BKU's Q4 Earnings Beat on Higher NII & Fee Income, Stock Jumps 9%

Core Insights - BankUnited, Inc. (BKU) shares increased by 9% following better-than-expected quarterly results, with adjusted earnings of 94 cents per share surpassing the Zacks Consensus Estimate of 85 cents, marking a 3.3% increase from the prior year [1][9] Financial Performance - The fourth-quarter 2025 results were bolstered by a rise in non-interest income and net interest income (NII), with NII reaching $258.2 million, a 7.9% increase, and net revenues totaling $288.2 million, up 4.5% year over year, exceeding the Zacks Consensus Estimate of $278.3 million [2][4] - For the full year 2025, earnings per share were $3.53, beating the Zacks Consensus Estimate of $3.49, and net income was $268.4 million, reflecting a 15.4% year-over-year increase [3] Income and Expenses - Non-interest income rose to $30 million, a 19% increase from the previous year, driven by higher deposit service charges and capital markets income [5] - Non-interest expenses increased by 7.7% to $173 million, primarily due to higher employee compensation and benefits [6] Loans and Deposits - As of December 31, 2025, total loans were $24.3 billion, up 2.4% from the prior quarter, while total deposits reached $29.4 billion, a 2.6% increase [7] Credit Quality - The provision for credit losses was $25.6 million, significantly higher than the $11 million recorded in the prior year, indicating a deterioration in credit quality [8][10] Capital and Profitability Ratios - The Common Equity Tier 1 risk-based capital ratio improved to 12.3%, while the return on average stockholders' equity decreased to 8.9% from 9.7% [11] Market Outlook - The company's revenue growth is expected to be supported by diverse fee income and steady loan growth, although elevated expenses and weakening asset quality may pose challenges [12]