantial control over the rate and timing of loan production, and resultant requirements for liquidity to fund new loans. 63 The following chart presents the components of same day available liquidity at December 31, 2024 and 2023 (in millions): Same Day Available Liquidity The increase in same day available liquidity as compared to December 31, 2023 reflected the decline in outstanding FHLB advances, increasing FHLB capacity.
The following chart presents the components of same day available liquidity at December 31, 2025 and 2024 (in millions): Same Day Available Liquidity The increase in same day available liquidity as compared to December 31, 2024 reflected the decline in outstanding FHLB advances, increasing FHLB capacity.
The ACL to loans ratio for commercial portfolio sub-segments including C&I, CRE, franchise finance and equipment finance was 1.37% at December 31, 2024 and the ACL to loans ratio for CRE office loans was 2.30%. ◦ At December 31, 2024, CET1 was 12.0% and pro-forma CET1, including accumulated other comprehensive income, was 10.9%.
The ratio of the ACL to non-performing loans was 58.99%. The ACL to loans ratio for commercial portfolio sub-segments including C&I, CRE, franchise finance and equipment finance was 1.30% at December 31, 2025 and the ACL to loans ratio for CRE office loans was 2.03%.
The NPA ratio at December 31, 2024 was 0.73%, including 0.10% related to the guaranteed portion of non-performing SBA loans. ◦ The ratio of the ACL to total loans increased to 0.92% at December 31, 2024, from 0.82% at December 31, 2023.
The net charge-off ratio for the year ended December 31, 2025, was 0.30%. The NPA ratio at December 31, 2025 was 1.08%, including 0.11% related to the guaranteed portion of non-performing SBA loans. • The ratio of the ACL to total loans declined to 0.91% at December 31, 2025, from 0.92% at December 31, 2024.
These assumptions form the basis for our judgments about the carrying values of assets and liabilities that are not readily available from independent, objective sources. We evaluate our estimates on an ongoing basis. Use of alternative assumptions may have resulted in significantly different estimates. Actual results may differ from these estimates.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable and appropriate under current circumstances. These assumptions form the basis for our judgments about the carrying values of assets and liabilities that are not readily available from independent, objective sources. We evaluate our estimates on an ongoing basis.
Government agency and sponsored enterprise commercial MBS 4.54 % 4.92 % 2.95 % 2.06 % 3.50 % Private label residential MBS and CMOs 4.00 % 4.23 % 3.76 % 4.01 % 4.02 % Private label commercial MBS 5.68 % 6.14 % 2.35 % 3.29 % 5.80 % Single family real estate-backed securities 4.90 % 3.84 % — % — % 4.33 % Collateralized loan obligations 6.33 % 6.45 % 6.17 % — % 6.33 % Non-mortgage asset-backed securities 3.09 % 5.39 % 2.69 % — % 5.16 % State and municipal obligations 2.26 % 4.34 % 4.07 % — % 4.24 % SBA securities 5.76 % 5.75 % 5.67 % 5.44 % 5.73 % 5.02 % 5.44 % 4.44 % 4.30 % 5.03 % Loans The following table shows the composition of the loan portfolio at the dates indicated (dollars in thousands): December 31, 2024 December 31, 2023 Amortized Cost Percent of Total Loans Amortized Cost Percent of Total Loans Non-owner occupied commercial real estate $ 5,652,203 23.3 % $ 5,323,241 21.6 % Construction and land 561,989 2.3 % 495,992 2.0 % Owner occupied commercial real estate 1,941,004 8.0 % 1,935,743 7.9 % Commercial and industrial 7,042,222 28.9 % 6,971,981 28.3 % Total Core C&I and CRE 15,197,418 62.5 % 14,726,957 59.8 % Pinnacle - municipal finance 720,661 3.0 % 884,690 3.6 % Franchise and equipment finance 213,477 0.9 % 380,347 1.5 % Mortgage warehouse lending 585,610 2.4 % 432,663 1.8 % Total commercial 16,717,166 68.8 % 16,424,657 66.7 % 1-4 single family residential 6,508,922 26.8 % 6,903,013 28.0 % Government insured residential 1,071,892 4.4 % 1,306,014 5.3 % Total residential 7,580,814 31.2 % 8,209,027 33.3 % Total loans 24,297,980 100.0 % 24,633,684 100.0 % Allowance for credit losses (223,153) (202,689) Loans, net $ 24,074,827 $ 24,430,995 Commercial loans and leases Commercial loans include a diverse portfolio of commercial and industrial loans and lines of credit, loans secured by owner-occupied commercial real-estate, income-producing non-owner occupied commercial real estate, a smaller amount of construction loans, SBA loans, mortgage warehouse lines of credit, municipal loans and leases originated by Pinnacle and franchise and equipment finance loans and leases originated by Bridge. 43 The following charts present the distribution of the commercial loan portfolio at the dates indicated (dollars in millions): December 31, 2024 December 31, 2023 Commercial Real Estate: Commercial real estate loans include term loans secured by non-owner occupied income producing properties including rental apartments, industrial properties, retail shopping centers, free-standing single-tenant buildings, medical and other office buildings, warehouse facilities, hotels, and real estate secured lines of credit.
Government agency and sponsored enterprise commercial MBS 4.51 % 3.36 % 3.05 % 2.13 % 3.18 % Private label residential MBS and CMOs 4.13 % 4.47 % 3.66 % 3.85 % 4.08 % Private label commercial MBS 4.63 % 5.41 % 3.42 % 3.21 % 5.21 % Single family real estate-backed securities 1.36 % 4.10 % — % — % 4.08 % Collateralized loan obligations 5.96 % 5.54 % 5.58 % — % 5.55 % Non-mortgage asset-backed securities 3.11 % 4.51 % 2.63 % — % 4.37 % State and municipal obligations 4.29 % 4.39 % 4.34 % — % 4.34 % SBA securities 5.06 % 5.04 % 4.95 % 4.71 % 5.02 % 4.56 % 4.88 % 4.12 % 3.94 % 4.60 % Loans The following table shows the composition of the loan portfolio at the dates indicated (dollars in thousands): December 31, 2025 December 31, 2024 Amortized Cost Percent of Total Loans Amortized Cost Percent of Total Loans Non-owner occupied commercial real estate $ 6,105,207 25.2 % $ 5,652,203 23.3 % Construction and land 705,664 2.9 % 561,989 2.3 % Owner occupied commercial real estate 2,020,572 8.3 % 1,941,004 8.0 % Commercial and industrial 7,008,903 28.8 % 7,042,222 28.9 % Mortgage warehouse lending 728,241 3.0 % 585,610 2.4 % Total core loans 16,568,587 68.2 % 15,783,028 64.9 % Pinnacle - municipal finance 619,374 2.6 % 720,661 3.0 % Franchise and equipment finance 102,746 0.4 % 213,477 0.9 % Total commercial 17,290,707 71.2 % 16,717,166 68.8 % 1-4 single family residential 6,091,959 25.1 % 6,508,922 26.8 % Government insured residential 891,041 3.7 % 1,071,892 4.4 % Total residential 6,983,000 28.8 % 7,580,814 31.2 % Total loans 24,273,707 100.0 % 24,297,980 100.0 % Allowance for credit losses (219,825) (223,153) Loans, net $ 24,053,882 $ 24,074,827 Commercial loans and leases Commercial loans include a diverse portfolio of commercial and industrial loans and lines of credit, loans secured by owner-occupied commercial real-estate, income-producing non-owner occupied commercial real estate, construction loans, SBA loans, mortgage warehouse lines of credit, municipal loans and leases and franchise and equipment finance loans and leases. 42 Commercial Real Estate Commercial real estate loans include term loans secured by non-owner occupied income producing properties including rental apartments, industrial properties, retail shopping centers, free-standing single-tenant buildings, medical and other office buildings, warehouse facilities, hotels, and real estate secured lines of credit.

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