BankUnited Earns $72 Million in Q3 as Margins Widen and Buybacks Continue
BankUnited, the $34.6 billion bank headquartered in Miami Lakes, posted $72.2 million in third-quarter profit as cheaper deposits widened its margin. It also bought back about 2.1 million shares.
MIAMI LAKES — One of South Florida’s largest homegrown banks is earning more on every dollar it lends, and it’s handing a large share of those profits back to shareholders.
BankUnited Inc. (NYSE: BKU), the holding company for BankUnited N.A., reported third-quarter 2026 net income of $72.2 million, or $1.01 per diluted share. That compares with $70.7 million, or 97 cents, in the second quarter and $71.9 million, or 95 cents, a year earlier. Excluding a loss from selling investment securities, adjusted net income was $73.9 million, or $1.03 per share.
The bank had $34.6 billion in total assets at Sept. 30. Besides Florida, it operates in New York, Dallas, Atlanta, Morristown, New Jersey, and Charlotte, North Carolina.
“We delivered another quarter of solid performance, with continued deposit momentum and net interest margin expanding to 3.16%, ahead of our guidance,” Chairman, President and CEO Rajinder Singh said in the release. “Benefiting from a strong economy, we remain focused on increasing profitability and creating long-term shareholder value.”
Cheaper Deposits, Wider Margin
The main story of the quarter is the margin. Net interest margin, which measures how much more a bank earns on loans and securities than it pays for deposits and borrowings, rose to 3.16%. That’s up 10 basis points from the second quarter and 16 basis points from a year earlier.
The gain came mostly from cheaper funding. BankUnited’s average cost of deposits fell 6 basis points in the quarter to 1.99%, and it’s down 39 basis points from a year ago. Net interest income came in at $260.7 million, up about 2% from the second quarter and 4% from the same quarter last year.
Non-interest-bearing demand deposits are a big part of that. These are the checking balances that businesses and consumers keep at the bank, and BankUnited pays no interest on them. Their average balance rose $824 million, or 10%, from a year earlier, and they now make up 32.2% of total deposits, up from 30.1% a year ago. The ending balance fell from June, which the bank attributed to seasonal normalization after big second-quarter inflows.
The bank also sold about $1.0 billion of lower-yielding securities during the quarter and reinvested the money at higher yields. That trade produced a $2.3 million loss this quarter, but it’s meant to raise what the portfolio earns going forward.
Commercial Lending Up, Residential Down
BankUnited has been steadily moving away from residential mortgages and toward business lending. Average core loans rose $706 million, or 4%, from a year ago. Average commercial real estate loans climbed 10% year over year, and mortgage warehouse lending, which is short-term credit to mortgage originators, jumped 35%. Average residential loans fell 9%, which the bank called consistent with its balance sheet repositioning.
Average commercial and industrial loans, a key measure of lending to operating businesses, slipped 4% from the second quarter and 1% from a year ago.
Credit Quality Mostly Steady
Credit numbers were mixed but calm. Criticized and classified loans fell $176 million, or 14%, from a year earlier. Annualized net charge-offs held at 0.11%, flat with the prior quarter and down from 0.25% a year ago. Non-performing loans did rise $40 million, or 18%, from June, though they remain 30% below last year’s level. Non-performing assets were 0.77% of total assets.
Buybacks Shrink the Share Count
BankUnited repurchased about 2.1 million shares in the third quarter for $97.0 million. Shares outstanding fell to about 70.2 million from 75.2 million a year earlier. Its common equity tier 1 capital ratio was 12.1%, well above regulatory minimums, and tangible book value was $39.10 per share, down from $40.48 in June. Most of that drop came from higher unrealized losses on securities.
For the first nine months of 2026, the bank earned $204.7 million, or $2.80 per diluted share, compared with $199.1 million, or $2.63, in the same period of 2025.
What It Means for Local Businesses
For South Florida business owners, BankUnited’s numbers back up what other local lenders have reported this fall. Ocean Bank said its nine-month net income rose 37% to $65.5 million, and U.S. Century Bank posted its best quarter since going public in 2021.
Banks are paying a little less for deposits and competing hard for business checking accounts. They’re also growing commercial real estate and specialty lending faster than general business loans. That means companies with steady operating balances have bargaining power. When a company that keeps money on deposit asks for better loan pricing, many banks will listen, because those deposits are worth a lot to them right now.
BankUnited’s next test is whether the margin keeps rising as interest rates move and deposit competition, which the bank said pushed up costs this year, stays intense.