

Delaware	27-0162450
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)



14817 Oak Lane	Miami Lakes FL	FL	33016
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (305) 569-2000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated ~~filer” and~~filer,” “smaller reporting ~~company”~~company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filerý

☒

Accelerated filer

☐

~~Accelerated filer~~ o

Emerging growth company

☐

Non-accelerated filero

☐

Smaller reporting companyo

☐

~~Emerging growth company~~ o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o☐ No ý☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class

Trading Symbol

Name of Exchange on Which Registered

Common Stock, $0.01 Par Value

BKU

New York Stock Exchange

The number of outstanding shares of the registrant common stock, $0.01 par value, as of May 2, 2022 was 81,787,178.

BANKUNITED, INC.

Form 10-Q

For the Quarter Ended March 31, 2022

TABLE OF CONTENTS


			Page

~~Class~~		Glossary of Defined Terms	~~November 6, 2017~~
~~Common Stock, $0.01 Par Value~~	~~106,820,503~~

~~BANKUNITED, INC.~~

~~Form 10-Q~~

~~For the Quarter Ended September 30, 2017~~

~~TABLE OF CONTENTS~~

GLOSSARY OF DEFINED TERMS

The following acronyms and terms may be used throughout this Form 10-Q, including the consolidated financial statements and related notes.



~~ACI~~ACL		~~Loans acquired with evidence of deterioration in~~Allowance for credit ~~quality since origination (Acquired Credit Impaired)~~losses
~~ALCO~~AFS		Available for sale
ALCO		Asset/Liability Committee
~~ALLL~~		~~Allowance for loan and lease losses~~
~~AOCI~~ALM		Asset Liability Management
AOCI		Accumulated other comprehensive income
~~ARM~~APY		~~Adjustable rate mortgage~~Annual Percentage Yield
~~ASC~~
ASC		Accounting Standards Codification
ASU		Accounting Standards Update
~~BKU~~		~~BankUnited, Inc.~~
~~BankUnited~~	~~BankUnited, National Association~~
~~The Bank~~	~~BankUnited, National Association~~
~~Bridge~~	~~Bridge Funding Group, Inc.~~
~~CET1~~	~~Common Equity Tier 1 capital~~
~~CECL~~	~~Current expected credit losses~~
~~CME~~	~~Chicago Mercantile Exchange~~
~~CMOs~~	~~Collateralized mortgage obligations~~
~~Commercial Shared-Loss Agreement~~	~~A commercial and other loans shared-loss agreement entered into with the FDIC in connection with the FSB Acquisition~~
~~Covered assets~~	~~Assets covered under the Loss Sharing Agreements~~
~~Covered loans~~	~~Loans covered under the Loss Sharing Agreements~~
~~EPS~~	~~Earnings per common share~~
~~EVE~~	~~Economic value of equity~~
~~FASB~~	~~Financial Accounting Standards Board~~
~~FDIA~~	~~Federal Deposit Insurance Act~~
~~FDIC~~	~~Federal Deposit Insurance Corporation~~
~~FEMA~~	~~Federal Emergency Management Agency~~
~~FHLB~~	~~Federal Home Loan Bank~~
~~FICO~~	~~Fair Isaac Corporation (credit score)~~
~~FRB~~	~~Federal Reserve Bank~~
~~FSB Acquisition~~	~~Acquisition of substantially all of the assets and assumption of all of the non-brokered deposits and substantially all of the other liabilities of BankUnited, FSB from the FDIC on May 21, 2009~~
~~GAAP~~	~~U.S. generally accepted accounting principles~~
~~GDP~~	~~Gross Domestic Product~~
~~HAMP~~	~~Home Affordable Modification Program~~
~~IPO~~	~~Initial public offering~~
~~ISDA~~	~~International Swaps and Derivatives Association~~
~~LIBOR~~	~~London InterBank Offered Rate~~
~~LIHTC~~	~~Low Income Housing Tax Credits~~
~~Loss Sharing Agreements~~	~~Two loss sharing agreements entered into with the FDIC in connection with the FSB Acquisition~~
~~LTV~~	~~Loan-to-value~~
~~MBS~~	~~Mortgage-backed securities~~
~~MSA~~	~~Metropolitan Statistical Area~~



~~MSRs~~						~~Mortgage servicing rights~~
~~New Loans~~						~~Loans originated or purchased since the FSB Acquisition~~
~~Non-ACI~~						~~Loans acquired without evidence of deterioration in credit quality since origination~~
~~NSF~~BKU						~~Non-sufficient funds~~BankUnited, Inc.
~~NYTLC~~BankUnited						BankUnited, National Association
The Bank						BankUnited, National Association
Bridge						Bridge Funding Group, Inc.
Buyout loans						FHA and VA insured mortgages from third party servicers who have exercised their right to purchase these loans out of GNMA securitizations
CARES Act						Coronavirus Aid, Relief, and Economic Security Act


CECL						Current expected credit losses
CET1						Common Equity Tier 1 capital

C&I						Commercial and Industrial loans, including owner-occupied commercial real estate
CLO						Collateralized loan obligations
CMBS						Commercial mortgage-backed securities
CME						Chicago Mercantile Exchange
CMOs						Collateralized mortgage obligations
COVID-19						Coronavirus disease of 2019
CPR						Constant prepayment rate

CRE						Commercial real estate loans, including multi-family; non-owner occupied commercial real estate; and construction and land

DDA						Demand deposit account
DFAST						Dodd-Frank Act Stress Test

DSCR						Debt Service Coverage Ratio


EVE						Economic value of equity

FASB						Financial Accounting Standards Board


FDIA						Federal Deposit Insurance Act
FDIC						Federal Deposit Insurance Corporation

FHA						Federal Housing Administration
FHLB						Federal Home Loan Bank
FICO						Fair Isaac Corporation (credit score)

FRB						Federal Reserve Bank
GAAP						U.S. generally accepted accounting principles
GDP						Gross Domestic Product

GNMA						Government National Mortgage Association

HPI						Home price indices




ISDA						International Swaps and Derivatives Association


LGD						Loss Given Default


LIBOR						London InterBank Offered Rate

LTV						Loan-to-value
MBS						Mortgage-backed securities
MSA						Metropolitan Statistical Area


MWL						Mortgage warehouse lending

NRSRO						Nationally recognized statistical rating organization

NYSE						New York ~~City Taxi and Limousine Commission~~Stock Exchange
~~OCC~~
OCC						Office of the Comptroller of the Currency
~~OREO~~
OFAC						U.S. Department of the Treasury's Office of Foreign Assets Control

OREO						Other real estate owned
~~OTTI~~						~~Other-than-temporary impairment~~
~~PSU~~PCD						~~Performance Share Unit~~Purchased credit-deteriorated
~~Pinnacle~~PD						Probability of default
Pinnacle						Pinnacle Public Finance, Inc.
~~RSU~~						~~Restricted Share Unit~~
~~SBA~~PPP						Small Business Administration’s Paycheck Protection Program









SBA						U.S. Small Business Administration
~~SBF~~						~~Small Business Finance Unit~~
SEC						Securities and Exchange Commission
~~Single Family Shared-Loss Agreement~~						~~A single-family loan shared-loss agreement entered into with the FDIC in connection with the FSB Acquisition~~
~~TDR~~SOFR						~~Troubled-debt restructuring~~Secured Overnight Financing Rate
~~UPB~~S&P 500						Standard & Poor's 500 Index

TDR						Troubled-debt restructuring
Tri-State						New York, New Jersey and Connecticut
UPB						Unpaid principal balance
~~2014 Plan~~						~~2014 Omnibus Equity Incentive Plan~~


VIX						CBOE Volatility Index
WARM						Weighted-average remaining maturity

iii

~~Table of Contents~~

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements and Supplementary Data

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS - UNAUDITED

(In thousands, except share and per share data)

September 30,
2017 December 31,
2016
ASSETS

Cash and due from banks:

Non-interest bearing $ 34,883
$ 40,260
Interest bearing 3,714
35,413
Interest bearing deposits at Federal Reserve Bank 254,004
372,640
Cash and cash equivalents 292,601
448,313
Investment securities available for sale, at fair value 6,893,472
6,073,584
Investment securities held to maturity 10,000
10,000
Non-marketable equity securities 270,239
284,272
Loans held for sale 31,507
41,198
Loans (including covered loans of $537,976 and $614,042) 20,610,430
19,395,394
Allowance for loan and lease losses (158,573 ) (152,953 )
Loans, net 20,451,857
19,242,441
FDIC indemnification asset 349,617
515,933
Bank owned life insurance 248,876
239,736
Equipment under operating lease, net 588,207
539,914
Deferred tax asset, net 23,910
62,940
Goodwill and other intangible assets 77,857
78,047
Other assets 316,688
343,773
Total assets $ 29,554,831
$ 27,880,151

LIABILITIES AND STOCKHOLDERS’ EQUITY

Liabilities:

Demand deposits:

Non-interest bearing $ 3,096,492
$ 2,960,591
Interest bearing 1,828,809
1,523,064
Savings and money market 9,964,242
9,251,593
Time 6,333,701
5,755,642
Total deposits 21,223,244
19,490,890
Federal Home Loan Bank advances 4,871,000
5,239,348
Notes and other borrowings 402,828
402,809
Other liabilities 434,270
328,675
Total liabilities 26,931,342
25,461,722

Commitments and contingencies

Stockholders' equity:

Common stock, par value $0.01 per share, 400,000,000 shares authorized; 106,821,902 and 104,166,945 shares issued and outstanding 1,068
1,042
Paid-in capital 1,492,790
1,426,459
Retained earnings 1,077,042
949,681
Accumulated other comprehensive income 52,589
41,247
Total stockholders' equity 2,623,489
2,418,429
Total liabilities and stockholders' equity $ 29,554,831
$ 27,880,151


	March 31, 2022		December 31, 2021
ASSETS
Cash and due from banks:
Non-interest bearing	$	17,780	$	19,143
Interest bearing	679,712		295,714
Cash and cash equivalents	697,492		314,857
Investment securities (including securities recorded at fair value of $10,562,098 and $10,054,198)	10,572,098		10,064,198
Non-marketable equity securities	190,534		135,859

Loans	23,370,029		23,765,053
Allowance for credit losses	(125,443)		(126,457)
Loans, net	23,244,586		23,638,596
Bank owned life insurance	314,697		309,477
Operating lease equipment, net	627,146		640,726

Goodwill	77,637		77,637
Other assets	607,434		634,046
Total assets	$	36,331,624	$	35,815,396

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Demand deposits:
Non-interest bearing	$	9,663,307	$	8,975,621
Interest bearing	2,872,430		3,709,493
Savings and money market	13,029,823		13,368,745
Time	2,975,715		3,384,243
Total deposits	28,541,275		29,438,102
Federal funds purchased	199,000		199,000
FHLB advances	3,395,000		1,905,000
Notes and other borrowings	721,291		721,416
Other liabilities	613,826		514,117
Total liabilities	33,470,392		32,777,635

Commitments and contingencies	0		0

Stockholders' equity:
Common stock, par value $0.01 per share, 400,000,000 shares authorized; 84,052,021 and 85,647,986 shares issued and outstanding	841		856
Paid-in capital	626,564		707,503
Retained earnings	2,391,526		2,345,342
Accumulated other comprehensive loss	(157,699)		(15,940)
Total stockholders' equity	2,861,232		3,037,761
Total liabilities and stockholders' equity	$	36,331,624	$	35,815,396

The accompanying notes are an integral part of these consolidated financial statements

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

(In thousands, except per share data)


	Three Months Ended March 31,
		2022		2021
Interest income:
Loans		$	191,562	$	205,335
Investment securities		43,048		38,501
Other		1,354		1,593
Total interest income		235,964		245,429
Interest expense:
Deposits		11,857		22,376
Borrowings		15,465		26,813
Total interest expense		27,322		49,189
Net interest income before provision for credit losses		208,642		196,240
Provision for (recovery of) credit losses		7,830		(27,989)
Net interest income after provision for credit losses		200,812		224,229
Non-interest income:
Deposit service charges and fees		5,960		4,900
Gain (loss) on sale of loans, net		(824)		1,754
Gain (loss) on investment securities, net		(7,868)		2,365
Lease financing		13,415		12,488
Other non-interest income		3,618		8,789
Total non-interest income		14,301		30,296
Non-interest expense:
Employee compensation and benefits		67,088		59,288
Occupancy and equipment		11,512		11,875
Deposit insurance expense		3,403		7,450
Professional fees		2,262		1,912
Technology and telecommunications		17,004		15,741

Depreciation of operating lease equipment		12,610		12,217

Other non-interest expense		12,445		14,738
Total non-interest expense		126,324		123,221
Income before income taxes		88,789		131,304
Provision for income taxes		21,639		32,490
Net income		$	67,150	$	98,814
Earnings per common share, basic		$	0.79	$	1.06
Earnings per common share, diluted		$	0.79	$	1.06

The accompanying notes are an integral part of these consolidated financial statements

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Interest income:

Loans $ 253,815
$ 227,233
$ 739,586
$ 662,439
Investment securities 51,851
39,712
141,624
109,963
Other 3,777
3,036
10,606
8,850
Total interest income 309,443
269,981
891,816
781,252
Interest expense:
Deposits 45,919
30,968
120,161
86,427
Borrowings 22,260
17,278
60,209
51,939
Total interest expense 68,179
48,246
180,370
138,366
Net interest income before provision for loan losses 241,264
221,735
711,446
642,886
Provision for (recovery of) loan losses (including $261, $(445), $2,693 and $(1,119) for covered loans) 37,854
24,408
63,573
42,449
Net interest income after provision for loan losses 203,410
197,327
647,873
600,437
Non-interest income:
Income from resolution of covered assets, net 6,400
8,883
22,066
26,426
Net gain (loss) on FDIC indemnification (4,838 ) 993
(14,174 ) (9,410 )
Service charges and fees 4,938
5,171
15,554
14,529
Gain (loss) on sale of loans, net (including $0, $(10,033), $(1,582) and $(14,895) related to covered loans) 2,447
(7,947 ) 6,601
(7,360 )
Gain on investment securities available for sale, net 26,931
3,008
29,194
10,065
Lease financing 13,287
11,188
40,067
32,762
Other non-interest income 4,161
3,779
12,055
10,118
Total non-interest income 53,326
25,075
111,363
77,130
Non-interest expense:
Employee compensation and benefits 58,327
55,162
178,386
166,374
Occupancy and equipment 18,829
18,867
56,689
57,199
Amortization of FDIC indemnification asset 45,225
38,957
135,351
116,711
Deposit insurance expense 5,764
4,943
16,827
12,866
Professional fees 2,748
3,884
12,573
10,119
Telecommunications and data processing 3,452
3,746
10,481
10,800
Depreciation of equipment under operating lease 8,905
6,855
25,655
20,004
Other non-interest expense 13,455
15,590
37,735
40,151
Total non-interest expense 156,705
148,004
473,697
434,224
Income before income taxes 100,031
74,398
285,539
243,343
Provision for income taxes 32,252
23,550
89,060
80,896
Net income $ 67,779
$ 50,848
$ 196,479
$ 162,447
Earnings per common share, basic (see Note 2) $ 0.62
$ 0.47
$ 1.79
$ 1.52
Earnings per common share, diluted (see Note 2) $ 0.62
$ 0.47
$ 1.79
$ 1.50
Cash dividends declared per common share $ 0.21
$ 0.21
$ 0.63
$ 0.63

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - UNAUDITED

(In thousands)


	Three Months Ended March 31,
		2022		2021

Net income		$	67,150	$	98,814
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) on investment securities available for sale:
Net unrealized holding loss arising during the period		(174,980)		(22,485)
Reclassification adjustment for net securities gains realized in income		(1,978)		(2,955)
Net change in unrealized gains (losses) on securities available for sale		(176,958)		(25,440)
Unrealized gains (losses) on derivative instruments:
Net unrealized holding gains arising during the period		31,179		24,611
Reclassification adjustment for net losses realized in income		4,020		11,156

Net change in unrealized gains (losses) on derivative instruments		35,199		35,767
Other comprehensive income (loss)		(141,759)		10,327
Comprehensive income (loss)		$	(74,609)	$	109,141

The accompanying notes are an integral part of these consolidated financial statements

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016

Net income $ 67,779
$ 50,848
$ 196,479
$ 162,447
Other comprehensive income (loss), net of tax:

Unrealized gains on investment securities available for sale:

Net unrealized holding gain arising during the period 8,557
3,216
32,826
53,490
Reclassification adjustment for net securities gains realized in income (16,293 ) (1,820 ) (17,662 ) (6,090 )
Net change in unrealized gains on securities available for sale (7,736 ) 1,396
15,164
47,400
Unrealized losses on derivative instruments:

Net unrealized holding gain (loss) arising during the period (170 ) 5,055
(8,337 ) (34,948 )
Reclassification adjustment for net losses realized in income 1,210
2,264
4,515
7,896
Net change in unrealized losses on derivative instruments 1,040
7,319
(3,822 ) (27,052 )
Other comprehensive income (loss) (6,696 ) 8,715
11,342
20,348
Comprehensive income $ 61,083
$ 59,563
$ 207,821
$ 182,795

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(In thousands)


	Nine Months Ended September 30,							Three Months Ended March 31,
	2017			2016				2022		2021
Cash flows from operating activities:							Cash flows from operating activities:
Net income	$	196,479		$	162,447		Net income	$	67,150	$	98,814
Adjustments to reconcile net income to net cash provided by operating activities:							Adjustments to reconcile net income to net cash provided by operating activities:
Amortization and accretion, net	(71,111		)	(90,360		)	Amortization and accretion, net	(3,382)		(8,202)
Provision for loan losses	63,573			42,449
Income from resolution of covered assets, net	(22,066		)	(26,426		)
Net loss on FDIC indemnification	14,174			9,410
Provision for (recovery of) credit losses							Provision for (recovery of) credit losses	7,830		(27,989)

(Gain) loss on sale of loans, net	(6,601		)	7,360			(Gain) loss on sale of loans, net	824		(1,754)
Increase in cash surrender value of bank owned life insurance	(4,647		)	(2,973		)
Gain on investment securities available for sale, net	(29,194		)	(10,065		)

(Gain) loss on investment securities, net							(Gain) loss on investment securities, net	7,868		(2,365)
Equity based compensation	14,337			13,418			Equity based compensation	6,614		7,669
Depreciation and amortization	45,204			38,971			Depreciation and amortization	18,947		18,142
Deferred income taxes	31,625			33,958			Deferred income taxes	12,924		6,599

Proceeds from sale of loans held for sale	126,778			121,968			Proceeds from sale of loans held for sale	248,843		203,155
Loans originated for sale, net of repayments	(109,588		)	(108,075		)

Other:							Other:
(Increase) decrease in other assets	15,743			(9,502		)
Increase (decrease) in other liabilities	(33,546		)	44,708
Decrease in other assets							Decrease in other assets	56,905		24,498
Increase in other liabilities							Increase in other liabilities	32,767		67,832
Net cash provided by operating activities	231,160			227,288			Net cash provided by operating activities	457,290		386,399

Cash flows from investing activities:							Cash flows from investing activities:
Purchase of investment securities available for sale	(2,355,872		)	(2,224,174		)
Proceeds from repayments and calls of investment securities available for sale	861,618			457,610
Proceeds from sale of investment securities available for sale	827,353			753,756
Purchase of non-marketable equity securities	(185,718		)	(178,813		)

Purchases of investment securities							Purchases of investment securities	(1,698,615)		(920,302)
Proceeds from repayments and calls of investment securities							Proceeds from repayments and calls of investment securities	559,785		535,586
Proceeds from sale of investment securities							Proceeds from sale of investment securities	482,307		410,242
Purchases of non-marketable equity securities							Purchases of non-marketable equity securities	(106,875)		(1,199)
Proceeds from redemption of non-marketable equity securities	199,751			115,388			Proceeds from redemption of non-marketable equity securities	52,200		19,355
Purchases of loans	(949,294		)	(936,882		)	Purchases of loans	(862,163)		(963,441)
Loan originations, repayments and resolutions, net	(192,075		)	(1,389,435		)
Loan originations and repayments, net							Loan originations and repayments, net	1,000,544		1,164,935
Proceeds from sale of loans, net	98,404			120,537			Proceeds from sale of loans, net	5,159		114,742
Decrease in FDIC indemnification asset for claims filed	16,768			30,829
Acquisition of equipment under operating lease, net	(73,948		)	(52,399		)

Acquisition of operating lease equipment							Acquisition of operating lease equipment	—		(38,875)
Other investing activities	(31,718		)	(19,577		)	Other investing activities	(11,964)		(1,771)
Net cash used in investing activities	(1,784,731		)	(3,323,160		)
Net cash provided by (used in) investing activities							Net cash provided by (used in) investing activities	(579,622)		319,272
				(Continued)

The accompanying notes are an integral part of these consolidated financial statements

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS ~~- UNAUDITED~~ (Continued)

(In thousands)


	Nine Months Ended September 30,							Three Months Ended March 31,
	2017			2016				2022		2021
Cash flows from financing activities:							Cash flows from financing activities:
Net increase in deposits	1,732,354			1,897,808
Additions to Federal Home Loan Bank advances	3,921,000			3,360,000
Repayments of Federal Home Loan Bank advances	(4,290,000		)	(2,150,000		)
Net increase (decrease) in deposits							Net increase (decrease) in deposits	(896,827)		236,266
Net decrease in federal funds purchased							Net decrease in federal funds purchased	—		(180,000)
Additions to FHLB borrowings							Additions to FHLB borrowings	1,810,000		920,000
Repayments of FHLB borrowings							Repayments of FHLB borrowings	(320,000)		(1,020,000)

Dividends paid	(68,583		)	(67,342		)	Dividends paid	(19,876)		(22,309)
Exercise of stock options	61,519			222

Repurchase of common stock							Repurchase of common stock	(82,103)		(7,263)
Other financing activities	41,569			49,638			Other financing activities	13,773		19,715
Net cash provided by financing activities	1,397,859			3,090,326
Net increase (decrease) in cash and cash equivalents	(155,712		)	(5,546		)
Net cash provided by (used in) financing activities							Net cash provided by (used in) financing activities	504,967		(53,591)
Net increase in cash and cash equivalents							Net increase in cash and cash equivalents	382,635		652,080
Cash and cash equivalents, beginning of period	448,313			267,500			Cash and cash equivalents, beginning of period	314,857		397,716
Cash and cash equivalents, end of period	$	292,601		$	261,954		Cash and cash equivalents, end of period	$	697,492	$	1,049,796

Supplemental disclosure of cash flow information:							Supplemental disclosure of cash flow information:
Interest paid	$	169,759		$	132,398		Interest paid	$	17,616	$	41,379
Income taxes paid, net	$	46,320		$	8,168
Income taxes (refunded) paid, net							Income taxes (refunded) paid, net	$	(13,092)	$	39,459

Supplemental schedule of non-cash investing and financing activities:							Supplemental schedule of non-cash investing and financing activities:
Transfers from loans to other real estate owned and other repossessed assets	$	6,738		$	11,679

Transfers from loans to loans held for sale							Transfers from loans to loans held for sale	$	254,826	$	305,028

Dividends declared, not paid	$	23,045		$	22,482		Dividends declared, not paid	$	20,966	$	21,405
Unsettled purchases of investment securities available for sale	$	107,500		$	—

The accompanying notes are an integral part of these consolidated financial statements

BANKUNITED, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - UNAUDITED

(In thousands, except share data)


	Common Shares Outstanding	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity
















Balance at December 31, 2021	85,647,986	$	856	$	707,503	$	2,345,342	$	(15,940)	$	3,037,761
Comprehensive loss	—	—		—		67,150		(141,759)		(74,609)
Dividends ($0.25 per common share)	—	—		—		(20,966)		—		(20,966)
Equity based compensation	468,050	5		6,326		—		—		6,331
Forfeiture of unvested shares and shares surrendered for tax withholding obligations	(132,112)	(1)		(5,181)		—		—		(5,182)

Repurchase of common stock	(1,931,903)	(19)		(82,084)		—		—		(82,103)
Balance at March 31, 2022	84,052,021	$	841	$	626,564	$	2,391,526	$	(157,699)	$	2,861,232



Balance at December 31, 2020	93,067,500	$	931	$	1,017,518	$	2,013,715	$	(49,152)	$	2,983,012
Comprehensive income	—	—		—		98,814		10,327		109,141
Dividends ($0.23 per common share)	—	—		—		(21,405)		—		(21,405)
Equity based compensation	539,711	5		4,007		—		—		4,012
Forfeiture of unvested shares and shares surrendered for tax withholding obligations	(140,084)	(1)		(5,686)		—		—		(5,687)
Exercise of stock options	1,569	—		25		—		—		25
Repurchase of common stock	(205,064)	(2)		(7,261)		—		—		(7,263)
Balance at March 31, 2021	93,263,632	$	933	$	1,008,603	$	2,091,124	$	(38,825)	$	3,061,835

Common
Shares
Outstanding

Common
Stock

Paid-in
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Income

Total
Stockholders’
Equity
Balance at December 31, 2016 104,166,945
$ 1,042
$ 1,426,459
$ 949,681
$ 41,247
$ 2,418,429
Comprehensive income —
—
—
196,479
11,342
207,821
Dividends —
—
—
(69,118 ) —
(69,118 )
Equity based compensation 618,306
6
12,103
—
—
12,109
Forfeiture of unvested shares and shares surrendered for tax withholding obligations (267,457 ) (3 ) (7,268 ) —
—
(7,271 )
Exercise of stock options 2,304,108
23
61,496
—
—
61,519
Balance at September 30, 2017 106,821,902
$ 1,068
$ 1,492,790
$ 1,077,042
$ 52,589
$ 2,623,489

Balance at December 31, 2015 103,626,255
$ 1,036
$ 1,406,786
$ 813,894
$ 22,182
$ 2,243,898
Comprehensive income —
—
—
162,447
20,348
182,795
Dividends —
—
—
(67,444 ) —
(67,444 )
Equity based compensation 644,888
6
13,250
—
—
13,256
Forfeiture of unvested shares and shares surrendered for tax withholding obligations (139,718 ) (1 ) (483 ) —
—
(484 )
Exercise of stock options 10,000
—
222
—
—
222
Tax benefits from dividend equivalents and equity based compensation —
—
847
—
—
847
Balance at September 30, 2016 104,141,425
$ 1,041
$ 1,420,622
$ 908,897
$ 42,530
$ 2,373,090

The accompanying notes are an integral part of these consolidated financial ~~statements.~~statements

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

~~September 30, 2017~~March 31, 2022

Note 1 Basis of Presentation and Summary of Significant Accounting Policies

BankUnited, Inc. is a national bank holding company with one wholly-owned subsidiary, BankUnited, collectively, the Company. BankUnited, a national banking association headquartered in Miami Lakes, Florida, provides a full range of banking and related services to individual and corporate customers through 9062 banking centers located in 1512 Florida counties and 64 banking centers located in the New York metropolitan area at ~~September 30, 2017.~~March 31, 2022. The Bank also offers certain commercial lending and deposit products through national platforms.

In connection with the FSB Acquisition, BankUnited entered into two loss sharing agreements with the FDIC. The Loss Sharing Agreements consist of the Single Family Shared-Loss Agreement and the Commercial Shared-Loss Agreement. Assets covered by the Loss Sharing Agreements are referred to as covered assets or, in certain cases, covered loans. The Single Family Shared-Loss Agreement provides for FDIC loss sharing and the Bank’s reimbursement for recoveries to the FDIC through May 21, 2019 for single family residential loans and OREO. Loss sharing under the Commercial Shared-Loss Agreement terminated on May 21, 2014. The Commercial Shared-Loss Agreement continued to provide for the Bank’s reimbursement of recoveries to the FDIC through June 30, 2017 for all other covered assets, including commercial real estate, commercial and industrial and consumer loans, certain investment securities and commercial OREO. Pursuant to the terms of the Loss Sharing Agreements, the covered assets are subject to a stated loss threshold whereby the FDIC will reimburse BankUnited for 80% of losses related to the covered assets up to $4.0 billion and 95% of losses in excess of this amount, beginning with the first dollar of loss incurred.

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, ~~they~~these do not include all of the information and footnotes required for a fair presentation of financial position, results of operations and cash flows in conformity with GAAP and should be read in conjunction with the Company’s consolidated financial statements and the notes thereto appearing in BKU’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021 filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Operating results for the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2022 are not necessarily indicative of the results that may be expected in future periods.

~~Certain amounts presented for prior periods have been reclassified to conform to the current period presentation.~~The Company has a single reportable segment.

Accounting Estimates

In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and disclosures of contingent assets and liabilities. Actual results could differ significantly from these estimates.

~~Significant estimates include~~The most significant estimate impacting the ~~ALLL,~~Company's consolidated financial statements is the amount and timing of expected cash flows from covered assets and the FDIC indemnification asset, and the fair values of investment securities and other financial instruments. Management has used information provided by third party valuation specialists to assist in the determination of the fair values of investment securities.ACL.

New Accounting Pronouncements Adopted During the Three Months Ended March 31, 2022

ASU No. ~~2016-09,~~ ~~Compensation~~2020-06, Debt - ~~Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting~~Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU simplifies the accounting for convertible debt and convertible preferred stock by reducing the number of accounting models for these instruments, resulting in fewer embedded conversion features being separately recognized from the host contract. Additionally, this ASU revises the criteria for determining whether contracts in an entity's own equity meet the scope exception from derivative accounting, which will change the population of contracts that are recognized as assets or liabilities. The amendments in this ASU ~~simplified several~~also revise certain aspects of the ~~accounting for share-based payment transactions.~~guidance on calculating earnings per share with respect to convertible instruments and instruments that may be settled in the entity's own shares. The Company adopted this ASU on January 1, 2022, with no material impact on the Company's consolidated financial position, results of operations, and cash flows.

ASU No. 2022-01, Fair Value Hedging—Portfolio Layer Method(Topic 815). This ASU expands the portfolio layer method of hedge accounting prescribed in ASU No. 2017-12 to allow multiple hedged layers of a single closed portfolio and to include portfolios of both prepayable and non-prepayable financial assets. This scope expansion is consistent with the FASB’s efforts to simplify hedge accounting and allows entities to apply the same accounting method to similar hedging strategies. The ASU also specifies eligible hedging instruments in a single-layer hedge, provides additional guidance on accounting and disclosure of hedge basis adjustments and specifies how hedge basis adjustments should be considered in determining credit losses for assets in the ~~first quarter of 2017.~~designated closed portfolio. This ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2022. The ~~amendment requiring the recognition of excess tax benefits and deficiencies as income tax benefit or expense~~Company adopted this ASU upon its release in the income statement as opposed to being recognized as additional paid-in-capital was applied prospectively and resulted in the recognition of $0.3 million and $3.2 million in excess tax benefits in the consolidated statement of income line item "Provision for income taxes" for the three and nine months ended September 30, 2017, increasing net income by the same amount in each period. The adoption hadMarch 2022 with no material impact on ~~basic and diluted earnings per share for~~ the three months ended September 30, 2017 and increased basic and diluted earnings per share by $0.02 and $0.03, respectively, for the nine months ended September 30, 2017. The Company retrospectively adopted the amendments requiring the classificationCompany's consolidated financial position, results of ~~excess tax benefits and deficiencies with other income tax cash flows as operating activities~~operations, and cash paid when directly withholding shares as financing activities in the accompanying consolidated statements of cash flows; the impact was not material. The Company elected to continue its practice of estimating the number of awards expected to vest in determining the amount of compensation cost to be recognized related to share based payment transactions.flows.

September 30, 2017
FICO
LTV 720 or less 721 - 740 741 - 760
761 or
greater
Total
60% or less $ 94,357
$ 111,279
$ 185,614
$ 819,422
$ 1,210,672
60% - 70% 93,963
102,461
140,350
586,158
922,932
70% - 80% 139,923
173,808
316,544
1,091,868
1,722,143
More than 80% 24,725
20,610
24,981
85,781
156,097
$ 352,968
$ 408,158
$ 667,489
$ 2,583,229
$ 4,011,844

December 31, 2016
FICO
LTV 720 or less 721 - 740 741 - 760
761 or
greater
Total
60% or less $ 87,035
$ 113,401
$ 163,668
$ 751,291
$ 1,115,395
60% - 70% 80,694
94,592
124,180
523,970
823,436
70% - 80% 110,509
148,211
276,425
907,450
1,442,595
More than 80% 22,115
9,058
15,470
42,280
88,923
$ 300,353
$ 365,262
$ 579,743
$ 2,224,991
$ 3,470,349

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

~~September 30, 2017~~March 31, 2022


	December 31, 2021
	Amortized Cost By Origination Year												Revolving Loans
	2021		2020		2019		2018		2017		Prior				Total
CRE
Pass	$	869,852	$	619,056	$	1,283,401	$	676,151	$	455,965	$	986,427	$	119,308	$	5,010,160
Special mention	985		—		29,573		—		—		1,704		—		32,262
Substandard	—		14,227		187,284		55,944		115,944		285,917		—		659,316

Total CRE	$	870,837	$	633,283	$	1,500,258	$	732,095	$	571,909	$	1,274,048	$	119,308	$	5,701,738
C&I
Pass	$	1,280,160	$	666,437	$	870,797	$	406,145	$	353,590	$	669,308	$	2,120,693	$	6,367,130
Special mention	6,051		19,861		39,647		17,185		1,854		11,640		20,093		116,331
Substandard	365		22,106		167,496		59,349		51,117		122,663		49,119		472,215
Doubtful	—		—		900		—		—		—		26,862		27,762
Total C&I	$	1,286,576	$	708,404	$	1,078,840	$	482,679	$	406,561	$	803,611	$	2,216,767	$	6,983,438
Pinnacle
Pass	$	143,063	$	113,785	$	88,206	$	36,761	$	177,258	$	360,568	$	—	$	919,641

Total Pinnacle	$	143,063	$	113,785	$	88,206	$	36,761	$	177,258	$	360,568	$	—	$	919,641
Bridge - Equipment Finance
Pass	$	73,190	$	18,763	$	108,990	$	43,826	$	23,684	$	48,471	$	—	$	316,924

Substandard	—		—		12,875		4,775		23,025		—		—		40,675

Total Bridge - Equipment Finance	$	73,190	$	18,763	$	121,865	$	48,601	$	46,709	$	48,471	$	—	$	357,599
Bridge - Franchise Finance
Pass	$	49,949	$	51,057	$	104,299	$	10,199	$	7,039	$	5,838	$	—	$	228,381

Substandard	—		7,351		39,588		30,134		8,660		8,018		—		93,751
Doubtful	—		—		7,718		12,274		—		—		—		19,992
Total Bridge - Franchise Finance	$	49,949	$	58,408	$	151,605	$	52,607	$	15,699	$	13,856	$	—	$	342,124
Mortgage Warehouse Lending
Pass	$	—	$	—	$	—	$	—	$	—	$	—	$	1,092,133	$	1,092,133
Total Mortgage Warehouse Lending	$	—	$	—	$	—	$	—	$	—	$	—	$	1,092,133	$	1,092,133

~~Commercial~~At March 31, 2022 and December 31, 2021, the balance of revolving loans converted to term loans was immaterial.

The following tables summarize the Company's commercial credit exposure based on internal risk ~~rating:~~ rating, in aggregate, at the dates indicated (in thousands):


	March 31, 2022

	Multi-Family		Non-Owner Occupied Commercial Real Estate		Construction and Land		Owner Occupied Commercial Real Estate		Commercial and Industrial		PPP		Pinnacle		Bridge - Franchise Finance		Bridge - Equipment Finance		Mortgage Warehouse Lending		Total
Pass	$	886,222	$	3,931,211	$	159,478	$	1,753,081	$	4,603,865	$	80,296	$	935,915	$	208,720	$	314,655	$	701,172	$	13,574,615
Special mention	—		30,083		1,902		5,369		57,896		—		—		—		—		—		95,250
Substandard - accruing	176,034		297,714		10,355		125,866		250,016		—		—		69,619		26,714		—		956,318
Substandard non-accruing	10,725		25,667		5,090		21,079		33,380		—		—		8,388		—		—		104,329
Doubtful	—		—		—		—		6,842		—		—		19,836		—		—		26,678
	$	1,072,981	$	4,284,675	$	176,825	$	1,905,395	$	4,951,999	$	80,296	$	935,915	$	306,563	$	341,369	$	701,172	$	14,757,190

September 30, 2017
Commercial and Industrial
Multi-Family Non-Owner Occupied Commercial Real Estate Construction
and Land Owner Occupied Commercial Real Estate Taxi Medallion Loans Other Commercial and Industrial Commercial Lending Subsidiaries Total
Pass $ 3,299,753
$ 4,069,749
$ 265,921
$ 1,890,785
$ —
$ 3,666,227
$ 2,313,152
$ 15,505,587
Special mention 32,255
12,824
—
31,495
—
38,389
35,936
150,899
Substandard 30,253
90,996
5,535
31,460
120,572
64,087
33,637
376,540
Doubtful —
—
—
3,009
—
2,807
—
5,816
$ 3,362,261
$ 4,173,569
$ 271,456
$ 1,956,749
$ 120,572
$ 3,771,510
$ 2,382,725
$ 16,038,842

December 31, 2016
Commercial and Industrial
Multi-Family Non-Owner Occupied Commercial Real Estate
Construction
and Land
Owner Occupied Commercial Real Estate Taxi Medallion Loans Other Commercial and Industrial Commercial Lending Subsidiaries Total
Pass $ 3,811,822
$ 3,694,931
$ 309,675
$ 1,672,199
$ 40,460
$ 3,112,590
$ 2,255,444
$ 14,897,121
Special mention 12,000
7,942
—
33,274
—
19,009
—
72,225
Substandard 5,852
28,935
1,238
30,377
138,035
68,704
31,572
304,713
Doubtful —
—
—
—
178
8,162
3,178
11,518
$ 3,829,674
$ 3,731,808

$ 310,913
$ 1,735,850

$ 178,673

$ 3,208,465
$ 2,290,194

$ 15,285,577

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

~~September 30, 2017~~March 31, 2022


	December 31, 2021

	Multi-Family		Non-Owner Occupied Commercial Real Estate		Construction and Land		Owner Occupied Commercial Real Estate		Commercial and Industrial		PPP		Pinnacle		Bridge - Franchise Finance		Bridge - Equipment Finance		Mortgage Warehouse Lending		Total
Pass	$	970,337	$	3,892,353	$	147,470	$	1,750,035	$	4,368,590	$	248,505	$	919,641	$	228,381	$	316,924	$	1,092,133	$	13,934,369
Special mention	—		26,088		6,174		14,010		102,321		—		—		—		—		—		148,593
Substandard -accruing	173,536		423,918		6,582		160,159		250,644		—		—		80,864		40,675		—		1,136,378
Substandard non-accruing	10,865		39,251		5,164		20,454		40,958		—		—		12,887		—		—		129,579
Doubtful	—		—		—		—		27,762		—		—		19,992		—		—		47,754
	$	1,154,738	$	4,381,610	$	165,390	$	1,944,658	$	4,790,275	$	248,505	$	919,641	$	342,124	$	357,599	$	1,092,133	$	15,396,673

~~Aging of loans:~~ Past Due and Non-Accrual Loans:

The following table presents an aging of loans at the dates ~~indicated. Amounts include premiums, discounts and deferred fees and costs~~indicated (in thousands):


	March 31, 2022										December 31, 2021

	Current		30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days or More Past Due		Total		Current		30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days or More Past Due		Total
1-4 single family residential	$	6,598,534	$	50,875	$	3,600	$	15,107	$	6,668,116	$	6,261,995	$	53,092	$	5,650	$	17,488	$	6,338,225
Government insured residential	1,004,764		127,093		102,749		703,873		1,938,479		1,034,686		143,672		115,028		729,835		2,023,221

Other consumer loans	6,212		32		—		—		6,244		6,919		15		—		—		6,934
Multi-family	1,070,843		—		—		2,138		1,072,981		1,135,363		6,017		11,220		2,138		1,154,738
Non-owner occupied commercial real estate	4,246,741		19,133		1,286		17,515		4,284,675		4,359,671		2,727		29		19,183		4,381,610
Construction and land	172,178		4,301		—		346		176,825		160,183		492		4,369		346		165,390
Owner occupied commercial real estate	1,891,719		543		—		13,133		1,905,395		1,930,932		—		1,402		12,324		1,944,658
Commercial and industrial	4,891,789		21,799		25,901		12,510		4,951,999		4,763,976		2,114		11,016		13,169		4,790,275
PPP	80,119		177		—		—		80,296		247,740		765		—		—		248,505
Pinnacle	935,915		—		—		—		935,915		919,641		—		—		—		919,641
Bridge - franchise finance	275,590		27,602		—		3,371		306,563		331,397		—		6,735		3,992		342,124
Bridge - equipment finance	338,803		2,566		—		—		341,369		357,599		—		—		—		357,599
Mortgage warehouse lending	701,172		—		—		—		701,172		1,092,133		—		—		—		1,092,133
	$	22,214,379	$	254,121	$	133,536	$	767,993	$	23,370,029	$	22,602,235	$	208,894	$	155,449	$	798,475	$	23,765,053

September 30, 2017 December 31, 2016
Current
30 - 59
Days Past
Due

60 - 89
Days Past
Due

90 Days or
More Past
Due
Total Current
30 - 59
Days Past
Due

60 - 89
Days Past
Due

90 Days or
More Past
Due
Total
Non-covered loans:

1-4 single family residential $ 3,994,758
$ 13,964
$ 444
$ 2,678
$ 4,011,844
$ 3,457,606
$ 10,355
$ 325
$ 2,063
$ 3,470,349
Home equity loans and lines of credit 1,623
21
—
—
1,644
1,120
—
—
—
1,120
Other consumer loans 19,623
500
—
1
20,124
24,306
—
—
—
24,306
Multi-family 3,362,261
—
—
—
3,362,261
3,829,674
—
—
—
3,829,674
Non-owner occupied commercial real estate 4,171,880
—
—
1,689
4,173,569
3,730,470
754
—
584
3,731,808
Construction and land 270,218
—
—
1,238
271,456
309,675
—
—
1,238
310,913
Owner occupied commercial real estate 1,947,728
1,261
266
7,494
1,956,749
1,726,826
1,557
797
6,670
1,735,850
Commercial and industrial
Taxi medallion loans 107,325
—
2,803
10,444
120,572
137,856
7,037
4,563
29,217
178,673
Other commercial and industrial 3,769,065
1,629
58
758
3,771,510
3,198,008
2,515
954
6,988
3,208,465
Commercial lending subsidiaries 2,382,725
—
—
—
2,382,725
2,284,435
12
3,247
2,500
2,290,194
$ 20,027,206
$ 17,375
$ 3,571
$ 24,302
$ 20,072,454
$ 18,699,976
$ 22,230
$ 9,886
$ 49,260
$ 18,781,352
Covered loans:
Non-ACI loans:

1-4 single family residential $ 23,002
$ 691
$ —
$ 934
$ 24,627
$ 29,406
$ 481
$ —
$ 918
$ 30,805
Home equity loans and lines of credit 33,263
1,114
663
2,369
37,409
43,129
1,255
534
2,077
46,995
$ 56,265
$ 1,805
$ 663
$ 3,303
$ 62,036
$ 72,535
$ 1,736
$ 534
$ 2,995
$ 77,800
ACI loans:
1-4 single family residential $ 436,051
$ 14,126
$ 2,549
$ 17,574
$ 470,300
$ 500,272
$ 13,524
$ 2,990
$ 15,562
$ 532,348
Home equity loans and lines of credit 4,876
89
40
635
5,640
3,460
148
23
263
3,894
$ 440,927
$ 14,215
$ 2,589
$ 18,209
$ 475,940
$ 503,732
$ 13,672
$ 3,013
$ 15,825
$ 536,242

~~1-4 single family residential and home equity ACI~~Included in the table above is the guaranteed portion of SBA loans ~~that are contractually delinquent~~past due by ~~more than~~ 90 days ~~and accounted for in pools that are on accrual status because discount continues to be accreted totaled $18~~or more totaling $30.6 million and ~~$16~~$31.3 million at ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively.

~~Foreclosure of residential real estate~~

The carrying amount of foreclosed residential real estate properties included in "Other assets" in the accompanying consolidated balance sheets, all of which were covered, totaled $4 million and $5 million at September 30, 2017 and December 31, 2016, respectively. The recorded investment in residential mortgage loans in the process of foreclosure totaled $13 million and $8 million at September 30, 2017 and December 31, 2016, respectively, substantially all of which were covered loans.

2720

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BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

~~September 30, 2017~~March 31, 2022

Loans contractually delinquent by 90 days or more and still accruing totaled $704 million and $730 million at March 31, 2022 and December 31, 2021, respectively, all of which were government insured residential loans. These loans are government insured pool buyout loans, which the Company buys out of GNMA securitizations upon default.

The following table presents information about loans on non-accrual status at the dates indicated (in thousands):


	March 31, 2022				December 31, 2021

	Amortized Cost		Amortized Cost With No Related Allowance		Amortized Cost		Amortized Cost With No Related Allowance
Residential and other consumer	$	19,824	$	—	$	28,553	$	1,684
Commercial:
Multi-family	10,725		10,725		10,865		10,865
Non-owner occupied commercial real estate	25,667		11,069		39,251		20,929
Construction and land	5,090		4,301		5,164		4,369
Owner occupied commercial real estate	21,079		5,707		20,453		4,457
Commercial and industrial	40,222		16,176		68,720		10,083

Bridge - franchise finance	28,224		2,304		32,879		16,808

	$	150,831	$	50,282	$	205,885	$	69,195

Included in the table above is the guaranteed portion of non-accrual SBA loans totaling $41.9 million and $46.1 million at March 31, 2022 and December 31, 2021, respectively. The amount of interest income recognized on non-accrual loans was insignificant for the three months ended March 31, 2022 and 2021. The amount of additional interest income that would have been recognized on non-accrual loans had they performed in accordance with their contractual terms was approximately $1.3 million and $3.0 million for the three months ended March 31, 2022 and 2021, respectively.

Collateral dependent loans:

The following table presents the amortized cost basis of collateral dependent loans at the dates indicated (in thousands):


	March 31, 2022				December 31, 2021
	Amortized Cost		Extent to Which Secured by Collateral		Amortized Cost		Extent to Which Secured by Collateral
Residential and other consumer	$	746	$	746	$	2,317	$	2,295
Commercial:
Multi-family	10,725		10,725		10,865		10,865
Non-owner occupied commercial real estate	24,784		24,289		29,001		28,486
Construction and land	4,647		4,647		4,715		4,715
Owner occupied commercial real estate	16,431		16,387		15,198		15,155
Commercial and industrial	17,643		16,743		45,015		37,020

Bridge - franchise finance	24,889		17,457		26,055		18,740

Total commercial	99,119		90,248		130,849		114,981
	$	99,865	$	90,994	$	133,166	$	117,276

Collateral for the multi-family, non-owner occupied commercial real estate and owner-occupied commercial real estate loan classes generally consists of commercial real estate. Collateral for construction and land loans is typically residential or commercial real estate. Collateral for commercial and industrial loans generally consists of equipment, accounts receivable, inventory and other business assets; owner-occupied commercial real estate loans may also be collateralized by these types of assets. Bridge franchise finance loans may be collateralized by franchise value or by equipment. Bridge equipment finance loans are secured by the financed equipment. Residential loans are collateralized by residential real estate. There have been no significant changes to the extent to which collateral secures collateral dependent loans during the three months ended March 31, 2022.

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BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

March 31, 2022

Foreclosure of residential real estate

The recorded investment in residential loans in the process of foreclosure was $298 million, of which $291 million was government insured, at March 31, 2022 and $208 million, of which $202 million was government insured, at December 31, 2021. The carrying amount of foreclosed residential real estate included in other assets in the accompanying consolidated balance sheet was insignificant at March 31, 2022 and December 31, 2021.

Troubled debt restructurings

The following table summarizes loans that were modified in TDRs during the periods indicated, as well as loans modified during the twelve months preceding ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021 that experienced payment defaults during ~~the~~those periods ~~indicated~~ (dollars in thousands):


	Three Months Ended March 31,
	2022						2021
	Loans Modified in TDRs During the Period			TDRs Experiencing Payment Defaults During the Period			Loans Modified in TDRs During the Period			TDRs Experiencing Payment Defaults During the Period
	Number of TDRs	Amortized Cost		Number of TDRs	Amortized Cost		Number of TDRs	Amortized Cost		Number of TDRs	Amortized Cost
1-4 single family residential	4	$	1,992	—	$	—	—	$	—	—	$	—
Government insured residential	390	63,539		125	21,391		68	11,497		58	10,054





Commercial and industrial	8	15,219		—	—		—	—		—	—

Bridge - franchise finance	—	—		—	—		—	—		1	492

	402	$	80,750	125	$	21,391	68	$	11,497	59	$	10,546

Three Months Ended September 30,
2017 2016
Loans Modified in TDRs
During the Period TDRs Experiencing Payment
Defaults During the Period Loans Modified in TDRs
During the Period TDRs Experiencing Payment
Defaults During the Period
Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment
Non-covered loans:

1-4 single family residential —
$ —
2
$ 269
—
$ —
—
$ —
Owner occupied commercial real estate —
—
—
—
1
491
—
—
Commercial and industrial
Taxi medallion loans 15
5,439
6
2,105
18
29,854
8
4,104
Other commercial and industrial 1
978
—
—
2
1,646
—

Commercial lending subsidiaries —
—
—
—
5
4,433
1
3,500
16
$ 6,417
8
$ 2,374
26
$ 36,424
9
$ 7,604
Covered loans:
Non-ACI loans:

Home equity loans and lines of credit —
$ —
1
$ 70
10
$ 1,671
—
$ —
ACI loans:
Owner occupied commercial real estate —
$ —
—
$ —
1
$ 839
—
$ —

Nine Months Ended September 30,
2017 2016
Loans Modified in TDRs
During the Period TDRs Experiencing Payment
Defaults During the Period Loans Modified in TDRs
During the Period TDRs Experiencing Payment
Defaults During the Period
Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment Number of
TDRs Recorded
Investment
Non-covered loans:

1-4 single family residential 4
$ 351
2
$ 269
1
$ 107
—
$ —
Non-owner occupied commercial real estate 1
5,389
—
—
—
—
—
—
Owner occupied commercial real estate 2
4,522
—
—
3
5,225
—
—
Commercial and industrial

Taxi medallion loans 97
48,692
8
3,509
58
57,341
8
4,104
Other commercial and industrial 14
20,860
—
—
7
21,422
1
3,500
Commercial lending subsidiaries 1
12,810
—
—
6
7,933
—
—
119
$ 92,624
10
$ 3,778
75
$ 92,028
9
$ 7,604
Covered loans:
Non-ACI loans:

Home equity loans and lines of credit 5
$ 939
1
$ 70
16
$ 2,293
—
$ —
ACI loans:
Owner occupied commercial real estate —
$ —
—
$ —
1
$ 839
—
$ —

~~Modifications~~TDRs during the three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2022 and ~~2016~~2021 generally included interest rate reductions ~~restructuring of the amount~~ and ~~timing of required periodic payments,~~ extensions of ~~maturity and covenant waivers.~~maturity. Included in TDRs are residential loans to borrowers who have not reaffirmed their debt discharged in Chapter 7 bankruptcy. The total amount of such loans is not material. ~~Modified ACI loans accounted for in pools are not considered TDRs, are not separated from the pools and are not classified as impaired loans.~~

~~Table of Contents~~

~~BANKUNITED, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED~~

~~September 30, 2017~~

Note 5 ~~FDIC Indemnification Asset~~

When the Company recognizes gains or losses related to covered assets in its consolidated financial statements, changes in the estimated amount recoverable from the FDIC under the Loss Sharing Agreements with respect to those gains or losses are also reflected in the consolidated financial statements. Covered loans may be resolved through prepayment, short sale of the underlying collateral, foreclosure, sale of the loans or charge-off. For loans resolved through prepayment, short sale or foreclosure, the difference between consideration received in satisfaction of the loans and the carrying value of the loans is recognized in the consolidated statement of income line item “Income from resolution of covered assets, net.” Losses from the resolution of covered loans increase the amount recoverable from the FDIC under the Loss Sharing Agreements. Gains from the resolution of covered loans reduce the amount recoverable from the FDIC under the Loss Sharing Agreements. Similarly, differences in proceeds received on the sale of covered OREO and covered loans and their carrying amounts result in gains or losses and reduce or increase the amount recoverable from the FDIC under the Loss Sharing Agreements. Increases in valuation allowances or impairment charges related to covered assets also increase the amount estimated to be recoverable from the FDIC. These additions to or reductions in amounts recoverable from the FDIC related to transactions in the covered assets are recorded in the consolidated statement of income line item “Net gain (loss) on FDIC indemnification” and reflected as corresponding increases or decreases in the FDIC indemnification asset.

In addition, through June 30, 2017, recoveries of previously indemnified losses on assets that were formerly covered under the Commercial Shared-Loss Agreement resulted in reimbursements due to the FDIC. These transactions are included in the tables below. Amounts payable to the FDIC resulting from these transactions are recognized in other liabilities in the accompanying consolidated balance sheet at December 31, 2016.

The following tables summarize the components of the gains and losses associated with covered assets, along with the related additions to or reductions in the amounts recoverable from the FDIC under the Loss Sharing Agreements, as reflected in the consolidated statements of income for the periods indicated (in thousands):

Three Months Ended September 30,
2017 2016
Transaction
Income (Loss) Net Loss on FDIC
Indemnification Net Impact
on Pre-tax
Earnings Transaction
Income (Loss) Net Gain on FDIC
Indemnification Net Impact
on Pre-tax
Earnings
Recovery of (provision for) losses on covered loans $ (261 ) $ 215
$ (46 ) $ 445
$ (368 ) $ 77
Income from resolution of covered assets, net 6,400
(5,082 ) 1,318
8,883
(7,106 ) 1,777
Loss on sale of covered loans —
—
—
(10,033 ) 8,026
(2,007 )
Loss on covered OREO (35 ) 29
(6 ) (552 ) 441
(111 )
$ 6,104
$ (4,838 ) $ 1,266
$ (1,257 ) $ 993
$ (264 )

Nine Months Ended September 30,
2017 2016
Transaction
Income (Loss) Net Loss on FDIC
Indemnification Net Impact
on Pre-tax
Earnings Transaction
Income (Loss) Net Loss on FDIC
Indemnification Net Impact
on Pre-tax
Earnings
Recovery of (provision for) losses on covered loans $ (2,693 ) $ 2,095
$ (598 ) $ 1,119
$ (1,007 ) $ 112
Income from resolution of covered assets, net 22,066
(17,591 ) 4,475
26,426
(21,140 ) 5,286
Loss on sale of covered loans (1,582 ) 1,266
(316 ) (14,895 ) 11,958
(2,937 )
Loss on covered OREO (65 ) 56
(9 ) (957 ) 779
(178 )
$ 17,726
$ (14,174 ) $ 3,552
$ 11,693
$ (9,410 ) $ 2,283

~~Table of Contents~~

~~BANKUNITED, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED~~

~~September 30, 2017~~

Changes in the FDIC indemnification asset and in the liability to the FDIC for recoveries related to assets previously covered under the Commercial Shared-Loss Agreement for the nine months ended September 30, 2017 and the year ended December 31, 2016, were as follows (in thousands):

Balance at December 31, 2015 $ 739,843
Amortization (160,091 )
Reduction for claims filed (46,083 )
Net loss on FDIC indemnification (17,759 )
Balance at December 31, 2016 515,910
Amortization (135,351 )
Reduction for claims filed (16,768 )
Net loss on FDIC indemnification (14,174 )
Balance at September 30, 2017 $ 349,617

~~The balances at September 30, 2017 and December 31, 2016 are reflected in the consolidated balance sheets as follows (in thousands):~~

September 30, 2017 December 31, 2016
FDIC indemnification asset $ 349,617
$ 515,933
Other liabilities —
(23 )
$ 349,617
$ 515,910

~~Note 6~~Income Taxes

The Company’s effective income tax rate was ~~32.2%~~24.4% and ~~31.7%~~24.7% for the three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016, respectively, and 31.2% and 33.2% for the nine months ended September 30, 2017 and 2016,~~2021, respectively. The effective income tax ~~rate~~rates differed from the statutory federal income tax rate of ~~35% in all periods~~21% due primarily to the ~~effect~~impact of state income taxes, partially offset by the benefit of income not subject to tax, offset by state income taxes. In addition, the effective income tax rate for the three and nine months ended September 30, 2017 reflected the impact of $0.3 million and $3.2 million, respectively, in excess tax benefits resulting from activity related to vesting of share-based awards and exercise of stock options.federal tax.

The Company has investments in affordable housing limited partnerships which generate federal Low Income Housing Tax Credits and other tax benefits. The balance of these investments, included in other assets in the accompanying consolidated balance sheet, was $66 million and $71 million at September 30, 2017 and December 31, 2016, respectively. Unfunded commitments for affordable housing investments, included in other liabilities in the accompanying consolidated balance sheet, were $29 million and $53 million at September 30, 2017 and December 31, 2016, respectively. The maximum exposure to loss as a result of the Company's involvement with these limited partnerships at September 30, 2017 was approximately $73 million. While the Company believes the likelihood of potential losses from these investments is remote, the maximum exposure was determined by assuming a scenario where the projects completely fail and do not meet certain government compliance requirements resulting in recapture of the related tax credits. These investments did not have a material impact on income tax expense for the three and nine months ended September 30, 2017 and 2016.

Note 76 Derivatives and Hedging Activities

The Company ~~uses~~has entered into interest rate swaps to manage interest rate risk related to liabilities that expose the Company to variability in cash flows due to changes in interest rates. The Company enters into LIBOR-based interest rate swaps that areand caps designated as cash flow hedges with the objective of limiting the variability of interest payment cash ~~flows resulting from changes in the benchmark~~flows. The Company has also entered into interest rate ~~LIBOR. Changes~~swaps designated as fair value hedges designed to hedge changes in the fair value of ~~interest~~outstanding fixed rate ~~swaps designated as cash flow hedging~~ instruments ~~are reported in AOCI and subsequently reclassified into interest expense~~caused by fluctuations in the ~~same period in which the related~~benchmark interest ~~on the floating-rate debt obligations affects earnings.~~

~~Table of Contents~~

~~BANKUNITED, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED~~

~~September 30, 2017~~

rate.

The Company ~~also~~ enters into interest rate derivative contracts with certain of its commercial borrowers to enable those borrowers to manage their exposure to interest rate fluctuations. To mitigate interest rate risk associated with these derivative contracts, the Company enters into offsetting derivative contract positions with primary dealers. These interest rate derivative contracts are not designated as hedging instruments; therefore, changes in the fair value of these derivatives are recognized immediately in earnings. ~~The~~For the three months ended March 31, 2022 and 2021, the impact on earnings related to changes in fair value of these derivatives ~~for the three and nine months ended September 30, 2017 and 2016~~ was not material.

The Company may be exposed to credit risk in the event of non-performance by the counterparties to its interest rate derivative agreements. The Company assesses the credit risk of its financial institution counterparties by monitoring publicly available credit rating and financial information. The Company manages dealer credit risk by entering into interest rate derivatives only with primary and highly rated counterparties, the use of ISDA master agreements, central clearing mechanisms and counterparty limits. The agreements contain bilateral collateral arrangements with the amount of collateral to be posted generally governed by the settlement value of outstanding swaps. The Company manages the risk of default by its commercial borrower counterparties through its normal loan underwriting and credit monitoring policies and procedures. The Company

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

March 31, 2022

does not currently anticipate any significant losses from failure of interest rate derivative counterparties to honor their obligations.

The CME ~~amended its rules effective January 2017 to~~ legally ~~characterize~~characterizes variation margin payments for centrally cleared derivatives as settlements of the derivatives' exposures rather than collateral. As a result, the variation margin payment and the related derivative instruments are considered a single unit of account for accounting and financial reporting purposes. The Company's clearing agent for interest rate derivative contracts centrally cleared through the CME settles the variation margin daily with the CME; therefore, those interest rate derivative contracts the Company clears through the CME are reported at a fair value of ~~approximately~~ zero at ~~September 30, 2017.~~both March 31, 2022 and December 31, 2021.

The following tables set forth certain information concerning the Company’s interest rate contract derivative financial instruments and related hedged items at the dates indicated (dollars in thousands):


																					March 31, 2022
	September 30, 2017
		Weighted Average Pay Rate		Weighted Average Receive Rate		Weighted Average Remaining Life in Years																		Weighted Average Pay Rate / Strike Price			Weighted Average Receive Rate / Strike Price			Weighted Average Remaining Life in Years
					Notional Amount			Balance Sheet Location		Fair Value																			Notional Amount				Balance Sheet Location					Fair Value
	Hedged Item						Asset				Liability				Hedged Item																	Asset						Liability
Derivatives designated as cash flow hedges:																							Derivatives designated as cash flow hedges:
Pay-fixed interest rate swaps	Variability of interest cash flows on variable rate borrowings		1.77%			3-Month Libor	4.6		$	2,046,000		Other assets / Other liabilities		$	1,066			$	(259	)	Pay-fixed interest rate swaps	Variability of interest cash flows on variable rate borrowings				2.36%			3-Month LIBOR			2.6				$	820,000		Other liabilities				$	—				$	(568)
Pay-fixed interest rate swaps																			Pay-fixed interest rate swaps		Variability of interest cash flows on variable rate borrowings				1.61%			SOFR			2.3				275,000							—					—
Pay-fixed interest rate swaps																			Pay-fixed interest rate swaps		Variability of interest cash flows on variable rate liabilities				1.22%			Fed Funds Effective Rate			2.4				400,000							—					—
Interest rate caps purchased, indexed to Fed Funds effective rate																			Interest rate caps purchased, indexed to Fed Funds effective rate		Variability of interest cash flows on variable rate liabilities			1.00%						3.2			200,000					Other assets		9,781					—
Derivatives designated as fair value hedges:																			Derivatives designated as fair value hedges:
Pay-variable interest rate swaps																			Pay-variable interest rate swaps		Variability of fair value of fixed rate loans						SOFR			2.3			100,000							—					—
Derivatives not designated as hedges:																			Derivatives not designated as hedges:
Pay-fixed interest rate swaps		3.86%		Indexed to 1-month Libor		6.4	1,000,763				Other assets / Other liabilities	7,605				(18,311		)	Pay-fixed interest rate swaps					3.56%			1-Month LIBOR			4.7			1,598,865					Other assets / Other liabilities		14,934					(3,061)
Pay-variable interest rate swaps		Indexed to 1-month Libor		3.86%		6.4	1,000,763				Other assets / Other liabilities	19,648				(8,491		)	Pay-variable interest rate swaps					1-Month LIBOR			3.56%			4.7			1,598,865					Other assets / Other liabilities		9,196					(40,650)
Interest rate caps purchased, indexed to 1-month Libor				2.80%		1.6	145,957				Other assets	15				—
Interest rate caps sold, indexed to 1-month Libor		2.80%				1.6	145,957				Other liabilities	—				(15		)
Pay-fixed interest rate swaps																			Pay-fixed interest rate swaps					3.48%			SOFR			6.4			70,260					Other assets / Other liabilities		2,074					(117)
Pay-variable interest rate swaps																			Pay-variable interest rate swaps					SOFR			3.48%			6.4			70,260					Other assets / Other liabilities		338					(2,074)
Interest rate caps purchased, indexed to 1-month LIBOR																			Interest rate caps purchased, indexed to 1-month LIBOR								1.00%			3.7			25,000					Other assets		951					—
Interest rate caps sold, indexed to 1-month LIBOR																			Interest rate caps sold, indexed to 1-month LIBOR					1.00%						3.7			25,000					Other liabilities		—					(951)
							$	4,339,440				$	28,334			$	(27,076	)															$	5,183,250						$	37,274				$	(47,421)

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

~~September 30, 2017~~March 31, 2022


	December 31, 2021

		Weighted Average Pay Rate / Strike Price	Weighted Average Receive Rate / Strike Price	Weighted Average Remaining Life in Years
					Notional Amount		Balance Sheet Location	Fair Value
	Hedged Item							Asset		Liability
Derivatives designated as cash flow hedges:
Pay-fixed interest rate swaps	Variability of interest cash flows on variable rate borrowings	2.35%	3-Month LIBOR	2.6	$	905,000	Other liabilities	$	—	$	(2,687)
Pay-fixed forward-starting interest rate swaps	Variability of interest cash flows on variable rate liabilities	0.87%	Fed Funds Effective Rate	2.5	200,000			—		—
Interest rate caps purchased, indexed to Fed Funds effective rate	Variability of interest cash flows on variable rate liabilities	1.00%		3.5	200,000		Other assets	3,260		—
Derivatives not designated as hedges:
Pay-fixed interest rate swaps		3.57%	1-Month LIBOR or SOFR	5.0	1,668,517		Other assets / Other liabilities	3,369		(15,347)
Pay-variable interest rate swaps		1-Month LIBOR or SOFR	3.57%	5.0	1,668,517		Other assets / Other liabilities	51,947		(6,837)
Interest rate caps purchased, indexed to 1-month LIBOR			1.00%	4.0	25,000		Other assets	443		—
Interest rate caps sold, indexed to 1-month LIBOR		1.00%		4.0	25,000		Other liabilities	—		(443)
					$	4,692,034		$	59,019	$	(25,314)

December 31, 2016

Weighted
Average Pay Rate

Weighted
Average Receive Rate

Weighted
Average
Remaining
Life in Years

Notional Amount Balance Sheet Location Fair Value
Hedged Item Asset Liability
Derivatives designated as cash flow hedges:

Pay-fixed interest rate swaps Variability of interest cash flows on variable rate borrowings 1.58% 3-Month Libor 3.3 $ 1,715,000
Other assets / Other liabilities $ 19,648
$ (3,112 )
Pay-fixed forward-starting interest rate swaps Variability of interest cash flows on variable rate borrowings 3.43% 3-Month Libor 10.5 300,000
Other liabilities —
(27,866 )
Derivatives not designated as hedges:

Pay-fixed interest rate swaps 3.77% Indexed to 1-month Libor 6.8 912,000
Other assets / Other liabilities 9,949
(20,383 )
Pay-variable interest rate swaps Indexed to 1-month Libor 3.77% 6.8 912,000
Other assets / Other liabilities 20,383
(9,949 )
Interest rate caps purchased, indexed to 1-month Libor
2.96% 2.3 189,057
Other assets 252
—
Interest rate caps sold, indexed to 1-month Libor 2.96% 2.3 189,057
Other liabilities —
(252 )
$ 4,217,114
$ 50,232
$ (61,562 )

The following table provides information about the amount of loss related to derivatives designated as cash flow hedges reclassified from AOCI into interest expense for the periods indicated ~~(dollars in~~(in thousands):

Amount of Loss Reclassified from AOCI on Derivatives
Three Months Ended September 30, Nine Months Ended September 30,
Derivatives in Cash Flow Hedging Relationships 2017 2016 2017 2016 Location of Loss Reclassified from AOCI into Income
Interest rate contracts $ (2,001 ) $ (3,741 ) $ (7,463 ) $ (13,050 ) Interest expense on borrowings


	Three Months Ended March 31,
		2022		2021
Location of loss reclassified from AOCI into income:
Interest expense on borrowings		$	(4,710)	$	(14,975)
Interest expense on deposits		(722)		—
		$	(5,432)	$	(14,975)

During the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, no derivative positions designated as cash flow hedges were discontinued and none of the gains and losses reported in AOCI were reclassified into earnings as a result of the discontinuance of cash flow hedges or because of the early extinguishment of debt. As of ~~September 30, 2017,~~March 31, 2022, the amount of net loss expected to be reclassified from AOCI into earnings during the next twelve months was ~~$6.2~~$1.1 million. See Note 7 to the consolidated financial statements for additional information about the reclassification adjustments from AOCI into earnings.

Table of Contents

BANKUNITED, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

March 31, 2022

The following table provides information about the amount of gain (loss) related to derivatives designated as fair value hedges recognized in earnings for the periods indicated (in thousands):


	Three Months Ended March 31,			Location of Gain (Loss) in Consolidated Statements of Income
		2022				2021
Variability of fair value of fixed rate loans:
Fair value adjustment on derivatives		$	700	$	—		Interest income on loans
Fair value adjustment on hedged items		(733)		—			Interest income on loans
Loss recognized on fair value hedges (ineffective portion)		$	(33)	$	—

Variability of fair value of fixed rate borrowings:
Fair value adjustment on derivatives		$	—	$	(827)		Interest expense on borrowings
Fair value adjustment on hedged items		—		825			Interest expense on borrowings
Loss recognized on fair value hedges (ineffective portion)		$	—	$	(2)

Included in the table above are fair value hedges on fixed rate borrowings which matured during the year ended December 31, 2021.

The following table provides information about the hedged items related to derivatives designated as fair value hedges at the dates indicated (in thousands):


	March 31, 2022		December 31, 2021		Location in Consolidated Balance Sheets
Contractual balance outstanding of hedged item (1)	$	100,000	$	—	Loans
Cumulative fair value hedging adjustments	$	(733)	$	—	Loans

(1)This amount is included in the amortized cost basis of a closed portfolio of loans used to designate hedging relationships in a portfolio layer method hedge in which the hedged item is anticipated to be outstanding for the designated hedge period. At March 31, 2022, the amortized cost basis of the closed portfolio used in this hedging relationship was $1.1 billion.

Some of the Company’s ISDA master agreements with financial institution counterparties contain provisions that permit either counterparty to terminate the agreements and require settlement in the event that regulatory capital ratios fall below certain designated thresholds, upon the initiation of other defined regulatory actions or upon suspension or withdrawal of the Bank’s credit rating. Currently, there are no circumstances that would trigger these provisions of the agreements.

~~Table of Contents~~

~~BANKUNITED, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED~~

~~September 30, 2017~~

The Company does not offset assets and liabilities under master netting agreements for financial reporting purposes. Information on interest rate swaps and caps subject to these agreements is as follows at the dates indicated (in thousands):


	March 31, 2022

			Gross Amounts Offset in Balance Sheet		Net Amounts Presented in Balance Sheet		Gross Amounts Not Offset in Balance Sheet
	Gross Amounts Recognized						Derivative Instruments		Collateral Pledged		Net Amount
Derivative assets	$	27,740	$	—	$	27,740	$	(2,041)	$	(25,514)	$	185
Derivative liabilities	(3,746)		—		(3,746)		2,041		1,214		(491)
	$	23,994	$	—	$	23,994	$	—	$	(24,300)	$	(306)


	September 30, 2017																		December 31, 2021
				Gross Amounts Offset in Balance Sheet			Net Amounts Presented in Balance Sheet			Gross Amounts Not Offset in Balance Sheet
	Gross Amounts Recognized					Derivative Instruments				Collateral Pledged			Net Amount								Gross Amounts Offset in Balance Sheet			Net Amounts Presented in Balance Sheet			Gross Amounts Not Offset in Balance Sheet
																							Gross Amounts Recognized								Derivative Instruments				Collateral Pledged				Net Amount
Derivative assets	$	8,686		$	—		$	8,686		$	(6,814	)	$	(1,539	)	$	333	Derivative assets	$	7,072		$	—				$	7,072			$	(3,104)			$	(3,915)			$	53
Derivative liabilities	(18,570		)	—			(18,570		)	6,814			11,756			—		Derivative liabilities	(18,034)			—			(18,034)				3,104				14,557				(373)
	$	(9,884	)	$	—		$	(9,884	)	$	—		$	10,217		$	333		$	(10,962)		$	—		$	(10,962)			$	—			$	10,642			$	(320)

Nine Months Ended September 30,
2017 2016
Average
Balance
Interest ⁽¹⁾

Yield/
Rate ⁽¹⁾⁽²⁾
Average
Balance
Interest ⁽¹⁾

Yield/
Rate ⁽¹⁾⁽²⁾
Assets:
Interest earning assets:

Non-covered loans $ 19,169,479
$ 535,926
3.73 % $ 16,876,786
$ 452,525
3.58 %
Covered loans 560,934
225,194
53.54 % 746,709
226,659
40.48 %
Total loans 19,730,413
761,120
5.15 % 17,623,495
679,184
5.14 %
Investment securities ⁽³⁾
6,569,553
151,337
3.07 % 5,551,249
117,478
2.82 %
Other interest earning assets 557,623
10,606
2.54 % 531,245
8,850
2.22 %
Total interest earning assets 26,857,589
923,063
4.59 % 23,705,989
805,512
4.53 %
Allowance for loan and lease losses (157,015 ) (133,280 )
Non-interest earning assets 1,754,499
1,946,846

Total assets $ 28,455,073
$ 25,519,555

Liabilities and Stockholders' Equity:
Interest bearing liabilities:
Interest bearing demand deposits $ 1,564,229
8,913
0.76 % $ 1,341,218
6,140
0.61 %
Savings and money market deposits 9,557,907
55,741
0.78 % 8,203,676
37,285
0.61 %
Time deposits 5,988,433
55,507
1.24 % 5,177,191
43,002
1.11 %
Total interest bearing deposits 17,110,569
120,161
0.94 % 14,722,085
86,427
0.78 %
FHLB advances 4,889,578
44,262
1.21 % 4,698,492
35,972
1.02 %
Notes and other borrowings 402,821
15,947
5.28 % 403,213
15,967
5.28 %
Total interest bearing liabilities 22,402,968
180,370
1.08 % 19,823,790
138,366
0.93 %
Non-interest bearing demand deposits 3,034,682
2,944,861

Other non-interest bearing liabilities 443,430
431,921

Total liabilities 25,881,080
23,200,572

Stockholders' equity 2,573,993
2,318,983

Total liabilities and stockholders' equity $ 28,455,073
$ 25,519,555

Net interest income $ 742,693
$ 667,146

Interest rate spread 3.51 % 3.60 %
Net interest margin 3.69 % 3.75 %
(1)On a tax-equivalent basis where applicable. The tax-equivalent adjustment for tax-exempt loans was $3.0 million, $3.1 million and $3.5 million for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively. The tax-equivalent adjustment for tax-exempt investment securities was $0.7 million for all periods presented.

(2)Annualized

(3) At fair value except for securities held to maturity.


~~(1)~~	On a tax-equivalent basis. The tax-equivalent adjustment for tax-exempt loans was $21.5 million and $16.7 million, and the tax-equivalent adjustment for tax-exempt investment securities was $9.7 million and $7.5 million, for the nine months ended September 30, 2017 and 2016, respectively.


~~(2)~~	~~Annualized.~~


~~(3)~~	~~At fair value except for securities held to maturity.~~

Three months ended ~~September 30, 2017~~March 31, 2022 compared to the immediately preceding three months ended ~~September 30, 2016~~December 31, 2021

Net interest income, calculated on a tax-equivalent basis, was ~~$252.0~~$212.3 million for the three months ended March 31, 2022, compared to $209.8 million for the three months ended ~~September 30, 2017~~December 31, 2021, an increase of $2.5 million. The increase in net interest income was comprised of decreases in tax-equivalent interest income and interest expense of $2.0 million and $4.5 million, respectively, for the three months ended March 31, 2022, compared to ~~$230.5~~the three months ended December 31, 2021. The decrease in interest income reflected a lower yield on average loans and lower day count, partially offset by a higher average balance of loans and higher yield on investment securities. The decrease in interest expense reflected a lower cost of both interest bearing deposits and FHLB advances and lower day count, partially offset by a higher average balance of interest-bearing liabilities, particularly FHLB advances.

The net interest margin, calculated on a tax-equivalent basis, was 2.50% for the three months ended March 31, 2022, compared to 2.44% for the three months ended December 31, 2021. Offsetting factors impacting the net interest margin for the three months ended March 31, 2022 compared to the immediately preceding three months ended December 31, 2021 included:

•The tax-equivalent yield on investment securities increased to 1.73%, for the three months ended March 31, 2022 from 1.54%for the three months ended December 31, 2021. This increase resulted from the impact of purchases of higher-yielding securities and slower prepayment speeds on securities purchased at a premium.

•The tax-equivalent yield on loans decreased to 3.36% for the three months ended March 31, 2022, from 3.50% for the three months ended December 31, 2021. Factors contributing to this decrease included runoff of loans originated in a comparatively higher rate environment, slower prepayment speeds on PCD residential loans, the effect of the sale of a pool of higher yielding residential loans during the fourth quarter of 2021, lower prepayment penalties and partially offsetting higher PPP fee recognition.

•The average rate paid on FHLB advances decreased to 1.11% for the three months ended March 31, 2022 from 1.86% for the three months ended December 31, 2021. This decrease resulted from the maturity of higher rate advances, including the termination of certain cash flow hedges during the three months ended December 31, 2021, and the addition of new advances at comparatively lower prevailing rates.

•The average rate paid on interest bearing deposits decreased to 0.24% for the three months ended March 31, 2022, from 0.27% for the three months ended December 31, 2021. Callable and other brokered CDs and cash flow hedges entered into in anticipation of rising rates impacted the cost of deposits for the quarter; the average rate paid on interest bearing deposits excluding these instruments was 0.21% for the quarter ended March 31, 2022. The increase in the average cost of time deposits for the quarter ended March 31, 2022 compared to the quarter ended December 31, 2021 was attributable to these products. The average cost of time deposits other than these products was 0.22% for the quarter ended March 31, 2022.

Three months ended March 31, 2022 compared to the three months ended March 31, 2021

Net interest income, calculated on a tax-equivalent basis, was $212.3 million for the three months ended March 31, 2022, compared to $200.4 million for the three months ended ~~September 30, 2016,~~March 31, 2021, an increase of ~~$21.5~~$11.9 million. The increase in net interest income was comprised of ~~an increase~~decreases in tax-equivalent interest income and interest expense of ~~$41.5~~$10.0 million and $21.9 million, respectively, for the three months ended March 31, 2022, compared to the three months ended March 31, 2021. The decrease in interest income related to lower interest income on loans, resulting primarily from the turnover of the loan portfolio at lower prevailing rates, partially offset by an increase in interest ~~expense of $19.9 million.~~

~~The increase in tax-equivalent interest~~ income ~~was comprised primarily of a $27.9 million increase in interest income from loans and a $12.8 million increase in interest income from~~on investment ~~securities.~~

~~Increased interest income from loans was attributable~~securities related to ~~a $1.7 billion~~an increase in the average balance outstanding and a 0.12% increase in the tax-equivalent yield to 5.15% for the three months ended September 30, 2017 from 5.03% for the three months ended September 30, 2016. Factors contributing to the increase in the yield on loans included:

balance. The tax-equivalent yield on non-covered loans was 3.79% for the three months ended September 30, 2017 compared to 3.56% for the three months ended September 30, 2016. The most significant factor contributing to the increased yield on non-covered loans was increases in market interest rates.

Interest income on covered loans totaled $73.5 million and $74.5 million for the three months ended September 30, 2017 and 2016, respectively. The tax-equivalent yield on those loans increased to 56.70% for the three months ended September 30, 2017 from 42.50% for the three months ended September 30, 2016. The increase in the yield on covered loans resulted primarily from improvements in expected cash flows for ACI loans.

The impact on the overall yield on loans of increased yields on both covered and non-covered loans considered individually was somewhat offset by the continued increase in non-covered loans, with yields lower than those on covered loans, as a percentage of total loans.

The average balance of investment securities increased by $1.1 billion for the three months ended September 30, 2017 from the three months ended September 30, 2016 while the tax-equivalent yield increased to 3.14% from 2.87%. The most significant factor contributing to the increase in the tax-equivalent yield were increases in coupon rates on floating-rate securities.

~~The components of the increase~~decline in interest expense ~~for the three months ended September 30, 2017 as compared to the three months ended September 30, 2016 were a $15.0 million increase~~reflected lower interest expense on both deposits and FHLB advances. The decrease in interest expense on deposits ~~and~~reflected both a ~~$5.0 million increase in interest expense on FHLB advances.~~

~~The increase in interest expense on deposits was attributable to an increase of $2.5 billion in average interest bearing deposits and an increase~~decline in the average balance of interest-bearing deposits and a decline in the cost of ~~interest bearing~~those deposits resulting from the impact of ~~0.22% to 1.02% for~~our strategy focused on lowering the ~~three months ended September 30, 2017 from 0.80% for the three months ended September 30, 2016. These~~ cost ~~increases were generally driven by growth~~ of deposits ~~in competitive markets~~ and ~~a rising market interest rate environment.~~

improving the deposit mix as well as term deposits repricing at lower prevailing rates. The ~~increase~~decline in interest expense on FHLB advances reflected ~~an increase~~a lower average balance, the maturities of higher rate FHLB advances and the termination of certain cash flow hedges in the ~~average cost~~fourth quarter of advances of 0.45% to 1.37% for the three months ended September 30, 2017 from 0.92% for the three months ended September 30, 2016. The increase in cost was driven by increased market rates and to a lesser extent, an extension of maturities through interest rate swaps.2021.

The net interest margin, calculated on a tax-equivalent basis, was 2.50% for the three months ended ~~September 30, 2017 was 3.62% as~~March 31, 2022, compared to ~~3.69%~~2.39% for the three months ended ~~September 30, 2016.~~March 31, 2021. The ~~interest rate spread decreased to 3.43% for the three months ended September 30, 2017 from 3.53% for the three months ended September 30, 2016. The declines~~reduction in ~~net interest margin and interest rate spread resulted primarily from the~~ cost of ~~interest-bearing~~interest bearing liabilities ~~increasing by more than~~outpaced the decline in the yield on interest earning assets.

•The tax-equivalent yield on loans decreased to 3.36% for the three months ended March 31, 2022, from 3.58% for the three months ended March 31, 2021. This ~~difference was driven~~decrease resulted primarily byfrom the ~~decline~~runoff of loans originated in ~~covered loans as~~ a ~~percentage~~comparatively higher rate environment.

•The average rate paid on interest bearing deposits decreased to 0.24% for the three months ended March 31, 2022, from 0.45% for the three months ended March 31, 2021. This decrease resulted from declines in prevailing interest rates and continues execution of ~~total loans. Future trends~~initiatives taken to lower rates on deposits, including the re-pricing of term deposits.

•The average rate paid on FHLB advances decreased to 1.11% for the three months ended March 31, 2022, from 2.32% for the three months ended March 31, 2021. The decrease resulted from the maturity of higher rate advances and the termination of certain cash flow hedges in the ~~net interest margin will be~~fourth quarter of 2021.

Provision for Credit Losses

The provision for credit losses is a charge or credit to earnings required to maintain the ACL at a level consistent with management’s estimate of expected credit losses on financial assets carried at amortized cost at the balance sheet date. The

amount of the provision is impacted by changes in ~~market interest rates, including~~current economic conditions, as well as in management's reasonable and supportable economic forecast, loan originations and runoff, changes in portfolio mix, risk rating migration and portfolio seasoning, changes in specific reserves, changes in expected prepayment speeds and other assumptions. The provision for credit losses also includes amounts related to off-balance sheet credit exposures and may include amounts related to accrued interest receivable and AFS debt securities.

The following table presents the ~~shape~~components of the ~~yield curve, by~~provision for (recovery of) credit losses for the ~~mix of interest earning assets, including~~periods indicated (in thousands):


	Three Months Ended March 31,
	2022		2021
Amount related to funded portion of loans	$	7,446	$	(26,306)
Amount related to off-balance sheet credit exposures	384		(1,048)
Amount related to accrued interest receivable	—		(271)
Amount related to AFS debt securities	—		(364)
Total provision for (recovery of) credit losses	$	7,830	$	(27,989)

The provision for credit losses for the ~~decline in covered loans as a percentage of total loans, and by the Company's ability to manage the cost of funds while growing deposits in competitive markets.~~

~~Nine~~three months ended ~~September 30, 2017~~ ~~compared to nine months ended September 30, 2016~~

~~Net interest income, calculated on a tax-equivalent basis,~~March 31, 2022 was $742.7 million for the nine months ended September 30, 2017 compared to $667.1 million for the nine months ended September 30, 2016, an increase of $75.5 million. The increase in net interest income was comprised of an increase in tax-equivalent interest income of $117.6 million, offsetimpacted by an increase in ~~interest expense of $42.0 million.~~

The increase in tax-equivalent interest income was comprised primarily of an $81.9 million increase in interest income from loans and a $33.9 million increase in interest income from investment securities.

~~Increased interest income from loans was attributable~~qualitative loss factors related to a $2.1 billion increase in the average balance and a 0.01% increase in the tax-equivalent yield to 5.15% for the nine months ended September 30, 2017 from 5.14% for the nine months ended September 30, 2016. Offsetting factors contributingeconomic uncertainty. Those qualitative considerations included but were not necessarily limited to the ~~relatively steady yield on loans included:~~

~~Although the yield on non-covered loans increased~~Federal Reserve's plans for quantitative tightening and increasing its benchmark rate and geopolitical uncertainty, some of which have emerged or evolved subsequent to ~~3.73% for the nine months ended September 30, 2017 from 3.58% for the nine months ended September 30, 2016, lower-yielding non-covered loans comprised a greater percentage~~publishing of the ~~portfolio for~~economic scenarios used in developing the ~~nine months ended September 30, 2017 than for the corresponding period in 2016. Non-covered loans represented 97.2%~~quantitative estimate of the ~~average balance~~ACL. The recovery of ~~loans outstanding for the nine months ended September 30, 2017 compared to 95.8% for the nine months ended September 30, 2016.~~

Interest income on covered loans totaled $225.2 million and $226.7 million for the nine months ended September 30, 2017 and 2016, respectively. The tax-equivalent yield on those loans increased to 53.54% for the nine months ended September 30, 2017 from 40.48% for the nine months ended September 30, 2016.

The average balance of investment securities increased by $1.0 billion for the nine months ended September 30, 2017 from the nine months ended September 30, 2016 while the tax-equivalent yield increased to 3.07% from 2.82%.

The components of the increase in interest expense for the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016 were a $33.7 million increase in interest expense on deposits and an $8.3 million increase in interest expense on FHLB advances.

The increase in interest expense on deposits was attributable to an increase of $2.4 billion in average interest bearing deposits and an increase in the average cost of interest bearing deposits of 0.16% to 0.94% for the nine months ended September 30, 2017 from 0.78% for the nine months ended September 30, 2016. The increase in interest expense on FHLB advances was primarily a result of an increase in the average cost of advances of 0.19% to 1.21% for the nine months ended September 30, 2017 from 1.02% for the nine months ended September 30, 2016.

~~Factors contributing to the changes in yields and costs for the nine month periods were generally consistent with those~~credit losses for the three ~~month periods discussed above.~~

~~The net interest margin, calculated on a tax-equivalent basis, for the nine~~ months ended ~~September 30, 2017~~March 31, 2021 was 3.69% as compared to 3.75% for the nine months ended September 30, 2016. The interest rate spread decreased to 3.51% for the nine months ended September 30, 2017 from 3.60% for the nine months ended September 30, 2016. The declineslargely driven by improvements in ~~net interest margin and interest rate spread resulted primarily from the factors discussed above.~~

~~Provision for Loan Losses~~forecasted economic conditions.

The provision for ~~loan~~credit losses ismay continue to be volatile and the ~~amount~~level of ~~expense that, based on our judgment, is required to maintain~~ the ~~ALLL at an adequate level to absorb probable losses inherent~~ACL may change materially from current levels. Future levels of the ACL could be significantly impacted, in either direction, by changes in the ~~loan portfolio at~~economic outlook and by the ~~balance sheet date~~evolving impact of the COVID-19 pandemic, geopolitical events, and ~~that,~~their impact on individual borrowers in ~~management’s judgment, is appropriate under GAAP.~~ the portfolio.

The determination of the amount of the ~~ALLL~~ACL is complex and involves a high degree of judgment and subjectivity. Our determination of the amount of the allowance and corresponding provision for loan losses considers ongoing evaluations of the credit quality of and level of credit risk inherent in various segments of the loan portfolio and of individually significant credits, levels of non-performing loans and charge-offs, historical and statistical trends and economic and other relevant factors. See “Analysis of the Allowance for ~~Loan and Lease~~Credit Losses” below for more information about how we determine the appropriate level of the ~~allowance.~~

~~The provision for loan losses for~~ACL and about factors that impacted the ~~quarter and~~ ~~nine months ended September 30, 2017~~ included $5.4 million related to the impact of Hurricanes Irma and Harvey. The amount of this provision was determined based on our evaluation of an intensive analysis conducted by our credit teams of the individual loans potentially impacted by these storms, including but not limited to direct contact with borrowers, preliminary assessments of the extent of damage to collateral and impacts on borrowers’ business operations and consideration of the impact of insurance coverage. The amount of the provision related to the impact of these storms is subject to change as individual situations evolve.

~~For the three months ended September 30, 2017 and 2016, we recorded provisions for loan losses of $37.6 million and $24.9 million, respectively, related to non-covered loans. For the~~ ~~nine months ended September 30, 2017~~ ~~and 2016, we recorded provisions for loan losses of~~ ~~$60.9 million~~ ~~and~~ ~~$43.6 million~~, respectively, related to non-covered loans. The amount of the provision is impacted by loan growth, portfolio mix, historical loss rates, the level of charge-offs and specific reserves for impaired loans, and management's evaluation of qualitative factors in the determination of general reserves.

The most significant reason for the increase in the provision for loan losses related to non-covered loans for the quarter ended September 30, 2017 compared to the quarter ended September 30, 2016 was an increase of $28.9 million in the provision related to taxi medallion loans. The provision related to taxi medallion loans totaled $32.7 million for the quarter ended September 30, 2017, compared to $3.9 million for the quarter ended September 30, 2016. A $5.4 million provision recognized in the quarter ended September 30, 2017 related to the impact of hurricanes was more than offset by (i) a net decrease in the relative impact on the provision of changes in quantitative and qualitative loss factors, (ii) the impact of lower loan growth, and (iii) a decrease in provisions for criticized and classified loans.

Factors contributing to the increase in the provision for loan losses related to non-covered loans for the nine months ended September 30, 2017 as compared to the nine months ended September 30, 2016 were generally consistent with those for the three month periods discussed above.

For the three months ended September 30, 2017 and 2016, we recorded provisions for (recovery of) loan losses of $0.3 million and $(0.4) million, respectively, related to covered loans. For the nine months ended September 30, 2017 and 2016, we recorded provisions for (recovery of) loan losses of $2.7 million and $(1.1) million, respectively, related to covered loans. The provision for the nine months ended September 30, 2017 related primarily to impairment recognized on an ACI HELOC pool. As discussed below in the section entitled "Non-interest income," the impact on our results of operations of any provision for (recovery of) loan losses on covered loans is significantly mitigated by the corresponding impact on the FDIC indemnification asset, recorded in non-interest income.

~~Non-Interest Income~~

~~The Company reported non-interest income of $53.3 million and $25.1 million~~ACL for the three months ended ~~September 30, 2017 and 2016, respectively. Non-interest income was~~ ~~$111.4 million~~ ~~and~~ ~~$77.1 million~~ ~~for the~~ ~~nine months ended September 30, 2017~~ and 2016, respectively. A significant portion of our non-interest income has historically related to transactions in the covered assets. We have broken out the significant categories of non-interest income that relate to covered assets in the table below, to assist in the comparison of the amount and composition of our non-interest income with that of other financial institutions.March 31, 2022.

Non-Interest Income

The following table presents a comparison of the categories of non-interest income for the periods indicated (in thousands):


	Three Months Ended March 31,
		2022		2021
Deposit service charges and fees		$	5,960	$	4,900





Gain (loss) on sale of loans, net		(824)		1,754
Gain (loss) on investment securities:
Net realized gain on sale of securities AFS		2,673		3,967
Net unrealized loss on marketable equity securities		(10,541)		(1,602)
Gain (loss) on investment securities, net		(7,868)		2,365
Lease financing		13,415		12,488
Other non-interest income		3,618		8,789
		$	14,301	$	30,296

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Income from resolution of covered assets, net $ 6,400
$ 8,883
$ 22,066
$ 26,426
Loss on sale of covered loans, net —
(10,033 ) (1,582 ) (14,895 )
Net gain (loss) on FDIC indemnification (4,838 ) 993
(14,174 ) (9,410 )
Other 237
371
957
623
Non-interest income related to the covered assets 1,799
214
7,267
2,744
Service charges and fees 4,938
5,171
15,554
14,529
Gain on sale of non-covered loans 2,447
2,086
8,183
7,535
Gain on investment securities available for sale, net 26,931
3,008
29,194
10,065
Lease financing 13,287
11,188
40,067
32,762
Other non-interest income 3,924
3,408
11,098
9,495
$ 53,326
$ 25,075
$ 111,363
$ 77,130

~~Non-interest~~The increase in deposit service charges for the three months ended March 31, 2022 resulted primarily from higher treasury management fee income, related to ~~transactions~~growth in commercial non-interest bearing DDA relationships as well as enhancements to the~~covered assets~~ product suite and pricing structure.

The ~~consolidated financial statements reflect~~unrealized loss on marketable equity securities for the ~~impact of gains or losses arising from transactions~~three months ended March 31, 2022 was attributable to the decline in the ~~covered assets.~~ fair value of certain preferred stock investments resulting from rising market interest rates.

The balance of the FDIC indemnification asset is reduced or increased as a result of decreases or increases in cash flows expected to be received from the FDIC related to these gains or losses. When these transaction gains or losses are recorded, we also record an offsetting amount in the consolidated statement of income line item “Net gain (loss) on FDIC indemnification.” This line item includes the significantly mitigating impact of FDIC indemnification relatedmost significant factors leading to the ~~following types of transactions~~decrease in ~~covered assets:~~

~~gains or losses from the resolution of covered assets;~~

~~provisions for (recoveries of) losses on covered loans;~~

~~gains or losses on the sale of covered loans; and~~

~~gains or losses on covered OREO.~~

See Note 5 to the consolidated financial statements for further details about the components of these gains and losses associated with covered assets, along with the related additions to or reductions in the amounts recoverable from the FDIC under the Loss Sharing Agreements, as reflected in the consolidated statements ofother non-interest income for the three ~~and nine~~ months ended ~~September 30, 2017 and 2016.~~

Covered loans may be resolved through prepayment, short sale of the underlying collateral, foreclosure, sale of the loans or charge-off. For loans resolved through prepayment, short sale or foreclosure, the difference between consideration received in resolution of the loans and the carrying value of the loans is recorded in the consolidated statement of income line item “Income

from resolution of covered assets, net.” Both gains and losses on individual resolutions are included in this line item. Losses from the resolution of covered loans increase the amount recoverable from the FDIC under the Loss Sharing Agreements. Gains from the resolution of covered loans reduce the amount recoverable from the FDIC under the Loss Sharing Agreements. These additionsMarch 31, 2022 compared to or reductions in amounts recoverable from the FDIC related to the resolution of covered loans are recorded in non-interest income in the line item “Net gain (loss) on FDIC indemnification” and reflected as corresponding increases or decreases in the FDIC indemnification asset. The amount of income or loss recorded in any period will be impacted by the amount of covered loans resolved, the amount of consideration received, and our ability to accurately project cash flows from ACI loans in future periods.

~~The following table provides further detail of the components of income from resolution of covered assets, net, for the periods indicated (in thousands):~~

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Payments in full $ 6,423
$ 9,371
$ 22,201
$ 26,790
Other (23 ) (488 ) (135 ) (364 )
Income from resolution of covered assets, net $ 6,400
$ 8,883
$ 22,066
$ 26,426

Under the terms of the Purchase and Assumption Agreement with the FDIC, the Bank may sell up to 2.5% of the covered loans based on UPB at the date of the FSB Acquisition, or approximately $280 million, on an annual basis without prior consent of the FDIC. Any losses incurred from such loan sales are covered under the Single Family Shared-Loss Agreement. Any loan sale in excess of this stipulated annual threshold requires approval from the FDIC to be eligible for loss share coverage. However, if the Bank seeks to sell covered loans in excess of the 2.5% threshold in the nine months prior to the stated termination date of loss share coverage, May 21, 2019, and the FDIC does not consent, the Single Family Shared-Loss Agreement will be extended for two additional years with respect to the loans requested to be included in such sales. The Bank will then have the right to sell all or any portion of such loans without FDIC consent at any time within the nine months prior to the extended termination date, and any losses incurred will be covered under the Single Family Shared-Loss Agreement. This final sale mechanism, if exercised, ensures no residual credit risk in our covered loan portfolio that would otherwise arise from credit losses occurring after the termination date of the Single Family Shared-Loss Agreement.

~~The following table summarizes the gain (loss) recorded on the sale of covered residential loans and the impact of related FDIC indemnification for the periods indicated (in thousands):~~

Three Months Ended September 30, Nine Months Ended September 30,
2016 2017 2016
Loss on sale of covered loans $ (10,033 ) $ (1,582 ) $ (14,895 )
Net gain on FDIC indemnification 8,026
1,266
11,958
Net impact on pre-tax earnings $ (2,007 ) $ (316 ) $ (2,937 )

~~The Bank did not sell covered residential loans in~~ the three months ended ~~September 30, 2017, due to the potential impact of Hurricane Irma on the market for these loans, the collateral for many of which is located in Florida.~~

Pricing received on the sale of covered loans may vary based on (i) market conditions, including the interest rate environment, the amount of capital seeking investment and the secondary supply of loans with a particular performance history or collateral type, (ii) the type and quality of collateral, (iii) the performance history of loans included in the sale and (iv) whether or not the loans have been modified. We anticipate that we will continue to exercise our right to sell covered residential loans on a quarterly basis in the future.

~~Other components of non-interest income~~

~~Period over period increases~~March 31, 2021 were declines in income ~~from lease financing corresponded to the growth in the portfolio of equipment under operating lease.~~

~~Gains on sale of non-covered loans for the three and nine months ended September 30, 2017 and 2016 related primarily to sales of loans by SBF.~~

Gain on sale of investment securities available for sale, net totaled $26.9 million for the quarter ended September 30, 2017. Substantially all of these gains resulted from the sale of securities formerly covered under the Commercial Shared-Loss Agreement and originally acquired at significant discounts in the FSB Acquisition. Other gains on investment securities available for sale for the three and nine months ended September 30, 2017 and 2016 related to ~~sales of securities~~certain investments in ~~the normal course of managing liquidity, portfolio duration~~bank-owned life insurance and ~~yield.~~revenue related to our customer derivative program.

Non-Interest Expense

The following table presents the components of non-interest expense for the periods indicated (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Employee compensation and benefits $ 58,327
$ 55,162
$ 178,386
$ 166,374
Occupancy and equipment 18,829
18,867
56,689
57,199
Amortization of FDIC indemnification asset 45,225
38,957
135,351
116,711
Deposit insurance expense 5,764
4,943
16,827
12,866
Professional fees 2,748
3,884
12,573
10,119
Telecommunications and data processing 3,452
3,746
10,481
10,800
Depreciation of equipment under operating lease 8,905
6,855
25,655
20,004
Other non-interest expense 13,455
15,590
37,735
40,151
$ 156,705
$ 148,004
$ 473,697
$ 434,224

~~Annualized non-interest expense as a percentage of average assets was 2.1% and 2.2% for the three and nine months ended September 30, 2017, respectively, and 2.2% and 2.3% for the three and~~ ~~nine months ended September 30, 2016~~, respectively. Excluding amortization of the FDIC indemnification asset, non-interest expense as a percentage of average assets was 1.5% and 1.6% for the three and nine months ended September 30, 2017, respectively, and 1.6% and 1.7% for the three and ~~nine months ended September 30, 2016, respectively. The more significant changes in the components of non-interest expense are discussed below.~~


	Three Months Ended March 31,
		2022		2021
Employee compensation and benefits		$	67,088	$	59,288
Occupancy and equipment		11,512		11,875
Deposit insurance expense		3,403		7,450
Professional fees		2,262		1,912
Technology and telecommunications		17,004		15,741

Depreciation and impairment of operating lease equipment		12,610		12,217

Other non-interest expense		12,445		14,738
Total non-interest expense		$	126,324	$	123,221

Employee compensation and benefits

~~As is typical for financial institutions, employee compensation and benefits represents the single largest component of recurring non-interest expense.~~ Employee compensation and benefits increased by $7.8 million for the three months ended March 31, 2022 compared to the three months ended March 31, 2021. The increase was primarily due to increased headcount and employee compensation increases.

Deposit insurance expense

Deposit insurance expense decreased by $4.0 million for the three ~~and nine~~ months ended ~~September 30, 2017 increased by $3.2 million and $12.0 million~~March 31, 2022, compared to the ~~corresponding periods in 2016. The increases for the~~ three ~~and nine~~ months ended ~~September 30, 2017~~March 31, 2021, primarily ~~reflected increased headcount and general increases in compensation levels.~~

~~Amortization of FDIC indemnification asset~~

~~Amortization of FDIC indemnification asset totaled $45.2 million and $135.4 million, respectively, for the three and nine months ended September 30, 2017 compared to~~ ~~$39.0 million~~ ~~and~~ ~~$116.7 million, respectively, for the three and~~ ~~nine months ended September 30, 2016~~.

The FDIC indemnification asset was initially recorded at its estimated fair value, representing the present value of estimated future cash payments from the FDIC for probable losses on covered assets. As projected cash flows from the ACI loans have increased, the yield on the loans has increased accordingly and the estimated future cash payments from the FDIC have decreased. This change in estimated cash flows is recognized prospectively, consistent with the recognition of the increased cash flows from the ACI loans. Asas a result ~~the FDIC indemnification asset is being amortized to the amount~~ of the estimated future cash flows. For the three and nine months ended September 30, 2017, the average rate at which the FDIC indemnification asset was amortized was 46.62% and 41.19%, respectively, compared to ~~25.36%~~ ~~and~~ ~~23.48%, respectively, during the comparable periods in~~ ~~2016~~.

~~The rate of amortization will increase if estimated future cash payments from the FDIC decrease. The amount of amortization is impacted by both the change~~an improvement in the amortization rate and the decrease in the average balance of the indemnification asset. As we continue to submit claims under the Loss Sharing Agreements and recognize periodic amortization, the balance of the indemnification asset will continue to decline.assessment rate.

Income Taxes

See Note 5 to the consolidated financial statements for ~~a rollforward of the FDIC indemnification asset for the nine months ended September 30, 2017 and the year ended December 31, 2016. The entire balance of the FDIC indemnification asset relates~~information about income taxes.

to residential loans and OREO covered under the Single Family Shared-Loss Agreement. The following table presents the carrying value of the FDIC indemnification asset and the estimated future cash flows at the dates indicated (in thousands):

September 30, 2017 December 31, 2016
FDIC indemnification asset $ 349,617
$ 515,933
Less expected amortization (173,685 ) (245,350 )
Amount expected to be collected from the FDIC $ 175,932
$ 270,583

The amount of expected amortization reflects the impact of improvements in cash flows expected to be collected from the covered loans, as well as the impact of time value resulting from the discounting of the asset when it was initially established. This amount will be amortized to non-interest expense using the effective interest method over the period during which cash flows from the FDIC are expected to be collected, which is limited to the lesser of the contractual term of the Single Family Shared-Loss Agreement and the expected remaining life of the indemnified assets.

~~Deposit insurance expense~~

~~Deposit insurance expense increased $0.8 million and $4.0 million, respectively, for the three and nine months ended September 30, 2017 compared to the corresponding periods in~~ ~~2016. These increases primarily reflect the growth of the balance sheet, the large bank surcharge imposed by the FDIC, which began in the third quarter of~~ ~~2016, and increases in certain components of the Bank's assessment rate.~~

~~Depreciation of equipment under operating lease~~

Depreciation of equipment under operating lease increased by $2.1 million and $5.7 million, respectively, for the three and nine months ended September 30, 2017 compared to the corresponding periods in ~~2016. These increases generally correspond to the growth in the portfolio of equipment under operating lease.~~

~~Other non-interest expense~~

The most significant components of other non-interest expense are advertising and promotion, costs related to lending activities and deposit generation, OREO related expenses, insurance, travel and general office expense. Other non-interest expense for the three months ended September 30, 2017 includes $0.6 million related primarily to facilities damage and employee relocation and assistance due to the impact of Hurricane Irma. We do not expect future expenses related to facilities damage and employee relocation to be material to the Company.

~~Income Taxes~~

~~The Company’s effective income tax rate was 32.2% and 31.2% for the three and nine months ended September 30, 2017, respectively, compared to~~ ~~31.7%~~ ~~and~~ ~~33.2%~~ ~~for the three and~~ ~~nine months ended September 30, 2016~~, respectively. Significant components included in the reconciliation of the Company's effective income tax rate to the statutory federal tax rate of 35.0% included the effect of state income taxes and the impact of income not subject to federal tax for each of the periods presented. In addition, the effective income tax rate for the three and nine months ended September 30, 2017 reflected the impact of $0.3 million and $3.2 million, respectively, in excess tax benefits resulting from activity related to vesting of share-based awards and exercise of stock options.

Analysis of Financial Condition

Average interest-earning assets increased ~~$3.2 billion~~by $425 million to ~~$26.9~~$34.1 billion for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2022 from ~~$23.7~~$33.7 billion for the ~~nine~~three months ended ~~September 30, 2016. This increase was driven by a $2.1 billion increase in the average balance of outstanding loans and a $1.0 billion~~March 31, 2021, primarily due to an increase in the average balance of investment securities. The increase in average loans reflected growth of $2.3 billion in average non-covered loans outstanding, partially offset by a $186 million decrease in the average balance of covered loans. The decrease in average non-interest earning assets period over period primarily reflected a decrease in the FDIC indemnification asset. Growth in interest earning assets, resolution of covered loans and declines in the amount of the FDIC indemnification asset are trends that are expected to continue.

Average interest bearing liabilities ~~increased $2.6 billion to $22.4 billion~~declined by $912.9 million for the ~~nine~~three months ended ~~September 30, 2017 from $19.8 billion for~~March 31, 2022 compared to the ~~nine~~three months ended ~~September 30, 2016, due to increases of $2.4 billion~~March 31, 2021, reflecting declines in both average ~~interest bearing~~interest-bearing deposits and ~~$191 million in~~ average FHLB advances. ~~Average~~Correspondingly, average non-interest bearing deposits increased by ~~$90 million. We expect~~$1.6 billion to $9.0 billion for the three months ended March 31, 2022. These year-over-year trends in average balances were reflective of the operating environment as the U.S. economy began to emerge from the COVID-19 pandemic. Our ongoing strategy focused on improving the quality of our deposit base coupled with increased amounts of liquidity in the system led to growth in ~~average~~non-interest bearing demand deposits ~~to continue,~~and corresponding ~~to anticipated growth~~declines in interest ~~earning assets.~~bearing sources of funds. Headwinds to commercial loan growth including muted demand, our risk appetite given continued uncertainty about the ultimate impact of the pandemic, prepayments and supply chain constraints led to deployment of liquidity into the securities portfolio.

~~Average stockholders' equity increased~~In analyzing changes in the balance sheet for the quarter ended March 31, 2022, cash and investment securities grew by ~~$255~~$891 million, ~~due primarily~~with securities growing by $508 million, at March 31, 2022 compared to December 31, 2021, while total loans declined by $395 million over the same period. Total deposits decreased by $897 million. This activity was offset by an increase of $1.5 billion in FHLB advances. Growth in the investment portfolio, which we did not initially anticipate would occur during the first quarter, reflected opportunistic purchases of securities at attractive spreads toward the end of the quarter. The most significant contributor to the ~~retention~~decline in total loans was a decrease of ~~earnings, but also reflecting proceeds from~~$391 million in mortgage warehouse loans as refinancing activity has slowed in response to rising interest rates. While total deposits declined during the ~~exercise~~first quarter of ~~stock options~~2022, non-interest bearing demand deposits grew by $688 million. The decrease in total deposits reflected declines in interest bearing demand, savings and ~~an increase~~money market, and time deposits. The majority of deposit outflows were accounts that, based on prior experience, we would expect to be price sensitive in ~~accumulated other comprehensive income.~~a rising rate environment and was consistent with our overall deposit strategy.

Investment Securities ~~Available for Sale~~

The following table shows the amortized cost and carrying value, which, with the exception of investment securities held to maturity, is fair value, of investment securities ~~available for sale as of~~at the dates indicated (in thousands):



	March 31, 2022				December 31, 2021
	Amortized Cost		Carrying Value		Amortized Cost		Carrying Value
U.S. Treasury securities	$	109,402	$	101,519	$	114,385	$	111,660
U.S. Government agency and sponsored enterprise residential MBS	2,175,183		2,165,624		2,093,283		2,097,796
U.S. Government agency and sponsored enterprise commercial MBS	753,232		714,594		861,925		856,899

Private label residential MBS and CMOs	2,827,169		2,708,041		2,160,136		2,149,420
Private label commercial MBS	2,752,931		2,711,986		2,604,690		2,604,010
Single family real estate-backed securities	506,111		493,869		474,845		476,968
Collateralized loan obligations	1,079,220		1,072,480		1,079,217		1,078,286
Non-mortgage asset-backed securities	119,282		117,398		151,091		152,510
State and municipal obligations	204,920		207,279		205,718		222,277
SBA securities	169,724		169,112		184,296		183,595

Investment securities held to maturity	10,000		10,000		10,000		10,000
	$	10,707,174	10,471,902		$	9,939,586	9,943,421
Marketable equity securities			100,196				120,777
			$	10,572,098			$	10,064,198

September 30, 2017 December 31, 2016

Amortized
Cost

Fair
Value

Amortized
Cost

Fair
Value
U.S. Treasury securities $ 24,969
$ 24,957
$ 4,999
$ 5,005
U.S. Government agency and sponsored enterprise residential MBS 2,332,616
2,348,687
1,513,028
1,527,242
U.S. Government agency and sponsored enterprise commercial MBS 139,966
139,220
126,754
124,586
Private label residential MBS and CMOs 507,381
527,858
334,167
375,098
Private label commercial MBS 1,140,465
1,153,601
1,180,386
1,187,624
Single family rental real estate-backed securities 566,635
572,948
858,339
861,251
Collateralized loan obligations 695,414
700,319
487,678
487,296
Non-mortgage asset-backed securities 80,255
82,637
187,660
186,736
Preferred stocks 60,716
70,716
76,180
88,203
State and municipal obligations 666,013
677,015
705,884
698,546
SBA securities 572,540
586,675
517,129
523,906
Other debt securities 4,056
8,839
3,999
8,091
$ 6,791,026
$ 6,893,472
$ 5,996,203
$ 6,073,584

Our investment strategy has focused on insuring adequate liquidity, ~~adding~~maintaining a suitable balance of high credit quality, ~~diversifying~~diverse assets, ~~to the consolidated balance sheet,~~ managing interest rate risk, and generating acceptable returns given our established risk parameters. We have sought to maintain liquidity by investing a significant portion of the portfolio in high quality liquid securities including U.S. Treasury ~~securities, SBA securities~~ and U.S. Government ~~agency MBS.~~Agency and sponsored enterprise securities. Investment grade municipal securities provide liquidity ~~along with higher~~and attractive tax-equivalent ~~yields at longer durations than the portfolio in general.~~yields. We have also invested in highly rated structured products, including private-label commercial and residential MBS, collateralized loan obligations, single family real estate-backed securities and non-mortgage asset-backed securities that, while somewhat less liquid, provide us with attractive yields. Relatively short effective portfolio duration helps mitigate interest rate ~~risk arising from~~risk. Based on the ~~currently low level of market interest rates. The~~Company’s assumptions, the estimated weighted average ~~expected~~ life of the investment portfolio as of ~~September 30, 2017~~March 31, 2022 was ~~4.9~~4.4 years and the effective duration of the portfolio was 1.7 years.

The ~~following table shows the scheduled maturities, carrying values and current yields for~~ investment securities available for sale as of September 30, 2017. Scheduled maturities have been adjusted for anticipated prepayments of MBS and other pass through securities. Yields on tax-exempt securities have been calculated on a tax-equivalent basis (dollars in thousands):

Within One Year
After One Year
Through Five Years

After Five Years
Through Ten Years
After Ten Years Total

Carrying
Value

Weighted
Average
Yield

Carrying
Value

Weighted
Average
Yield

Carrying
Value

Weighted
Average
Yield

Carrying
Value

Weighted
Average
Yield

Carrying
Value

Weighted
Average
Yield
U.S. Treasury securities $ 24,957
1.19 % $ —
— % $ —
— % $ —
— % $ 24,957
1.19 %
U.S. Government agency and sponsored enterprise residential MBS 355,685
2.94 % 860,103
2.28 % 893,121
2.14 % 239,778
2.15 % 2,348,687
2.31 %
U.S. Government agency and sponsored enterprise commercial MBS 5,562
3.80 % 11,066
3.71 % 83,066
2.50 % 39,526
3.57 % 139,220
2.95 %
Private label residential MBS and CMOs 113,951
4.01 % 284,366
3.82 % 101,127
4.07 % 28,414
4.39 % 527,858
3.94 %
Private label commercial MBS 90,284
3.80 % 786,542
3.57 % 276,775
3.20 % —
— % 1,153,601
3.50 %
Single family rental real estate-backed securities 1,516
3.18 % 546,920
2.92 % 24,512
3.70 % —
— % 572,948
2.95 %
Collateralized loan obligations —
— % 573,474
3.32 % 126,845
3.52 % —
— % 700,319
3.36 %
Non-mortgage asset-backed securities 11,999
3.91 % 70,638
3.63 % —
— % —
— % 82,637
3.67 %
State and municipal obligations —
— % 27,509
3.00 % 624,758
4.46 % 24,748
5.60 % 677,015
4.45 %
SBA securities 93,080
2.54 % 245,991
2.50 % 150,116
2.47 % 97,488
2.43 % 586,675
2.49 %
Other debt securities —
— % —
— % 1,900
9.17 % 6,939
9.13 % 8,839
9.14 %
$ 697,034
3.13 % $ 3,406,609
3.04 % $ 2,282,220
3.11 % $ 436,893
2.74 % 6,822,756
3.05 %
Preferred stocks with no scheduled maturity

70,716
8.66 %
Total investment securities available for sale

$ 6,893,472
3.11 %

~~The available for sale investment securities~~ portfolio was in a net unrealized ~~gain~~loss position of ~~$102.4~~$235.3 million at ~~September 30, 2017 with aggregate fair value equal to 101.5% of amortized cost.~~March 31, 2022. Net unrealized ~~gains~~losses at March 31, 2022 included ~~$110.3~~$17.5 million of gross unrealized gains and ~~$7.9~~$252.8 million of gross unrealized losses. Investment securities available for sale in an unrealized loss ~~position~~positions at ~~September 30, 2017~~March 31, 2022 had an aggregate fair value of ~~$1.0~~$8.4 billion. ~~At September 30, 2017, 96.7%~~The unrealized losses resulted primarily from rising interest rates and widening spreads related to the Federal Reserve's plans for quantitative tightening and benchmark interest rate increases. None of ~~investment~~the unrealized losses were attributable to credit loss impairments. The ratings distribution of our AFS securities available for sale were backed by the U.S. Government, U.S. Government agencies or sponsored enterprises or were rated AAA , AA or A, based on the most recent third-party ratings. Investment securities available for sale totaling $33 million were rated below investment grade or not ratedportfolio at ~~September 30, 2017, all of which were acquired~~March 31, 2022 is depicted in the ~~FSB Acquisition and substantially all of which were in unrealized gain positions at September 30, 2017.~~chart below:

We evaluate the credit quality of individual securities in the portfolio quarterly to determine whether ~~any~~we expect to recover the amortized cost basis of the investments in unrealized loss ~~positions are other-than-temporarily impaired.~~positions. This evaluation considers, but is not necessarily limited to, the following factors, the relative significance of which varies depending on the circumstances pertinent to each individual security:

~~our intent~~•Whether we intend to ~~hold~~sell the security ~~until maturity or for a period~~prior to recovery of ~~time sufficient for a recovery in value;~~its amortized cost basis;

~~whether~~•Whether it is more likely than not that we will be required to sell the security prior to recovery of its amortized cost basis;

~~the length of time and~~•The extent to which fair value ~~has been~~is less than amortized cost;

~~adverse changes~~•Adverse conditions specifically related to the security, an industry or geographic area;

•Changes in ~~expected cash flows;~~the financial condition of the issuer or underlying loan obligors;

~~collateral values and performance;~~

~~the~~•The payment structure and remaining payment terms of the security, including levels of subordination or over-collateralization;

~~changes in the economic or regulatory environment;~~

~~the general market condition~~•Failure of the ~~geographic area or industry of the issuer;~~issuer to make scheduled payments;

~~the issuer’s financial condition, performance and business prospects; and~~

~~changes~~•Changes in credit ~~ratings.~~ratings;

~~Our evaluation~~•Relevant market data;

•Estimated prepayments, defaults, and the value and performance of non-agency impaired securities for OTTI as of September 30, 2017 included consideration of the potential impacts of Hurricanes Irma and Harvey. Our considerations included but were not necessarily limited to (i) observations of market pricing since the hurricanes, (ii) whether a significant portion of the underlying collateral ~~was in an~~

~~impacted area, (iii) whether credit enhancement significantly exceeded~~at the balance of collateral in impacted areas, (iv) for residential mortgage-backed securities, the evaluation of the extent and nature of damage to residential collateral for loans in the Bank’s residential loan portfolio located in the same areas, and (v) discussions with sponsors or managers of individual ~~securities about specific collateral impact.~~

During the three and nine months ended September 30, 2016, OTTI was recognized on two positions in one private label commercial MBS. These positions were in unrealized loss positions at September 30, 2016 and the Company intended to sell the security ~~before recovery of the amortized cost basis. No securities were determined to be other-than-temporarily impaired at September 30, 2017, or during the three and nine months then ended.~~level.

We do not intend to sell securities in significant unrealized loss positions at ~~September 30, 2017.~~March 31, 2022. Based on an assessment of our liquidity position and internal and regulatory guidelines for permissible investments and concentrations, it is not more likely than not that we will be required to sell securities in significant unrealized loss positions prior to recovery of amortized cost ~~basis. The severity of impairment of individual securities~~basis, which may be at maturity.

We regularly engage with bond managers to monitor trends in ~~the portfolio is generally not material. Unrealized losses in the portfolio at September 30, 2017 were primarily attributable to an increase in market interest rates~~underlying collateral including potential downgrades and subsequent ~~to the date the securities were acquired.~~cash flow diversions, liquidity, ratings migration, and any other relevant developments.

The ~~timely repayment of principal~~following table presents subordination levels and interest on U.S. Treasury, U.S. Government agency and sponsored enterprise securities in unrealized loss positions is explicitly or implicitly guaranteed by the full faith and credit of the U.S. Government. Management performed projected cash flow analyses of the private label residential MBS and CMOs, private label commercial MBS and non-mortgage asset-backed securities in unrealized loss positions, incorporating CUSIP level assumptions consistent with the collateral characteristics of each security including collateral default rate, voluntary prepayment rate, severity and delinquency assumptions. Based on the results of this analysis, no creditaverage internal stress scenario losses ~~were projected. Management's analysis of the credit characteristics of individual securities and the underlying collateral and levels of subordination~~ for each of the single family rental real estate-backed securities in unrealized loss positions is not indicative of projected credit losses. Management's analysis of the state and municipal obligations in unrealized loss positions included reviewing the ratings of the securities and the results of credit surveillance performed by an independent third party. Given the expectation of timely repayment of principal and interest and the generally limited severity of impairment, the impairments were considered to be temporary.select portfolio segments at March 31, 2022:


				Subordination						Weighted Average Stress Scenario Loss
	Rating	Percent of Total		Minimum		Maximum		Average
Private label CMBS	AAA	84.2	%	30.0	%	88.5	%	44.3	%	5.7	%
	AA	11.1	%	28.5	%	92.5	%	40.1	%	6.0	%
	A	4.7	%	23.7	%	69.0	%	42.0	%	5.2	%
Weighted average		100.0	%	29.5	%	88.0	%	43.7	%	5.7	%

CLOs	AAA	79.0	%	41.2	%	64.3	%	44.9	%	7.4	%
	AA	17.2	%	30.8	%	42.5	%	35.2	%	7.0	%
	A	3.8	%	24.8	%	28.3	%	26.1	%	7.2	%
Weighted average		100.0	%	38.8	%	59.1	%	42.6	%	7.3	%

Private label residential MBS and CMO	AAA	95.0	%	2.9	%	81.5	%	17.2	%	1.8	%
	AA	1.0	%	19.9	%	30.4	%	23.0	%	4.2	%
	A	4.0	%	18.3	%	20.7	%	18.5	%	4.2	%
Weighted average		100.0	%	3.7	%	78.6	%	17.3	%	2.0	%

Single family real estate-backed securities	AAA	62.8	%	33.5	%	72.6	%	49.4	%	4.9	%
	AA	11.5	%	15.6	%	55.3	%	46.9	%	5.9	%
	NR	25.7	%	23.0	%	35.0	%	32.2	%	7.2	%
Weighted average		100.0	%	28.8	%	61.0	%	44.7	%	5.6	%

For further discussion of our analysis of impaired investment securities AFS for ~~OTTI,~~credit loss impairment see Note 3 to the consolidated financial statements.

We use third-party pricing services to assist us in estimating the fair value of investment securities. We perform a variety of procedures to ensure that we have a thorough understanding of the methodologies and assumptions used by the pricing services including obtaining and reviewing written documentation of the methods and assumptions employed, conducting interviews with valuation desk personnel and reviewing model results and detailed assumptions used to value selected securities as considered necessary. Our classification of prices within the fair value hierarchy is based on an evaluation of the nature of the significant assumptions impacting the valuation of each type of security in the portfolio. We have established a robust price challenge process that includes a review by our treasury front office of all prices provided on a monthly basis. Any price evidencing unexpected month over month fluctuations or deviations from our expectations based on recent observed trading activity and other information available in the marketplace that would impact the value of the security is challenged. Responses to the price challenges, which generally include specific information about inputs and assumptions incorporated in the valuation and their sources, are reviewed in detail. If considered necessary to resolve any discrepancies, a price will be obtained from an additional independent valuation ~~specialist.~~sources. We do not typically adjust the prices provided, other than through this established challenge process. Our primary pricing services utilize observable inputs when available, and employ unobservable inputs and proprietary models only when observable inputs are not available. As a matter of course, the services validate prices by comparison to recent trading activity whenever such activity exists. Quotes obtained from the pricing services are typically non-binding.

We have also established a quarterly price validation process to assess the propriety of the pricing methodologies utilized by our primary pricing services by independently verifying the prices of a sample of securities in the portfolio. Sample sizes vary based on the type of security being priced, with higher sample sizes applied to more difficult to value security types. Verification procedures may consist of obtaining prices from an additional outside source or internal modeling, generally based on Intex. We have established acceptable percentage deviations from the price provided by the initial pricing source. If deviations fall outside the established parameters, we will obtain and evaluate more detailed information about the assumptions and inputs used by each pricing source or, if considered necessary, employ an additional valuation specialist to price the security in question. Pricing issues identified through this evaluation are addressed with the applicable pricing service and methodologies or inputs are revised as determined necessary. Depending on the results of the validation process, sample sizes may be extended for particular classes of securities. Results of the validation process are reviewed by the treasury front office and by senior management.

The majority of our investment securities are classified within level 2 of the fair value hierarchy. U.S. Treasury securities and ~~certain preferred stocks~~marketable equity securities are classified within level 1 of the hierarchy. At September 30, 2017 and December 31, 2016, 1.0% and 2.1%, respectively, of our investment securities were classified within level 3 of the fair value hierarchy. Securities classified within level 3 of the hierarchy at September 30, 2017 included certain private label residential MBS and trust preferred securities. These securities were classified within level 3 of the hierarchy because proprietary assumptions related to voluntary prepayment rates, default probabilities, loss severities and discount rates were considered significant to the valuation. There were no transfers of investment securities between levels of the fair value hierarchy during the nine months ended September 30, 2017 and 2016.

For additional discussion of the fair values of investment securities, see Note 108 to the consolidated financial statements.

~~Loans Held~~

The following table shows the weighted average prospective yields, categorized by scheduled maturity, for ~~Sale~~AFS investment securities as of March 31, 2022. Scheduled maturities have been adjusted for anticipated prepayments when applicable. Yields on tax-exempt securities have been calculated on a tax-equivalent basis, based on a federal income tax rate of 21%:

Loans held for sale at September 30, 2017 included $32 million of commercial loans originated by SBF with the intent to sell in the secondary market. Commercial loans held for sale are comprised of the portion of loans guaranteed by U.S. government agencies. Loans are generally sold with servicing retained. Servicing activity did not have a material impact on the results of operations for the three and nine months ended September 30, 2017 and 2016.


	Within One Year		After One Year Through Five Years		After Five Years Through Ten Years		After Ten Years		Total

U.S. Treasury securities	0.69	%	—	%	—	%	—	%	0.69	%
U.S. Government agency and sponsored enterprise residential MBS	1.23	%	1.23	%	1.20	%	1.03	%	1.22	%
U.S. Government agency and sponsored enterprise commercial MBS	1.60	%	1.57	%	1.16	%	1.57	%	1.30	%
Private label residential MBS and CMOs	2.23	%	2.14	%	1.84	%	1.52	%	2.03	%
Private label commercial MBS	2.53	%	2.14	%	2.16	%	3.05	%	2.19	%
Single family real estate-backed securities	1.36	%	3.10	%	2.70	%	—	%	3.04	%
Collateralized loan obligations	2.36	%	2.62	%	2.60	%	—	%	2.59	%
Non-mortgage asset-backed securities	3.11	%	2.83	%	1.56	%	—	%	2.30	%
State and municipal obligations	2.91	%	3.87	%	4.48	%	3.99	%	3.98	%
SBA securities	1.29	%	1.23	%	1.14	%	1.00	%	1.21	%

	1.91	%	2.11	%	1.72	%	1.56	%	1.97	%

Loans

The loan portfolio comprises the Company’s primary interest-earning asset. The following ~~tables show~~table shows the composition of the loan portfolio ~~and the breakdown of the portfolio among non-covered loans, covered ACI loans and covered non-ACI loans~~ at the dates indicated (dollars in thousands):

September 30, 2017

Covered Loans Percent of Total
Non-Covered Loans ACI Non-ACI Total
Residential and other consumer:

1-4 single family residential $ 3,958,205
$ 470,300
$ 28,589
$ 4,457,094
21.7 %
Home equity loans and lines of credit 1,644
5,640
37,764
45,048
0.2 %
Other consumer loans 20,166
—
—
20,166
0.1 %
3,980,015
475,940
66,353
4,522,308
22.0 %
Commercial:
Multi-family 3,358,801
—
—
3,358,801
16.3 %
Non-owner occupied commercial real estate 4,183,275
—
—
4,183,275
20.4 %
Construction and land 271,994
—
—
271,994
1.3 %
Owner occupied commercial real estate 1,959,464
—
—
1,959,464
9.5 %
Commercial and industrial 3,900,290
—
—
3,900,290
19.0 %
Commercial lending subsidiaries 2,374,193
—
—
2,374,193
11.5 %
16,048,017
—
—
16,048,017
78.0 %
Total loans 20,028,032
475,940
66,353
20,570,325
100.0 %
Premiums, discounts and deferred fees and costs, net 44,422
—
(4,317 ) 40,105

Loans including premiums, discounts and deferred fees and costs 20,072,454
475,940
62,036
20,610,430

Allowance for loan and lease losses (153,725 ) (1,812 ) (3,036 ) (158,573 )
Loans, net $ 19,918,729
$ 474,128
$ 59,000
$ 20,451,857


	March 31, 2022				December 31, 2021

	Total		Percent of Total		Total		Percent of Total
Residential and other consumer loans	$	8,612,839	36.8	%	$	8,368,380	35.2	%
Multi-family	1,072,981		4.6	%	1,154,738		4.9	%
Non-owner occupied commercial real estate	4,284,675		18.3	%	4,381,610		18.4	%
Construction and land	176,825		0.8	%	165,390		0.7	%
Owner occupied commercial real estate	1,905,395		8.2	%	1,944,658		8.2	%
Commercial and industrial	4,951,999		21.2	%	4,790,275		20.2	%
PPP	80,296		0.3	%	248,505		1.0	%
Pinnacle	935,915		4.0	%	919,641		3.9	%
Bridge - franchise finance	306,563		1.3	%	342,124		1.4	%
Bridge - equipment finance	341,369		1.5	%	357,599		1.5	%
Mortgage warehouse lending	701,172		3.0	%	1,092,133		4.6	%
Total loans	23,370,029		100.0	%	23,765,053		100.0	%
Allowance for credit losses	(125,443)				(126,457)
Loans, net	$	23,244,586			$	23,638,596

December 31, 2016

Covered Loans Percent of Total
Non-Covered Loans ACI Non-ACI Total
Residential and other consumer:

1-4 single family residential $ 3,422,425
$ 532,348
$ 36,675
$ 3,991,448
20.6 %
Home equity loans and lines of credit 1,120
3,894
47,629
52,643
0.3 %
Other consumer loans 24,365
—
—
24,365
0.1 %
3,447,910
536,242
84,304
4,068,456
21.0 %
Commercial:
Multi-family 3,824,973
—
—
3,824,973
19.8 %
Non-owner occupied commercial real estate 3,739,235
—
—
3,739,235
19.3 %
Construction and land 311,436
—
—
311,436
1.6 %
Owner occupied commercial real estate 1,736,858
—
—
1,736,858
9.0 %
Commercial and industrial 3,391,614
—
—
3,391,614
17.5 %
Commercial lending subsidiaries 2,280,685
—
—
2,280,685
11.8 %
15,284,801
—
—
15,284,801
79.0 %
Total loans 18,732,711
536,242
84,304
19,353,257
100.0 %
Premiums, discounts and deferred fees and costs, net 48,641
—
(6,504 ) 42,137

Loans including premiums, discounts and deferred fees and costs 18,781,352
536,242
77,800
19,395,394

Allowance for loan and lease losses (150,853 ) —
(2,100 ) (152,953 )
Loans, net $ 18,630,499
$ 536,242
$ 75,700
$ 19,242,441

~~Total loans, including premiums, discounts and deferred fees and costs, increased by $1.2 billion to $20.6 billion at September 30, 2017, from $19.4 billion at December~~For the three months ended March 31, ~~2016. Non-covered loans grew by $1.3 billion while covered~~2022, total loans declined by ~~$76~~$395 million, ~~from December 31, 2016 to September 30, 2017. Non-covered residential~~while total loans, excluding PPP loans, declined by $227 million.

Residential and other consumer loans grew by ~~$538 million and non-covered commercial loans grew by $753~~$244 million during the ~~nine months~~quarter ended ~~September 30, 2017.~~

~~Growth in non-covered~~March 31, 2022. Commercial and industrial loans, including ~~premiums, discounts and deferred fees and costs, for the nine months ended September 30, 2017 reflected an increase of $536~~owner-occupied commercial real estate, grew by $122 million for the ~~Florida franchise, a decrease~~quarter. Most of ~~$74 million~~the remaining commercial portfolio segments showed declines for the ~~New York franchise~~quarter. MWL utilization declined to 39% at March 31, 2022 compared to 56% at December 31, 2021 as rising rates have led to lower refinancing activity and ~~an increase of $829~~we believe this segment is evidencing a return to historically normal seasonal utilization patterns. PPP loans declined by $168 million ~~for~~during the ~~national platforms.~~

~~The following tables show~~quarter ended March 31, 2022, resulting from full or partial forgiveness from the composition of the non-covered loan portfolio and the breakdown among the Florida and New York franchises and national platforms at the dates indicated. Amounts include premiums, discounts and deferred fees and costs (dollars in thousands):SBA.

September 30, 2017
Florida New York National Total
Residential and other consumer $ 228,300
$ 206,308
$ 3,599,004
$ 4,033,612
Commercial:
Multi-family 555,193
2,807,068
—
3,362,261
Non-owner occupied commercial real estate 2,572,743
1,501,597
99,229
4,173,569
Construction and land 123,655
134,854
12,947
271,456
Owner occupied commercial real estate 1,110,581
748,339
97,829
1,956,749
Commercial and industrial 2,509,353
891,978
490,751
3,892,082
Commercial lending subsidiaries —
—
2,382,725
2,382,725
$ 7,099,825
$ 6,290,144
$ 6,682,485
$ 20,072,454
35.4 % 31.3 % 33.3 % 100.0 %

December 31, 2016
Florida New York National Total
Residential and other consumer: $ 254,139
$ 226,154
$ 3,015,482
$ 3,495,775
Commercial:
Multi-family 520,263
3,309,411
—
3,829,674
Non-owner occupied commercial real estate 2,337,806
1,294,231
99,771
3,731,808
Construction and land 174,494
125,983
10,436
310,913
Owner occupied commercial real estate 1,042,441
602,155
91,254
1,735,850
Commercial and industrial 2,234,393
806,660
346,085
3,387,138
Commercial lending subsidiaries —
—
2,290,194
2,290,194
$ 6,563,536
$ 6,364,594
$ 5,853,222
$ 18,781,352
34.9 % 33.9 % 31.2 % 100.0 %

The increase in non-owner occupied commercial real estate loans and the decrease in multi-family loans in the New York franchise over the nine months ended September 30, 2017 includes the impact of reclassifying $207 million of loans on mixed-use properties from multi-family to non-owner occupied commercial real estate loans, based on the primary source of rental income on those properties.

Residential mortgages and other consumer loans

~~Residential mortgages~~The following table shows the composition of residential and other consumer loans ~~totaled $4.5 billion, or 22.0% of total loans,~~ at ~~September 30, 2017 and $4.1 billion, or 21.0% of total loans, at December 31, 2016.~~the dates indicated (in thousands):


	March 31, 2022		December 31, 2021

1-4 single family residential	$	6,668,116	$	6,338,225
Government insured residential	1,938,479		2,023,221
Other consumer loans	6,244		6,934
	$	8,612,839	$	8,368,380

The ~~non-covered~~1-4 single family residential loan portfolio, excluding government insured residential loans, is primarily comprised of loans purchased ~~on a national basis~~ through established correspondent channels. The portfolio also includes loans originated through retail channels in our Florida and New York geographic footprint prior to the termination of our retail residential mortgage origination business in early 2016. Non-covered1-4 single family residential mortgage loans are primarily closed-end, first lien jumbo mortgages for the purchase or re-finance of owner occupied property. The loans have terms ranging from 10 to 30 years, with either fixed or adjustable interest rates. At ~~September 30, 2017, $113~~March 31, 2022, $927 million or ~~2.8%~~14% were secured by investor-owned properties.

The Company acquires non-performing FHA and VA insured mortgages from third party servicers who have exercised their right to purchase these loans out of ~~non-covered residential mortgage~~GNMA securitizations (collectively, "government insured pool buyout loans" or "buyout loans"). Buyout loans ~~were interest-only~~that re-perform, either through modification or self-cure, may be eligible for re-securitization. The Company and the servicer share in the economics of the sale of these loans ~~substantially all~~into new securitizations. The balance of ~~which begin amortizing 10 years after origination.~~buyout loans totaled $1.9 billion at March 31, 2022. The Company is not the servicer of these loans.

We do not originate or acquire option ARMs, “no-doc” or “reduced-doc” mortgages and do not utilize wholesale mortgage origination channels although the covered loan portfolio contains loans with these characteristics. The Company’s exposure to future losses on these mortgage loans is mitigated by the Single Family Shared-Loss Agreement.

The following charts present the distribution of the ~~non-covered~~ 1-4 single family residential mortgage portfolio ~~by interest rate terms and contractual lives~~ at the dates indicated:


~~(1)~~	~~Fixed-rate loans with contractual terms of 20 years comprise less than 3% of the total at both September 30, 2017 and December 31, 2016, and are reported with 15 year fixed above.~~

The following table presents the five states with the largest geographic ~~concentration~~concentrations of ~~the non-covered~~ 1-4 single family residential ~~portfolio is summarized as follows~~loans, excluding government insured residential loans, at the dates indicated ~~(dollar~~(dollars in thousands):


	March 31, 2022				December 31, 2021

	Total		Percent of Total		Total		Percent of Total
California	$	2,161,899	32.4	%	$	2,056,100	32.4	%
New York	1,361,904		20.4	%	1,293,825		20.4	%
Florida	490,414		7.4	%	494,043		7.8	%
Illinois	333,820		5.0	%	306,388		4.8	%
Virginia	286,656		4.3	%	280,898		4.4	%
Others	2,033,423		30.5	%	1,906,971		30.2	%
	$	6,668,116	100.0	%	$	6,338,225	100.0	%

September 30, 2017 December 31, 2016
California $ 1,052,154
26.2 % $ 904,107
26.1 %
New York 848,123
21.1 % 763,824
22.0 %
Florida 530,056
13.2 % 487,294
14.0 %
District of Columbia 177,978
4.4 % 123,825
3.6 %
Virginia 175,550
4.4 % 152,113
4.4 %
Others ⁽¹⁾
1,227,983
30.7 % 1,039,186
29.9 %
$ 4,011,844
100.0 % $ 3,470,349
100.0 %


~~(1)~~	~~No other state represented borrowers with more than 4.0% of non-covered 1-4 single family residential loans outstanding at September 30, 2017 or December 31, 2016.~~

~~Home equity loans and lines of credit are not significant to the non-covered loan portfolio.~~

~~Other consumer loans are comprised primarily of consumer installment financing, loans secured by certificates of deposit, unsecured personal lines of credit and demand deposit account overdrafts.~~

Commercial loans and leases

~~The~~Commercial loans include commercial ~~portfolio segment includes~~and industrial loans and leases, loans secured by owner-occupied commercial real-estate, multi-family properties ~~loans secured by both owner-occupied~~ and other income-producing non-owner occupied commercial real estate, a limited amount of construction and land loans, ~~commercial and industrial~~SBA loans, mortgage warehouse lines of credit, PPP loans, municipal loans and ~~direct financing leases.~~leases originated by Pinnacle and franchise and equipment finance loans and leases originated by Bridge.

~~Management’s loan origination strategy is heavily focused on~~The following charts present the distribution of the commercial loan portfolio ~~segment, which comprised 80.1% and 81.6% of non-covered loans as of September 30, 2017 and December 31, 2016, respectively.~~at the dates indicated (dollars in millions):

Commercial real estate loans include term loans secured by ~~owner and~~ non-owner occupied income producing properties including rental apartments, mixed-use properties, industrial properties, retail shopping centers, free-standing single-tenant buildings, office buildings, warehouse facilities, ~~and~~ hotels, ~~as well as~~ real estate secured lines of ~~credit.~~credit, as well as credit facilities to institutional real estate entities such as REITs and commercial real estate investment funds.

The following ~~charts present~~table presents the distribution of ~~non-owner occupied~~ commercial real estate loans by ~~product types~~property type along with weighted average DSCRs and LTVs at March 31, 2022 (dollars in thousands):



	Amortized Cost		Percent of Total		FL		New York Tri State		Other		Weighted Average DSCR	Weighted Average LTV
Office	$	1,826,531	33	%	60	%	25	%	15	%	2.43	65.3	%
Multi-family	1,157,169		21	%	43	%	55	%	2	%	2.18	56.4	%
Retail	1,011,670		18	%	58	%	34	%	8	%	1.84	64.1	%
Warehouse/Industrial	895,020		16	%	67	%	21	%	12	%	2.41	58.4	%
Hotel	504,801		9	%	82	%	10	%	8	%	1.69	58.3	%
Other	139,290		3	%	58	%	26	%	16	%	2.42	51.6	%
	$	5,534,481	100	%	59	%	32	%	9	%	2.20	61.1	%

DSCRs and LTVs in the ~~dates indicated:~~table above are based on the most recent information available. Geographic distribution in the table above is based on location of the underlying collateral property.

~~Loans secured by~~The Company’s commercial real estate typically have shorter repayment periods and re-price more frequently than 1-4 single family residential loans but may have longer terms and re-price less frequently than commercial and industrial loans. The Company’s underwriting standards ~~generally~~most often provide for loan terms of five to ~~ten~~seven years, with amortization schedules of no more than thirty years. LTV ratios are typically limited to no more than ~~80%~~75%. ~~Owner-occupied~~Construction and land loans, included by property type in the table above, represented 0.8% of the total loan portfolio at March 31, 2022.

Included in the table above are approximately $119 million of mixed-use properties in New York, consisting of $55 million categorized as multi-family, $46 million categorized as retail and $18 million categorized as office. The New York multi-family portfolio included $437 million of loans collateralized by properties with some or all of the units subject to rent regulation at March 31, 2022, substantially all of which were stabilized properties.

Commercial and industrial loans are typically made to small, middle market and larger corporate businesses and not-for-profit entities and include equipment loans, secured and unsecured working capital facilities, formula-based loans, trade finance, SBA product offerings, business acquisition finance credit facilities and commercial credit cards. These loans may be structured as term loans, typically with maturities of five to seven years, or revolving lines of credit which may have multi-year maturities. The Bank also provides financing to state and local governmental entities generally within our geographic markets. Commercial loans included loans meeting the regulatory definition of shared national credits totaling $3.3 billion at March 31, 2022, the majority of which were relationship based loans to borrowers in Florida and New York. The Bank makes loans secured by owner-occupied commercial real estate ~~loans~~that typically have risk profiles more closely aligned with that of commercial and industrial loans than with other types of commercial real estate loans. ~~Construction and land~~

The following table presents the exposure in the C&I portfolio, excluding PPP loans, ~~represented only 1.3% of the total loan portfolio~~by industry, at ~~September 30, 2017. Construction and land loans are generally made for projects expected to stabilize within eighteen months of completion~~March 31, 2022 (dollars in thousands):

~~in sub-markets with strong fundamentals and, to a lesser extent, for-sale residential projects to experienced developers with a strong cushion between market prices and loan basis.~~

Commercial and industrial loans are typically made to small and middle market businesses and include equipment loans, secured and unsecured working capital facilities, formula-based loans, mortgage warehouse lines, taxi medallion loans, SBA product offerings and business acquisition finance credit facilities. These loans may be structured as term loans, typically with maturities of three to seven years, or revolving lines of credit which may have multi-year maturities. Commercial loans include shared national credits totaling $1.5 billion at September 30, 2017, typically relationship based loans to borrowers in our geographic footprint.



	Amortized Cost		Percent of Total
Finance and Insurance	$	1,162,463	17.0	%
Educational Services	673,206		9.8	%
Wholesale Trade	669,159		9.8	%
Health Care and Social Assistance	488,299		7.1	%
Transportation and Warehousing	459,429		6.7	%
Manufacturing	439,488		6.4	%
Information	415,120		6.1	%
Real Estate and Rental and Leasing	404,414		5.9	%
Utilities	317,026		4.6	%
Construction	291,695		4.3	%
Retail Trade	280,840		4.1	%
Other Services (except Public Administration)	231,215		3.4	%
Professional, Scientific, and Technical Services	228,577		3.3	%
Public Administration	201,512		2.9	%
Accommodation and Food Services	181,130		2.6	%
Administrative and Support and Waste Management	171,677		2.5	%
Arts, Entertainment, and Recreation	164,356		2.4	%
Other	77,788		1.1	%
	$	6,857,394	100.0	%

Through its commercial lending subsidiaries, Pinnacle and Bridge, the Bank provides equipment and franchise financing on a national basis using both loan and lease structures. Pinnacle provides essential-use equipment financing to state and local governmental entities directly and through vendor programs and alliances. Pinnacle offers a full array of financing structures including equipment lease purchase agreements and direct (private placement) bond re-fundings and loan agreements. Bridge has two operating divisions. The franchise finance division offers franchise acquisition, expansion and equipment financing, typically to experienced operators in well-established concepts. The franchise finance portfolio is made up primarily of quick service restaurant and fitness concepts comprising 53% and 43% of the portfolio, respectively. The equipment finance division provides primarily transportation equipment financing through a variety of loan and lease structures. The Bank's SBF unit primarily originates SBA guaranteed commercial and commercial real estate loans, generally selling the guaranteed portion in the secondary market and retaining the unguaranteed portion in portfolio. The Bank engages in mortgage warehouse lending on a national basis.

The following table presents the ~~recorded investment in loans and direct finance leases held for investment for each of our national commercial lending platforms~~franchise portfolio by concept at ~~the dates indicated (in thousands):~~

September 30, 2017 December 31, 2016
Pinnacle $ 1,393,965
$ 1,317,820
Bridge - franchise finance 421,821
426,661
Bridge - transportation equipment finance 566,939
545,713
SBF 235,433
225,241
Mortgage warehouse lending 465,323
322,305
$ 3,083,481
$ 2,837,740

The geographic concentration of the commercial loans and direct financing leases in the national platforms is summarized as follows at the dates indicated. Amounts include premiums, discounts and deferred fees and costsMarch 31, 2022 (dollars in thousands):


	Amortized Cost		Percent of Bridge -Franchise Finance
Restaurant concepts:
Burger King	$	50,191	16.4	%
Dunkin Donuts	14,180		4.6	%
Ram Restaurant and Brewery	13,215		4.3	%
Jimmy John's	12,219		4.0	%
Black Bear	12,014		3.9	%
Other	60,206		19.6	%
	$	162,025	52.8	%
Non-restaurant concepts:
Planet Fitness	$	93,631	30.6	%
Orange Theory Fitness	37,731		12.3	%
Other	13,176		4.3	%
	144,538		47.2	%
	$	306,563	100.0	%

September 30, 2017 December 31, 2016
Florida $ 593,307
19.2 % $ 543,445
19.2 %
California 464,853
15.1 % 421,480
14.9 %
Arizona 171,321
5.6 % 133,549
4.7 %
Texas 161,662
5.2 % 118,122
4.2 %
Iowa 152,869
5.0 % 161,874
5.7 %
Virginia 131,041
4.2 % 138,417
4.9 %
All others (1) 1,408,428
45.7 % 1,320,853
46.4 %
$ 3,083,481
100.0 % $ 2,837,740
100.0 %
The Company has originated PPP loans under both the First and Second Draw Programs. These loans bear interest at 1% and are guaranteed as to principal and interest by the SBA. PPP loans have terms of 2 and 5 years under the First and Second Draw Programs, respectively, and are eligible for earlier forgiveness under the terms of the PPP in prescribed circumstances. At March 31, 2022, deferred origination fees on PPP loans totaled $1.4 million.

Geographic Concentrations

The Company's commercial and commercial real estate portfolios are concentrated in Florida and the Tri-state area. 59% and 32% of commercial real estate loans were secured by collateral located in Florida and the Tri-state area, respectively; while 39% and 23% of all other commercial loans were to borrowers in Florida and the Tri-state area, respectively.


~~(1)~~	~~No other state represented borrowers with more than 4.0% of loans outstanding at September 30, 2017 or December 31, 2016.~~

~~Equipment under~~ Operating ~~Lease~~lease equipment, net

~~Equipment under~~Operating lease equipment, net of accumulated depreciation totaled $627 million at March 31, 2022, including off-lease equipment, net of accumulated depreciation of $91 million. The portfolio consists primarily of railcars, non-commercial aircraft and other transport equipment. Our operating lease ~~increased by $48 million to $588~~customers are North American commercial end users. We have a total of 4,539 railcars with a carrying value of $337 million at ~~September 30, 2017, from $540 million at December~~March 31, ~~2016. The portfolio consisted primarily of 5,424 railcars,~~2022, including hoppers, tank cars, boxcars, auto carriers, center beams and ~~gondolas leased to North American commercial end-users. The portfolio also included non-commercial aircraft and other transport equipment.~~gondolas. The largest concentrations of rail cars were ~~2,264~~2,117 hopper cars and ~~1,683~~1,351 tank cars, primarily used to ship sand and petroleum products, respectively, for the energy industry. ~~Equipment with a~~

The chart below presents operating lease equipment by type at the dates indicated:

At March 31, 2022, the breakdown of carrying ~~value~~values of ~~$288 million at September 30, 2017~~operating lease equipment, excluding equipment off-lease, by the year leases are scheduled to expire was ~~leased to companies for use in the energy industry.~~as follows (in thousands):


Years Ending December 31:
2022	$	54,478
2023	76,279
2024	47,367
2025	92,817
2026	83,139
Thereafter through 2034	182,257
	$	536,337

Asset Quality

In discussing asset quality, we distinguish between covered loans and non-covered loans. Although the risk profile of covered loans is higher than that of non-covered loans, our exposure to loss related to covered loans is significantly mitigated by the fair value basis recorded in these loans resulting from the application of acquisition accounting and by the Single Family Shared-Loss Agreement. At September 30, 2017, residential loans covered under the Single Family Shared-Loss Agreement totaled $538 million.Commercial Loans

We have ~~established~~ a robust credit risk management framework, ~~put in place~~ an experienced team to lead the workout and recovery process for the commercial and commercial real estate portfolios and ~~implemented~~ a dedicated internal credit review function. We have an experienced resolution team in place for covered residential mortgage loans, and have implemented outsourcing arrangements with industry leading firms in certain areas such as OREO resolution.

Loan performance is monitored by our credit administration, portfolio management and workout and recovery departments. Generally, commercial relationships with balances in excess of defined thresholds are re-evaluated at least annually and more frequently if circumstances indicate that a change in risk rating may be warranted. The defined thresholds range from $1 million to $3 million. ~~Additionally,~~Homogenous groups of smaller balance commercial loans may be monitored collectively. The credit quality and risk rating of commercial loans as well as our underwriting and portfolio management practices are regularly reviewed by our internal independent credit review department.

We believe internal risk rating is the best indicator of the credit quality of commercial loans. The Company utilizes a ~~13 grade~~16-grade internal asset risk classification system as part of its efforts to monitor and maintain commercial asset quality. ~~Loans~~The special mention rating is considered a transitional rating for loans exhibiting potential credit weaknesses that ~~deserve management’s close attention and that if left uncorrected may~~could result in deterioration of ~~the~~ repayment ~~capacity of the borrower are categorized as special mention.~~prospects at some future date if not checked or corrected and that deserve management’s close attention. These borrowers may exhibit ~~negative financial trends~~declining cash flows or ~~erratic financial performance, strained liquidity, marginal collateral coverage, declining industry trends~~revenues or ~~weak management.~~increasing leverage. Loans with well-defined credit weaknesses that may result in a loss if the deficiencies are not corrected are assigned a risk rating of substandard. These borrowers may exhibit payment defaults, inadequate cash flows from current operations, operating losses, increasing balance sheet leverage, project cost overruns, unreasonable construction delays, exhausted interest reserves, declining collateral values, frequent overdrafts or past due real estate taxes. Loans with weaknesses so severe that collection in full is highly questionable

or improbable, but because of certain reasonably specific pending factors have not been charged off, are assigned an internal risk rating of doubtful.

Residential mortgage loans and consumer loans are not individually risk rated. Delinquency status is the primary measure we use to monitor the credit quality of these loans. We also consider original LTV and FICO score to be significant indicators of credit quality for the non-covered 1-4 single family residential portfolio.

Although our assessment is ongoing and the results of that assessment are subject to change in the future, we do not currently believe the ability of the substantial majority of our borrowers to repay their loans or the value of the collateral securing those loans has been materially impacted by Hurricanes Irma and Harvey.

~~Non-covered Loans and Leases~~

~~Commercial Loans~~

The ongoing asset quality of significant commercial loans is monitored on an individual basis through our regular credit review and risk rating process. We believe internal risk rating is the best indicator of the credit quality of commercial loans. Homogenous groups of smaller balance commercial loans may be monitored collectively.

The following table summarizes the Company's commercial credit exposure, based on internal risk rating, at the dates indicated ~~(in~~(dollars in thousands):


						March 31, 2022				December 31, 2021	December 31, 2020

	September 30, 2017		December 31, 2016			Amortized Cost		Percent of Commercial Loans				Amortized Cost		Percent of Commercial Loans		Amortized Cost		Percent of Commercial Loans
Pass	$	15,505,587	$	14,897,121	Pass	$	13,574,615	92.0	%			$	13,934,369	90.5	%	$	14,832,025	84.6	%
Special mention	150,899		72,225		Special mention	95,250		0.6	%			148,593		1.0	%	711,416		4.1	%
Substandard ⁽¹⁾	376,540		304,713
Substandard accruing					Substandard accruing	956,318		6.5	%			1,136,378		7.4	%	1,758,654		10.0	%
Substandard non-accruing					Substandard non-accruing	104,329		0.7	%			129,579		0.8	%	203,758		1.2	%
Doubtful	5,816		11,518		Doubtful	26,678		0.2	%			47,754		0.3	%	11,867		0.1	%
	$	16,038,842	$	15,285,577		$	14,757,190	100.0	%			$	15,396,673	100.0	%	$	17,517,720	100.0	%

~~(1)~~

The balance of substandard loans at September 30, 2017 and December 31, 2016 included $121 million and $138 million, respectively, of taxi medallion finance loans. Criticized and classified loans represented 3.3%Our internal risk ratings at March 31, 2022 continued to be influenced by the impact of the COVID-19 pandemic and the measures and restrictions employed to contain the spread of the virus on the economy, our borrowers and the sectors in which they operate, although that impact continues to decline. Management took what it believed to be a proactive and objective approach to risk rating the commercial ~~loan portfolio, of which 0.8% were taxi medallion loans, at September 30, 2017. See~~ ~~Note 4~~ ~~to the consolidated financial statements for more detailed information about risk rating of commercial loans.~~

~~Taxi Medallion Finance~~

~~The commercial and industrial~~ loan portfolio ~~includes exposure to taxi medallion finance~~at the onset of ~~$121 million at September 30, 2017. The estimated value~~the pandemic. Levels of ~~underlying taxi medallion collateral~~criticized and ~~liquidity~~classified loans, particularly in the ~~market for sales~~special mention and substandard accruing categories, increased over the course of ~~medallions,~~2020 as a potential secondary source of repayment, have declined significantly in recent years due to competitive developments in the transportation-for-hire industry. Due to the ongoing trend of declining estimated cash flows from the operation of taxi medallions leading to declines in medallion valuations, the entire taxi medallion portfolio was placed on non-accrual status and risk rated substandard as of September 30, 2017. In addition, partial charge-offs were recognized on all taxi medallion loans with carrying values in excess of collateral values, determined using the cash flow template discussed below, to reduce the carrying value of those loans to this estimated collateral value.

We update our analysis of the cash flow generating capacity of the operation of New York City medallions on a regular basis using current available taxi industry data from which taxi medallion values and prospective debt service capacity are estimated. This analysis is based on an extensive data set obtained from the NYTLC and assumptions that we believe are reasonable estimates of fleet utilization and borrower expenses. We update our analysis of estimated medallion valuations on a quarterly basis, based on these cash flow capacity estimates. At September 30, 2017, our estimate of the value of New York City taxi medallions based on our cash flow template and consideration of estimated selling costs and declining trends in medallion values was $351,000 for both corporate and individual medallions. We used this value for purposes of determining the partial charge-offs and the value of repossessed medallions. See Note 10 to the consolidated financial statements for additional information about the valuation of New York City taxi medallions.

~~The taxi medallion portfolio had the following characteristics at September 30, 2017:~~

~~Approximately 97% of the portfolio secured directly by taxi medallions was concentrated in New York City.~~

Loans delinquent by 30 days or more totaled $13.2 million or 11.0% of the portfolio, compared to $40.8 million or 22.8% of the portfolio at December 31, 2016. Loans delinquent by 90 days or more totaled $10.4 million or 8.7% of the portfolio, compared to $29.2 million or 16.4% of the portfolio at December 31, 2016. The most significant factor contributing to the decrease in delinquencies was one large relationship that was brought current and restructured in the first quarter.

~~The portfolio included~~ ~~173~~ ~~loans modified in TDRs with a recorded investment of~~ ~~$92.4 million~~.

In the aggregate, the ALLL related to taxi medallion loans was 10.9% of the outstanding balance at September 30, 2017, compared to 6.0% at December 31, 2016. Charge-offs of $35.3 million and $47.1 million were recognized in the three and nine months ended September 30, 2017 related to taxi medallion loans.

We are no longer originating new taxi medallion loans. Our portfolio management strategies include, but are not limited to, working with borrowers experiencing cash flow challenges to provide short term relief and/or extended amortization periods, pro-actively attempting to refinance loans prior to maturity, continuing to monitor industry data and obtaining updated borrower and guarantor financial information. As taxi medallion loans approach maturity or are refinanced, we expect the number and amount of TDRs in this portfolio segment to continue to increase.

~~Hurricane Impact - Commercial Loans~~

Commercial loans totaling $1.9 million and $19.4 million had been modified or granted temporary payment deferrals as of September 30, 2017 and October 31, 2017, respectively, related to the recent hurricanes. Of these modifications and deferrals, none were determined to be TDRs due to the generally insignificant nature of the payment delays.

As of September 30 and October 31, 2017, respectively, commercial loans to borrowers that have significant business operations in or are secured by collateral in areas impacted by Hurricanes Irma and Harvey totaling approximately $4.7 million and $21.3 million were more than 30 days past due; $3.7 million of these loans were more than 30 days past due prior to the storms. Approximately $22.2 million of commercial loans have been downgraded to criticized or classified status through October 31, 2017 as adirect result of the impact of the ~~storms.~~COVID-19 pandemic. Throughout 2021 and the three months ended March 31, 2022, levels of criticized and classified loans declined in response to the trajectory of the economic recovery. If the economic recovery and its impact on individual borrowers evolve in line with our current expectations and economic forecast, we would expect to see the level of criticized and classified loans continue to decline over the course of 2022. However, uncertainty remains around the future trajectory of the economy due to a number of factors. In light of that uncertainty, it is possible that criticized and classified loan levels may not decline or that they may increase.

~~Equipment Under~~

The following table provides additional information about special mention and substandard accruing loans, at the dates indicated (dollars in thousands). Non-performing loans are discussed further in the section entitled "Non-performing Assets" below.



	March 31, 2022				December 31, 2021
	Amortized Cost		% of Loan Segment			Amortized Cost		% of Loan Segment
Special mention:
CRE
Hotel	$	569	0.1	%		$	760	0.1	%


Office	31,180		1.7	%		27,001		1.5	%

Other	236		0.3	%		4,501		3.7	%
	31,985					32,262
Owner occupied commercial real estate	5,369		0.3	%		14,010		0.7	%
Commercial and industrial	57,896		1.2	%		102,321		2.1	%



	$	95,250				$	148,593

Substandard accruing:
CRE
Hotel	$	121,996	24.2	%		$	200,486	36.7	%
Retail	103,378		10.2	%		140,081		13.0	%
Multi-family	176,034		16.4	%		173,536		15.0	%
Office	72,245		4.0	%		83,121		4.6	%
Industrial	988		0.1	%		1,009		0.1	%
Other	9,462		6.8	%		5,803		2.2	%
	484,103					604,036
Owner occupied commercial real estate	125,866		6.6	%		160,159		8.2	%
Commercial and industrial	250,016		5.0	%		250,644		5.2	%

Bridge - franchise finance	69,619		22.7	%		80,864		23.6	%
Bridge - equipment finance	26,714		7.8	%		40,675		11.4	%

	$	956,318				$	1,136,378

Payment Deferrals and Modifications

At March 31, 2022, commercial loans under CARES Act modification totaled $117 million. All of the commercial loans that have rolled off of modification have paid off or resumed regular payments. CARES Act modifications most commonly have taken the form of 9 to 12 month interest only periods. The majority of loan modifications that took place after the onset of the COVID-19 pandemic and through December 31, 2021 were not categorized as TDRs, in accordance with interagency and authoritative guidance and the provisions of the CARES Act, which expired effective January 1, 2022.

Operating Lease Equipment, net

~~Four~~Three operating ~~lease relationships with assets under lease~~leases with a carrying value of assets under lease totaling ~~$81~~$18 million, all of which ~~$75 million~~ were exposures to the energy industry, were internally risk rated ~~special mention or~~ substandard at ~~September 30, 2017. The present~~March 31, 2022. On a quarterly basis, management performs an impairment analysis on assets with indicators of potential impairment. Potential impairment indicators include evidence of changes in residual value, macro-economic conditions, an extended period of ~~remaining lease payments on these leases totaled approximately $22 million~~time off-lease, criticized or classified status, or management's intention to sell the asset at ~~September 30, 2017, of which $17 million~~an amount potentially below its carrying value. There were ~~exposures to~~no impairment charges during the ~~energy industry. There have been no missed payments related to the operating lease portfolio to date. One relationship has been restructured to date, with no decrease in total minimum lease payments.~~three months ended March 31, 2022 or March 31, 2021.

The primary risks inherent in the equipment leasing business are asset risk resulting from ownership of the equipment on ~~operating~~ lease and credit risk. Asset risk arises from fluctuations in supply and demand for the underlying leased equipment. ~~Railcars are long-lived equipment with useful lives of approximately 35-50 years.~~ The equipment is leased to commercial ~~end-users~~end users with original lease terms generally ranging from ~~3-9 years at September 30, 2017.~~three to ten years. We are exposed to the risk that, at the end of the lease term, the value of the asset will be lower than expected, potentially resulting in reduced future lease income over the remaining life of the asset or a lower sale value. Asset risk may also lead to changes in depreciation as a result of changes in the residual values of the ~~operating lease~~leased assets or ~~through~~ impairment of asset carrying values.

Asset risk is evaluated and managed by a dedicated internal staff of asset managers, managed by seasoned equipment finance professionals with a broad depth and breadth of experience in the leasing business. Additionally, we have partnered with an industry leading, experienced service provider who provides fleet management and servicing relating to the railcar fleet, including lease administration and reporting, a Regulation Y compliant full service maintenance program and railcar re-marketing. Risk is managed by setting appropriate residual values at inception and systematic reviews of residual values based on independent appraisals, performed at least annually. Additionally, our internal management team and our external service provider closely follow the rail markets, monitoring traffic flows, supply and demand trends and the impact of new technologies and regulatory requirements. Demand for railcars is sensitive to shifts in general and industry specific economic and market trends and shifts in trade flows from specific events such as natural or man-made disasters. We seek to mitigate these risks by leasing to a stable ~~end-user~~end user base, by maintaining a relatively young and diversified fleet of assets that are expected to maintain stronger and more stable utilization rates despite impacts from unexpected events or cyclical trends and by staggering lease maturities. We regularly monitor the impact of ~~lower~~ oil prices on the estimated residual value of rail cars being used in the petroleum/natural gas extraction sector.

Credit risk in the leased equipment portfolio results from the potential default of lessees, possibly driven by obligor specific or industry-wide conditions, and is economically less significant than asset risk, because in the operating lease business, there is no extension of credit to the obligor. Instead, the lessor deploys a portion of the useful life of the asset. Credit losses, if any, will manifest through reduced rental income due to missed payments, time off lease, or lower rental payments due either to a restructuring or re-leasing of the asset to another obligor. Credit risk in the operating lease portfolio is managed and monitored ~~utilizing~~using credit administration infrastructure, processes and procedures similar to those used to manage and monitor credit risk in the commercial loan portfolio. We also mitigate credit risk in this portfolio by leasing ~~only~~ to high credit quality obligors.

~~We expect our~~Bridge had exposure to the energy industry of $272 million at March 31, 2022. The majority of the energy exposure was in the operating lease equipment portfolio ~~to continue to grow,~~where energy exposure totaled $235 million. The remaining energy exposure, totaling approximately $37 million was comprised of loans and ~~we may expand into other asset classes.~~

~~Based on our initial analysis of the location and condition of equipment under operating lease, we do not currently believe there has been any significant damage to such equipment~~direct or ~~to the ongoing operations of lessees from Hurricanes Irma and Harvey.~~sales type finance leases.

Residential and Other Consumer Loans

~~The majority of our non-covered~~Our residential mortgage portfolio, excluding GNMA buyout loans, consists primarily of loans purchased through established correspondent channels. ~~In general, we purchase~~Most of our purchases are of performing jumbo mortgage loans which have FICO scores above 700, primarily are owner-occupied and full documentation, and have a current LTV of 80% or less although loans with LTVs higher than 80% may be extended to selected credit-worthy borrowers. We perform due diligence on the purchased loans for credit, compliance, counterparty, payment history and property valuation.

~~The following tables show~~We have a dedicated residential credit risk management function, and the ~~distribution~~residential portfolio is monitored by our internal credit review function. Residential mortgage loans and consumer loans are not individually risk rated. Delinquency status is the primary measure we use to monitor the credit quality of ~~non-covered~~these loans. We also consider original LTV and most recently available FICO score to be significant indicators of credit quality for the 1-4 single family residential portfolio, excluding government insured residential loans.

The following charts present information about the 1-4 single family residential portfolio, excluding government insured loans, by ~~original~~ FICO distribution, LTV distribution and ~~LTV as~~vintage at March 31, 2022:

FICO scores are generally updated at least annually, and were most recently updated in the first quarter of 2022. LTVs are typically based on valuation at origination since we do not routinely update residential appraisals.

At March 31, 2022, the majority of the ~~dates indicated:~~

September 30, 2017
FICO
LTV 720 or less 721 - 740 741 - 760 761 or
greater Total
60% or less 2.4 % 2.8 % 4.6 % 20.4 % 30.2 %
60% - 70% 2.3 % 2.6 % 3.5 % 14.6 % 23.0 %
70% - 80% 3.5 % 4.4 % 7.9 % 27.2 % 43.0 %
More than 80% 0.6 % 0.5 % 0.6 % 2.1 % 3.8 %
8.8 % 10.3 % 16.6 % 64.3 % 100.0 %

December 31, 2016
FICO
LTV 720 or less 721 - 740 741 - 760 761 or
greater Total
60% or less 2.5 % 3.2 % 4.7 % 21.7 % 32.1 %
60% - 70% 2.3 % 2.7 % 3.6 % 15.1 % 23.7 %
70% - 80% 3.2 % 4.3 % 8.0 % 26.1 % 41.6 %
More than 80% 0.7 % 0.3 % 0.4 % 1.2 % 2.6 %
8.7 % 10.5 % 16.7 % 64.1 % 100.0 %

~~At September 30, 2017, the non-covered~~ 1-4 single family residential loan portfolio, ~~had the following characteristics: substantially all were full documentation with a weighted-average FICO score of 765 and a weighted-average LTV of 66.6%. The majority of this portfolio~~excluding government insured residential loans, was owner-occupied, with ~~87.9%~~81% primary residence, ~~8.3%~~5% second homes and ~~3.8%~~14% investment properties. ~~In terms of vintage, 22.2% of the portfolio was originated pre-2014, 13.1% in 2014, 22.2% in 2015, 26.0% in 2016 and 16.5% in 2017.~~

~~Non-covered~~

1-4 single family residential loans excluding government insured residential loans past due more than 30 days totaled ~~$17.1~~$70 million and ~~$12.7~~$76 million at ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. The amount of these loans 90 days or more past due was ~~$2.7~~$15 million and ~~$2.1~~$17 million at ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively.

~~Hurricane Impact- Residential loans~~

~~The following table presents information related to 1-4 single family residential mortgages with borrowers and/~~ At March 31, 2022, $32 million or ~~collateral located in areas impacted by Hurricanes Irma and Harvey, at the dates indicated (in thousands):~~

September 30, 2017 October 31, 2017
Past due more than 30 days:
Covered loans $ 14,669
$ 13,454
Total $ 20,099
$ 21,350
Granted temporary payment deferrals:
Covered loans $ 14,807
$ 16,983
Total $ 24,772
$ 25,969

~~Other Consumer Loans~~

~~Substantially all consumer loans were current at September 30, 2017. At December 31, 2016, there were no delinquent consumer loans.~~

~~Covered Loans~~

~~At September 30, 2017, residential ACI loans totaled $476 million and residential non-ACI loans totaled $62 million, including premiums, discounts and deferred fees and costs. All~~less than 1% of ~~these loans are covered under the Single Family Shared-Loss Agreement.~~

Covered residential loans were placed into homogenous pools at the time of the FSB Acquisition and the ongoing credit quality and performance of these loans is monitored on a pool basis. We monitor the pools quarterly to determine whether any changes have occurred in expected cash flows that would be indicative of impairment or necessitate reclassification between non-accretable difference and accretable yield. At September 30, 2017, accretable yield on residential ACI loans totaled $511 million and non-accretable difference related to those loans totaled $227 million.

~~At September 30, 2017, the recorded investment in non-ACI~~ 1-4 single family residential loans, was $24.6 million; $1.6 million or 6.6% of these loans were 30 days or more past due and $0.9 million or 3.8% of these loans were 90 days or more past due. At September 30, 2017, the recorded investment in ACI 1-4 single familyexcluding government insured residential loans, ~~totaled $470.3 million; $34.2 million~~remained under short-term deferral or ~~7.3%~~had been modified due to the COVID-19 pandemic.

Note 4 to the consolidated financial statements presents additional information about key credit quality indicators and delinquency status of ~~these loans were delinquent by 30 days or more and $17.6 million or 3.7% were delinquent by 90 days or more.~~

At September 30, 2017, non-ACI home equity loans and lines of credit had an aggregate recorded investment of $37.4 million; $4.1 million or 11.1% of these loans were 30 days or more past due and $2.4 million or 6.3% were 90 days or more past due. ACI home equity loans and lines of credit had a carrying amount of $5.6 million at September 30, 2017; 13.5% of these loans were delinquent by 30 days or more.

~~Home equity lines of credit generally provide that payment terms be reset after an initial contractual period of interest only payments, requiring~~ the ~~pay down of principal through balloon payments or amortization. Additional information regarding ACI and non-ACI home equity lines of credit at September 30, 2017 is summarized as follows:~~

ACI Non-ACI
Loans resetting from interest only:

Previously reset 72.3 % 51.5 %
Scheduled to reset within 12 months 2.5 % 5.5 %
Scheduled to reset after 12 months 25.2 % 43.0 %
100.0 % 100.0 %
Lien position:

First liens 10.3 % 18.8 %
Second or third liens 89.7 % 81.2 %
100.0 % 100.0 %

The Company's exposure to loss related to covered loans is significantly mitigated by the Single Family Shared-Loss Agreement and by the fair value basis recorded in these assets resulting from the application of acquisition accounting. Management regularly evaluates the impact of resets of interest only loans on default rates for the covered home equityloan portfolio.

~~Impaired Loans and~~ Non-Performing Assets

Non-performing assets generally consist of (i) non-accrual loans, including loans that have been modified in TDRs or CARES Act modifications and placed on non-accrual status, (ii) accruing loans that are more than 90 days contractually past due as to interest or principal, excluding ~~ACI~~PCD loans for which management has a reasonable basis for an expectation about future cash flows and government insured residential loans, and (iii) OREO and repossessed assets. Impaired loans also typically include loans modified in TDRs that are accruing and ACI loans or pools for which expected cash flows at acquisition (as adjusted for any additional cash flows expected to be collected arising from changes in estimates after acquisition) have been revised downward since acquisition, other than due to changes in interest rate indices and prepayment assumptions.OREO.

The following ~~tables~~table and charts summarize the Company's ~~impaired~~non-performing loans and non-performing assets at the dates indicated (dollars in thousands):


	March 31, 2022			December 31, 2021

Non-accrual loans:
Residential and other consumer:
1-4 single family residential	$	19,824		$	26,988
Other consumer loans	—			1,565
Total residential and other consumer loans	19,824			28,553
Commercial:
Multi-family	10,725			10,865
Non-owner occupied commercial real estate	25,667			39,251
Construction and land	5,090			5,164
Owner occupied commercial real estate	21,079			20,453
Commercial and industrial	40,222			68,720

Bridge - franchise finance	28,224			32,879

Total commercial loans	131,007			177,332
Total non-accrual loans	150,831			205,885
Loans past due 90 days and still accruing	—			24
Total non-performing loans	150,831			205,909
OREO	1,763			2,275
Total non-performing assets	$	152,594		$	208,184

Non-performing loans to total loans (1)	0.65		%	0.87		%
Non-performing assets to total assets (1)	0.42		%	0.58		%
ACL to total loans	0.54		%	0.53		%
ACL to non-performing loans	83.17		%	61.41		%

Net charge-offs to average loans (2)	0.15		%	0.29		%

September 30, 2017 December 31, 2016
Covered
Assets Non-Covered
Assets Total
Covered
Assets

Non-Covered
Assets
Total
Non-accrual loans
Residential and other consumer:
1 - 4 single family residential $ 934
$ 1,890
$ 2,824
$ 918
$ 566
$ 1,484
Home equity loans and lines of credit 2,369
—
2,369
2,283
—
2,283
Other consumer loans —
332
332
—
2
2
Total residential and other consumer loans 3,303
2,222
5,525
3,201
568
3,769
Commercial:
Non-owner occupied commercial real estate —
9,930
9,930
—
559
559
Construction and land —
1,238
1,238
—
1,238
1,238
Owner occupied commercial real estate —
21,455
21,455
—
19,439
19,439
Commercial and industrial

Taxi medallion loans —
120,572
120,572
—
60,660
60,660
Other commercial and industrial —
27,569
27,569
—
16,036
16,036
Commercial lending subsidiaries —
16,625
16,625
—
32,645
32,645
Total commercial loans —
197,389
197,389
—
130,577
130,577
Total non-accrual loans 3,303
199,611
202,914
3,201
131,145
134,346
Non-ACI and new loans past due 90 days and still accruing —
846
846
—
1,551
1,551
Total non-performing loans 3,303
200,457
203,760
3,201
132,696
135,897
OREO 4,114
1,661
5,775
4,658
4,882
9,540
Repossessed assets —
2,457
2,457
—
3,551
3,551
Total non-performing assets 7,417
204,575
211,992
7,859
141,129
148,988
Impaired ACI loans and pools on accrual status 5,640
—
5,640
—
1,335
1,335
Performing TDRs

Taxi medallion loans —
—
—
—
36,848
36,848
Other 10,786
19,365
30,151
11,166
26,282
37,448
Total impaired loans and non-performing assets $ 23,843
$ 223,940
$ 247,783
$ 19,025
$ 205,594
$ 224,619

Non-performing loans to total loans ^{(1) (3)}
1.00 % 0.99 % 0.71 % 0.70 %
Non-performing assets to total assets ⁽²⁾
0.69 % 0.72 % 0.51 % 0.53 %
ALLL to total loans ⁽¹⁾
0.77 % 0.77 % 0.80 % 0.79 %
ALLL to non-performing loans 76.69 % 77.82 % 113.68 % 112.55 %
Net charge-offs to average loans ^{(4) (5)}
0.40 % 0.39 % 0.13 % 0.13 %


~~(1)~~			~~Total loans for purposes of calculating these ratios include premiums, discounts and deferred fees and costs.~~


~~(2)~~	~~Ratio for non-covered assets is calculated as non-performing non-covered assets to total assets.~~


~~(3)~~	~~Non-performing taxi medallion loans comprised 0.60% and 0.32% of total non-covered loans at September 30, 2017 and December 31, 2016, respectively.~~


~~(4)~~	~~Annualized for September 30, 2017.~~


~~(5)~~	~~The annualized ratio of charge-offs of taxi medallion loans to average non-covered loans was 0.33% and 0.06% for the nine months ended September 30, 2017 and the year ended December 31, 2016.~~

A ~~$8.0 million~~ ~~decrease for commercial lending subsidiaries primarily reflects decreases in quantitative loss factors for the municipal finance receivables and decreases~~ in qualitative loss factors related to economic uncertainty, partially offset by net charge-offs.

The ACL for the commercial and industrial sub-segment, including owner-occupied commercial real estate, decreased by $2.2 million during the three months ended March 31, 2022. Significant factors contributing to the decrease included (i) the decline in criticized and classified loans; (ii) a decrease related to the impact of the economic forecast; and (iii) a decrease in specific reserves; partially offset by (iv) a decrease in estimated prepayment speeds; and (v) the increase in qualitative loss factors related to economic uncertainty. The ACL coverage ratio for these loans increased from 0.84% to 0.86% during the three months ended March 31, 2021 despite the decline in the ACL. This was driven by the decline in the amortized cost basis of MWL and PPP loans, which carry nominal or no reserves, during the quarter.

The ACL for the BFG franchise finance portfolio segment decreased by $2.3 million during the three months ended March 31, 2022, from 4.90% to 4.71% of loans. This decrease is primarily attributed to reduced levels of criticized and classified loans and improvements in the economic forecast.

The ACL for the BFG equipment finance portfolio segment decreased by $0.9 million during the three months ended March 31, 2022, from 1.00% to 0.78% of loans, resulting primarily from risk rating upgrades, and to a lesser extent, faster prepayment speed assumptions partially offset by an increase in qualitative factors related to economic uncertainty.

The estimate of the ACL at March 31, 2022 was informed by economic scenarios published in March 2022, developments emerging after the scenarios were published, economic information provided by additional sources, information about borrower financial condition and collateral values and other relevant information. The economic forecast used in modeling the ACL as of March 31, 2022 was a third-party provided baseline forecast. Some of the assumptions and data points informing the reasonable and supportable economic forecast used in estimating the ACL at March 31, 2022 included:

•Labor market assumptions, which reflected national unemployment at 3.7% for the second quarter of 2022, steadily declining to normalized levels of full employment of 3.5% through the end of 2022 and 3.4% throughout 2023;

•Annualized growth ~~trends~~in GDP at 4.8% for the second quarter of 2022, normalizing to an average of 3.4% and ~~credit concentrations.~~3.2% for 2022 and 2023;

•VIX trending at stabilized levels through the forecast horizon; and

•S&P 500 averaging near 4,200 through the reasonable and supportable forecast period.

Additional variables and assumptions not explicitly stated, including but not limited to residential and commercial property forecasts, also contributed to the overall impact economic conditions and the economic forecast had on the ACL estimate. Furthermore, while the variables presented above are at the national level; many of the variables are regionalized at the market and submarket level in the models.

For additional information about the ~~ALLL,~~ACL, see Note 4 to the consolidated financial statements.

Deposits

Average balances and rates paid on deposits were as follows for the periods indicated (dollars in thousands):


	Three Months Ended March 31,
	2022				2021
	Average Balance		Average Rate Paid		Average Balance		Average Rate Paid
Demand deposits:
Non-interest bearing	$	9,047,864	—	%	$	7,491,249	—	%
Interest bearing	3,078,037		0.18	%	2,942,874		0.38	%
Savings and money market	13,401,332		0.21	%	12,793,019		0.38	%
Time	3,319,585		0.44	%	4,330,781		0.70	%
	$	28,846,818	0.17	%	$	27,557,923	0.33	%

Three Months Ended September 30, Nine Months Ended September 30,
�� 2017 2016 2017 2016
Average
Balance Average
Rate Paid Average
Balance Average
Rate Paid Average
Balance
Average
Rate Paid
Average
Balance Average
Rate Paid
Demand deposits:

Non-interest bearing $ 3,036,046
— % $ 2,981,017
— % $ 3,034,682
— % $ 2,944,861
— %
Interest bearing 1,590,206
0.85 % 1,437,677
0.62 % 1,564,229
0.76 % 1,341,218
0.61 %
Money market 9,590,333
0.90 % 7,948,299
0.64 % 9,187,225
0.80 % 7,778,761
0.63 %
Savings 378,179
0.24 % 400,982
0.22 % 370,682
0.19 % 424,915
0.24 %
Time 6,290,056
1.30 % 5,567,909
1.13 % 5,988,433
1.24 % 5,177,191
1.11 %
$ 20,884,820
0.87 % $ 18,335,884
0.67 % $ 20,145,251
0.80 % $ 17,666,946
0.65 %

~~Total~~The estimated amount of uninsured deposits at ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016 included $2.3~~2021 was $19.8 billion and ~~$1.9~~$20.2 billion, ~~respectively,~~respectively. Time deposit accounts with balances of ~~brokered deposits.~~

$250,000 or more totaled $420 million and $603 million at March 31, 2022 and December 31, 2021, respectively. The following table shows scheduled maturities of ~~certificates of deposit with denominations greater than or equal to $100,000~~uninsured time deposits as of ~~September 30, 2017~~March 31, 2022 (in thousands):


Three months or less	$	285,268
Over three through six months	56,306
Over six through twelve months	157,168
Over twelve months	20,528
	$	519,270

Three months or less $ 741,235
Over three through six months 1,037,771
Over six through twelve months 1,351,330
Over twelve months 931,302
$ 4,061,638

~~FHLB Advances, Notes and Other~~ Borrowings

In addition to deposits, we utilize FHLB advances ~~to fund growth in interest earning assets;~~as a funding source; the advances provide us with additional flexibility in managing both term and cost of ~~funding.~~funding and in managing interest rate risk. FHLB advances are secured by ~~FHLB stock,~~ qualifying residential first mortgage and commercial real estate ~~and home equity~~ loans, and MBS. ~~At September 30, 2017 and December 31, 2016,~~The following table presents information about the contractual balance of outstanding FHLB advances ~~totaled $4.9 billion and $5.2 billion, respectively.~~

~~The contractual balance~~as of ~~FHLB advances outstanding at September 30, 2017 is scheduled to mature as follows (in~~March 31, 2022 (dollars in thousands):

Maturing in:
2017—One month or less $ 2,395,000
2017—Over one month 855,000
2018 1,396,000
2019 100,000
2020 125,000
Carrying value $ 4,871,000


	Amount		Weighted Average Rate
Maturing in:
2022 - One month or less	$	2,560,000	0.32	%
2022 - Over one month	835,000		0.53	%




Total contractual balance outstanding	$	3,395,000

The table above reflects contractual maturities of outstanding advances and does not incorporate the impact that interest rate swaps designated as cash flow hedges have on the duration of borrowings.

The table below presents information about outstanding interest rate swaps hedging the variability of interest cash flows on the FHLB advances included in the table above, as of March 31, 2022 (dollars in thousands):


	Notional Amount		Weighted Average Rate
Cash flow hedges maturing in:
2022	$	125,000	2.61	%
2023	255,000		2.35	%
2024	285,000		2.02	%
2025	275,000		2.06	%
2026	130,000		1.93	%
Thereafter	25,000		2.50	%
	$	1,095,000	2.17	%

See Note 76 to the consolidated financial statements for more information about derivative instruments.

Outstanding ~~senior~~ notes payable and other borrowings consisted of the following at the dates indicated (in thousands):


	March 31, 2022		December 31, 2021
Senior notes:
Principal amount of 4.875% senior notes maturing on November 17, 2025	$	400,000	$	400,000
Unamortized discount and debt issuance costs	(3,200)		(3,400)
	396,800		396,600
Subordinated notes:
Principal amount of 5.125% subordinated notes maturing on June 11, 2030	300,000		300,000
Unamortized discount and debt issuance costs	(5,273)		(5,400)
	294,727		294,600
Total notes	691,527		691,200
Finance leases	29,764		30,216
Notes and other borrowings	$	721,291	$	721,416

Liquidity and Capital Resources

Liquidity involves our ability to generate adequate funds to support planned interest earning asset growth, meet deposit withdrawal and credit line usage requests, maintain reserve requirements, conduct routine operations, pay dividends, service outstanding debt and meet other contractual obligations.

BankUnited's ongoing liquidity needs have been and continue to be met primarily by cash flows from operations, deposit growth, the investment portfolio and FHLB advances. FRB discount window borrowings provide an additional source of contingent liquidity. For the three months ended March 31, 2022 and 2021 net cash provided by operating activities was $457 million and $386 million, respectively.

Available liquidity includes cash, borrowing capacity at the Federal Home Loan Bank of Atlanta and the Federal Reserve Discount Window, Federal Funds lines of credit and unpledged agency securities. Additional sources of liquidity include cash flows from operations, wholesale deposits, cash flow from the Bank's amortizing securities and loan portfolios, and the sale of investment securities. Management also has the ability to exert substantial control over the rate and timing of loan production, and resultant requirements for liquidity to fund new loans.

The ALM policy establishes limits or operating thresholds and guidelines for a number of measures of liquidity which are typically monitored monthly by the ALCO and quarterly by the Board of Directors. The primary measures used to dimension liquidity risk are the ratio of available liquidity to volatile liabilities and a liquidity stress test coverage ratio. Other measures employed to monitor and manage liquidity include but are not limited to a 30-day total liquidity ratio, a one-year liquidity ratio, a wholesale funding ratio, concentrations of large deposits, a measure of on-balance sheet available liquidity, the ratio of FHLB advances to total assets and the ratio of non-interest bearing deposits to total deposits, which is reflective of the quality and cost, rather than the quantity, of available liquidity. At March 31, 2022, BankUnited was in compliance with the limits prescribed by the ALM policy.

September 30, 2017 December 31, 2016
Senior notes $ 393,564
$ 393,092
Capital lease obligations 9,264
9,717
$ 402,828
$ 402,809
The ALM policy stipulates that BankUnited’s liquidity is within policy limits if the available liquidity/volatile liabilities ratio and liquidity stress test ratios exceed 100%. At March 31, 2022, BankUnited’s available liquidity/volatile liabilities ratio was 309% and the liquidity stress test ratio was 188%. The Company has a comprehensive contingency liquidity funding plan and conducts a quarterly liquidity stress test, the results of which are reported to the risk committee of the Board of Directors.

~~Senior notes have~~As a ~~face amount~~holding company, BankUnited, Inc. is a corporation separate and apart from its banking subsidiary, and therefore, provides for its own liquidity. BankUnited, Inc.’s main sources of ~~$400 million, a fixed coupon rate~~funds include management fees and dividends from the Bank, access to capital markets and its own securities portfolio. There are regulatory limitations that may affect the ability of ~~4.875%~~the Bank to pay dividends to BankUnited, Inc. Management believes that such limitations will not impact our ability to meet our ongoing near-term cash obligations.

We expect that our liquidity needs and ~~mature on November 17, 2025.~~

~~Capital Resources~~cash requirements will continue to be satisfied over the next twelve months through the sources of funds described above.

Pursuant to the FDIA, the federal banking agencies have adopted regulations setting forth a five-tier system for measuring the capital adequacy of the financial institutions they supervise. At ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016, BankUnited~~2021, the Company and the ~~Company~~Bank had capital levels that exceeded both the regulatory well-capitalized guidelines and all internal capital ratio targets.

~~Stockholders' equity increased to $2.6 billion at September 30, 2017, an increase of $205 million, or 8.5%, from December 31, 2016, due primarily to~~The following table provides information regarding regulatory capital for the ~~retention of earnings~~Company and the ~~exercise~~Bank as of ~~stock options resulting~~March 31, 2022 (dollars in ~~proceeds~~thousands):



	Actual				Required to be Considered Well Capitalized				Required to be Considered Adequately Capitalized				Required to be Considered Adequately Capitalized Including Capital Conservation Buffer
	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
BankUnited, Inc.:
Tier 1 leverage	$	2,954,166	8.29	%	N/A (1)		N/A (1)		$	1,426,167	4.00	%	N/A (1)		N/A (1)
CET1 risk-based capital	$	2,954,166	12.53	%	$	1,532,351	6.50	%	$	1,060,859	4.50	%	$	1,650,225	7.00	%
Tier 1 risk-based capital	$	2,954,166	12.53	%	$	1,885,971	8.00	%	$	1,414,478	6.00	%	$	2,003,844	8.50	%
Total risk-based capital	$	3,360,452	14.25	%	$	2,357,464	10.00	%	$	1,885,971	8.00	%	$	2,475,337	10.50	%
BankUnited:
Tier 1 leverage	$	3,404,598	9.58	%	$	1,776,518	5.00	%	$	1,421,214	4.00	%	N/A		N/A
CET1 risk-based capital	$	3,404,598	14.52��	%	$	1,523,624	6.50	%	$	1,054,816	4.50	%	$	1,640,826	7.00	%
Tier 1 risk-based capital	$	3,404,598	14.52	%	$	1,875,229	8.00	%	$	1,406,422	6.00	%	$	1,992,431	8.50	%
Total risk-based capital	$	3,510,884	14.98	%	$	2,344,037	10.00	%	$	1,875,229	8.00	%	$	2,461,238	10.50	%

(1) There is no Tier 1 leverage ratio component in the definition of ~~$61.5 million during~~a well-capitalized bank holding company.

Upon adoption of ASU 2016-13 on January 1, 2020, the Company elected the option to temporarily delay the effects of CECL on regulatory capital for two years, followed by a three-year transition period.

~~Since~~We believe we are well positioned, from a capital perspective, to withstand a severe downturn in the economy. We continue to evolve our ~~formation, stockholders' equity has been impacted primarily by the retention of earnings,~~stress testing framework and adapt it to ~~a lesser extent, proceeds from the issuance of common shares and changes in unrealized gains and losses, net of taxes, on investment securities~~

~~available for sale and cash flow hedges. Our rate of earnings retention is derived by dividing undistributed earnings per~~ ~~common share by earnings per common share. Our retention ratio was~~ ~~66.0%~~ ~~and 64.9% for the three and~~ ~~nine months ended September 30, 2017, respectively, compared to 55.7% and 58.4%~~ ~~for the three and nine months ended September 30, 2016, respectively.~~ ~~We retain a high percentage~~evolving macro-economic conditions as necessary. The majority of our ~~earnings~~commercial portfolio is subject to ~~support~~quarterly stress test analysis. On an annual basis, we also run a rigorous stress test of our ~~planned growth.~~entire balance sheet and, where applicable, we incorporate considerations for evolving macro-economic themes.

We ~~filed a~~have an active shelf registration statement on file with the SEC ~~in October 2015~~ that allows the Company to periodically offer and sell in one or more offerings, individually or in any combination, our common stock, preferred stock and other non-equity securities. The shelf registration provides us with flexibility in issuing capital instruments and enables us to more readily access the capital markets as needed to pursue future growth opportunities and to ensure continued compliance with regulatory capital requirements. Our ability to issue securities pursuant to the shelf registration is subject to market conditions.

~~The following table provides information regarding regulatory capital for the Company and the Bank as of September 30, 2017 (dollars in thousands):~~

Actual
Required to be
Considered Well
Capitalized

Required to be
Considered
Adequately
Capitalized
Amount Ratio Amount Ratio Amount Ratio
BankUnited, Inc.:

Tier 1 leverage $ 2,491,853
8.56 %
N/A ⁽¹⁾

N/A⁽¹⁾

$ 1,164,462
4.00 %
CET1 risk-based capital $ 2,491,853
11.91 % $ 1,359,799
6.50 % $ 941,399
4.50 %
Tier 1 risk-based capital $ 2,491,853
11.91 % $ 1,673,599
8.00 % $ 1,255,199
6.00 %
Total risk based capital $ 2,657,784
12.70 % $ 2,091,998
10.00 % $ 1,673,599
8.00 %
BankUnited:

Tier 1 leverage $ 2,706,006
9.32 % $ 1,451,814
5.00 % $ 1,161,451
4.00 %
CET1 risk-based capital $ 2,706,006
12.98 % $ 1,354,884
6.50 % $ 937,997
4.50 %
Tier 1 risk-based capital $ 2,706,006
12.98 % $ 1,667,550
8.00 % $ 1,250,662
6.00 %
Total risk based capital $ 2,869,850
13.77 % $ 2,084,437
10.00 % $ 1,667,550
8.00 %

~~(1) There is no Tier 1 leverage ratio component in the definition of a well-capitalized bank holding company.~~

Levels of capital required to be well capitalized or adequately capitalized as reflected above do not include a capital conservation buffer that is being phased in beginning in 2016. When fully phased in on January 1, 2019, the Bank and the Company will have to maintain this capital conservation buffer composed of CET1 capital equal to 2.50% of risk-weighted assets above the amounts required to be adequately capitalized, as reflected above, in order to avoid limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers. Capital ratios required to be considered well-capitalized exceed the ratios required under the capital conservation buffer requirement at September 30, 2017.

~~Liquidity~~

Liquidity involves our ability to generate adequate funds to support planned interest earning asset growth, meet deposit withdrawal requests, maintain reserve requirements, conduct routine operations, pay dividends, service outstanding debt and meet other contractual obligations.

Primary sources of liquidity include cash flows from operations, cash generated by the repayment and resolution of covered loans, cash payments received from the FDIC pursuant to the Single Family Shared-Loss Agreement, deposit growth, the available for sale securities portfolio and FHLB advances.

For the nine months ended September 30, 2017 and 2016, net cash provided by operating activities was $231.2 million and $227.3 million, respectively. Accretion on ACI loans, which is reflected as a non-cash reduction in net income to arrive at operating cash flows, totaled $226.3 million, and $228.5 million for the nine months ended September 30, 2017 and 2016, respectively. Accretable yield on ACI loans represents the excess of expected future cash flows over the carrying amount of the loans, and is recognized as interest income over the expected lives of the loans. Amounts recorded as accretion are realized in cash as individual loans are paid down or otherwise resolved; however, the timing of cash realization may differ from the timing of income recognition. These cash flows from the repayment or resolution of covered loans, inclusive of amounts that have been accreted through earnings over time, are recognized as cash flows from investing activities in the consolidated statements of cash flows upon receipt. Cash payments from the FDIC in the form of reimbursements of losses related to the

covered loans under the Single Family Shared-Loss Agreement are also characterized as investing cash flows. Cash generated by the repayment and resolution of covered loans and reimbursements from the FDIC totaled $348.5 million and $430.3 million for the nine months ended September 30, 2017 and 2016, respectively. Both cash generated by the repayment and resolution of covered loans and cash payments received from the FDIC have been and are expected to continue to be, although to a lesser extent in the future, consistent and relatively predictable sources of liquidity.

In addition to cash provided by operating activities, the repayment and resolution of covered loans and payments under the Single Family Shared-Loss Agreement from the FDIC, BankUnited’s liquidity needs, particularly liquidity to fund growth of interest earning assets, have been and continue to be met by deposit growth and FHLB advances. The investment portfolio also provides a source of liquidity.

BankUnited has access to additional liquidity through FHLB advances, other collateralized borrowings, wholesale deposits or the sale of available for sale securities. At September 30, 2017, unencumbered investment securities available for sale totaled $4.3 billion. At September 30, 2017, BankUnited had available borrowing capacity at the FHLB of $3.8 billion, unused borrowing capacity at the FRB of $544 million and unused Federal funds lines of credit totaling $70 million. Management also has the ability to exert substantial control over the rate and timing of growth of the non-covered loan portfolio, and resultant requirements for liquidity to fund loans.

Continued runoff of the covered loan portfolio and FDIC indemnification asset and growth of deposits and the non-covered loan portfolio are the most significant trends expected to impact the Bank’s liquidity in the near term.

The ALCO policy has established several measures of liquidity which are monitored monthly by the ALCO and quarterly by the Board of Directors. One primary measure of liquidity monitored by management is the 30 day total liquidity ratio, defined as (a) the sum of cash and cash equivalents, pledgeable securities and a measure of funds expected to be generated by operations over the next 30 days; divided by (b) the sum of potential deposit runoff, liabilities maturing within the 30 day time frame and a measure of funds expected to be used in operations over the next 30 days. BankUnited’s liquidity is considered acceptable if the 30 day total liquidity ratio exceeds 100%. At September 30, 2017, BankUnited’s 30 day total liquidity ratio was 172%. Management also monitors a one year liquidity ratio, defined as (a) cash and cash equivalents, pledgeable securities, unused borrowing capacity at the FHLB, and loans and non-agency securities maturing within one year; divided by (b) forecasted deposit outflows and borrowings maturing within one year. Forecasted deposit outflows, excluding certificate of deposits, are based on runoff rates derived from the most recent external core deposit analysis obtained by the Company. This ratio allows management to monitor liquidity over a longer time horizon. The acceptable threshold established by the ALCO for this liquidity measure is 100%. At September 30, 2017, BankUnited’s one year liquidity ratio was 158%. Additional measures of liquidity regularly monitored by the ALCO include the ratio of wholesale funding to total assets, a measure of available liquidity to volatile liabilities and the ratio of brokered deposits to total deposits. At September 30, 2017, BankUnited was within acceptable limits established by the ALCO and the Board of Directors for each of these measures.

As a holding company, BankUnited, Inc. is a corporation separate and apart from its banking subsidiary, and therefore, provides for its own liquidity. BankUnited, Inc.’s main sources of funds include management fees and dividends from the Bank, access to capital markets and, to a lesser extent, its own available for sale securities portfolio. There are regulatory limitations that affect the ability of the Bank to pay dividends to BankUnited, Inc. Management believes that such limitations will not impact our ability to meet our ongoing near-term cash obligations.

~~We expect that our liquidity requirements will continue to be satisfied over the next 12 months through the sources of funds described above.~~

Interest Rate Risk

~~The~~A principal component of the Company’s risk of loss arising from adverse changes in the fair value of financial instruments, or market risk, is interest rate risk, including the risk that assets and liabilities with similar re-pricing characteristics may not reprice at the same time or to the same degree. A primary objective of the Company’s asset/liability management

activities is to maximize net interest income, while maintaining acceptable levels of interest rate risk. The ALCO is responsible for establishing policies to ~~limit~~manage exposure to interest rate risk, and to ensure procedures are established to monitor compliance with these policies. The ~~guidelines~~policies established by the ALCO are approved at least annually by the Board of ~~Directors.~~Directors or its Risk Committee.

Management believes that the simulation of net interest income in different interest rate environments provides the most meaningful measure of interest rate risk. Income simulation analysis is designed to capture not only the potential of all assets and liabilities to mature or reprice, but also the probability that they will do so. Income simulation also attends to the relative interest rate sensitivities of these items, and projects their behavior over an extended period of time. Finally, income simulation

permits management to assess the probable effects on the balance sheet not only of changes in interest rates, but also of proposed strategies for responding to them.

The income simulation model analyzes interest rate sensitivity by projecting net interest income over twelve and twenty-four month periods in a most likely rate scenario based on consensus forward interest rate curves versus net interest income in alternative rate scenarios. ~~Simulations are generated based on both static and dynamic balance sheet assumptions.~~ Management continually reviews and refines its interest rate risk management process in response to changes in the interest rate environment, the economic climate and ~~economic climate.~~observed customer behavior. Currently, our ~~model projects a down 100, plus 100, plus 200 and plus 300 basis point change with rates increasing by the magnitude of the~~interest rate ~~ramp evenly over the next 12 months as well as flattening yield curve scenarios and~~risk policy framework is based on modeling instantaneous rate shocks of ~~down~~plus and minus 100, ~~plus 100, plus~~ 200, 300 and ~~plus 300~~400 basis ~~points.~~point shifts. We also model a variety of yield curve slope and dynamic balance sheet scenarios. We continually evaluate the scenarios being modeled with a view toward adapting them to changing economic conditions, expectations and trends.

The Company’s ALCO policy provides that net interest income sensitivity will be considered acceptable if decreases in forecast net interest income, based on a dynamic forecasted balance sheet, in specified rate shock scenarios are within specified percentages of forecast net interest income in the most likely rate scenario over the next twelve months and in the second year. The following table ~~illustrates the acceptable limits as defined by policy and~~presents the impact on forecasted net interest income ~~of down 100, plus 100, plus 200 and plus 300 basis point~~compared to a "most likely" scenario in parallel rate shock scenarios of plus 100, 200, 300 and 400 basis points at ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016:~~2021, as well as a minus 100 basis points scenario at March 31, 2022. At March 31, 2022, the most likely rate scenario incorporated a bear flattening yield curve and floored all indices at 0%. We did not apply the falling rate scenario at December 31, 2021 due to the low prevailing interest rate environment at that time.


										Down 100		Plus 100		Plus 200		Plus 300		Plus 400
	Down 100		Plus 100		Plus 200		Plus 300
Policy Limits:

Model Results at March 31, 2022 - increase (decrease)									Model Results at March 31, 2022 - increase (decrease)
In year 1	(6.0	)%	(6.0	)%	(10.0	)%	(14.0	)%	In year 1	(6.3)	%	2.6	%	5.3	%	7.0	%	9.2	%
In year 2	(9.0	)%	(9.0	)%	(13.0	)%	(17.0	)%	In year 2	(6.3)	%	5.7	%	10.0	%	16.7	%	23.6	%
Model Results at September 30, 2017 - increase (decrease):
Model Results at December 31, 2021 - increase									Model Results at December 31, 2021 - increase
In year 1	(0.4	)%	(0.2	)%	(0.6	)%	(1.2	)%	In year 1	N/A		2.5	%	3.9	%	4.3	%	4.2	%
In year 2	(3.2	)%	1.7	%	3.0	%	4.2	%	In year 2	N/A		6.6	%	11.5	%	15.8	%	20.4	%
Model Results at December 31, 2016 - increase (decrease):
In year 1	(2.0	)%	1.5	%	2.8	%	3.4	%
In year 2	(3.7	)%	2.6	%	4.6	%	6.6	%



			~~Page~~

PART I.	~~Glossary of Defined Terms~~		ii

~~PART I.~~	FINANCIAL INFORMATION

ITEM 1.		Financial Statements (Unaudited)
		Consolidated Balance Sheets		1
		Consolidated Statements of Income		2
		Consolidated Statements of Comprehensive Income		3
		Consolidated Statements of Cash Flows		4
		Consolidated Statements of Stockholders’ Equity		6
		Notes to Consolidated Financial Statements		7

ITEM 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		4631

ITEM 3.		Quantitative and Qualitative Disclosures About Market Risk		8059

ITEM 4.		Controls and Procedures		8059

PART II.		OTHER INFORMATION

ITEM 1.		Legal Proceedings		8159

ITEM 1A.		Risk Factors		8159

ITEM 6.2.		~~Exhibits~~Unregistered Sales of Equity Securities and Use of Proceeds		8260

ITEM 6.		Exhibits		61

SIGNATURES				8362


	Three Months Ended March 31,
c		2022		2021
Basic earnings per common share:
Numerator:
Net income		$	67,150	$	98,814
Distributed and undistributed earnings allocated to participating securities		(929)		(1,252)
Income allocated to common stockholders for basic earnings per common share		$	66,221	$	97,562
Denominator:
Weighted average common shares outstanding		84,983,873		93,075,702
Less average unvested stock awards		(1,211,807)		(1,205,529)
Weighted average shares for basic earnings per common share		83,772,066		91,870,173
Basic earnings per common share		$	0.79	$	1.06
Diluted earnings per common share:
Numerator:
Income allocated to common stockholders for basic earnings per common share		$	66,221	$	97,562
Adjustment for earnings reallocated from participating securities		1		1
Income used in calculating diluted earnings per common share		$	66,222	$	97,563
Denominator:
Weighted average shares for basic earnings per common share		83,772,066		91,870,173
Dilutive effect of certain share-based awards		137,704		93,540
Weighted average shares for diluted earnings per common share		83,909,770		91,963,713
Diluted earnings per common share		$	0.79	$	1.06



	Three Months Ended September 30,						Nine Months Ended September 30,
c	2017			2016			2017			2016
Basic earnings per common share:
Numerator:
Net income	$	67,779		$	50,848		$	196,479		$	162,447
Distributed and undistributed earnings allocated to participating securities	(2,525		)	(2,031		)	(7,331		)	(6,522		)
Income allocated to common stockholders for basic earnings per common share	$	65,254		$	48,817		$	189,148		$	155,925
Denominator:
Weighted average common shares outstanding	106,809,381			104,153,018			106,488,396			104,077,932
Less average unvested stock awards	(1,101,485		)	(1,150,268		)	(1,102,381		)	(1,165,509		)
Weighted average shares for basic earnings per common share	105,707,896			103,002,750			105,386,015			102,912,423
Basic earnings per common share	$	0.62		$	0.47		$	1.79		$	1.52
Diluted earnings per common share:
Numerator:
Income allocated to common stockholders for basic earnings per common share	$	65,254		$	48,817		$	189,148		$	155,925
Adjustment for earnings reallocated from participating securities	6			(81		)	21			(264		)
Income used in calculating diluted earnings per common share	$	65,260		$	48,736		$	189,169		$	155,661
Denominator:
Weighted average shares for basic earnings per common share	105,707,896			103,002,750			105,386,015			102,912,423
Dilutive effect of stock options and executive share-based awards	365,286			558,304			479,459			699,977
Weighted average shares for diluted earnings per common share	106,073,182			103,561,054			105,865,474			103,612,400
Diluted earnings per common share	$	0.62		$	0.47		$	1.79		$	1.50



	Three Months Ended September 30,		Nine Months Ended September 30,
	2017	2016	2017	2016
Unvested shares and share units	1,111,300	1,296,848	1,111,300	1,296,848
Stock options and warrants	1,850,279	1,851,376	1,850,279	1,851,376


	Amortized Cost		Fair Value
Due in one year or less	$	1,551,485	$	1,517,106
Due after one year through five years	6,465,385		6,369,610
Due after five years through ten years	2,092,483		2,014,536
Due after ten years	587,821		560,650
	$	10,697,174	$	10,461,902


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	September 30, 2017			December 31, 2016
ASSETS
Cash and due from banks:
Non-interest bearing	$	34,883		$	40,260
Interest bearing	3,714			35,413
Interest bearing deposits at Federal Reserve Bank	254,004			372,640
Cash and cash equivalents	292,601			448,313
Investment securities available for sale, at fair value	6,893,472			6,073,584
Investment securities held to maturity	10,000			10,000
Non-marketable equity securities	270,239			284,272
Loans held for sale	31,507			41,198
Loans (including covered loans of $537,976 and $614,042)	20,610,430			19,395,394
Allowance for loan and lease losses	(158,573		)	(152,953		)
Loans, net	20,451,857			19,242,441
FDIC indemnification asset	349,617			515,933
Bank owned life insurance	248,876			239,736
Equipment under operating lease, net	588,207			539,914
Deferred tax asset, net	23,910			62,940
Goodwill and other intangible assets	77,857			78,047
Other assets	316,688			343,773
Total assets	$	29,554,831		$	27,880,151

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Demand deposits:
Non-interest bearing	$	3,096,492		$	2,960,591
Interest bearing	1,828,809			1,523,064
Savings and money market	9,964,242			9,251,593
Time	6,333,701			5,755,642
Total deposits	21,223,244			19,490,890
Federal Home Loan Bank advances	4,871,000			5,239,348
Notes and other borrowings	402,828			402,809
Other liabilities	434,270			328,675
Total liabilities	26,931,342			25,461,722

Commitments and contingencies

Stockholders' equity:
Common stock, par value $0.01 per share, 400,000,000 shares authorized; 106,821,902 and 104,166,945 shares issued and outstanding	1,068			1,042
Paid-in capital	1,492,790			1,426,459
Retained earnings	1,077,042			949,681
Accumulated other comprehensive income	52,589			41,247
Total stockholders' equity	2,623,489			2,418,429
Total liabilities and stockholders' equity	$	29,554,831		$	27,880,151



	December 31, 2021
	Amortized Cost		Gross Unrealized				Carrying Value (1)
			Gains		Losses
Investment securities available for sale:
U.S. Treasury securities	$	114,385	$	173	$	(2,898)	$	111,660
U.S. Government agency and sponsored enterprise residential MBS	2,093,283		12,934		(8,421)		2,097,796
U.S. Government agency and sponsored enterprise commercial MBS	861,925		5,287		(10,313)		856,899

Private label residential MBS and CMOs	2,160,136		3,575		(14,291)		2,149,420
Private label commercial MBS	2,604,690		7,843		(8,523)		2,604,010
Single family real estate-backed securities	474,845		5,031		(2,908)		476,968
Collateralized loan obligations	1,079,217		598		(1,529)		1,078,286
Non-mortgage asset-backed securities	151,091		1,419		—		152,510
State and municipal obligations	205,718		16,559		—		222,277
SBA securities	184,296		2,027		(2,728)		183,595
	9,929,586		$	55,446	$	(51,611)	9,933,421
Investment securities held to maturity	10,000						10,000
	$	9,939,586					9,943,421
Marketable equity securities							120,777
							$	10,064,198


																	March 31, 2022
	September 30, 2017
	Less than 12 Months					12 Months or Greater					Total						Less than 12 Months				12 Months or Greater				Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses				Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. Treasury securities	$	24,957	$	(12	)	$	—	$	—		$	24,957	$	(12	)	U.S. Treasury securities	$	57,646	$	(2,331)	$	43,873	$	(5,552)	$	101,519	$	(7,883)
U.S. Government agency and sponsored enterprise residential MBS	460,806		(425		)	9,544		(266		)	470,350		(691		)	U.S. Government agency and sponsored enterprise residential MBS	757,481		(10,072)		408,874		(8,166)		1,166,355		(18,238)
U.S. Government agency and sponsored enterprise commercial MBS	55,152		(1,783		)	14,270		(30		)	69,422		(1,813		)	U.S. Government agency and sponsored enterprise commercial MBS	366,153		(23,942)		158,361		(15,966)		524,514		(39,908)

Private label residential MBS and CMOs	72,557		(217		)	5,820		(118		)	78,377		(335		)	Private label residential MBS and CMOs	2,594,526		(113,293)		66,721		(5,864)		2,661,247		(119,157)
Private label commercial MBS	124,664		(1,510		)	—		—			124,664		(1,510		)	Private label commercial MBS	1,979,528		(26,074)		286,911		(16,291)		2,266,439		(42,365)
Single family rental real estate-backed securities	14,708		(112		)	—		—			14,708		(112		)
Single family real estate-backed securities																Single family real estate-backed securities	325,231		(8,945)		41,621		(3,531)		366,852		(12,476)
Collateralized loan obligations																Collateralized loan obligations	731,894		(4,348)		317,886		(2,392)		1,049,780		(6,740)
Non-mortgage asset-backed securities																Non-mortgage asset-backed securities	104,093		(1,911)		—		—		104,093		(1,911)
State and municipal obligations	184,082		(3,368		)	—		—			184,082		(3,368		)	State and municipal obligations	59,176		(1,636)		—		—		59,176		(1,636)
SBA securities	—		—			18,229		(17		)	18,229		(17		)	SBA securities	45		—		91,539		(2,484)		91,584		(2,484)
	$	936,926	$	(7,427	)	$	47,863	$	(431	)	$	984,789	$	(7,858	)
																	$	6,975,773	$	(192,552)	$	1,415,786	$	(60,246)	$	8,391,559	$	(252,798)


	March 31, 2022		December 31, 2021
UPB	$	115,405	$	124,963
Non-credit discount	(54,709)		(59,759)
Total amortized cost of PCD loans	60,696		65,204
ACL related to PCD loans	(621)		(476)
PCD loans, net	$	60,075	$	64,728



	December 31, 2016
				Covered Loans								Percent of Total
	Non-Covered Loans			ACI		Non-ACI			Total			Percent of Total
Residential and other consumer:
1-4 single family residential	$	3,422,425		$	532,348	$	36,675		$	3,991,448		20.6	%
Home equity loans and lines of credit	1,120			3,894		47,629			52,643			0.3	%
Other consumer loans	24,365			—		—			24,365			0.1	%
	3,447,910			536,242		84,304			4,068,456			21.0	%
Commercial:
Multi-family	3,824,973			—		—			3,824,973			19.8	%
Non-owner occupied commercial real estate	3,739,235			—		—			3,739,235			19.3	%
Construction and land	311,436			—		—			311,436			1.6	%
Owner occupied commercial real estate	1,736,858			—		—			1,736,858			9.0	%
Commercial and industrial	3,391,614			—		—			3,391,614			17.5	%
Commercial lending subsidiaries	2,280,685			—		—			2,280,685			11.8	%
	15,284,801			—		—			15,284,801			79.0	%
Total loans	18,732,711			536,242		84,304			19,353,257			100.0	%
Premiums, discounts and deferred fees and costs, net	48,641			—		(6,504		)	42,137
Loans including premiums, discounts and deferred fees and costs	18,781,352			536,242		77,800			19,395,394
Allowance for loan and lease losses	(150,853		)	—		(2,100		)	(152,953		)
Loans, net	$	18,630,499		$	536,242	$	75,700		$	19,242,441



Balance at December 31, 2015	$	902,565
Reclassifications from non-accretable difference	76,751
Accretion	(303,931		)
Balance at December 31, 2016	675,385
Reclassifications from non-accretable difference	72,827
Accretion	(226,251		)
Balance at September 30, 2017	$	521,961



	September 30, 2017						December 31, 2016
	Recorded Investment		UPB		Related Specific Allowance		Recorded Investment		UPB		Related Specific Allowance
Non-covered loans:
With no specific allowance recorded:
1-4 single family residential	$	27	$	32	$	—	$	—	$	—	$	—
Non-owner occupied commercial real estate	9,041		9,224		—		510		512		—
Construction and land	1,238		1,238		—		1,238		1,238		—
Owner occupied commercial real estate	16,786		16,949		—		16,834		16,894		—
Commercial and industrial
Taxi medallion loans	20,320		20,321		—		18,107		18,107		—
Other commercial and industrial	1,081		1,095		—		6,172		6,172		—
Commercial lending subsidiaries	12,810		12,815		—		10,620		10,510		—
With a specific allowance recorded:
1-4 single family residential	884		863		71		561		546		12
Owner occupied commercial real estate	3,961		3,943		2,994		491		513		263
Commercial and industrial
Taxi medallion loans	100,252		100,255		13,117		73,131		73,147		5,948
Other commercial and industrial	41,297		41,292		7,313		29,452		29,463		9,168
Commercial lending subsidiaries	3,578		3,553		478		21,712		21,605		3,850
Total:
Residential and other consumer	$	911	$	895	$	71	$	561	$	546	$	12
Commercial	210,364		210,685		23,902		178,267		178,161		19,229
	$	211,275	$	211,580	$	23,973	$	178,828	$	178,707	$	19,241
Covered loans:
Non-ACI loans:
With no specific allowance recorded:
1-4 single family residential	$	102	$	118	$	—	$	1,169	$	1,391	$	—
Home equity loans and lines of credit	1,312		1,324		—		2,255		2,286		—
With a specific allowance recorded:
1-4 single family residential	2,221		2,579		208		1,272		1,514		181
Home equity loans and lines of credit	8,086		8,163		816		7,700		7,804		348
	$	11,721	$	12,184	$	1,024	$	12,396	$	12,995	$	529
ACI loans:
With a specific allowance recorded:
Home equity loans and lines of credit	$	5,640	$	27,731	$	1,812	$	—	$	—	$	—



	September 30, 2017
	FICO
LTV	720 or less		721 - 740		741 - 760		761 or greater		Total
60% or less	$	94,357	$	111,279	$	185,614	$	819,422	$	1,210,672
60% - 70%	93,963		102,461		140,350		586,158		922,932
70% - 80%	139,923		173,808		316,544		1,091,868		1,722,143
More than 80%	24,725		20,610		24,981		85,781		156,097
	$	352,968	$	408,158	$	667,489	$	2,583,229	$	4,011,844



Balance at December 31, 2015	$	739,843
Amortization	(160,091		)
Reduction for claims filed	(46,083		)
Net loss on FDIC indemnification	(17,759		)
Balance at December 31, 2016	515,910
Amortization	(135,351		)
Reduction for claims filed	(16,768		)
Net loss on FDIC indemnification	(14,174		)
Balance at September 30, 2017	$	349,617



	Unrealized Gains on Investment Securities Available for Sale		Unrealized Losses on Derivative Instruments			Total
Balance at December 31, 2016	$	47,057	$	(5,810	)	$	41,247
Other comprehensive income	15,164		(3,822		)	11,342
Balance at September 30, 2017	$	62,221	$	(9,632	)	$	52,589

Balance at December 31, 2015	$	41,535	$	(19,353	)	$	22,182
Other comprehensive income	47,400		(27,052		)	20,348
Balance at September 30, 2016	$	88,935	$	(46,405	)	$	42,530


	Three Months Ended March 31,
	Unrealized Gain (Loss) on Investment Securities Available for Sale		Unrealized Gain (Loss) on Derivative Instruments		Total





Balance at December 31, 2021	$	2,859	$	(18,799)	$	(15,940)

Other comprehensive income (loss)	(176,958)		35,199		(141,759)
Balance at March 31, 2022	$	(174,099)	$	16,400	$	(157,699)

Balance at December 31, 2020	$	63,799	$	(112,951)	$	(49,152)
Other comprehensive income (loss)	(25,440)		35,767		10,327
Balance at March 31, 2021	$	38,359	$	(77,184)	$	(38,825)



	Number of Option Awards		Weighted Average Exercise Price
Option awards outstanding, December 31, 2016	3,602,076		$	26.74
Exercised	(2,304,108	)	26.70
Option awards outstanding and exercisable, September 30, 2017	1,297,968		$	26.81


	March 31, 2022

	Level 1		Level 2		Total
Investment securities available for sale:
U.S. Treasury securities	$	101,519	$	—	$	101,519
U.S. Government agency and sponsored enterprise residential MBS	—		2,165,624		2,165,624
U.S. Government agency and sponsored enterprise commercial MBS	—		714,594		714,594

Private label residential MBS and CMOs	—		2,708,041		2,708,041
Private label commercial MBS	—		2,711,986		2,711,986
Single family real estate-backed securities	—		493,869		493,869
Collateralized loan obligations	—		1,072,480		1,072,480
Non-mortgage asset-backed securities	—		117,398		117,398
State and municipal obligations	—		207,279		207,279
SBA securities	—		169,112		169,112

Marketable equity securities	100,196		—		100,196
Servicing rights	—		5,032		5,032
Derivative assets	—		37,274		37,274
Total assets at fair value	$	201,715	$	10,402,689	$	10,604,404
Derivative liabilities	$	—	$	(47,421)	$	(47,421)
Total liabilities at fair value	$	—	$	(47,421)	$	(47,421)



	Fair Value at		Valuation Technique	Unobservable Input	Range (Weighted Average)
	September 30, 2017		Valuation Technique	Unobservable Input	Range (Weighted Average)
Investment grade	$	34,245	Discounted cash flow	Voluntary prepayment rate	6.60% - 25.60% (15.92%)
				Probability of default	0.13% - 4.04% (1.36%)
				Loss severity	15.00% - 75.00% (33.10%)
				Discount rate	1.88% - 7.43% (3.48%)

Non-investment grade	$	26,552	Discounted cash flow	Voluntary prepayment rate	1.10% - 29.30% (15.35%)
				Probability of default	0.13% - 4.15% (1.51%)
				Loss severity	15.00% - 95.00% (32.96%)
				Discount rate	1.35% - 9.43% (5.89%)


	March 31, 2022		December 31, 2021

Collateral dependent loans	$	41,232	$	70,433

OREO	121		2,788
Operating lease equipment	—		11,429
	$	41,353	$	84,650



	September 30, 2017								Losses from Fair Value Changes
	Level 1		Level 2		Level 3		Total		Three Months Ended September 30, 2017			Nine Months Ended September 30, 2017
OREO and repossessed assets	$	—	$	—	$	5,520	$	5,520	$	(515	)	$	(1,534	)
Impaired loans	$	—	$	—	$	107,173	$	107,173	$	(35,106	)	$	(58,073	)



	September 30, 2016								Losses from Fair Value Changes
	Level 1		Level 2		Level 3		Total		Three Months Ended September 30, 2016			Nine Months Ended September 30, 2016
OREO and repossessed assets	$	—	$	—	$	7,923	$	7,923	$	(372	)	$	740
Impaired loans	$	—	$	—	$	59,678	$	59,678	$	(10,623	)	$	(18,873	)



	~~Average Amount~~
~~Average fare per trip~~	~~$16.12~~
~~Number of trips per shift~~	~~15.4~~
~~Days worked per month~~	~~25.6~~


		March 31, 2022				December 31, 2021

	Level	Carrying Value		Fair Value		Carrying Value		Fair Value
Assets:
Cash and cash equivalents	1	$	697,492	$	697,492	$	314,857	$	314,857
Investment securities	1/2	$	10,572,098	$	10,572,495	$	10,064,198	$	10,064,887
Non-marketable equity securities	2	$	190,534	$	190,534	$	135,859	$	135,859

Loans, net	3	$	23,244,586	$	23,116,432	$	23,638,596	$	24,088,190
Derivative assets	2	$	37,274	$	37,274	$	59,019	$	59,019
Liabilities:
Demand, savings and money market deposits	2	$	25,565,560	$	25,565,560	$	26,053,859	$	26,053,859
Time deposits	2	$	2,975,715	$	2,962,239	$	3,384,243	$	3,388,435
Federal funds purchased	2	$	199,000	$	199,000	$	199,000	$	199,000
FHLB advances	2	$	3,395,000	$	3,394,089	$	1,905,000	$	1,905,629
Notes and other borrowings	2	$	721,291	$	758,714	$	721,416	$	813,095
Derivative liabilities	2	$	47,421	$	47,421	$	25,314	$	25,314



Commitments to fund loans	$	417,943
Commitments to purchase loans	287,302
Unfunded commitments under lines of credit	2,361,922
Commercial and standby letters of credit	83,141
	$	3,150,308


Commitments to fund loans	$	631,426

Unfunded commitments under lines of credit	4,329,074
Commercial and standby letters of credit	108,781
	$	5,069,281


	Three Months Ended September 30,															Three Months Ended
	2017							2016								March 31, 2022						December 31, 2021						March 31, 2021
	Average Balance			Interest ⁽¹⁾		Yield/ Rate ⁽¹⁾⁽²⁾		Average Balance			Interest ⁽¹⁾		Yield/ Rate ⁽¹⁾⁽²⁾			Average Balance		Interest (1)		Yield/ Rate (1)(2)		Average Balance		Interest (1)		Yield/ Rate (1)(2)		Average Balance		Interest (1)		Yield/ Rate (1)(2)
Assets:															Assets:
Interest earning assets:															Interest earning assets:
Non-covered loans	$	19,710,115		$	187,928	3.79	%	$	17,813,925		$	158,963	3.56	%
Covered loans	518,026			73,452		56.70	%	700,884			74,487		42.50	%
Total loans	20,228,141			261,380		5.15	%	18,514,809			233,450		5.03	%

Loans															Loans	$	23,349,143	$	194,551	3.36	%	$	22,919,535	$	201,345	3.50	%	$	23,549,309	$	208,821	3.58	%
Investment securities ⁽³⁾	7,002,615			55,046		3.14	%	5,898,382			42,262		2.87	%	Investment securities (3)	10,083,083		43,719		1.73	%	10,113,026		38,889		1.54	%	9,070,185		39,188		1.73	%
Other interest earning assets	545,224			3,777		2.75	%	557,490			3,036		2.17	%	Other interest earning assets	674,640		1,354		0.81	%	1,184,056		1,397		0.47	%	1,062,840		1,593		0.61	%
Total interest earning assets	27,775,980			320,203		4.60	%	24,970,681			278,748		4.45	%	Total interest earning assets	34,106,866		239,624		2.83	%	34,216,617		241,631		2.81	%	33,682,334		249,602		2.98	%
Allowance for loan and lease losses	(160,231		)					(139,284		)
Allowance for credit losses															Allowance for credit losses	(129,028)						(149,319)						(254,438)
Non-interest earning assets	1,699,912							1,884,894							Non-interest earning assets	1,674,476						1,767,850						1,724,176
Total assets	$	29,315,661						$	26,716,291						Total assets	$	35,652,314					$	35,835,148					$	35,152,072
Liabilities and Stockholders' Equity:															Liabilities and Stockholders' Equity:
Interest bearing liabilities:															Interest bearing liabilities:
Interest bearing demand deposits	$	1,590,206		3,415		0.85	%	$	1,437,677		2,224		0.62	%	Interest bearing demand deposits	$	3,078,037	$	1,364	0.18	%	$	3,058,355	$	1,481	0.19	%	$	2,942,874	$	2,774	0.38	%
Savings and money market deposits	9,968,512			21,964		0.87	%	8,349,281			12,974		0.62	%	Savings and money market deposits	13,401,332		6,931		0.21	%	13,460,084		9,619		0.28	%	12,793,019		12,127		0.38	%
Time deposits	6,290,056			20,540		1.30	%	5,567,909			15,770		1.13	%	Time deposits	3,319,585		3,562		0.44	%	3,399,302		2,531		0.30	%	4,330,781		7,475		0.70	%
Total interest bearing deposits	17,848,774			45,919		1.02	%	15,354,867			30,968		0.80	%	Total interest bearing deposits	19,798,954		11,857		0.24	%	19,917,741		13,631		0.27	%	20,066,674		22,376		0.45	%
Federal funds purchased															Federal funds purchased	187,539		58		0.12	%	56,793		13		0.09	%	8,000		3		0.15	%
FHLB advances	4,924,325			16,946		1.37	%	5,143,003			11,956		0.92	%	FHLB advances	2,248,889		6,146		1.11	%	1,909,450		8,957		1.86	%	3,072,717		17,558		2.32	%
Notes and other borrowings	402,828			5,314		5.28	%	403,590			5,322		5.27	%	Notes and other borrowings	721,405		9,261		5.13	%	721,525		9,257		5.13	%	722,305		9,252		5.12	%
Total interest bearing liabilities	23,175,927			68,179		1.17	%	20,901,460			48,246		0.92	%	Total interest bearing liabilities	22,956,787		27,322		0.48	%	22,605,509		31,858		0.56	%	23,869,696		49,189		0.83	%
Non-interest bearing demand deposits	3,036,046							2,981,017							Non-interest bearing demand deposits	9,047,864						9,330,805						7,491,249
Other non-interest bearing liabilities	468,735							460,514							Other non-interest bearing liabilities	623,200						785,254						746,973
Total liabilities	26,680,708							24,342,991							Total liabilities	32,627,851						32,721,568						32,107,918
Stockholders' equity	2,634,953							2,373,300							Stockholders' equity	3,024,463						3,113,580						3,044,154
Total liabilities and stockholders' equity	$	29,315,661						$	26,716,291						Total liabilities and stockholders' equity	$	35,652,314					$	35,835,148					$	35,152,072
Net interest income				$	252,024						$	230,502			Net interest income			$	212,302					$	209,773					$	200,413
Interest rate spread						3.43	%						3.53	%	Interest rate spread					2.35	%					2.25	%					2.15	%
Net interest margin						3.62	%						3.69	%	Net interest margin					2.50	%					2.44	%					2.39	%



	September 30, 2017		October 31, 2017
Past due more than 30 days:
Covered loans	$	14,669	$	13,454
Total	$	20,099	$	21,350
Granted temporary payment deferrals:
Covered loans	$	14,807	$	16,983
Total	$	24,772	$	25,969



	ACI		Non-ACI
Loans resetting from interest only:
Previously reset	72.3	%	51.5	%
Scheduled to reset within 12 months	2.5	%	5.5	%
Scheduled to reset after 12 months	25.2	%	43.0	%
	100.0	%	100.0	%
Lien position:
First liens	10.3	%	18.8	%
Second or third liens	89.7	%	81.2	%
	100.0	%	100.0	%



	September 30, 2017								December 31, 2016
	Covered Assets		Non-Covered Assets			Total			Covered Assets		Non-Covered Assets			Total
Non-accrual loans
Residential and other consumer:
1 - 4 single family residential	$	934	$	1,890		$	2,824		$	918	$	566		$	1,484
Home equity loans and lines of credit	2,369		—			2,369			2,283		—			2,283
Other consumer loans	—		332			332			—		2			2
Total residential and other consumer loans	3,303		2,222			5,525			3,201		568			3,769
Commercial:
Non-owner occupied commercial real estate	—		9,930			9,930			—		559			559
Construction and land	—		1,238			1,238			—		1,238			1,238
Owner occupied commercial real estate	—		21,455			21,455			—		19,439			19,439
Commercial and industrial
Taxi medallion loans	—		120,572			120,572			—		60,660			60,660
Other commercial and industrial	—		27,569			27,569			—		16,036			16,036
Commercial lending subsidiaries	—		16,625			16,625			—		32,645			32,645
Total commercial loans	—		197,389			197,389			—		130,577			130,577
Total non-accrual loans	3,303		199,611			202,914			3,201		131,145			134,346
Non-ACI and new loans past due 90 days and still accruing	—		846			846			—		1,551			1,551
Total non-performing loans	3,303		200,457			203,760			3,201		132,696			135,897
OREO	4,114		1,661			5,775			4,658		4,882			9,540
Repossessed assets	—		2,457			2,457			—		3,551			3,551
Total non-performing assets	7,417		204,575			211,992			7,859		141,129			148,988
Impaired ACI loans and pools on accrual status	5,640		—			5,640			—		1,335			1,335
Performing TDRs
Taxi medallion loans	—		—			—			—		36,848			36,848
Other	10,786		19,365			30,151			11,166		26,282			37,448
Total impaired loans and non-performing assets	$	23,843	$	223,940		$	247,783		$	19,025	$	205,594		$	224,619

Non-performing loans to total loans ^{(1) (3)}			1.00		%	0.99		%			0.71		%	0.70		%
Non-performing assets to total assets ⁽²⁾			0.69		%	0.72		%			0.51		%	0.53		%
ALLL to total loans ⁽¹⁾			0.77		%	0.77		%			0.80		%	0.79		%
ALLL to non-performing loans			76.69		%	77.82		%			113.68		%	112.55		%
Net charge-offs to average loans ^{(4) (5)}			0.40		%	0.39		%			0.13		%	0.13		%


	March 31, 2022					December 31, 2021

	Number of TDRs	Amortized Cost		Related Specific Allowance		Number of TDRs	Amortized Cost		Related Specific Allowance
Residential and other consumer (1)	749	$	128,913	$	60	449	$	79,524	$	87
Commercial	22	30,645		2,197		16	29,309		1,377
	771	$	159,558	$	2,257	465	$	108,833	$	1,464



	Number of TDRs	Recorded Investment		Related Specific Allowance
Residential and other consumer:
Covered	59	$	11,721	$	1,024
Non-covered	9	912		71
Commercial:
Taxi medallion loans	173	92,370		10,505
Other	30	72,702		10,581
	271	$	177,705	$	22,181



	Nine Months Ended September 30, 2017
				Covered Loans
	Non-Covered Loans			ACI Loans		Non-ACI Loans			Total
Balance at December 31, 2016	$	150,853		$	—	$	2,100		$	152,953
Provision for (recovery of) loan losses:
1-4 single family residential	(4		)	—		212			208
Home equity loans and lines of credit	—			1,812		714			2,526
Other consumer loans	(48		)	—		—			(48		)
Multi-family	(3,303		)	—		—			(3,303		)
Non-owner occupied commercial real estate	4,032			—		—			4,032
Construction and land	(9		)	—		—			(9		)
Owner occupied commercial real estate	4,884			—		—			4,884
Commercial and industrial
Taxi medallion loans	49,604			—		—			49,604
Other commercial and industrial	9,338			—		(45		)	9,293
Commercial lending subsidiaries	(8,614		)	—		—			(8,614		)
Unallocated	5,000			—		—			5,000
Total Provision	60,880			1,812		881			63,573
Charge-offs:
Home equity loans and lines of credit	—			—		(55		)	(55		)
Non-owner occupied commercial real estate	(162		)	—		—			(162		)
Owner occupied commercial real estate	(1,164		)	—		—			(1,164		)
Commercial and industrial
Taxi medallion loans	(47,141		)	—		—			(47,141		)
Other commercial and industrial	(12,567		)	—		—			(12,567		)
Commercial lending subsidiaries	—			—		—			—
Total Charge-offs	(61,034		)	—		(55		)	(61,089		)
Recoveries:
Home equity loans and lines of credit	—			—		65			65
Other consumer loans	21			—		—			21
Owner occupied commercial real estate	2			—		—			2
Commercial and industrial
Other commercial and industrial	2,400			—		45			2,445
Commercial lending subsidiaries	603			—		—			603
Total Recoveries	3,026			—		110			3,136
Net Charge-offs:	(58,008		)	—		55			(57,953		)
Balance at September 30, 2017	$	153,725		$	1,812	$	3,036		$	158,573