Carlyle professionals worked with BankUnited to build a new management team, who collectively rationalized the branch network, rebuilt the lending platform and invested significantly in IT infrastructure.
About BankUnited and the Transaction
Carlyle, along with veteran bank CEO John Kanas and other investors, invested in BankUnited in May 2009. Carlyle’s investment was made through three funds: Carlyle Global Financial Services Partners, Carlyle Partners V and Carlyle Strategic Partners II.
BankUnited offers a full range of traditional banking products and financial services coupled with personalized customer service to both its commercial and consumer customers. At the time of Carlyle’s exit in 2014, BankUnited was the seventh largest depository institution operating in Florida based on deposit market share. Headquartered in Miami Lakes, Florida, BankUnited, as of March 31, 2014, employed 1,660 people and had $11.1 billion in deposits.
BankUnited, Inc., the new institution formed by investors, assumed $8 billion of the deposits and purchased $14 billion of the assets of Bank United, FSB (the "Predecessor Bank”). As a result of losses on the Predecessor Bank’s $11 billion mortgage portfolio, it was the fourth largest bank to fail in 2009, and was seized by government regulators prior to Carlyle’s investment. As a result of the acquisition, the loan portfolio was written down from $11 billion to $5 billion in fair value.
Key Value Creation Metrics
• Structured loss share agreement with FDIC that provided a guarantee on legacy asset performance
• Built new management team around John Kanas
• Improved deposit mix and managed down the cost of deposits while growing deposit base significantly
• New loan book post-investment grew to $8.6 billion as of March 31, 2014
Strengthening Management for Next Stage of Growth
Carlyle helped build a new management team around John Kanas, CEO of BankUnited, and one of the most successful bank executives in the US. Management focused on the best strategy for bank branch locations, rebuilding its lending platform, investing significantly in infrastructure and acquiring Herald National Bank to expand into the New York Metropolitan area.
Executing Successful IPO
On February 2, 2011, BankUnited became a publicly-traded company, raising approximately $900 million. Carlyle fully exited its investment in BankUnited in March 2014.