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BKU's Q4 Earnings Beat on Higher NII & Fee Income, Stock Jumps 9%
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Key Takeaways
BKU delivered Q4 adjusted EPS of 94 cents, topping expectations as higher NII and fee income lifted results.
BankUnited benefited from a 22-bp NIM expansion and a 19% jump in non-interest income.
BankUnited reported rising loans and deposits, though provisions and asset quality metrics worsened.
Shares of BankUnited, Inc. (BKU - Free Report) rallied 9% in yesterday’s trading session on better-than-expected quarterly results and upbeat broader market sentiments. The company’s fourth-quarter 2025 adjusted earnings of 94 cents per share surpassed the Zacks Consensus Estimate of 85 cents. Further, the bottom line was up 3.3% from the prior-year quarter.
Results were aided primarily by a rise in non-interest income and net interest income (NII). Higher loan balance and improved deposits were the other positives. However, higher expenses and provisions were the undermining factors.
Quarterly results in the reported quarter excluded a one-time charge related to a write-down on capitalized software. After considering it, net income totaled $69.3 million, marginally down from the year-ago quarter. Our estimate for the metric was $62.9 million.
For 2025, earnings per share of $3.53 beat the Zacks Consensus Estimate of $3.49. The figure represented a rise of 14.6% from the previous year. Net income was $268.4 million, up 15.4% year over year. Our estimate for net income was $262 million.
BankUnited’s Revenues Rise, Expenses Up
Quarterly net revenues were $288.2 million, up 4.5% year over year. The top line beat the Zacks Consensus Estimate of $278.3 million.
For 2025, net revenues were $1.09 billion, up 7.9%. The top line surpassed the Zacks Consensus Estimate of $1.08 billion.
In the reported quarter, NII was $258.2 million, which rose 7.9%. Net interest margin (NIM) expanded 22 basis points (bps) to 3.06%. Our estimates for NII and NIM were $252.3 million and 3.01%, respectively.
Non-interest income of $30 million increased 19% from the prior-year quarter. The increase was mainly driven by higher deposit service charges and fees, capital markets income and other non-interest income. We had projected a non-interest income of $25.5 million.
Non-interest expenses grew 7.7% to $173 million. The rise was due to higher employee compensation and benefits costs and other non-interest expenses, partially offset by lower depreciation of operating lease equipment costs, deposit insurance expense, occupancy and equipment costs and technology costs. Our estimate for non-interest expenses was $172.1 million.
BankUnited’s Loans & Deposits Increase
As of Dec. 31, 2025, total loans were $24.3 billion, up 2.4% from the prior quarter. Total deposits amounted to $29.4 billion, up 2.6% from the previous quarter. Our estimates for total loans and total deposits were $24.3 billion and $29.3 billion, respectively.
BKU’s Credit Quality Worsens
In the reported quarter, BankUnited recorded a provision for credit losses of $25.6 million, up substantially from $11 million in the prior-year quarter. We had expected the metric to be $20 million.
As of Dec. 31, 2025, the ratio of net charge-offs to average loans was 0.30%, up 14 bps year over year. Also, the non-performing assets ratio was 1.08%, up 35 bps.
BKU’s Capital & Profitability Ratios: Mixed Bag
As of Dec. 31, 2025, the Common Equity Tier 1 risk-based capital ratio was 12.3%, up from 12%. The total risk-based capital ratio was 14.1%, same as of Dec. 31, 2024.
At the end of the fourth quarter, the return on average assets was 0.78%, the same as in the year-ago quarter. Return on average stockholders’ equity was 8.9%, down from 9.7%.
Our View on BankUnited Stock
BankUnited’s revenues are expected to be supported by diverse fee income, low-cost deposits, steady loan growth and stabilizing funding cost. However, elevated expenses, significant exposure to commercial real estate and residential loans, and weakening asset quality might affect near-term financials.
BankUnited, Inc. Price, Consensus and EPS Surprise
First Horizon Corporation’s (FHN - Free Report) fourth-quarter 2025 adjusted earnings per share of 52 cents surpassed the Zacks Consensus Estimate of 47 cents. This compares favorably with 43 cents in the year-ago quarter.
FHN’s results benefited from higher NII and a significant rise in non-interest income, along with the absence of provision for credit losses. However, the rise in expenses remains a headwind.
Bank OZK’s (OZK - Free Report) fourth-quarter 2025 earnings per share were $1.53, down 1.9% year over year. The bottom line also missed the Zacks Consensus Estimate of $1.56.
OZK’s results were primarily hurt by higher provisions for credit losses and a rise in operating expenses. Nevertheless, solid NII and non-interest income growth acted as tailwinds. Healthy year-over-year growth in loans and deposits was another positive.
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BKU's Q4 Earnings Beat on Higher NII & Fee Income, Stock Jumps 9%
Key Takeaways
Shares of BankUnited, Inc. (BKU - Free Report) rallied 9% in yesterday’s trading session on better-than-expected quarterly results and upbeat broader market sentiments. The company’s fourth-quarter 2025 adjusted earnings of 94 cents per share surpassed the Zacks Consensus Estimate of 85 cents. Further, the bottom line was up 3.3% from the prior-year quarter.
Results were aided primarily by a rise in non-interest income and net interest income (NII). Higher loan balance and improved deposits were the other positives. However, higher expenses and provisions were the undermining factors.
Quarterly results in the reported quarter excluded a one-time charge related to a write-down on capitalized software. After considering it, net income totaled $69.3 million, marginally down from the year-ago quarter. Our estimate for the metric was $62.9 million.
For 2025, earnings per share of $3.53 beat the Zacks Consensus Estimate of $3.49. The figure represented a rise of 14.6% from the previous year. Net income was $268.4 million, up 15.4% year over year. Our estimate for net income was $262 million.
BankUnited’s Revenues Rise, Expenses Up
Quarterly net revenues were $288.2 million, up 4.5% year over year. The top line beat the Zacks Consensus Estimate of $278.3 million.
For 2025, net revenues were $1.09 billion, up 7.9%. The top line surpassed the Zacks Consensus Estimate of $1.08 billion.
In the reported quarter, NII was $258.2 million, which rose 7.9%. Net interest margin (NIM) expanded 22 basis points (bps) to 3.06%. Our estimates for NII and NIM were $252.3 million and 3.01%, respectively.
Non-interest income of $30 million increased 19% from the prior-year quarter. The increase was mainly driven by higher deposit service charges and fees, capital markets income and other non-interest income. We had projected a non-interest income of $25.5 million.
Non-interest expenses grew 7.7% to $173 million. The rise was due to higher employee compensation and benefits costs and other non-interest expenses, partially offset by lower depreciation of operating lease equipment costs, deposit insurance expense, occupancy and equipment costs and technology costs. Our estimate for non-interest expenses was $172.1 million.
BankUnited’s Loans & Deposits Increase
As of Dec. 31, 2025, total loans were $24.3 billion, up 2.4% from the prior quarter. Total deposits amounted to $29.4 billion, up 2.6% from the previous quarter. Our estimates for total loans and total deposits were $24.3 billion and $29.3 billion, respectively.
BKU’s Credit Quality Worsens
In the reported quarter, BankUnited recorded a provision for credit losses of $25.6 million, up substantially from $11 million in the prior-year quarter. We had expected the metric to be $20 million.
As of Dec. 31, 2025, the ratio of net charge-offs to average loans was 0.30%, up 14 bps year over year. Also, the non-performing assets ratio was 1.08%, up 35 bps.
BKU’s Capital & Profitability Ratios: Mixed Bag
As of Dec. 31, 2025, the Common Equity Tier 1 risk-based capital ratio was 12.3%, up from 12%. The total risk-based capital ratio was 14.1%, same as of Dec. 31, 2024.
At the end of the fourth quarter, the return on average assets was 0.78%, the same as in the year-ago quarter. Return on average stockholders’ equity was 8.9%, down from 9.7%.
Our View on BankUnited Stock
BankUnited’s revenues are expected to be supported by diverse fee income, low-cost deposits, steady loan growth and stabilizing funding cost. However, elevated expenses, significant exposure to commercial real estate and residential loans, and weakening asset quality might affect near-term financials.
BankUnited, Inc. Price, Consensus and EPS Surprise
BankUnited, Inc. price-consensus-eps-surprise-chart | BankUnited, Inc. Quote
Currently, BKU carries a Zacks Rank #4 (Sell).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Banks
First Horizon Corporation’s (FHN - Free Report) fourth-quarter 2025 adjusted earnings per share of 52 cents surpassed the Zacks Consensus Estimate of 47 cents. This compares favorably with 43 cents in the year-ago quarter.
FHN’s results benefited from higher NII and a significant rise in non-interest income, along with the absence of provision for credit losses. However, the rise in expenses remains a headwind.
Bank OZK’s (OZK - Free Report) fourth-quarter 2025 earnings per share were $1.53, down 1.9% year over year. The bottom line also missed the Zacks Consensus Estimate of $1.56.
OZK’s results were primarily hurt by higher provisions for credit losses and a rise in operating expenses. Nevertheless, solid NII and non-interest income growth acted as tailwinds. Healthy year-over-year growth in loans and deposits was another positive.