BankUnited Announces Work Force Reductions
19 Septiembre 2008 - 4:11PM
Business Wire
BankUnited Financial Corporation (NASDAQ:BKUNA), parent company of
BankUnited FSB (the Bank) today announced that the Company, as part
of its strategic plan, is reducing the headcount of the Bank by
approximately 160 persons, or 12% of the Bank�s current workforce.
The reductions will come primarily from the Bank�s residential
lending support and operations. The Company expects this action to
result in estimated annualized cost savings of approximately $11
million. �We have done everything to avoid cutting staff and it is
painful to get to this point,� said Alfred R. Camner, BankUnited�s
chairman and chief executive officer. �Unfortunately in this
unprecedented economic environment, it has become a necessary
step.� Regulatory Consent Orders The Company and the Bank have
reached agreement with the Office of Thrift Supervision (OTS) on
regulatory consent orders that require the Company and the Bank to
take various actions and impose certain restrictions designed to
improve their financial strength. The Company has previously
disclosed most of the actions and restrictions set forth in the new
Orders which the OTS and the Company and Bank agreed to today.
BankUnited and the Bank have therefore, already taken action on,
and in certain situations, completed or made substantial progress
towards completion of a number of the required actions. The Orders
acknowledge that BankUnited has previously submitted a capital
augmentation plan and an alternative capital strategy to the OTS to
preserve and enhance its capital and the Bank�s capital. Upon
receipt of the OTS�s written non-objection, BankUnited must adopt
and implement the capital plan. The Orders require the Bank, on and
after December 31, 2008, to meet and maintain a minimum Tier One
Core Capital Ratio of 7% and a minimum Total Risk-Based Capital
ratio of 14%. The Bank�s core and risk-based capital ratios were
7.6% and 13.8%, respectively, at June 30, 2008. The Orders prohibit
the Bank from paying, and BankUnited from accepting or requesting
from the Bank, dividends or capital distributions without receiving
the prior written approval of the OTS. The Orders also require,
among other things, that BankUnited and the Bank notify the OTS
prior to adding directors or senior executive officers; limit
certain kinds of severance and indemnification payments; and obtain
OTS approval before entering into, renewing, extending, or revising
any compensatory or benefits arrangements with any director or
officer. The Orders also require that the Bank enhance its policies
and procedures regarding its allowance for loan losses, limit its
asset growth and develop strategies to strengthen its liquidity
position. In addition, the Orders preclude the Bank from
originating any loans that provide for or may result in negative
amortization, including payment option adjustable rate mortgages
(option ARM loans). Additionally, the Orders preclude the Bank from
originating any loans under reduced documentation and no
documentation loan programs; require the Bank to reduce the
portfolio of negative option ARM loans; and enhance monitoring and
internal reporting on the option ARM loan reduction efforts and on
unpaid mortgage insurance claims. The Bank must report regularly to
the OTS on such efforts. As previously announced the Bank has
already terminated the option ARM loan program, eliminated all
reduced documentation and no documentation loan programs and
suspended the payment of dividends. �We have been working closely
with our regulators to proactively position BankUnited to meet the
challenges of the sharp decline in the housing and financial
markets,� said Camner. �We have already enacted many of the
elements of the order. �Most importantly the Orders do not prevent
us from offering the products and services needed to meet our
customers� banking needs. Our employees remain committed to
providing our customers with the high-quality and professional
service to which they are accustomed.� The description of each
Order and the corresponding Stipulation and Consent set forth
herein are qualified in their entirety by reference to the Orders
and Stipulations, copies of which are attached as Exhibits 10.1,
10.2, 10.3 and 10.4 to the Company�s Current Report on Form 8-K
filed today with the SEC. Deferral of Interest Payments on the
Company�s Trust Preferred Debentures The Company also announced
that the Board of Directors has determined to defer payment of
regularly scheduled quarterly interest payments on the Company�s
aggregate $237 million of floating rate junior subordinated
interest debentures (the Subordinated Debentures) associated with
its ten trust preferred subsidiaries. Pursuant to the indentures
for the Subordinated Debentures, the Company has the right to defer
payments of interest for up to twenty consecutive quarterly
periods, provided that there is no event of default (as defined in
the indentures), existing at the time of deferral. During a period
for which interest payments are deferred the Company may not, among
other things and subject to certain exceptions, declare or pay
dividends with respect to the Company�s capital stock, pay
principal or interest on debt that rank pari passu or junior to the
Subordinated Debentures and make any payments under guarantees of
the Company which rank pari passu or junior to the Subordinated
Debentures. During a period when interest payments are being
deferred, interest continues to accrue at an annual rate equal to
the interest rate in effect for such period and compounded
quarterly from the date of deferral. All interest, including the
additional compounded quarterly interest, must be paid at the end
of the deferral period. The total estimated annual interest that
would be payable on the Subordinated Debentures, if not deferred,
would be $12.4 million, based on current variable rates. The
deferrals are expected to take effect commencing with the regularly
scheduled payments in Oct. 2008. About BankUnited BankUnited
Financial Corp. is the holding company for BankUnited FSB, the
largest banking institution headquartered in Florida. At June 30,
2008, BankUnited had assets of $14.2 billion. Serving customers
through 85 branches in 13 coastal counties, including Miami-Dade,
Broward, Palm Beach, Martin, St. Lucie, Collier, Charlotte,
Manatee, Hillsborough, Sarasota, Lee, Indian River and Pinellas,
BankUnited offers a full spectrum of consumer and commercial
banking products and services, including online products that can
be accessed through http://www.bankunited.com. For additional
information, call (877) 779-2265. Forward-Looking Statements This
press release may contain certain forward-looking statements Such
forward-looking statements are within the meaning of that term in
Section�27A of the Securities Act of 1933, as amended (the
�Securities Act�), and Section�21E of the Securities Exchange Act
of 1934, as amended (the �Exchange Act�). Words and phrases such
as: �will likely result,� �expect,� �will continue,� �anticipate,�
�estimate,� �project,� �believe,� �intend,� �will,� �should,�
�would,� �could,� �may,� �can,� �plan,� �target� and similar
expressions are intended to identify �forward-looking statements�
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements may include, but are not
limited to, discussions concerning national and regional business
and economic conditions, fiscal and monetary policies; natural
events such as hurricanes; changes in interest rates; a reduced
demand for credit; reduced access to borrowings and deposits; a
decrease in deposit flows, loan demand or deposit or other
customers; risks associated with residential mortgage lending or
the slowdown in the housing market, including, without limitation,
continued deterioration in credit quality, reduced real estate
values and slower sales, interest rate changes, payment elections
by borrowers of option ARM loans and deterioration in the ability
of borrowers to repay their loans and other debts; competition from
other financial service companies in our markets; potential or
actual litigation; potential or actual actions by regulators,
including, without limitation, new, changed or increased regulatory
restrictions and the ability to comply with such restrictions; our
ability to comply with the regulatory consent orders; changes in
regulations, laws, policies or standards, including, among others,
changes in accounting standards, guidelines and policies; the
outcome of ongoing tax audits; the issuance, redemption or deferral
of payments on company debt or equity; the concentration of
operations in Florida; reliance on other companies for products and
services; the impact of war and the threat and impact of terrorism;
volatility in the market price of the company�s common stock;
unfavorable conditions in the capital markets; the possible loss of
key personnel; the possible inability to successfully implement its
agreement with regulators, strategic initiatives, and other
economic, competitive, servicing capacity, governmental, regulatory
and technological factors affecting the company�s operations,
price, products and delivery of services. Neither the success,
timing nor terms of the Company�s capital raising efforts are
certain.�The Company is not able to make any assurances, including
but not limited to any assurances that the increased rate of sale
of foreclosed homes will continue in future periods, that the
percentage of unsold homes in escrow or under negotiation will be
representative of the number or percentage of homes sold in future
periods, that the quality of the Company�s loan portfolio will
continue in future periods, that the Company will have adequate
liquidity in future periods, or that the Company will qualify as
�well-capitalized,� �adequately-capitalized� or otherwise in future
periods. The Company does not update forward-looking statements to
reflect the impact of circumstances or events that arise after the
date the forward-looking statements were made, except as required
by law. Please refer to the documents that BankUnited Financial
Corporation files periodically with the SEC, such as the Form 10-K
for the 2007 fiscal year, and report on Form 10-Q for the fiscal
quarter ended June 30, 2008, which contain additional important
factors that could cause actual results to differ from the
Company�s current expectations and from the forward-looking
statements contained in this press release.
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