Week of September 3, 2009
| BankUnited unveils new 'express' small, medium loans By Zachary S. Fagenson BankUnited was to announce Tuesday a new line of loans for small- and mid-size businesses that are to be approved within days, according to Carlos Fernandez-Guzman, senior executive vice president of its Neighborhood Banking Group. The program, titled Express Credit, aims to turn around requests for loans under $75,000 within 24 hours. Larger loans will be turned be turned around "in a few days," BankUnited spokesperson Melissa Gracey wrote in an e-mail. The move comes three months after a consortium of private-equity firms, led by New York banker John Kanas, brought the then-ailing thrift from federal receivership for about $900 million. The new owners assumed $12.7 billion in assets and $8.3 billion in deposits. The bank's failure will cost the Federal Deposit Insurance Corp. $4.9 billion. The federal government will also share in part of the losses up to $10.7 billion of the bank's assets. During the second quarter, BankUnited earned $37.6 million, with $30.8 million from net interest income. The short quarter began May 22, the day after the bank came out of receivership. During the same time, its assets dropped to $11.27 billion while non-current loans dropped to $1.08 billion from $1.48 billion in March. Now well-capitalized and free from billions of dollars in non-performing assets thanks to the FDIC, the bank's focus has shifted to the commercial market. "It's a very profitable business and a loyal business," Mr. Fernandez-Guzman said in a telephone interview. "We moved away from wholesale loan origination well over a year ago [and] the opportunity in Florida, ever since I can remember, has been always that small- to mid-size business sector." BankUnited, he said, will also continue to operate in the 13 counties where it had under old ownership. However, in a previous interview, Mr. Kanas said the bank would re-examine its branch system, build out markets that looked promising and leave ones that didn't. "We think… there's a huge void for commercial customers because so many South Florida banks are stumbling under the pressure," he said. "Conversely, we're in some markets that we don't want to be in long term because it's just a random branch here and there." But due to all-around uncertainty, Mr. Fernandez-Guzman said, management will have to be cautious before growing or leaving any market. "A lot of dust is still settling on which areas of Florida [will] come out of this cycle earlier," he said. "This is not a time when you can make those hard decisions. You have to be flexible and cautious." And while he declined to say how much capital the bank will dedicate to business loans, that business may become the bank's bread-and-butter. "I will tell you it's not a capital-allocation issue, it's a company focus issue," he noted. "It will be the focus of [this] company." Other changes include relocating eight branches scattered throughout Palm Beach, Broward and Miami-Dade counties to newer facilities offering a more modern array of amenities. The move is the "normal ebb and flow of realigning a branch network," Mr. Fernandez-Guzman said. This has "been scheduled to happen before the May 21 event but had been postponed because of how the bank was doing at the time." Meanwhile, the Coral Gables-based thrift has only seen a couple changes in senior management since its new owners took the reins. Clay Wilson, who served as executive vice president of commercial real estate, "chose to pursue other interests," Mr. Fernandez-Guzman said. And Douglas J. Pauls, who most recently served as chief financial officer for Commerce Bancorp, has been named executive vice president and chief financial officer. Mr. Pauls spent 15 years at the New Jersey-based bank, which was purchased by Toronto-based TD Bank Financial Group for $8.5 billion in March 2008. And while some employees have taken on new responsibilities as of June 30, the bank had 1,076 employees, only seven fewer than at the end of the previous quarter. Mr. Fernandez-Guzman did add that the bank is in the process of adding staff but said he couldn't comment further due to the regulatory-approval process. "You're going to see [added staff] in various key positions important to the bank, not only from a segment perspective but also an overall bank perspective," he said. And finally, the future address of BankUnited's headquarters, now in Coral Gables, is still cloudy. Mark Trowbridge, president of the Coral Gables Chamber of Commerce, said he has yet to hear from BankUnited's management on whether it plans to keep its three floors in 255 Alhambra Circle. Both Mr. Trowbridge and Coral Gables Mayor Donald Slesnick contacted BankUnited's new owners in May in hopes of convincing them to remain in the city. And while the bank has regularly declined to comment on where it will be headquartered, Mr. Fernandez-Guzman said it is still sorting out its backroom operations and "there is still a lot of repositioning of areas [and] at this point in time there's no news other than what we know. "Our address continues to be 255 Alhambra Circle. It is what it is." |
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