Form 10-K Amendment No. 1

10-K/A 1 d10ka.htm FORM 10-K AMENDMENT NO. 1 Form 10-K Amendment No. 1

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(AMENDMENT NO. 1)

(Mark One)

x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the fiscal year ended September 30, 2005

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

Commission File Number 1-13921

BANKUNITED FINANCIAL CORPORATION

(Exact name of Registrant as specified in its charter)


Florida		65-0377773
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

255 Alhambra Circle, Coral Gables, Florida		33134
(Address of principal executive offices)		(Zip Code)

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

Securities registered pursuant to Section 12(b) of the Act: None.

Securities registered pursuant to Section 12(g) of the Act:

Class A Common Stock, $.01 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. x Yes ¨ No.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15 (d) of the Act. ¨ Yes x No.

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, and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by checkmark whether the registrant is an accelerated filer. x Yes ¨ No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.): Yes ¨ No x

The aggregate market value of the Class A Common Stock and Class B Common Stock held by non-affiliates of the Registrant, based upon the average price on March 31, 2005, was $788,282,015*. The Class A Common Stock is the only publicly traded voting security of the Registrant.

The shares of the Registrant’s common stock outstanding as of December 1, 2005 were as follows:


Class		Number of Shares
Class A Common Stock, $.01 par value		29,986,792
Class B Common Stock, $.01 par value		431,562

DOCUMENTS INCORPORATED BY REFERENCE

None.

*	Based on reported beneficial ownership of all directors and executive officers of the Registrant; this determination does not, however, constitute an admission of affiliated status for any of these individual stockholders.

EXPLANATORY NOTE:

BankUnited Financial Corporation is hereby amending its previously filed Annual Report on Form 10-K for the fiscal year ended September 30, 2005 (the “Report”). This Amendment No. 1 (the “Amendment”) is being filed solely for the purposes of correcting clerical errors by:

A) including the conformed signatures of management on Management’s Report on Internal Control Over Financial Reporting;

B) including the conformed signature of the Registrant’s independent registered certified public accounting firm on the Report of Independent Registered Certified Public Accounting Firm;

C) completing the date of the Registrant’s signature on the Signature Page of the Report; and

D) including the conformed signature of the Registrant’s independent registered certified public accounting firm on its consent filed as exhibit 23.1 of the Report and re-filing that consent as exhibit 23.1 to this Amendment.

As a result of this Amendment, the certifications required by Item 601(b)(31)(i) of Regulation S-K have been executed as of the date of this Amendment and are filed as exhibits to this Amendment. No revisions have been made with respect to any other disclosures contained in the Report.

Item 8. Consolidated Financial Statements and Supplementary Data

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


		Page
Management’s Report on Internal Control Over Financial Reporting		4

Report of Independent Registered Certified Public Accounting Firm		5

Consolidated Statements of Financial Condition as of September 30, 2005 and September 30, 2004		7

Consolidated Statements of Operations for the Years Ended September 30, 2005, 2004 and 2003		8

Consolidated Statements of Stockholders’ Equity for the Years Ended September 30, 2005, 2004 and 2003		9

Consolidated Statements of Cash Flows for the Years Ended September 30, 2005, 2004 and 2003		11

Notes to Consolidated Financial Statements		13

Management’s Report on Internal Control Over Financial Reporting

Management of BankUnited Financial Corporation is responsible for establishing and maintaining adequate internal control over financial reporting. BankUnited Financial Corporation’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management has completed an assessment of BankUnited Financial Corporation’s internal control over financial reporting as of September 30, 2005. This assessment used a framework based on the “Internal Control - Integrated Framework” promulgated by the Committee of Sponsoring Organizations of the Treadway Commission, commonly referred to as the “COSO” criteria. Based on this assessment, management concluded that as of September 30, 2005, BankUnited Financial Corporation maintained effective internal control over financial reporting.

Management’s assessment of the effectiveness of BankUnited Financial Corporation’s internal control over financial reporting and the effectiveness of BankUnited Financial Corporation’s internal control over financial reporting as of September 30, 2005 has been audited by PricewaterhouseCoopers LLP, BankUnited Financial Corporation’s independent registered certified public accounting firm, who also audited BankUnited Financial Corporation’s consolidated financial statements as of and for the year ended September 30, 2005, as stated in their attestation report which is included herein.


By:		/s/ Alfred R. Camner
		Alfred R. Camner Chairman and Chief Executive Officer, BankUnited Financial Corporation

		/s/ Humberto L. Lopez
		Humberto L. Lopez Senior Executive Vice President and Chief Financial Officer, BankUnited Financial Corporation

Report of Independent Registered Certified Public Accounting Firm

To the Board of Directors and Stockholders of

BankUnited Financial Corporation

We have completed an integrated audit of BankUnited Financial Corporation’s 2005 consolidated financial statements and of its internal control over financial reporting as of September 30, 2005 and audits of its 2004 and 2003 consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Our opinions, based on our audits, are presented below.

Consolidated financial statements

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, stockholders’ equity and of cash flows present fairly, in all material respects, the financial position of BankUnited Financial Corporation and its subsidiaries at September 30, 2005 and 2004, and the results of their operations and their cash flows for each of the three years in the period ended September 30, 2005 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Internal control over financial reporting

Also, in our opinion, management’s assessment, included in Management’s Report on Internal Control over Financial Reporting appearing under ITEM 8, that the Company maintained effective internal control over financial reporting as of September 30, 2005 based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), is fairly stated, in all material respects, based on those criteria. Furthermore, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2005, based on criteria established in Internal Control—Integrated Framework issued by the COSO. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express opinions on management’s assessment and on the effectiveness of the Company’s internal control over financial reporting based on our audit. We conducted our audit of internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. An audit of internal control over financial reporting includes obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we consider necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable

assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

/s/ PricewaterhouseCoopers LLP

Miami, Florida

December 12, 2005

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


	September 30,
	2005			2004
	(Dollars in thousands, except per share amounts)
ASSETS
Cash	$	60,870		$	31,062
Federal Home Loan Bank overnight deposits		175,249			148,647
Federal funds sold		1,932			2,185
Investment securities available for sale, at fair value		289,932			333,939
Mortgage-backed securities available for sale, at fair value (including assets pledged of $1,223,261 and $1,271,100 at September 30, 2005 and 2004, respectively)		1,626,005			2,068,180
Mortgage loans held for sale at fair value		12,196			28,786
Loans held in portfolio		7,933,759			5,684,887
Add: Unearned discounts, premiums and deferred loan costs, net		119,588			65,992
Less: Allowance for loan losses		(25,755	)		(24,079	)

Loans held in portfolio, net		8,027,592			5,726,800

FHLB stock and other earning assets		190,043			156,166
Office properties and equipment, net		41,072			26,417
Real estate owned		542			1,611
Accrued interest receivable		41,621			32,195
Mortgage servicing rights		22,101			15,414
Goodwill		28,353			28,353
Bank owned life insurance		112,383			88,210
Amounts due from brokers		3,780			—
Prepaid expenses and other assets		34,034			22,480

Total assets	$	10,667,705		$	8,710,445

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Interest bearing deposits	$	4,361,820		$	3,281,108
Non-interest bearing deposits		371,535			247,154

Total deposits		4,733,355			3,528,262

Securities sold under agreements to repurchase		1,161,348			1,182,237
Advances from Federal Home Loan Bank		3,820,385			3,115,428
Convertible senior notes		120,000			120,000
Trust preferred securities and subordinated debentures		195,500			164,979
Interest payable		15,291			14,051
Advance payments by borrowers for taxes and insurance		74,998			59,971
Accrued expenses and other liabilities		39,212			32,860

Total liabilities		10,160,089			8,217,788

Commitments and Contingencies (See notes (7), (9), (10) and (15))

Stockholders’ Equity:
Preferred stock, $0.01 par value		9			8
Authorized shares—10,000,000, Issued shares—889,139 and 803,405 Outstanding shares—862,419 and 776,685 Treasury shares—26,720		(528	)		(528	)
Class A common stock, $0.01 par value		302			299
Authorized shares—60,000,000 Issued shares—30,202,220 and 29,866,275 Outstanding shares—29,768,791 and 29,522,546 Treasury shares—433,429 and 343,729		(5,223	)		(3,008	)
Class B common stock, $0.01 par value		6			6
Authorized shares—3,000,000 Issued shares—612,762 and 622,762 Outstanding shares—431,562 and 536,562 Treasury shares—181,200 and 86,200		(1,977	)		(1,011	)
Additional paid-in capital		342,859			336,258
Retained earnings		193,372			166,713
Deferred compensation		1,695			1,216
Accumulated other comprehensive loss		(22,899	)		(7,296	)

Total stockholders’ equity		507,616			492,657

Total liabilities and stockholders’ equity	$	10,667,705		$	8,710,445

See accompanying notes to consolidated financial statements

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS


	For the Years Ended September 30,
	2005			2004			2003
	(Dollars and shares in thousands, except earnings per share)
Interest income:
Interest and fees on loans	$	345,005		$	231,524		$	232,160
Interest on mortgage-backed securities		64,265			80,856			67,934
Interest and dividends on investments and other earning assets		22,100			19,721			15,298

Total interest income		431,370			332,101			315,392

Interest expense:
Interest on deposits		98,313			71,928			82,559
Interest on borrowings		157,156			108,720			98,883
Preferred dividends of trust preferred securities and subordinated debentures		12,942			8,255			17,406

Total interest expense		268,411			188,903			198,848

Net interest income before provision for loan losses		162,959			143,198			116,544
Provision for loan losses		3,800			5,025			5,425

Net interest income after provision for loan losses		159,159			138,173			111,119

Non-interest income:
Loan servicing fees		3,357			3,110			2,208
Amortization of mortgage servicing rights		(3,673	)		(4,322	)		(6,800	)
Impairment of mortgage servicing rights		(130	)		(1,200	)		—
Loan fees		2,506			2,540			3,775
Deposit fees		4,422			4,278			4,059
Other fees		2,266			1,920			1,424
Net gain (loss) on sale of investments and mortgage-backed securities		2,794			(1,902	)		4,604
Net gain on sale of loans and other assets		3,318			6,859			9,968
Income from insurance and investment services		4,262			4,295			2,695
Settlement of swap related to extinguishment of debt		(1,369	)		—			1,445
Other non-interest income		4,858			4,785			5,398

Total non-interest income		22,611			20,363			28,776

Non-interest expenses:
Employee compensation and benefits		51,817			43,773			40,390
Occupancy and equipment		24,379			17,399			12,606
Telecommunications and data processing		7,030			5,726			5,206
Advertising and promotion expense		5,579			5,288			4,290
Professional fees		6,796			3,892			4,610
Extinguishment of debt		35,814			—			6,859
Other non-interest expense		12,440			8,595			10,263

Total non-interest expenses		143,855			84,673			84,224

Income before income taxes		37,915			73,863			55,671
Provision for income taxes		10,378			23,141			16,551

Net income	$	27,537		$	50,722		$	39,120

Earnings Per Share:
Basic	$	0.90		$	1.69		$	1.45
Diluted	$	0.85		$	1.58		$	1.36
Weighted average number of common shares outstanding:
Basic		30,090			29,843			26,803
Diluted		32,339			32,153			28,865
Dividends declared per share on common stock	$	0.02			—			—

See accompanying notes to consolidated financial statements

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

For the Years Ended September 30, 2005, 2004 and 2003


	Preferred Stock Outstanding			Class A Common Stock Outstanding				Class B Common Stock Outstanding					Paid-in Capital		Retained Earnings			Common Treasury Stock			Preferred Treasury Stock			Deferred Compensation		Accumulated Other Comprehensive Income (Loss) Net of Tax			Total Stockholders Equity
	Shares	Amount		Shares		Amount		Shares		Amount			Paid-in Capital		Retained Earnings			Common Treasury Stock			Preferred Treasury Stock			Deferred Compensation					Total Stockholders Equity
	(Dollars in thousands)
Balance at September 30, 2002	547,287	$	6	24,675,515		$	250	536,562		$	5		$	253,511	$	77,566		$	(2,794	)	$	(528	)	$	528	$	16,605		$	345,149
Comprehensive income:
Net income for the year ended September 30, 2003	—		—	—			—	—			—			—		39,120			—			—			—		—			39,120
Other comprehensive income, net of tax	—		—	—			—	—			—			—		—			—			—			—		(10,817	)		(10,817	)

Total comprehensive income	—		—	—			—	—			—			—		—			—			—			—					28,303
Payment of preferred stock dividends	—		—	—			—	—			—			—		(316	)		—			—			—		—			(316	)
Stock offering				3,936,500			39							67,728																67,767
Shares acquired through deferred compensation arrangements	—		—	(4,492	)		—	(43,700	)		—			—		—			(582	)		—			—		—			(582	)
Deferral of compensation	—		—	—			—	—			—			—		—			—			—			266		—			266
Stock option exercises and restricted stock awards	165,000		1	531,601			6	43,700			1			6,778		—			—			—			—		—			6,786

Balance at September 30, 2003	712,287		7	29,139,124			295	536,562			6			328,017		116,370			(3,376	)		(528	)		794		5,788			447,373

Comprehensive income:
Net income for the year ended September 30, 2004	—		—	—			—	—			—			—		50,722			—			—			—		—			50,722
Other comprehensive loss, net of tax	—		—	—			—	—			—			—		—			—			—			—		(13,084	)		(13,084	)

Total comprehensive income	—		—	—			—	—			—			—		—			—			—			—		—			37,638
Payment of preferred stock dividends	—		—	—			—	—			—			—		(379	)		—			—			—		—			(379	)
Shares acquired through deferred compensation arrangements	—		—	(6,237	)		—	(42,500	)		—			—		—			(643	)		—			—		—			(643	)
Deferral of compensation	—		—	—			—	—			—			—		—			—			—			422		—			422
Stock option exercises and restricted stock awards	64,398		1	389,659			4	42,500						8,241		—			—			—			—		—			8,246

Balance at September 30, 2004	776,685		8	29,522,546			299	536,562			6			336,258		166,713			(4,019	)		(528	)		1,216		(7,296	)		492,657

Comprehensive income:
Net income for the year ended September 30, 2005	—		—	—			—	—			—			—		27,537			—			—			—		—			27,537
Other comprehensive loss, net of tax	—		—	—			—	—			—			—		—			—			—			—		(15,603	)		(15,603	)

Total comprehensive income	—		—	—			—	—			—			—		—			—			—			—		—			11,934
Payment of stock dividends	—		—	—			—	—			—			—		(878	)		—			—			—		—			(878	)
Purchase of stock				(89,700	)														(2,215	)										(2,215	)
Shares acquired through deferred compensation arrangements	—		—	—			—	—			—			—		—			(966	)		—			—		—			(966	)
Deferral of compensation	—		—	—			—	—			—			—		—			—			—			479		—			479
Conversion of shares				145,500			1	(145,500	)		(1	)																		—
Stock option exercises and restricted stock awards	85,734		1	190,445			2	40,500			1			6,601		—			—			—			—		—			6,605

Balance at September 30, 2005	862,419	$	9	29,768,791		$	302	431,562		$	6		$	342,859	$	193,372		$	(7,200	)	$	(528	)	$	1,695	$	(22,899	)	$	507,616

See accompanying notes to consolidated financial statements

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY—(Continued)

For the Years Ended September 30, 2005, 2004 and 2003

The following table presents additional information concerning BankUnited’s other comprehensive income (loss):


	For the Years Ended September 30,
	2005			2004			2003
	(Dollars in thousands)
Net income	$	27,537		$	50,722		$	39,120
Other comprehensive loss, net of tax:
Unrealized losses arising during the period, on securities net of tax benefit of $(7,538), $(6,908), and $(3,312) for 2005, 2004 and 2003, respectively		(14,000	)		(12,830	)		(6,150	)
Unrealized gains (losses) on cash flow hedges, net of tax expense (benefit) of $268, $(183) and $(534) for 2005, 2004 and 2003, respectively		497			(340	)		(966	)
Less reclassification adjustment for:
Realized gains on securities sold included in net income, net of tax expense of $1,311, $297 and $2,307 for 2005, 2004 and 2003, respectively		2,434			551			4,284
Realized losses on cash flow hedges, net of tax benefit of $180, $343, and $328 for 2005, 2004, and 2003, respectively		(334	)		(637	)		(583	)

Total other comprehensive loss, net of tax		(15,603	)		(13,084	)		(10,817	)

Total comprehensive income	$	11,934		$	37,638		$	28,303

See accompanying notes to consolidated financial statements.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS


	For the Years Ended September 30,
	2005			2004			2003
	(Dollars in thousands)
Cash flows from operating activities:
Net income	$	27,537		$	50,722		$	39,120
Adjustments to reconcile net income to net cash used in operating activities:
Provision for loan losses		3,800			5,025			5,425
Depreciation and amortization		5,959			4,417			3,628
Adjustments to the carrying value of real estate owned		972			725			491
Amortization of fees, discounts and premiums, net		32,260			28,321			31,132
Amortization of mortgage servicing rights		3,673			4,322			6,800
Amortization of restricted stock and other awards		2,761			2,421			723
Amortization of issuance cost of long-term debt		1,304			1,659			1,147
Revaluation loss (gain) from derivatives		1,309			(919	)		(850	)
Increase in bank owned life insurance cash surrender value		(4,173	)		(4,055	)		(3,475	)
Net (gain) loss on sale of investments and mortgage-backed securities		(2,794	)		1,902			(4,604	)
Net gain on sale of loans and other assets		(3,318	)		(6,859	)		(9,968	)
Net gain on sale of real estate owned		(820	)		(813	)		(505	)
Impairment of mortgage servicing rights		130			1,200			—
Loss on extinguishment of debt		—			—			5,501
Loans originated for sale, net of repayments		(225,018	)		(337,466	)		(818,911	)
Proceeds from sale of loans held for sale		68,342			152,943			69,408
(Increase) decrease in accrued interest receivable		(10,179	)		(3,743	)		409
Increase (decrease) in interest payable		1,240			(280	)		393
Increase (decrease) in accrued taxes		252			(504	)		(233	)
Increase (decrease) in other liabilities		14,845			(18,087	)		(5,286	)
(Increase) decrease in prepaid expenses and other assets		(14,034	)		12,390			30,614
Other, net		(3,251	)		(8,236	)		(11,539	)

Net cash used in operating activities		(99,203	)		(114,915	)		(660,580	)

Cash flows from investing activities:
Net increase in loans held in portfolio		(2,842,235	)		(1,738,454	)		(252,060	)
Purchase of investment securities available for sale		(86,752	)		(48,398	)		(213,404	)
Purchase of mortgage-backed securities available for sale		(860	)		(1,115,796	)		(2,403,845	)
Purchase of FHLB stock and other earning assets		(122,439	)		(134,485	)		(128,324	)
Purchase of office properties and equipment		(20,976	)		(10,603	)		(6,721	)
Purchase of bank owned life insurance		(20,000	)		—			(27,500	)
Proceeds from repayments of investment securities available for sale		295			3,076			50,557
Proceeds from repayments of mortgage-backed securities available for sale		616,142			929,677			1,188,246
Proceeds from repayments of FHLB stock and other earning assets		88,562			101,750			95,617
Proceeds from sale of investment securities available for sale		119,906			6,577			41,051
Proceeds from sale and net settlement of mortgage-backed securities available for sale		482,320			526,421			1,003,011
Proceeds from sale of real estate owned and other assets		5,008			6,511			6,545

Net cash used in investing activities		(1,781,029	)		(1,473,724	)		(646,827	)

(Continued on next page)

See accompanying notes to consolidated financial statements

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS —(Continued)


	For the Years Ended September 30,
	2005			2004			2003
	(Dollars in thousands)
Cash flows from financing activities:
Net increase in deposits		1,205,093			292,156			259,935
Additions to long-term Federal Home Loan advances		1,639,000			900,000			750,000
Repayments of long-term Federal Home Loan advances		(1,419,000	)		(405,000	)		(175,000	)
Net increase in short-term Federal Home Loan advances		486,067			159,027			79,202
Net (decrease) increase in other borrowings		(20,889	)		664,940			162,255
Net increase in advances from borrowers for taxes and insurance		15,027			12,890			6,488
Guarantee fees for senior notes		—			—			(113	)
Repayment of senior notes		—			(200,000	)		—
Net proceeds from issuance of convertible senior notes		—			116,446			—
Retirement of trust preferred securities		—			—			(159,580	)
Net proceeds from issuance of trust preferred securities		30,927			—			65,630
Net proceeds from issuance of stock		1,565			3,555			73,514
Purchase of stock		(2,215	)		—			—
Tax benefit from stock-based compensation		1,692			—			—
Dividends paid on stock		(878	)		(379	)		(316	)

Net cash provided by financing activities		1,936,389			1,543,635			1,062,015

Increase (decrease) in cash and cash equivalents		56,157			(45,004	)		(245,392	)
Cash and cash equivalents at beginning of period		181,894			226,898			472,290

Cash and cash equivalents at end of period	$	238,051		$	181,894		$	226,898

Supplemental disclosure of cash flow activity:
Interest paid on deposits and borrowings	$	254,229		$	189,183		$	198,455
Income taxes paid	$	10,759		$	17,114			—
Supplemental schedule of non-cash investing and financing activities:
Securitization of mortgage loans and accrued interest	$	508,953			—			—
Exchange of loans for mortgage-backed securities in loan sales transaction with FNMA and FHLMC	$	176,184		$	378,421		$	750,458
Transfer of loans held for sale to portfolio		—		$	70,760			—
Transfers from loans to real estate owned	$	4,064		$	3,666		$	7,322
Securities sold pending settlement	$	3,780			—			—

See accompanying notes to consolidated financial statements.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2005

(1) Summary of Significant Accounting Policies

The accounting and reporting policies of BankUnited Financial Corporation (“BankUnited”) and subsidiaries conform to accounting principles generally accepted in the United States of America and to general practices within the savings and loan industry. Presented below is a description of BankUnited’s principal accounting policies.

(a) Basis of Presentation and Principles of Consolidation

With the exception of certain trust subsidiaries which do not meet the criteria for consolidation, (see FIN No. 46 and FIN No. 46R in (t) Impact of Certain Accounting Pronouncements of this note) the consolidated financial statements include the accounts of BankUnited and its subsidiaries, including BankUnited, FSB (the “Bank”). The Bank provides a full range of banking services to individual and corporate customers through its branches in Florida. The Bank is subject to the regulations of certain federal agencies and undergoes periodic examinations by the Office of Thrift Supervision. All significant inter-company transactions and balances associated with consolidated subsidiaries have been eliminated.

The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated statements of financial condition and operations for the period. Actual results could differ significantly from those estimates.

Material estimates included in the consolidated financial statements, that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses and the valuation of mortgage servicing rights. In addition, material estimates used in pro-forma footnote disclosures of compensation cost in connection with BankUnited’s stock-based compensation plans, have been determined based on the fair value at the grant dates for stock option awards consistent with the methodology prescribed by SFAS No. 123. These estimates may also differ significantly from actual results.

(b) Cash and Cash Equivalents

For the purpose of reporting cash flows, cash and cash equivalents include cash, Federal Home Loan Bank overnight deposits, federal funds sold and securities purchased under agreements to resell with original maturities of three months or less. The collateral held by the Bank for securities purchased under agreements to resell consists of the securities underlying those agreements.

The Bank must comply with Federal Reserve Board regulations requiring the maintenance of reserves against its transaction accounts (primarily interest-bearing and non-interest-bearing checking accounts) and non-personal time deposits. As of September 30, 2005, the Bank had exceeded cash reserve requirements that must be maintained at the FHLB for this purpose.

(c) Investment and Mortgage-backed Securities Available for Sale

Investment and mortgage-backed securities available for sale are carried at fair value, inclusive of unrealized gains and losses, and net of discount accretion and premium amortization computed using the level yield method. Net unrealized gains and losses are included in other comprehensive income (loss) net of applicable income taxes. Gains or losses on sales of investment and mortgage-backed securities available for sale are recognized on the specific identification basis.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(d) Loans

Loans held in the portfolio are considered long-term investments and, accordingly, are carried at historical cost. Mortgage loans held for sale are either recorded at the lower of cost or market, determined in the aggregate or at fair value when they are designated as the hedged item in a hedging relationship under SFAS No. 133.

(e) Allowance for Loan Losses

BankUnited’s allowance for loan losses is established and maintained at a level management deems prudent and adequate to cover probable losses on loans based upon a periodic evaluation of current information of the risks inherent in its loan portfolio. When evaluating loan loss allowances, management reviews performing and non-performing loans separately. There are several elements that management evaluates to estimate the loan loss allowance for BankUnited’s loan portfolio. The elements evaluated, and how they are applied to each portion of the portfolio, are as follows:

An allowance for loan losses present in the performing portion of the loan portfolio. This allowance is established based on historical loan loss analysis supplemented by peer loss analysis.

An allowance for estimated losses on various pools of non-performing loans is made. This element is evaluated for each of the portfolio components based on the internal loan grading system. Historical loan losses, current trends in delinquencies and charge-offs, peer group analysis, and other relevant factors are considered.

An allowance for losses based upon specific evaluations of impaired loans in accordance with Statement of Financial Accounting Standard, (“SFAS”) No. 114 is made. These loans are loans, other than consumer and residential loans, for which collection in full according to the contractual terms is doubtful and which are classified as such in the Bank’s internal loan grading system. Impaired loans are evaluated individually based on an examination of the current financial information of the borrower and an estimate of the value of the collateral, if any. If the carrying value of any of these loans is greater than the estimated net realizable value of the property or of the collateral securing these loans, a reserve is established for the difference.

An additional risk management allowance is made based on factors such as general economic and political conditions, concentrations of credit, economic trends and other conditions in specific geographical markets. This element also considers the uncertainty as to the applicability of historical loss factors as we expand into new markets and products with different risk characteristics. A portion of this allowance has been assigned to specific categories of loans. An unallocated portion represents management’s assessment of probable loss and uncertainties associated with the loan portfolio as a whole.

Loss allowances are established for performing loans and pools of non-performing loans in accordance with SFAS No. 5, “Accounting for Contingencies.” The identification of impaired loans is conducted in conjunction with the review of the adequacy of the allowance for loan losses. Loss allowances are established for specifically identified impaired loans based on the fair value of the underlying collateral in accordance with SFAS No. 114, “Accounting by Creditors for Impairment of a Loan.”

Losses are included in the allowance for loan losses through a charge to the provision for loan losses. The allowance for loan losses is adjusted by additions for loan recoveries, with actual losses charged as reductions to the allowance.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(f) Unearned Discounts, Premiums, and Deferred Costs

Loan origination fees and certain direct loan origination costs are included in the carrying value of loans, and amortized over the contractual maturities of the loans as an adjustment to interest income. Prepayments of loans results in acceleration of the amortization of these items. Commitment fees and costs relating to commitments are recognized over the commitment period where the likelihood of exercise is remote. If the commitment is subsequently exercised during the commitment period, the remaining unamortized commitment fee at the time of exercise is recognized over the life of the loan as an adjustment of yield.

(g) FHLB Stock and Other Earning Assets

FHLB Stock and other earning assets includes Federal Home Loan Bank of Atlanta (FHLB) stock and an equity investment under the Community Reinvestment Act. The fair value is estimated to be the carrying value, which is par.

(h) Office Properties and Equipment, net

Office properties and equipment are carried at cost less accumulated depreciation and amortization. Depreciation is calculated based on the straight line method using the estimated service lives of the assets for office building (30 years), furniture fixtures and equipment (seven to ten years), and computer equipment and software (three to five years), or with leasehold improvements, the term of the lease or the useful life of the improvement, whichever is shorter. Repair and maintenance costs are charged to operations as incurred, and improvements are capitalized.

(i) Real Estate Owned

Property acquired through foreclosure or deed in lieu of foreclosure is carried at the lower of the related principal balance at foreclosure or estimated fair value less estimated costs to sell the property. Any excess of the loan balance over the fair value less estimated costs to sell the property is charged to the allowance for loan losses at the time of foreclosure. The carrying value is reviewed periodically and, when necessary, any decline in the value of the real estate is charged to operations. Significant property improvements which enhance the salability of the property are capitalized to the extent that the carrying values do not exceed their estimated realizable values. Maintenance and carrying costs on the property are charged to operations as incurred. In connection with real estate owned, management obtains independent appraisals for properties.

(j) Accrued Interest Receivable

Recognition of interest on the accrual method is discontinued when interest or principal payments on loans are greater than 90 days in arrears. At the time a loan is placed on non-accrual status, previously accrued and uncollected interest is reversed against interest income in the current period. Loans are returned to accrual status when they become less than 90 days delinquent.

(k) Mortgage Servicing Rights and Transfers

Mortgage Servicing Rights

BankUnited recognizes mortgage servicing rights (MSR) as assets when it sells loans and retains the right to service those loans. The value of servicing assets is derived from estimated future revenues from contractually specified servicing fees, late charges, and other ancillary revenues that are expected to be more than adequate

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

compensation to cover the costs associated with performing the service, and generally expressed as a percent of the unpaid principal balance. Estimated future revenues are determined using the estimated future balance of the underlying mortgage loan portfolio which, absent new purchases, declines over time from prepayments and cash flows. MSR assets are carried at the lower of cost or market and amortized in proportion to and over the period of estimated net servicing income. BankUnited charges impairment as a direct write-down of its MSR assets. BankUnited does not currently utilize a valuation allowance for recognizing impairment of its MSR assets. BankUnited assesses the MSR assets for impairment based on the fair value of those assets as determined by independent third parties. Fair values are determined by stratifying the servicing assets by product and interest rates.

Servicing fees and the amortization of MSR assets are reported separately from other ancillary fees in BankUnited’s consolidated statement of operations.

Transfers

When BankUnited sells (transfers) mortgage loans for securitization it may acquire beneficial interests in the securities created as well as the rights to service the loans underlying the securities. Gains or losses on these transactions are recognized only for the portion of securities that are not acquired by BankUnited. Expenses related to the transaction are not deferred but are included in the gain or loss calculation. The book values of securities retained by BankUnited are based on their relative fair values at the date of transfer. BankUnited classifies retained securities as available for sale in its Consolidated Statement of Financial Condition which are carried at fair value. BankUnited obtains fair values of its retained securities, at both the date of securitization and at each reporting date, from independent third parties.

(l) Goodwill

Goodwill represents the excess of purchase price over the fair value of net assets acquired by BankUnited. BankUnited no longer amortizes goodwill, however, goodwill is tested annually for impairment. BankUnited measures goodwill impairment for the company as a whole by comparing the fair value of its net assets to the carrying value. Market capitalization, which is an indication of the value the market places on a company, is the basis for the fair value of net assets.

(m) Bank Owned Life Insurance

Bank owned life insurance is carried at an amount that could be realized under the insurance contract as of the date of the consolidated statement of financial condition. The change in contract value is recorded as an adjustment to the premiums paid in determining the expense or income to be recognized under the contract.

(n) Debt Extinguishment

BankUnited records prepayment fees incurred upon the early extinguishment of debt in non-interest expense, and the settlement of swaps related to debt extinguishment in non-interest income.

(o) Income Taxes

BankUnited and its subsidiaries, other than BU REIT, Inc., file a consolidated federal income tax return. Beginning in 2003, BankUnited and its subsidiaries file separate tax returns for each state jurisdiction. Deferred income taxes have been provided for elements of income and expense which are recognized for financial

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

reporting purposes in periods different than those for which such items are recognized for income tax purposes. BankUnited accounts for income taxes utilizing the asset and liability method, which applies the enacted statutory rates in effect at the statement of financial condition date to differences between the book and tax bases of assets and liabilities. The resulting deferred tax liabilities and assets are adjusted to reflect changes in tax laws.

(p) Earnings per Share

Basic earnings (loss) per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of BankUnited. Computation of diluted earnings per share does not assume conversion, exercise, or contingent issuance of securities that would have an antidilutive effect on earnings (loss) per share.

Securities issued by BankUnited, which could potentially dilute earnings per share in future periods include: stock options, restricted stock, contingently convertible senior notes, and convertible preferred stock. When calculating diluted earnings per share, BankUnited utilizes the Treasury Stock method for options, restricted stock, and the contingently convertible senior notes, which results in only an incremental number of shares added to shares outstanding during the period. BankUnited utilizes the If-Converted method for convertible preferred stock, which results in 100% of the shares added to shares outstanding during the period.

(q) Stock Options and Restricted Stock

Stock options are granted to employees and directors at an exercise price at or above the fair market value of the underlying stock on the date of the grant. The proceeds from the exercise of options are credited to common stock for the par value of the shares issued, and the excess, adjusted for any tax benefit, is credited to paid-in capital.

Restricted stock is issued to employees and directors from time to time. Restricted stock is recorded based on the market price of the stock on the date of issuance. Equity is credited with the par value of the stock and paid in capital is credited with the balance of the market value at the date of issuance. Also at the date of issuance, the value of the stock is recorded in paid-in-capital as contra equity. Non-performance based restricted stock vests ratably over the period assigned by the Compensation Committee and is amortized out of contra equity with a charge to compensation expense and a credit to the contra equity paid-in-capital account. Performance-based restricted stock is subject to performance goals and is also recorded as compensation expense with a credit to the contra equity paid-in-capital account ratably when the performance criteria are met and vesting begins.

(r) Segment Reporting

Public companies are required to report certain financial information about significant revenue-producing segments of the business for which such information is available and utilized by the chief operating decision maker. Specific information to be reported for individual operating segments includes a measure of profit and loss, certain revenue and expense items, and total assets. As a community-oriented financial institution, substantially all of BankUnited’s operations involve the delivery of loan and deposit products to customers. Management makes operation decisions and assesses performance based on an ongoing review of these community-banking operations, which constitute BankUnited’s only operating segment.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(s) Derivative Instruments Held for Purposes Other Than Trading

BankUnited enters into derivative contracts as a means of reducing its interest rate exposures. No derivatives are held for trading purposes. At inception these contracts, i.e., hedging instruments, are evaluated in order to determine if they qualify for hedge accounting. The hedging instrument must be highly effective in achieving offsetting changes in the hedge instrument and hedged item attributable to the risk being hedged. Any ineffectiveness which arises during the hedging relationship is recognized in noninterest expense in the period in which it arises. All derivatives are valued at fair value and included in other assets or other liabilities. For fair value hedges, the changes in the fair value of the hedged item and changes in fair value of the derivative are recognized in noninterest income. For cash flow hedges, the unrealized changes in fair value to the extent effective are recognized in other comprehensive income. The fair value of cash flow hedges related to forecasted transactions is recognized in noninterest expense in the period when the forecasted transaction occurs. Any ineffectiveness related to cash flow-hedges is recorded in interest expense.

Residential mortgage loan commitments related to loans to be sold are required to be accounted for as derivatives at fair value, along with all forward sales contracts for loans to be sold. The commitments and forward sales contracts are recorded as either assets or liabilities in the consolidated statement of financial condition with the changes in fair value recorded in non-interest expense.

(t) Impact of Certain Accounting Pronouncements

SFAS No. 123R

In March 2004, the FASB issued a statement to revise Statement of Financial Accounting Standards (“SFAS”) No. 123 and SFAS No. 95, “Share-Based Payment,” that addresses the accounting for share-based payment transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments. The Statement will eliminate the ability to account for share-based compensation transactions using APB Opinion No. 25, “Accounting for Stock Issued to Employees,” and will require instead that such transactions be accounted for using a fair-value-based method. The FASB had indicated that the statement would be effective for any interim or annual period beginning after June 15, 2005, meaning that an entity should apply the statement to all employee awards of share-based payment granted, modified, or settled in any interim or annual period beginning after June 15, 2005. On April 14, 2005, the Securities and Exchange Commission announced the adoption of a new rule that amends the compliance dates for SFAS No. 123R. The Commission’s new rule allows companies to implement Statement No. 123R at the beginning of their next fiscal year, instead of the next reporting period, that begins after June 15, 2005. BankUnited will implement FAS 123R using the modified prospective method of transition beginning October 1, 2005. Based on stock-based compensation plans outstanding as of September 30, 2005, management does not expect that the impact of SFAS No. 123R will be material to BankUnited’s consolidated financial condition or results of operations. See Note 13, Stock Based Compensation, for pro-forma earnings per share for stock-based compensation and information on the acceleration of vesting periods for two stock option grants.

SFAS No. 149

In April 2003, the FASB issued SFAS No. 149, “Amendment of SFAS No. 133 on Derivative Instruments and Hedging Activities.” SFAS No. 149 clarifies certain issues and amends definitions contained in SFAS No. 133 to ensure that contracts with comparable characteristics are accounted for similarly. This statement is effective for contracts entered into or modified after June 30, 2003, except for hedging transactions designated

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

after June 30, 2003, in which case it is effective in accordance with the respective effective dates outlined in SFAS No. 133. Although applicable to BankUnited, SFAS No. 149 has not had a significant impact on its consolidated financial condition or results of operations.

SFAS No. 150

In May 2003, the FASB issued SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.” SFAS No. 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liability and equity. Although applicable to BankUnited, SFAS No. 150 has not had a significant impact on its consolidated financial condition or results of operations.

FIN No. 46 and FIN No. 46R

In January 2003, FASB issued FASB Interpretation No. 46 (“FIN No. 46”), an interpretation of Accounting Research Bulletin No. 51, Consolidated Financial Statements. FIN No. 46 establishes the criteria used to identify variable interest entities and to determine whether or not to consolidate a variable interest entity. This interpretation was effective immediately for variable interest entities created after January 31, 2003 and in the first fiscal year or interim period beginning after December 15, 2003, for variable interest entities in which a variable interest was acquired prior to February 1, 2003. Prior to FIN No. 46, BankUnited eliminated the investments in all of its trust subsidiaries and reported trust preferred securities in the liability section of BankUnited’s Consolidated Statement of Financial Condition. On December 24, 2003, the FASB issued a revision to Interpretation 46 (“FIN No. 46R”) to clarify some of the provisions of FIN No. 46. Under the new guidance contained in FIN No. 46R, special effective date provisions apply to enterprises that have fully or partially applied FIN No. 46 prior to issuance of FIN No. 46R. Under the original provisions of FIN No. 46, beginning with the interim period beginning after June 15, 2003, BankUnited would no longer consolidate variable interest entities in which a variable interest was acquired prior to February 1, 2003 that do not meet the consolidation criteria under FIN No. 46. Under the new guidance contained in FIN No. 46R, the effective date has been moved up to the first interim period ending after December 15, 2003 for special purpose entities only. Currently, BankUnited Capital is the only trust subsidiary consolidated by BankUnited. BankUnited meets the consolidation criteria under FIN No. 46 with respect to BankUnited Capital due to its ownership of the majority of preferred shares issued by that trust. As a result of FIN No. 46, BankUnited recognizes investments in common securities of its non-consolidated trust subsidiaries in other assets and reports the amount of subordinated debentures issued by BankUnited Financial Corporation to those trust subsidiaries in the liability section of its Consolidated Statement of Financial Condition. FIN No. 46 does not require restatement of prior year balances. FIN No. 46 and FIN No. 46R have not had a significant impact on BankUnited’s consolidated financial condition or results of operations. The following information is being provided in accordance with disclosure requirements of FIN No. 46R.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

SAB No. 105

On March 9, 2004, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 105, (“SAB No. 105”) “Application of Accounting Principles to Loan Commitments.” SAB No. 105 pertains to recognizing and disclosing loan commitments, and is effective for commitments to originate mortgage loans held for sale that are entered into after March 31, 2004. Accounting guidance issued prior to SAB No. 105 requires entities, that make mortgage-loan commitments on loans it intends to sell, to recognize them at fair value through expiration or funding, but does not address how to measure fair value. SAB No. 105 clarifies this guidance by defining measurement of fair value at the balance sheet date as only the difference between the guaranteed interest rate in the loan commitment and market interest rate, excluding any expected future cash flows related to customer relationships or loan servicing. Prior to SAB No. 105, BankUnited based the fair value of loan commitments held for sale solely on the relationship to market interest rate, absent any expected cash flows from the customer relationship or servicing rights, therefore, SAB 105 will not have an impact on BankUnited’s consolidated financial condition or results of operations.

EITF Issue No. 03-1

The Emerging Issues Task Force (“EITF”) reached consensus in March 2004 regarding guidance provided in EITF Issue No. 03-1, The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments. The purpose of EITF Issue No. 03-1 is to determine the meaning of other-than-temporary impairment and its application to certain securities, including debt and equity securities that are within the scope of SFAS No. 115. Guidance in EITF Issue No. 03-1 should be used to determine when an investment is considered impaired, whether that impairment is other-than-temporary, and the measurement of an impaired loss. This guidance also includes accounting considerations for securities subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary. Portions of this guidance were effective for reporting periods beginning after June 15, 2004 and other portions will be deliberated further. This delay does not suspend the current requirement to recognize other-than-temporary impairments as required by existing authoritative literature. BankUnited has not identified any other-than-temporary impairment in its securities portfolio as of September 30, 2005. Subsequent to the FASB final deliberations, BankUnited will evaluate the potential impact on its process of identifying other-than-temporary declines in value of its debt and equity securities.

EITF Issue No. 04-8

The EITF of the FASB reached a consensus position Issue No. 04-8, “Accounting Issues Related to Certain Features of Contingently Convertible Debt and the Effect of Diluted Earnings Per Share”, which could have required that the dilutive effect of contingently convertible debt instruments such as BankUnited’s 3.125% Convertible Senior Notes (the “Notes”), be reflected in BankUnited’s calculation of diluted earnings per share for reporting periods ending after December 15, 2004. Previous accounting rules provided for the exclusion of the effect of the contingently convertible instruments until the contingency had been satisfied.

In December 2004, BankUnited entered into a First Supplemental Indenture (the “First Supplemental Indenture”), in respect of its $120 million aggregate principal amount of the Notes. The First Supplemental Indenture amends the indenture governing the Notes dated as of February 27, 2004 (the “Indenture”), between BankUnited and the Trustee.

Under the original terms of the Indenture, the Notes were convertible by holders, under certain circumstances described in the Indenture, into shares of BankUnited’s Class A Common Stock, cash in lieu of

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

shares of Class A Common Stock, or a combination of cash and shares of Class A Common Stock. Under the terms of the First Supplemental Indenture, BankUnited has irrevocably elected and agreed to pay only cash in settlement of the principal amount of the Notes in respect of its conversion obligations. BankUnited has retained the right to elect to settle any and all conversion obligations in excess of the principal amount of the Notes in cash or shares of Class A Common Stock or a combination of cash and shares of Class A Common Stock.

As a result of the amendment effected by the First Supplemental Indenture, the Notes will have no effect on the calculation of BankUnited’s diluted average shares outstanding until the market price for BankUnited’s Class A Common Stock exceeds the conversion price of $38.06 per share.

SFAS No. 154

In May 2005, the FASB issued SFAS No. 154 “Accounting Changes and Error Corrections.” This statement replaces Accounting Principles Board Opinion No. 20 “Accounting Changes”, and FASB Statement No. 3, “Reporting Accounting Changes in Interim Financial Statements” and changes the requirements for the accounting for and reporting of a change in accounting principle. SFAS No. 154 shall be effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Therefore, BankUnited will adopt this statement, as applicable, in its fiscal year beginning October 1, 2006.

(u) Financial Statement Reclassifications

Certain prior period amounts have been reclassified to conform to the September 30, 2005 consolidated financial statements.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(2) Earnings per Share

Earnings per share is calculated as follows:


	For the Years Ended September 30,
	2005		2004		2003
	(In thousands, except per share amounts)
Basic earnings per share:
Numerator:
Net income	$	27,537	$	50,722	$	39,120
Preferred stock dividends		431		379		316

Net income available to common stockholders	$	27,106	$	50,343	$	38,804

Denominator:
Weighted average common shares outstanding		30,090		29,843		26,803

Basic earnings per share	$	0.90	$	1.69	$	1.45

Diluted earnings per share:
Numerator:
Net income available to common stockholders	$	27,106	$	50,343	$	38,804
Plus:
Convertible preferred stock dividends		431		379		316

Diluted net income available to common stockholders	$	27,537	$	50,722	$	39,120

Denominator:
Weighted average common shares outstanding		30,090		29,843		26,803
Plus:
Stock options and restricted stock		1,427		1,543		1,332
Convertible preferred stock		822		767		730

Diluted weighted average shares outstanding		32,339		32,153		28,865

Diluted earnings per share (1)	$	0.85	$	1.58	$	1.36

(1)	During the fiscal years ended September 30, 2005, 2004, and 2003, BankUnited did not consider potential common shares of 392,996, 17,180, and 34,665, respectively, in the computation of diluted earnings per share because to do so would have been antidilutive.

(3) Investments and Mortgage-backed Securities Available for Sale

Investments Securities Available for Sale

Presented below is an analysis of investments designated as available for sale.


	September 30, 2005
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
U.S. government sponsored entity debt securities	$	72,637	$	—	$	(1,203	)	$	71,434
Preferred stock of U.S. government sponsored entities		96,085		15		(4,523	)		91,577
Trust preferred securities of other issuers		23,120		379		(72	)		23,427
Mutual funds and other bonds		105,628		29		(3,225	)		102,432
Other equity securities		1,011		51		—			1,062

Total	$	298,481	$	474	$	(9,023	)	$	289,932

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005


	September 30, 2004
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
U.S. government sponsored entity debt securities	$	52,038	$	539	$	—		$	52,577
Preferred stock of U.S. government sponsored entities		96,089		436		(2,028	)		94,497
Trust preferred securities of other issuers		88,567		4,072		(250	)		92,389
Mutual funds and other bonds		95,186		34		(1,706	)		93,514
Other equity securities		932		30		—			962

Total	$	332,812	$	5,111	$	(3,984	)	$	333,939

Investment securities at September 30, 2005, by contractual maturity, are shown below.


	Available for Sale
	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	12,163	$	12,119
Due after one year through five years		76,131		74,891
Due after five years through ten years		1,367		1,360
Due after ten years		44,139		44,151
Equity securities		164,681		157,411

Total	$	298,481	$	289,932

Mortgage-backed Securities Available for Sale

Presented below is an analysis of mortgage-backed securities designated as available for sale:



	September 30, 2005
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
FNMA mortgage-backed securities	$	266,564	$	168	$	(7,624	)	$	259,108
FHLMC mortgage-backed securities		80,659		53		(1,248	)		79,464
Collateralized mortgage obligations		9,065		1,308		(29	)		10,344
Mortgage pass-through certificates		1,296,773		376		(20,060	)		1,277,089

Total	$	1,653,061	$	1,905	$	(28,961	)	$	1,626,005

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005


	September 30, 2004
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(In thousands)
FNMA mortgage-backed securities	$	361,326	$	640	$	(3,714	)	$	358,252
FHLMC mortgage-backed securities		114,869		72		(1,355	)		113,586
Collateralized mortgage obligations		4,648		—		(34	)		4,614
Mortgage pass-through certificates		1,598,498		3,624		(10,394	)		1,591,728

Total	$	2,079,341	$	4,336	$	(15,497	)	$	2,068,180

Mortgage-backed securities at September 30, 2005, by contractual maturity and adjusted for anticipated prepayments, are shown below.


	Available for Sale
	Amortized Cost		Fair Value
	(In thousands)
Due in one year or less	$	457,533	$	450,045
Due after one year through five years		1,028,278		1,011,447
Due after five years through ten years		137,430		135,181
Due after ten years		29,820		29,332

Total	$	1,653,061	$	1,626,005

The following tables provide information on unrealized losses for investments and mortgage-backed securities available for sale as of September 30, 2005 and 2004.


						As of September 30, 2005
	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses (1)			Fair Value		Unrealized Losses (1)			Fair Value		Unrealized Losses (1)
	(In thousands)
Available for sale securities
Investment securities:
Trust preferred securities of other issuers	$	—	$	—		$	1,929	$	(72	)	$	1,929	$	(72	)
U.S. government sponsored entity debt securities (2)		71,434		(1,203	)		—		—			71,434		(1,203	)
Preferred stock of U.S. government sponsored entities (2)		56,816		(3,172	)		29,821		(1,351	)		86,637		(4,523	)
Mutual funds and other bonds (3)		8,000		(30	)		80,193		(3,195	)		88,193		(3,225	)

Total investment securities	$	136,250	$	(4,405	)	$	111,943	$	(4,618	)	$	248,193	$	(9,023	)

Mortgage-backed securities:
FNMA mortgage-backed securities	$	35,627	$	(666	)	$	214,523	$	(6,958	)	$	250,150	$	(7,624	)
FHLMC mortgage-backed securities		1,268		(8	)		74,379		(1,240	)		75,647		(1,248	)
Collateralized mortgage obligations		—		—			2,047		(29	)		2,047		(29	)
Mortgage pass-through certificates		580,892		(4,666	)		647,519		(15,394	)		1,228,411		(20,060	)

Total mortgage-backed securities	$	617,787	$	(5,340	)	$	938,468	$	(23,621	)	$	1,556,255	$	(28,961	)

(1)	These unrealized losses are caused by changes in interest rates and are considered to be temporary.

(2)	U.S. Government sponsored entities include FNMA and FHLMC.

(3)	Underlying assets of mutual funds consist primarily of mortgage-backed securities.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005


						As of September 30, 2004
	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses (1)			Fair Value		Unrealized Losses (1)			Fair Value		Unrealized Losses (1)
	(In thousands)
Available for sale securities
Investment securities:
Trust preferred securities of other issuers	$	7,427	$	(84	)	$	3,834	$	(166	)	$	11,261	$	(250	)
Preferred stock of U.S. government sponsored entities (2)		69,048		(2,028	)		—		—			69,048		(2,028	)
Mutual funds and other bonds (3)		19,780		(60	)		73,194		(1,646	)		92,974		(1,706	)

Total investment securities	$	96,255	$	(2,172	)	$	77,028	$	(1,812	)	$	173,283	$	(3,984	)

Mortgage-backed securities:
FNMA mortgage-backed securities	$	69,222	$	(253	)	$	212,095	$	(3,461	)	$	281,317	$	(3,714	)
FHLMC mortgage-backed securities		107,432		(1,355	)		—		—			107,432		(1,355	)
Collateralized mortgage obligations		4,018		(21	)		595		(13	)		4,613		(34	)
Mortgage pass-through certificates		844,874		(7,085	)		245,018		(3,309	)		1,089,892		(10,394	)

Total mortgage-backed securities	$	1,025,546	$	(8,714	)	$	457,708	$	(6,783	)	$	1,483,254	$	(15,497	)

(1)	These unrealized losses are caused by changes in interest rates and are considered to be temporary.

(2)	U.S. Government sponsored entities include FNMA and FHLMC.

(3)	Underlying assets of mutual funds consist primarily of mortgage-backed securities.

Proceeds from sales of investment securities were $119.9 million, $6.6 million and $41 million for the years ended September 30, 2005, 2004 and 2003, respectively. Realized gains from these sales were $3.5 million, $0.3 million and $1.5 million for the years ended September 30, 2005, 2004 and 2003, respectively. BankUnited realized losses of $6.0 thousand from sales of investment securities during the year ended September 30, 2005, none during the years ended September 30, 2004 and 2003.

Proceeds from sales of mortgage-backed securities were $482 million, $526 million, and $1.0 billion for the years ended September 30, 2005, 2004, and 2003, respectively. Realized gains from these sales were $0.9 million, $2.7 million, and $8.0 million for the years ended September 30, 2005, 2004 and 2003, respectively. Realized losses from these sales were $1.6 million, $4.9 million, and $4.8 million for the years ended September 30, 2005, 2004, and 2003, respectively.

At September 30, 2005, FNMA and FHLMC mortgage-backed securities with market values of approximately $152 million were pledged as collateral for public funds on deposit. At September 30, 2005, investment and mortgage-backed securities with an aggregate carrying value of approximately $1.2 billion were pledged as collateral for repurchase agreements.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(4) Loans Held in Portfolio

Loans held in portfolio consist of the following:


	As of September 30,
	2005					2004
	Amount			Percent of Total		Amount			Percent of Total
	(Dollars in thousands)
Real estate loans:
One-to-four family residential:
Residential mortgages	$	5,999,713		74.7	%	$	4,058,858		70.9	%
Specialty consumer mortgages		678,609		8.5			688,711		12.0

Total one-to-four family residential		6,678,322		83.2			4,747,569		82.9
Home equity loans and lines of credit		257,789		3.2			150,323		2.6
Multi-family		111,444		1.4			51,104		0.9
Commercial real estate		344,503		4.3			267,127		4.7
Construction		87,113		1.1			187,518		3.3
Land		235,829		2.9			94,006		1.6

Total real estate loans		7,715,000		96.1			5,497,647		96.0

Other loans:
Commercial		199,344		2.5			167,786		2.9
Consumer		19,415		0.2			19,454		0.3

Total other loans		218,759		2.7			187,240		3.2

Total loans held in portfolio (1)		7,933,759		98.8			5,684,887		99.2
Unearned discounts, premiums and deferred loan costs, net		119,588		1.5			65,992		1.2
Allowance for loan losses		(25,755	)	(0.3	)		(24,079	)	(0.4	)

Total loans held in portfolio, net	$	8,027,592		100.0	%	$	5,726,800		100.0	%

(1)	As of September 30, 2005, BankUnited had $8.4 million of non-accrual loans and no loans past due more than 90 days and still accruing. As of September 30, 2004, BankUnited had $15.5 million of non-accrual loans and $2 thousand of loans more than 90 days past due and still accruing.

As of September 30, 2005, approximately $5.9 billion, or 77%, of all secured loans were secured by properties in Florida. No other state represented more than 5.5% of BankUnited’s loan portfolio secured by real estate. As of September 30, 2004, approximately $4.6 billion, or 84%, of all secured loans were secured by properties in Florida. No other state represented more than 4% of BankUnited’s loan portfolio secured by real estate.

As of September 30, 2005, the Bank had pledged approximately $5.7 billion of mortgage loans as collateral for advances from the Federal Home Loan Bank of Atlanta. As of September 30, 2004, the Bank had pledged approximately $4.3 billion of mortgage loans as collateral for advances from the Federal Home Loan Bank of Atlanta.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Changes in the allowance for loan losses are as follows:


	For the Years Ended September 30,
	2005			2004			2003
	(In thousands)
Balance at beginning of period	$	24,079		$	22,295		$	20,293
Provision		3,800			5,025			5,425
Loans charged-off		(3,189	)		(3,110	)		(3,553	)
Recoveries		1,065			468			130
Reclassification of letter of credit reserve to other liabilities		—			(599	)		—

Balance at end of period	$	25,755		$	24,079		$	22,295

The following table sets forth information concerning impaired loans:


	As of September 30,
	2005				2004
	Outstanding Principal		Allowance for loan losses		Outstanding Principal		Allowance for loan losses
	(In thousands)
Home equity line of credit	$	73	$	73	$	700	$	700
Commercial real estate		—		—		1,465		555
Commercial		2,203		1,542		407		407

Total	$	2,276	$	1,615	$	2,572	$	1,662

(5) Servicing and Transfers of Mortgage Loans

Servicing

At September 30, 2005, and 2004 BankUnited was servicing loans of approximately $1.7 billion, and $1.3 billion, respectively, for others. As of September 30, 2005, and 2004 BankUnited had MSR assets with a carrying amount of $22.1 million, and $15.4 million, respectively. The following table provides activity related to BankUnited’s MSR assets during fiscal years 2005 and 2004:


	For the Years Ended September 30,
	2005			2004
	(In thousands)
Beginning Balance October 1,	$	15,414		$	12,930
New MSR assets from loans sales and transfers		10,490			8,006
Amortization of MSR assets		(3,673	)		(4,322	)
Impairment of MSR assets		(130	)		(1,200	)
Ending Balance September 30,	$	22,101		$	15,414

Management obtains a valuation of its MSR assets one month prior to each quarter end from independent third parties, which is used by management to assess those assets for impairment. For purposes of determining the fair value of BankUnited’s MSR assets, and any resulting impairment, MSR are stratified by product and interest rates which are the risk characteristics of the loans being serviced. As a result of third party valuations, BankUnited recorded impairment charges of $130 thousand and $1.2 million during the years ended September 30, 2005 and 2004, respectively, in order to bring the carrying value to a level no higher than the estimated fair value.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Transfers

On September 26, 2005, BankUnited sold mortgage loans for securitization to a trust in a transaction structured to qualify as a sale. This transaction was structured without recourse to BankUnited. While BankUnited does not retain credit risk on the loans it has securitized, it has potential liability, under representations and warranties it makes to the trust purchasing the loans. Upon securitization of the mortgage loans, BankUnited acquired subordinated securities, including an interest only strip (collectively retained securities), and recognized the value of the rights to services the underlying loans (MSRs). BankUnited recognized a loss of $89 thousand, net of costs associated with the securitization, from the sale of securities that were not retained by BankUnited. The retained securities have been classified by BankUnited as available for sale.

Considerable judgment is required to determine the fair values of BankUnited’s retained securities. Unlike government securities and other highly liquid investments, the precise market value of retained securities cannot be readily determined because these assets are not actively traded in stand-alone markets. Accordingly, BankUnited relies on independent third parties specializing in secondary market transactions to provide fair values of its retained securities through the use of discounted cash flow models. The key assumptions used in these models include prepayment speeds, discount margins/yields, and pricing curves (spot/forward).

The key economic assumptions used in determining the fair value of retained securities at September 30, 2005 and the resulting fair value of the retained securities from hypothetical adverse changes in those assumptions are as follows:


	September 30, 2005
	(In thousands)
Fair value of retained securities	$	279,124
Fair value of retained securities from hypothetical adverse changes in prepayment speeds:
10%	$	277,901
20%	$	275,944
Fair value of retained securities from hypothetical adverse changes in discount margin and yields:
10%	$	277,277
20%	$	275,518
Fair value of retained securities from hypothetical adverse changes in pricing curves (spot/forward):
10%	$	279,337
20%	$	278,518

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

In connection with the securitization transaction, BankUnited recognized approximately $7.0 million in MSR assets. The key economic assumptions used in measuring the period-end fair value of BankUnited’s MSRs resulting form securitizations at September 30, 2005 and the resulting fair value of those MSR assets from hypothetical adverse changes in those assumptions, are as follows:


	September 30, 2005
	(Dollars in thousands)
Fair value of MSR (1)	$	7,010
Weighted-average annual prepayment speed		26.21	%
Fair value after 10% hypothetical adverse change	$	6,930
Fair value after 20% hypothetical adverse change	$	6,890
Weighted-average annual discount rate		12.00	%
Fair value after 10% hypothetical adverse change	$	6,863
Fair value after 20% hypothetical adverse change	$	6,732
Weighted-average annual PPC (2)		62.00	%
Fair value after 10% hypothetical adverse change	$	6,748
Fair value after 20% hypothetical adverse change	$	6,486

(1)	Represents MSR resulting only from securitizations. Other MSR assets carried by BankUnited are not included.

(2)	PPC is the ratio of expected collections of prepayment penalties.

The sensitivities in the tables above are hypothetical and should be used with caution. In the above tables, the effect of a variation in a particular assumption on the fair value of the retained securities or MSRs is calculated independently without changing any other assumption. In reality, changes in one factor may result in changes in another, which might compound or counteract the sensitivities.

(6) FHLB stock and other earning assets

FHLB stock and other earning assets is summarized as follows:


	As of September 30,
	2005		2004
	(In thousands)
FHLB stock	$	189,593	$	155,716
Other earning assets		450		450

Total	$	190,043	$	156,166

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(7) Office Properties and Equipment, net

Office properties and equipment, net are summarized as follows:


	As of September 30,
	2005			2004
	(In thousands)
Office buildings	$	2,355		$	2,337
Leasehold improvements		26,876			18,898
Furniture, fixtures and equipment		19,429			13,760
Computer equipment and software		19,471			12,222

Total		68,131			47,217
Less: accumulated depreciation		(27,059	)		(20,800	)

Office properties and equipment, net	$	41,072		$	26,417

Depreciation expense was $6.3 million, $4.3 million, and $3.6 million, for the years ended September 30, 2005, 2004 and 2003, respectively.

BankUnited has entered into non-cancelable leases with approximate minimum future rentals as follows:


Years Ending September 30,	Amount
	(In thousands)
2006	$	9,557
2007		9,518
2008		8,785
2009		8,004
2010		6,976
Thereafter through 2016		19,136

Total	$	61,976

Actual rental payments may include deferred rents but are recognized as rent expense on a straight-line basis. Rent expense for the years ended September 30, 2005, 2004, and 2003 was $11.5 million, $7.8 million, and $5.7 million, respectively.

(8) Deposits

At September 30, 2005 and 2004, BankUnited had outstanding non-interest bearing deposits of $372 million and $247 million, and interest bearing deposits of $4.4 billion and $3.3 billion, respectively. At September 30, 2005 and 2004, there were overdrafts of approximately $1.7 million and $1.8 million, respectively. Certificate accounts with balances of $100 thousand or more totaled approximately $1.2 billion and $732 million at September 30, 2005 and 2004, respectively.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The following table sets forth maturities of certificates of deposit equal to or greater than $100 thousand as of September 30, 2005.


	As of September 30, 2005 (1)
	(In thousands)
Three months or less	$	251,568
Over 3 months through 6		275,419
Over 6 months through 12		363,202
Over 12 months through 24		207,114
Over 24 months through 36		49,894
Over 36 months through 48		25,212
Over 48 months through 60		40,104

	$	1,212,513

(1)

Included in the table above are $300 million of certificates of deposit issued to the State of Florida, and $520 thousand issued to the City of Ft. Lauderdale, referred to as public funds, with interest rates ranging from 1.85% to 4.73%. These certificates are collateralized with FNMA, and FHLMC mortgage-backed securities with an aggregate market value of approximately $152 million at September 30, 2005.

Interest expense on deposits for the years ended September 30, 2005, 2004 and 2003 was as follows:


	September 30,
	2005		2004		2003
	(In thousands)
Transaction and money market accounts	$	5,482	$	4,109	$	5,391
Savings accounts		21,096		16,475		14,211
Certificates of deposit		71,735		51,344		62,957

	$	98,313	$	71,928	$	82,559

Early withdrawal penalties on certificates of deposit are recognized as a reduction of interest expense on deposits. For the years ended September 30, 2005, 2004 and 2003, early withdrawal penalties totaled $350 thousand, $235 thousand and $250 thousand, respectively.

(9) Borrowings

Securities Sold under Agreements to Repurchase

Interest expense on securities sold under agreements to repurchase aggregated $36.2 million, $12.6 million and $7.6 million for the years ended September 30, 2005, 2004 and 2003, respectively.

The following sets forth information concerning repurchase agreements for the periods indicated:


	As of and for the Years Ended September 30,
	2005			2004
	(Dollars in thousands)
Maximum amount of outstanding agreements at any month end during the period	$	1,316,852		$	1,200,015
Average amount outstanding during the period	$	1,231,345		$	852,915
Weighted average interest rate for the period		2.94	%		1.46	%

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The carrying amount of securities sold under agreements to repurchase, and the maturity of the agreements, as of September 30, 2005 was as follows:


	Maturities of Agreements Outstanding as of September 30, 2005
	Overnight		Within 30 Days		30 to 90 Days		Over 90 Days		Total
	(In thousands)
Mortgage-backed securities	$	—	$	384,327	$	524,266	$	—	$	908,593
Investment securities	$	152,755	$	50,000		—		50,000		252,755
Total (1)	$	152,755	$	434,327	$	524,266	$	50,000	$	1,161,348

(1)	The weighted average interest rate on repurchase agreements outstanding as of September 30, 2005 was 3.88%.

Advances from Federal Home Loan Bank

Advances outstanding as of September 30, 2005 and 2004 from the Federal Home Loan Bank of Atlanta incur interest and have contractual repayments as follows:


	As of September 30,
	2005						2004
	Amount		Range of Interest Rates				Amount		Range of Interest Rates
	(Dollars in thousands)
Repayable During Year Ending September 30,
2005							$	769,000	1.90	%	– 7.43	%
2006	$	2,321,285	1.90	%	6.65	%		851,319	0.64	%	– 6.65	%
2007		705,000	2.34	%	4.59	%		450,000	0.40	%	– 3.43	%
2008 (3)		155,000	2.59	%	3.95	%		325,000	1.19	%	– 5.50	%
2009		—			—			125,000	4.01	%	– 5.48	%
2010 (4), (6)		150,000	3.61	%	3.72	%		480,000	5.44	%	– 6.94	%
2011		—	—		—			64,000	4.70	%	– 5.67	%
2012 (2)		50,000	4.01	%	4.01	%		50,000	4.01	%	4.01	%
2015 (5), (7), (8), (9)		439,100	3.46		4.79	%

Total contractual outstandings		3,820,385						3,114,319
Fair value adjustments (1)		—						1,109

Total carrying amount	$	3,820,385					$	3,115,428

(1)

Fair value adjustments to advances were made in accordance with SFAS No. 133 for hedge accounting transactions using interest rate swaps in which advances were the hedged item as of September 30, 2004. The notional amount of interest rate swaps used in these transactions was $200 million as of September 30, 2004. There were no interest rate swaps used as hedged against advances as of September 30, 2005.

**(2)

Advances for $50 million are callable by the FHLB in 2006

*(3)	Advances for $125 million are callable by the FHLB in 2007

**(4)

Advances for $50 million are callable by the FHLB in 2007

**(5)

Advances for $214 million are callable by the FHLB in 2007

**(6)

Advances for $100 million are callable by the FHLB in 2008

**(7)

Advances for $50 million are callable by the FHLB in 2008

**(8)

Advances for $75 million are callable by the FHLB in 2008

**(9)

Advances for $100 million are callable by the FHLB in 2009

* Europan convertible advances with one call date

** Callable on call date and each quarter there after

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The terms of a security agreement with the FHLB of Atlanta include a specific assignment of collateral that requires the maintenance of qualifying first mortgage loans as pledged collateral with unpaid principal amounts at least equal to 100% of the FHLB advances, when discounted at 85% of the unpaid principal balance. The FHLB of Atlanta stock, which is recorded at cost of $190 million as of September 30, 2005, is also pledged as collateral for these advances.

Convertible Senior Notes

BankUnited issued $120 million principal amount of convertible senior notes due 2034 in a private placement to certain qualified institutional buyers in February and March of 2004. The notes bear interest at the rate of 3.125% per year payable on March 1 and September 1 of each year, beginning on September 1, 2004. Beginning on March 1, 2011 BankUnited will pay additional contingent interest on the notes if the average trading price of the notes is above a specified level.

The notes are convertible by holders into shares of BankUnited’s Class A Common Stock at an initial conversion rate of 26.2771 shares of Class A Common Stock per $1,000 principal amount of notes, which is equivalent to an initial conversion price of $38.06 per share of Class A Common Stock (subject to adjustment in certain events), only under the following circumstances: (1) during any fiscal quarter after the first fiscal quarter ended March 31, 2004 if the closing sale price of our Class A Common Stock exceeds 125% of the then current conversion price for at least 20 consecutive trading days in the 30 consecutive trading-day period ending on the last trading day of the immediately preceding fiscal quarter, (2) during prescribed periods, upon the occurrence of specified corporate transactions, or (3) if we have called the notes for redemption.

The conversion rate of the notes is subject to adjustments for certain events, including but not limited to the issuance of stock dividends on our Class A Common Stock, the issuance of rights or warrants, subdivisions, or combinations of our Class A Common Stock, distributions of capital stock indebtedness or assets, cash dividends and issuer tender or exchange offers. The conversion rate may not be adjusted for other events that may adversely affect the trading price of the notes or the Class A Common Stock into which such notes may be convertible.

Under the terms of the First Supplemental Indenture entered into in December 2004, BankUnited has irrevocably elected and agreed to pay only cash in settlement of the principal amount of the Notes in respect of its conversion obligations. BankUnited has retained the right to elect to settle any and all conversion obligations in excess of the principal amount of the Notes in cash or shares of Class A Common Stock or a combination of cash and shares of Class A Common Stock. As a result of the amendment effected by the First Supplemental Indenture, the Notes will have no effect on the calculation of BankUnited’s diluted average shares outstanding until the market price for BankUnited’s Class A Common Stock exceeds the conversion price of $38.06 per share.

The notes will mature on March 1, 2034. BankUnited may redeem for cash some or all of the notes at any time on or after March 1, 2011 at 100% of the principal amount of the notes plus any accrued and unpaid interest, contingent interest and additional amounts, if any.

Holders may require BankUnited to purchase all or part of the notes for cash at a purchase price of 100% of the principal amount of the notes plus accrued and unpaid interest including contingent interest and additional amounts, if any, on March 1, 2011, March 1, 2014, March 1, 2019, March 1, 2024 and March 1, 2029 or upon the occurrence of a fundamental change.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The notes are senior unsecured obligations, ranking equally in right of payment with all of BankUnited’s existing and future unsecured senior indebtedness. The notes are effectively subordinated to BankUnited’s entire senior secured indebtedness and all indebtedness and liabilities of its subsidiaries. As of September 30, 2005, BankUnited did not have any senior secured indebtedness.

Trust Preferred Securities and Subordinated Debentures

BankUnited operates wholly-owned trust subsidiaries (“Trust Subsidiaries”) for the purpose of issuing Trust Preferred Securities and investing the proceeds from the sale thereof in Junior Subordinated Deferrable Interest Debentures issued by BankUnited (the “Subordinated Debentures”). All of the proceeds of the Trust Preferred Securities plus common securities issued by the Trust Subsidiaries are invested in Subordinated Debentures, which represent the sole assets of the Trust Subsidiaries. The Trust Preferred Securities pay preferential cumulative cash distributions at the same rate as the Junior Subordinated Debentures held by the Trust Subsidiaries. Considered together, back-up undertakings made by BankUnited with respect to the Trust Preferred Securities constitute a full and unconditional guarantee by BankUnited of the obligations of the Trust Preferred Securities. The carrying amount of trust preferred securities and subordinated debentures in BankUnited’s Consolidated Statement of Financial Condition of $195 million as of September 30, 2005, represents Trust Preferred Securities issued by its consolidated Trust Subsidiaries and the Subordinated Debentures issued to its non-consolidated Trust Subsidiaries. In addition BankUnited adjusts the carrying amount of certain Trust Preferred Securities in accordance with the hedge accounting requirements of SFAS No. 133.

The following table provides information for each of BankUnited’s Trust Subsidiaries with outstanding Trust Preferred Securities as of September 30, 2005:


	Outstanding as of September 30, 2005
	Trust Preferred Securities			Common Securities		Subordinated Debentures			Annual Rate of Preferential Cash Distribution		Maturity Date
BankUnited Capital	$	22,880	(1)	$	2,800	$	25,680		10.25	%	12/31/2026
BankUnited Statutory Trust I (8)		20,000			619		20,619	(1)	3-Month Libor+3.60	% (2)	12/18/2031
BankUnited Statutory Trust II (8)		25,000			774		25,774	(1)	3-Month Libor+3.60	% (3)	3/26/2032
BankUnited Statutory Trust III (8)		25,000			774		25,774	(1)	3-Month Libor+3.60	% (4)	9/26/2032
BankUnited Statutory Trust IV (8)		20,000			619		20,619		3-Month Libor+3.40	% (5)	11/15/2032
BankUnited Statutory Trust V (8)		15,000			464		15,464		3-Month Libor+3.25	% (6)	12/19/2032
BankUnited Statutory Trust VI (8)		17,640			546		18,186		3-Month Libor+3.15	% (7)	3/26/2033
BUFC Statutory Trust VII (8)		15,000			464		15,464	(1)	3-Month Libor+3.25	%	4/3/2033
BankUnited Statutory Trust VIII (8)		15,000			464		15,464		3-Month Libor+1.86	%	11/30/2034
BankUnited Statutory Trust IX (8)		15,000			464		15,464		5.84	% (9)	11/30/2034

Total	$	190,520		$	7,988	$	198,508

(1)

BankUnited uses interest rate swap and cap contracts to hedge interest rate risk on these instruments with notional amounts of $68 million and $40 million as of September 30, 2005, respectively. See note (10) Accounting for Derivatives and Hedging Activities. Included in the carrying amount of Trust Preferred Securities issued by BankUnited Capital as of September 30, 2005 is a $208 thousand hedge accounting adjustment made in accordance with SFAS No. 133.

(2)

Not to exceed 12.50% prior to December 18, 2006.

(3)

Not to exceed 11.00% prior to March 26, 2007.

(4)

Not to exceed 11.90% prior to September 26, 2007.

(5)

Not to exceed 11.90% prior to November 15, 2007.

(6)

Not to exceed 11.75% prior to December 26, 2007.

(7)

Not to exceed 11.75% prior to March 26, 2008.

(8)

In accordance with FIN 46, BankUnited has not consolidated these Trust Subsidiaries.

(9)

Fixed at 5.84% until 12/30/2009 at which time the rate converts to floating at 3-Month Libor + 1.86%.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(10) Accounting for Derivatives and Hedging Activities

Loan Commitments

BankUnited commits to originate one-to-four family residential mortgage loans with potential borrowers at specified interest rates for short periods of time, usually thirty days. If potential borrowers meet underwriting standards, these loan commitments obligate BankUnited to fund the loans, but do not obligate the potential borrowers to accept the loans. If the borrowers do not allow the commitments to expire, the loans are funded, and either placed into BankUnited’s loan portfolio or held for sale. Based on historical experience, the interest rate environment, and the underlying loan characteristics, BankUnited estimates the amount of commitments that will ultimately become loans held for sale and accounts for those as derivatives during the commitment period. As derivatives, the changes in the fair value of the commitments are recorded in current earnings under other non-interest expense with an offset to the consolidated statement of financial condition in other liabilities. Fair values are based solely on the relationship of observable market interest rates and are prepared by third parties.

Forward Sales Contracts

BankUnited enters into forward sales contracts in order to economically hedge fair value exposure of loan commitments to a change in interest rates. Since both the loan commitments and forward sales contracts are derivatives, this hedging relationship does not qualify for hedge accounting under SFAS No. 133. Fair value changes of forward sales contracts, related to loan commitments, are recorded in earnings under non-interest expense with an offset in other liabilities.

These forward contracts extend beyond the loan commitment period and are also used to offset fair value exposure of loans held for sale to changes in interest rates. This relationship exists until either the loan is sold or until the forward contract expires. These forward contracts may be allocated to loans held for sale when that relationship qualifies for hedge accounting, in which case any ineffectiveness is charged to earnings under non-interest expense with an offset to other liabilities. They may also be allocated to loans held for sale that are accounted for under the lower of cost or market method, in which case their changes in fair value are also recorded in earnings under non-interest expense with an offset in other liabilities.

Interest Rate Swaps and Caps

BankUnited enters into interest rate swap and cap contracts as fair value and cash flow hedges (“hedge”) for the purpose of hedging long-term fixed and variable rate debt (“hedged item”), respectively. All terms of the hedge contracts, with the exception of the right to defer interest payments, are the same as those of the hedged item. BankUnited expects these hedge contracts to be highly effective in offsetting fair value changes for fair value hedges and cash flow changes for cash flow hedges of its long-term debt, and therefore applies hedge accounting treatment. Hedges designated by BankUnited to change the fixed interest rate to variable on fixed long-term debt are treated as qualifying fair value hedges. The accounting treatment for fair value hedges is to record the change in fair value during the period of both the hedge instrument and the hedged item into current earnings. Hedges designated by BankUnited to change the variable interest rate to fixed on variable long-term debt are treated as qualifying cash flow hedges. The accounting treatment for cash flow hedges is to record the effective portion of the gain or loss on the hedge instrument as a component of other comprehensive income, net of tax, with an offsetting amount recorded in either other assets or other liabilities. The amounts recorded in other accumulated comprehensive income will be reclassified into current earnings in the same period in which the hedged item affects earnings.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The following table summarizes certain information with respect to the use of derivatives and their impact on BankUnited’s statements of income during the years ended September 30, 2005, 2004, and 2003:


	For the Years Ended September 30,
	2005			2004			2003
	(In thousands)
Fair Value Hedges
Net gain (loss) recorded in earnings due to ineffectiveness	$	5		$	(5	)	$	—
Net (loss) gain recorded in earnings upon settlement of swap related to extinguishment of debt		(1,369	)		—			1,445

Other Derivatives (1)
Net gain (loss) recorded in earnings		55			924			(595	)

Total net (loss) gain recorded in earnings due to derivatives	$	(1,309	)	$	919		$	850

Note:

There was no ineffectiveness related to cash flow hedges during the years ended September 30, 2005, 2004 and 2003. Within the next 12 months, BankUnited estimates that $445 thousand will be reclassified out of other comprehensive income as a charge to earnings.

(1)

These derivatives are used by BankUnited to economically hedge interest rate risk, but do not qualify for hedge accounting treatment.

(11) Regulatory Capital

The Bank’s regulatory capital levels as of September 30, 2005, 2004, and 2003 were as follows:


	As of September 30,
	2005			2004			2003
	(Dollars in thousands)
Tier 1 Leverage Capital
Amount	$	756,810		$	622,328		$	514,690
Actual Ratio		7.1	%		7.3	%		7.3	%
Well-Capitalized Minimum Ratio (1)		5.0	%		5.0	%		5.0	%
Adequately Capitalized Minimum Ratio (1)		4.0	%		4.0	%		4.0	%

Tier 1 Risk-Based Capital (1)
Amount	$	756,810		$	622,328		$	514,690
Actual Ratio		14.0	%		15.1	%		15.5	%
Well-Capitalized Minimum Ratio (2)		6.0	%		6.0	%		6.0	%
Adequately Capitalized Minimum Ratio (2)		4.0	%		4.0	%		4.0	%

Total Risk-Based Capital
Amount	$	774,390		$	644,060		$	534,062
Actual Ratio		14.5	%		15.6	%		16.1	%
Well-Capitalized Minimum Ratio (2)		10.0	%		10.0	%		10.0	%
Adequately Capitalized Minimum Ratio (2)		8.0	%		8.0	%		8.0	%

(1)	Tier 1 risk-based capital ratio is the ratio of core capital to risk weighted assets.

(2)	Based on Office of Thrift Supervision regulations adopted to implement the “prompt corrective action” provisions of the Federal Deposit Insurance Corporation Improvement Act of 1991.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Regulatory capital and net income amounts as of and for the years ended September 30, 2005, 2004 and 2003 did not differ from regulatory capital and net income amounts reported to the OTS.

Payment of dividends by the Bank is limited by federal regulations, which provide for certain levels of permissible dividend payments depending on the Bank’s regulatory capital and other relevant factors. In March, June, and September of 2005, BankUnited Financial Corporation contributed $42 million, $30 million, and $25 million, respectively, in additional capital to the Bank. In April and September 2004, BankUnited Financial Corporation contributed $30 million and $20 million, respectively, in additional capital to the Bank. The majority of these contributions were funded by proceeds BankUnited Financial Corporation received from the issuance of $120 million of convertible senior notes in February and March 2004.

(12) Stockholders’ Equity

BankUnited has a capital structure with the following characteristics:

Preferred Stock:

Issued in series with rights and preferences to be designated by the Board of Directors. As of September 30, 2005 and 2004, 10,000,000 shares of Preferred Stock were authorized, 2,000,000 of which were designated to a particular series and 8,000,000 of which were not designated.

Noncumulative Convertible Preferred Stock, Series B (“Series B Preferred”)—

Dividends - Quarterly noncumulative cash dividends are paid at an annual rate of $0.55 per share.

Redemption - Not redeemable until October 1, 2007 or later unless approved by the holders of at least 50% of the Series B Preferred shares.

Voting Rights - Two and one half votes per share.

Preference on Liquidation - Voluntary liquidation at the applicable redemption price per share and involuntary at $7.375 per share.

Convertibility - Convertible into 1.4959 shares (adjusted for all stock dividends) of Class B Common Stock for each share of Series B Preferred surrendered for conversion, subject to adjustment on the occurrence of certain events.

Common Stock:

Issued in series with rights and preferences to be designated by the Board of Directors. As of September 30, 2005 and 2004, 60,000,000 shares of Class A Common Stock and 3,000,000 shares of Class B Common Stock were authorized. The Board has designated 50,000,000 shares of Class A Common Stock to a series as of September 30, 2005 and 50,000,000 shares as of September 30, 2004.

Class A Common Stock

Dividends - As declared by the Board of Directors in the case of a dividend alone or not less than 110% of the amount per share of any dividend declared on the Class B Common Stock.

Voting Rights - One tenth of one vote per share.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Class B Common Stock

Dividends - As declared by the Board of Directors.

Voting Rights - One vote per share.

Convertibility - Each share of Class B Common Stock is convertible into one share of Class A Common Stock.

BankUnited’s Board of Directors declared dividends of $0.005 per share on its Class A Common Stock on March 29, 2005, May 26, 2005, and August 26, 2005. BankUnited anticipates that it will continue to declare and pay such dividends on a quarterly basis subject to termination at any time at the sole discretion of the board. No dividends were declared or paid on BankUnited’s Commons Stock during fiscal 2004.

BankUnited announced on October 24, 2002, that its Board of Directors had authorized a stock repurchase program on its Class A Common Stock. Under the program, BankUnited may purchase up to 1,000,000 shares of its Class A Common Stock in open market transactions, from time to time, at such prices and on such conditions as the Executive Committee of the Board determines to be advantageous. BankUnited initiated this program because its believes that the volatility of the financial markets, in general, have at times generated a market price that does not adequately reflect the real value of BankUnited stock or the level of confidence that management and the Board of Directors have in BankUnited’s ability to implement its strategy and achieve continued growth. The basis for the carrying value of BankUnited’s treasury stock is the purchase price or fair value of the shares in the open market at the time of purchase.

During fiscal 2005, BankUnited purchased 89,700 shares of its Class A Common Stock in the open market at an average price of $24.69 per share for a total of $2.2 million. This represents a purchase of stock under the authorized purchase program. There are 910,300 shares available for purchase under this program as of September 30, 2005.

(13) Stock-Based Compensation and Other Benefit Plans

Stock-Based Compensation

At September 30, 2005, BankUnited had certain stock-based compensation plans designed to provide incentives to current and prospective officers, directors and employees of BankUnited and its subsidiaries. Under the plans, BankUnited may award stock options, stock appreciation rights, restricted stock, deferred stock, bonus stock and awards in lieu of obligations, dividend equivalents, other stock-based awards and performance awards in each of its classes of stocks.

The following table summarizes terms of BankUnited’s stock-based incentive compensation plans as of September 30, 2005:


	Stock Compensation Plans
	Maximum Term	Shares Authorized	Class of Stock	Vesting Requirements	Type of Options
2002 Stock Award and Incentive Plan	10 Years	2,314,920	Common A & B; Series B Preferred	0-10 Years	ISO, NQ
1996 Incentive and Stock Award Plan	10 Years	3,150,000	Common A & B;	0-10 Years	ISO, NQ
1996 Incentive and Stock Award Plan	10 Years	650,000	Series B Preferred	0-10 Years	ISO, NQ
1994 Incentive Stock Option Plan	10 Years	250,000	Common A & B	0-10 Years	ISO, NQ
1992 Stock Option Plan Non-Statutory	10 Years	825,000	Common A & B	0-10 Years	NQ

ISO	- Incentive Stock Option

NQ	- Non-qualified Stock Option

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Options granted under BankUnited’s stock option plans expire ten years after the date of grant and are granted at or above the fair market value of the stock on the date of grant. Option terms are determined by the Compensation Committee of BankUnited’s Board of Directors at the time of the grant. An option may be immediately vested and exercisable or become so over a period of years. If an option vests over a period of years, it is subject to forfeiture as to any portion which is not exercisable upon termination of employment unless otherwise provided by the option agreement or Compensation Committee.

The following table presents additional data concerning activity of BankUnited’s outstanding stock options, for all classes in the aggregate, for the three years ended September 30, 2005:


	Number of Shares		Option Price per Share		Aggregate Option Price			Weighted Average Price per Share
	(Dollars in thousands, except per share data)
Options outstanding, September 30, 2002	3,347,388		$	4.95 – 20.20	$	32,262		$	9.64
Options granted	1,036,300			15.50 – 32.63		20,920			20.19
Options exercised	(548,001	)		5.73 – 15.56		(4,604	)		8.40
Options expired	(236,346	)		6.53 – 17.08		(2,963	)		12.54

Options outstanding September 30, 2003	3,599,341			4.95 – 32.63		45,615			12.67
Options granted	403,319			21.98 – 43.61		11,679			28.96
Options exercised	(396,955	)		4.95 – 21.62		(3,862	)		9.73
Options expired	(366,307	)		6.56 – 28.40		(5,683	)		15.52

Options outstanding, September 30, 2004	3,239,398			5.68 – 43.61		47,749			14.74
Options granted	712,731			21.98 – 43.61		20,371			28.58
Options exercised	(255,010	)		4.95 – 21.62		(2,110	)		8.27
Options expired	(36,928	)		7.50 – 31.50		(701	)		18.98

Options outstanding, September 30, 2005	3,660,191		$	6.13 – $43.61	$	65,309		$	17.84

The weighted-average grant date fair value of options granted at fair value on the grant date during the years ended September 30, 2005, 2004, and 2003 was $2.2 million, $4.4 million and $8.1 million, respectively. The weighted-average grant date fair value of options granted above fair value on the grant date during the year ended September 30, 2005 was $2.8 million. There were no options granted during fiscal years 2004 and 2003 at a price above fair value on their grant dates.

Summarized below is information about stock options outstanding and exercisable, for all classes in the aggregate, at September 30, 2005.


	Outstanding				Exercisable
Exercise Price Range per Share	Number of Shares Outstanding	Average Life(1)	Average Price per Share(2)		Number of Shares	Average Price per Share(2)
$ 6.13 - $ 9.07	1,049,324	2.7	$	7.56	993,476	$	7.53
9.25 - 13.72	572,577	3.9		11.90	469,192		11.56
14.09 - 20.31	629,555	6.8		17.14	317,609		16.87
21.36 - 32.04	1,113,735	8.9		25.43	640,951		25.81
$32.05 - $43.61	295,000	8.3	$	38.81	229,375	$	40.57

	3,660,191				2,650,603

(1)	Weighted average contractual life remaining in years.

(2)	Weighted average exercise price per share.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Summarized below is information about stock options outstanding and exercisable, for all classes, at September 30, 2004.


	Outstanding				Exercisable
Exercise Price Range per Share	Number of Shares Outstanding	Average Life(1)	Average Price per Share(2)		Number of Shares	Average Price per Share(2)
$ 5.68 - $ 7.56	1,000,602	3.4	$	7.04	922,382	$	7.0
8.63 - 12.93	609,263	4.3		10.04	548,974		10.19
13.14 - 20.12	814,139	7.5		15.58	289,376		14.89
20.30 - 29.15	580,394	8.8		23.08	92,254		23.52
31.95 - 43.61	235,000	9.3		36.19	—		—

	3,239,398				1,852,986

(1)	Weighted average contractual life remaining in years.

(2)	Weighted average exercise price per share.

The following table provides information on restricted stock for the periods presented.


	For the Years Ended September 30,
	2005		2004		2003
	(Dollars in thousands, except per share data)
Restricted Stock:
Shares awarded		110,135		70,364		109,225
Weighted average grant date fair value per share	$	27.67	$	27.65	$	20.49
Weighted average grant date fair value	$	3,048	$	1,946	$	2,238
Performance-based restricted stock:
Shares awarded		50,000		50,000		150,000
Weighted average grant date fair value per share	$	41.74	$	33.36	$	23.73
Weighted average grant date fair value	$	2,087	$	1,668	$	3,560

As permitted by SFAS No. 123, BankUnited continues to follow the intrinsic value method of accounting for stock-based compensation under the provisions of Accounting Principles Board (“APB”) No. 25, “Accounting for Stock Issued to Employees.” Accordingly, the alternative methods of transition for the fair value based method of accounting for stock-based employee compensation provided by SFAS No. 148 do not apply to BankUnited. BankUnited is required under the provisions of SFAS No. 148 amending SFAS No. 123 and APB No. 28, “Interim Financial Reporting,” to provide additional disclosures in both annual and interim financial statements.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Had compensation cost for BankUnited’s stock-based compensation plans been determined based on the fair value at the grant dates for stock option awards consistent with the methodology prescribed by SFAS No. 123, BankUnited’s net income and earnings per share for fiscal 2005, 2004 and 2003, would have been reduced to the pro forma amounts indicated below:


	For the Years Ended September 30,
	2005			2004			2003
	(Dollars in thousands, except per share data)
Net income, as reported	$	27,537		$	50,722		$	39,120
Add: Total stock-based employee and director compensation expense included in net income, net of related tax effects		1,794			1,574			429
Deduct: Total stock-based employee and director compensation expense determined under the fair value based method for all awards, net of related tax effects(1)		7,425			3,359			2,215

Pro forma net income	$	21,906		$	48,937		$	37,334

Earnings per share:
Basic — as reported	$	0.90		$	1.69		$	1.45
Basic — pro forma	$	0.71		$	1.63		$	1.38
Diluted — as reported	$	0.85		$	1.58		$	1.36
Diluted — pro forma	$	0.68		$	1.52		$	1.29
Assumptions for weighted average grant-date fair value of options using the Black Scholes option pricing model are as follows:
Dividend yields		0.07	%		—			—
Expected volatility		26.8	%		31.0	%		38.0	%
Risk-free interest rates		3.83	%		3.43	%		3.55	%
Expected life (in years)		4.6			5.6			5.5

(1)

BankUnited recognizes the tax effect of option exercises in additional paid in capital.

The pro forma results of operations reported above are not likely to be representative of the effects on reported income of future years due to vesting arrangements and additional option grants. The fair value of each option has been estimated on the date of the grant using the Black Scholes option pricing model.

Acceleration of Vesting

On January 24, 2005, the Compensation Committee (the “Compensation Committee”) of the Board of Directors of BankUnited determined to accelerate the vesting of two stock options which were granted to Alfred Camner, BankUnited’s Chief Executive Officer, and Ramiro Ortiz, BankUnited’s President and Chief Operating Officer, under BankUnited’s 2002 Stock Award and Incentive Plan (the “2002 Plan”) on September 30, 2004. The acceleration of vesting was approved to become effective automatically if, and at such time, that the market price of BankUnited’s Class A Common Stock closed below $29.15 per share. The exercise prices of both options were based on the fair market value of BankUnited’s Class A Common Stock on the date of grant, which was $29.15. On January 25, 2005 the price of BankUnited’s Class A Common Stock closed at $29.04 per share. The acceleration of the vesting period for the options granted to the CEO and COO met the criteria for variable accounting under FASB Interpretation No. 44, however, because the vesting of these options was accelerated at a time when the exercise price was higher than the market price of the underlying stock, the acceleration did not result in a charge to earnings for compensation expense. As a result of the acceleration, the option granted to the CEO for the purchase of 75,000 shares of BankUnited’s Noncumulative Convertible Preferred Stock, Series B,

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

and the option granted to the President and COO for the purchase of 50,000 shares of BankUnited’s Class A Common Stock, became immediately vested and exercisable on January 25, 2005, instead of vesting in five equal installments commencing on the first anniversary of the date of grant.

BankUnited projects that, if the vesting of these options had not been accelerated, then SFAS 123R would have required BankUnited to recognize approximately $1.4 million in compensation expense from these options over their remaining vesting terms, in quarters beginning after September 30, 2005. In exchange for the benefits conferred on the CEO by the accelerated vesting of his option, the Compensation Committee and the CEO agreed that the term of such option shall be shortened from ten years to eight years. The Committee agreed with the President and COO that the term of his employment agreement, which would otherwise expire on September 30, 2007, shall be extended by one additional year, subject to such other terms and conditions specified therein.

On May 20, 2005, the Compensation Committee determined to accelerate the vesting of two additional stock options which were also granted to CEO under the 2002 Plan. The acceleration of vesting was approved to become effective immediately. As a result of the acceleration, an option granted to the CEO on April 28, 2004 for the purchase of 10,000 shares of the Company’s Noncumulative Convertible Preferred Stock, Series B (“Series B Preferred Stock”), at an exercise price of $38.97 per share, became immediately vested and exercisable, instead of vesting in eight equal installments commencing on the first anniversary of the date of grant; and an option granted to the CEO on October 26, 2004 for the purchase of 50,000 shares of the Series B Preferred Stock, at an exercise price of $41.74 per share, became immediately vested and exercisable instead of vesting in five equal installments commencing on the first anniversary of the date of grant. Each share of Series B Preferred Stock is convertible into 1.4959 shares of BankUnited’s Class B Common Stock, and each share of the BankUnited’s Class B Common Stock is convertible into one share of the BankUnited ‘s Class A Common Stock.

The acceleration of the vesting period for the options meets the criteria for variable accounting under FASB Interpretation No. 44. However, the exercise prices of both options were based on the fair market value of BankUnited’s Class A Common Stock on the dates of grant, which was $26.05 on April 28, 2004, and $27.90 on October 26, 2004. On May 20, 2005, the Company’s Class A Common Stock closed at $25.07. The fair market value of the Series B Preferred Stock, calculated as the closing price of the Class A Common Stock multiplied by 1.4959, was $37.50. Because the vesting of these options was accelerated at a time when their exercise prices were higher than the market value of the underlying stock, the acceleration did not result in a charge to earnings for compensation expense. The value of these options were reflected in the footnote disclosures to BankUnited’s financial statements for the quarter ending September 30, 2005, as required by SFAS No. 148. BankUnited projects that, if the vesting of these options had not been accelerated, then SFAS 123R would have required the BankUnited to recognize approximately $690,000 in compensation expense from these options over their remaining vesting terms, in quarters beginning after September 30, 2005.

The 2002 Plan permits the Compensation Committee to adjust the terms and conditions of awards granted under that plan in response to changes in accounting principles, among other reasons, subject to certain restrictions. The Compensation Committee determined to accelerate the vesting of these options as a result of the issuance by the FASB of SFAS No. 123R, which BankUnited expects to adopt effective October 1, 2005. BankUnited anticipates that, by accelerating the vesting of these options at a time when their exercise price was higher than the market price, BankUnited will not be required to recognize compensation expense on the options. The value of these options is reflected in the pro-forma earnings per share disclosures above, as required by SFAS No. 148.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

BankUnited 401(k) Plan

BankUnited sponsors a 401(k) profit sharing plan for its eligible employees. Under the terms of the combined plan, eligible employees are permitted to contribute up to the limits set by law to the Plan. BankUnited currently makes matching contributions in the form of BankUnited Class A Common stock at a rate of 75% of employee contributions up to a maximum matching contribution of 4.5% of the employees salary. Employees are eligible to participate in the plan after one month of service and begin vesting in BankUnited’s contribution after two years of service at the rate of 25% per year up to 100%. For fiscal 2005, 2004 and 2003, the Bank made total matching contributions of approximately $1.3 million, $740 thousand, and $720 thousand, respectively.

(14) Income Taxes

The components of the provision for income taxes for the years ended September 30, 2005, 2004 and 2003 are as follows:


	For the Years Ended September 30,
	2005		2004		2003
	(In thousands)
Current-federal	$	1,065	$	18,731	$	72
Current-state		42		781		20
Deferred		9,271		3,629		16,459

Total	$	10,378	$	23,141	$	16,551

BankUnited’s effective tax rate differs from the statutory federal income tax rate as follows:


	Years Ended September 30,
	2005					2004					2003
	Amount			%		Amount			%		Amount			%
	(Dollars in thousands)
Tax at federal income tax rate	$	13,270		35.0	%	$	25,852		35.0	%	$	19,485		35.0	%
Increase (decrease) resulting from:
Tax exempt income		(2,688	)	(7.1	)		(2,563	)	(3.5	)		(2,352	)	(4.2	)
State tax, less effect on federal tax		27		0.1			508		0.7			13		—
Other, net		(231	)	(0.6	)		(656	)	(0.9	)		(595	)	(1.1	)

Total	$	10,378		27.4	%	$	23,141		31.3	%	$	16,551		29.7	%

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

The tax effects of significant temporary differences included in the net deferred tax liability as of September 30, 2005 and 2004 were:


	September 30,
	2005		2004
	(In thousands)
Deferred tax asset:
Non-accrual interest	$	162	$	483
Loan loss and other reserves		9,241		8,665
Unrealized losses in other comprehensive income		12,439		3,916
Net operating loss (1)		3,375		—
Other		1,568		991

Gross deferred tax asset		26,785		14,055

Deferred tax liability:
Deferrals and amortizations		5,788		5,327
Depreciation		753		1,750
Deferred REIT income		27,877		16,228
Contingent interest on convertible senior notes		3,110		1,080
Other		558		224

Gross deferred tax liability		38,086		24,609

Net deferred tax liability	$	11,301	$	10,554

(1)	This net operating loss will be carried forward for tax purposes and, if unused, will expire in BankUnited’s fiscal year 2025.

BankUnited files a consolidated federal income tax return with its subsidiaries other than BU REIT, Inc. on a fiscal year ending on September 30. BU REIT, Inc. files a separate tax return on a calendar-year basis.

At September 30, 2005, BankUnited had $409 thousand in tax bad debt reserves originating before December 31, 1987 for which deferred taxes have not been provided. The amount becomes taxable under the Internal Revenue Code upon the occurrence of certain events, including certain non-dividend distributions. BankUnited does not anticipate any actions that would ultimately result in the recapture of this amount for income tax purposes.

The components of deferred income tax benefit relate to the following:


	Years Ended September 30,
	2005			2004			2003
	(In thousands)
Deferred REIT income	$	11,648		$	(1,586	)	$	17,814
Differences in book/tax depreciation		(997	)		532			500
Non-accrual interest		321			380			(131	)
Net operating loss		(3,375	)		3,159			(3,159	)
Loan loss and other reserves		(575	)		(776	)		(132	)
Deferrals and amortization		460			1,457			1,831
Contingent interest		2,030			1,080			—
Stock-based compensation		(682	)		(619	)		(153	)
Other		441			2			(111	)

Total deferred tax benefit	$	9,271		$	3,629		$	16,459

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(15) Commitments and Contingencies

BankUnited is a party to credit related financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to fund loans, lines of credit, and commercial and standby letters of credit. Such commitments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated statement of financial condition. BankUnited’s exposure to credit loss is represented by the contractual amount of these commitments. BankUnited follows the same credit policies in making commitments as it does for on-balance-sheet instruments.

Total commitments at September 30, 2005 and 2004 were as follows:


	September 30,
	2005		2004
	(In thousands)
Commitments to fund loans:
Residential	$	193,720	$	176,727
Commercial and commercial real estate		159,834		72,785
Construction		168,754		70,197
Unfunded commitments under lines of credit		581,638		401,441
Commercial and standby letters of credit		38,849		53,539

Total	$	1,142,795	$	774,689

Commitments to fund loans are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments to fund loans generally have fixed expiration dates or other termination clauses and may require payment of a fee. Unfunded commitments under lines of credit, include consumer, commercial, and commercial real estate lines of credit to existing customers. The commitments under lines of credit may expire without being drawn upon, therefore, the total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if it is deemed necessary by BankUnited, is based on management’s credit evaluation of the customer.

Commercial and standby letters of credit are conditional commitments issued by BankUnited to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support trade transactions or guarantee arrangements. Fees collected on standby letters of credit represent the fair value of those commitments and are deferred and amortized over their term, which is typically one year or less. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. BankUnited generally holds collateral supporting those commitments if deemed necessary.

BankUnited and the Bank have employment and change in control agreements with certain members of senior management. The employment agreements, which establish the duties and compensation of the executives, have terms ranging from one year to five years, and include specific provisions for salary, bonus and other benefits. In addition to other provisions, the change in control agreements provide for severance payments in the event of a change in control.

BankUnited and its subsidiaries, from time to time, are involved as plaintiff or defendant in various legal actions arising in the normal course of their businesses. While the ultimate outcome of any such proceedings cannot be predicted with certainty, it is the opinion of management that no proceedings exist, either individually or in the aggregate, which, if determined adversely to BankUnited and its subsidiaries, would have a material effect on BankUnited’s consolidated financial condition, results of operations or cash flows.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(16) Related Party Transactions

From time to time, BankUnited makes loans in the ordinary course of its business as a financial institution to directors, officers and employees of BankUnited, as well as to members of their immediate families and affiliates, to the extent consistent with applicable laws and regulations. As of September 30, 2005 and 2004, these loans totaled $6.4 million, and $5.6 million, respectively.

The following table provides an analysis of changes in the amounts of related party loans during fiscal years 2005 and 2004:


	Related Party Loans
	2005			2004
	(In thousands)
Beginning balance	$	5,593		$	6,307
Additions		2,403			1,141
Payments		(1,633	)		(861	)
Other (1)		—			(994	)

Ending balance	$	6,363		$	5,593

(1)	Other represents loans to individuals who are no longer related parties.

During the 2005, 2004 and 2003 fiscal years, BankUnited retained the law firm of Camner, Lipsitz and Poller, Professional Association (“CLP”), as general counsel. Alfred R. Camner, Chief Executive Officer and Chairman of the Board of BankUnited, is the Senior Managing Director of CLP. During the 2005, 2004 and 2003 fiscal years, BankUnited paid CLP approximately $3.5 million, $3.6 million, and $3.7 million, respectively in legal fees allocable to loan closings, foreclosures, litigation, corporate and other matters.

During the 2005, 2004 and 2003 fiscal years, BankUnited obtained policies for directors’ and officers’ liability insurance, banker’s blanket bond insurance, commercial multi-peril insurance, and workers’ compensation insurance through Head-Beckham AmerInsurance Agency, Inc. (“Head-Beckham). Based on information provided by Head-Beckham, Head-Beckham received approximately $300 thousand, $169 thousand, and $92 thousand, respectively, in commissions on premiums paid for these policies. Marc Jacobson, a director of BankUnited, is a senior vice President and member of the Board of Directors of Head-Beckham. The fees paid to Head-Beckham for fiscal 2005 also includes $150 thousand for premiums paid on health and dental insurance policies. Based on information from American Central Insurance Agency (American Central), of which Mr. Jacobson’s wife is the president and owner, American Central received approximately $130 thousand, and $131 thousand during fiscal 2004 and 2003 respectively, in commission on premiums paid for health and dental insurance policies obtained by BankUnited through that agency.

In 1997, BankUnited entered into a lease for property located in the West Miami Airport area, on which it opened a branch office. The property was owned by a partnership owned 25% by Alfred Camner. BankUnited paid this partnership approximately $110 thousand in fiscal 2003. During fiscal 2003, the partnership sold the underlying subject property to an unaffiliated entity and ceased receiving payments from BankUnited, thus terminating the related party relationship.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

(17) BankUnited Financial Corporation

The following summarizes the major categories of BankUnited’s (holding company only) financial statements:

Condensed Statements of Financial Condition


	As of September 30,
	2005		2004
	(In thousands)
Assets:
Cash	$	26,852	$	15,605
Federal Home Loan Bank overnight deposits		101		75
Investments available for sale, at fair value		3,294		20,435
Mortgage-backed securities available for sale, at fair value		—		34,841
Loans held in portfolio, net		—		47,053
Accrued interest receivable		1,310		863
Investment in the Bank		769,500		646,370
Investment in other subsidiaries		3,772		3,282
Other assets		20,132		10,185

Total assets	$	824,961	$	778,709

Liabilities and Capital:
Convertible senior notes	$	120,000	$	120,000
Trust preferred securities and subordinated debentures		195,500		164,979
Other liabilities		1,845		1,073

Total liabilities		317,345		286,052
Stockholders’ equity		507,616		492,657

Total liabilities and stockholders’ equity	$	824,961	$	778,709

Condensed Statements of Operations


	For the Years Ended September 30,
	2005		2004		2003
	(In thousands)
Interest income	$	2,160	$	3,552	$	6,710
Interest expense		13,259		9,509		23,232
Equity income of the Bank and other subsidiaries		40,523		58,850		53,713
Gain on sale of investment securities		1,040		165		1,846
Non-interest expenses		10,223		6,613		8,459

Income before income taxes		20,241		46,445		30,578
Income tax benefit		7,296		4,277		8,542

Net income	$	27,537	$	50,722	$	39,120

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Condensed Statements of Cash Flows


	For the Years Ended September 30,
	2005			2004			2003
	(In thousands)
Cash flows from operating activities:
Net income	$	27,537		$	50,722		$	39,120
Less: Undistributed income of the other subsidiaries		(40,518	)		(59,232	)		(53,713	)
Tax effect of stock options and restricted stock		1,691			1,962			1,537
Deferred Compensation		2,761			88			266
Other, net		(6,987	)		10,489			6,099

Net cash (used in) provided by operating activities		(15,516	)		4,029			(6,691	)

Cash flows from investing activities:
Equity contributions to the Bank		(97,000	)		(50,000	)		—
Equity distributions from other subsidiaries		—			—			3,844
Net decrease (increase) in loans		45,859			(46,384	)		—
Proceeds from repayments of mortgage-backed securities available for sale		1,278			5,037			1,291
Proceeds from the sale of investment securities available for sale		15,171			—			4,242
Proceeds from the sale of mortgage-backed securities available for sale		33,412			—			—
Purchase of investment securities available for sale		—			(71	)		(361	)
Purchase of mortgage-backed securities available for sale		—			(39,753	)		—
Other, net		(1,332	)		(118	)		—

Net cash (used in) provided by investing activities		(2,612	)		(131,289	)		9,016

Cash flows from financing activities:
Net proceeds from issuance of junior subordinated deferrable interest debentures		30,928			—			69,734
Retirement of trust preferred securities		—			—			(165,520	)
Proceeds from issuance of convertible senior notes		—			116,446			—
Net proceeds from issuance of stock		1,565			3,555			71,711
Purchase of stock		(2,214	)		—			—
Dividends paid on stock		(878	)		(379	)		(316	)

Net cash provided by (used in) financing activities		29,401			119,622			(24,391	)

Increase(decrease) in cash and cash equivalents		11,273			(7,638	)		(22,066	)
Cash and cash equivalents at beginning of year		15,680			23,318			45,384

Cash and cash equivalents at end of year	$	26,953			15,680		$	23,318

(18) Estimated Fair Value of Financial Instruments

The information set forth below provides disclosure of the estimated fair value of BankUnited’s financial instruments. Management has made estimates of fair value discount rates that it believes to be reasonable. However, because there is no readily available market for some of these financial instruments, management has no basis to determine whether the fair value presented would be indicative of the value negotiated in an actual sale. The fair value estimates do not consider the tax effect that would be associated with the disposition of the assets or liabilities at their fair value estimates.

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

September 30, 2005

Fair values for investments and mortgage-backed securities are based on quoted market prices or dealer quotes. If quoted prices are not available, fair value is estimated using quoted market prices for similar securities.

Fair values are estimated for loan portfolios with similar financial characteristics. Loans are segregated by category, such as residential mortgage, second mortgages, commercial real estate, commercial, and other installment. Each loan category is further segmented into fixed and adjustable rate interest terms and by performing and non-performing status. The fair value of loans is calculated by discounting scheduled cash flows through the estimated maturity using estimated market discount rates that reflect the credit risk inherent in the loan. The estimate of average maturity is based on historical experience with prepayments for each loan classification modified, as required, by an estimate of the effect of current economic and lending conditions.

The carrying value of FHLB stock and other earning assets, approximates fair value.

The fair value of deposits with no stated maturity, such as non-interest bearing demand deposits, savings and transaction accounts, and money market accounts, is equal to the amount payable on demand. The fair value of certificates of deposit is based on the discounted value of contractual cash flows.

The fair value of borrowings, which include FHLB advances, securities sold under agreements to repurchase and senior notes is determined by discounting the scheduled cash flows through maturity using estimated market discount rates that reflect the interest rate currently available in the market.

Fair value for derivatives are based solely on quotes provided by independent third parties.

The estimated fair value of BankUnited’s financial instruments as of September 30, 2005 and 2004 was as follows:


	As of September 30,
	2005				2004
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(In thousands)
Financial assets:
Cash and cash equivalents	$	238,051	$	238,051	$	181,894	$	181,894
Investments		289,932		289,932		333,939		333,939
Mortgage-backed securities		1,626,005		1,626,005		2,068,180		2,068,180
Loans receivable, net (1)		8,039,788		8,060,715		5,755,586		5,758,764
FHLB stock and other earning assets		190,043		190,043		156,166		156,166
Financial liabilities:
Deposits	$	4,733,355	$	4,717,212	$	3,528,262	$	3,538,244
Borrowings(2)		5,101,733		5,078,002		4,417,665		4,483,696
Trust preferred securities and subordinated debentures		195,500		204,774		164,979		165,236
Derivative instruments, net debit (credit)		1,029		1,029		874		874

(1)

Including loans held for sale.

(2)

Excluding trust preferred securities and subordinated debentures.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on December 14, 2005.


BANK UNITED FINANCIAL CORPORATION

By:		/s/ ALFRED R. CAMNER
		Alfred R. Camner Chairman of the Board and Chief Executive Officer

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Alfred R. Camner, Ramiro A. Ortiz and Lawrence H. Blum and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments to this report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or his substitutes, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed on December 14, 2005 on behalf of the Registrant by the following persons and in the capacities indicated.


/s/ ALFRED R. CAMNER		Chairman of the Board, Chief Executive Officer, and Director (Principal Executive Officer)
Alfred R. Camner

/s/ RAMIRO A. ORTIZ		President, Chief Operating Officer, and Director
Ramiro A. Ortiz		President, Chief Operating Officer, and Director

/s/ LAWRENCE H. BLUM		Vice Chairman of the Board, Secretary and Director
Lawrence H. Blum		Vice Chairman of the Board, Secretary and Director

/s/ MARC D. JACOBSON		Director
Marc D. Jacobson		Director

/s/ ALLEN M. BERNKRANT		Director
Allen M. Bernkrant		Director

/s/ NEIL H. MESSINGER, M. D.		Director
Neil H. Messinger, M. D.		Director

/s/ HARDY C. KATZ		Director
Hardy C. Katz		Director

/s/ SHARON A. BROWN		Director
Sharon A. Brown		Director


/s/ ALBERT E. SMITH		Director
Albert E. Smith		Director

/s/ TOD ARONOVITZ		Director
Tod Aronovitz		Director

/s/ LAUREN CAMNER		Director
Lauren Camner		Director

/s/ HUMBERTO L. LOPEZ		Senior Executive Vice President and Chief Financial Officer (Principal Financial Officer)
Humberto L. Lopez

/s/ BERNARDO M. ARGUDIN		Executive Vice President and Chief Accounting Officer
Bernardo M. Argudin		Executive Vice President and Chief Accounting Officer

Item 15. Exhibits and Financial Statement Schedules

(a)	The Following Documents are Filed as Part of this Amendment

(3)

Exhibits

23.1	Consent of PricewaterhouseCoopers LLP

31.1	Certification of the Chief Executive Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification of the Chief Financial Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment to be signed on its behalf by the undersigned , thereunto duly authorized on December 16, 2005.


BANK UNITED FINANCIAL CORPORATION

By:		/S/ ALFRED R. CAMNER
		Alfred R. Camner
		Chairman of the Board and Chief Executive Officer

Exhibit Index


Exhibit No.		Description
23.1		Consent of PricewaterhouseCoopers LLP

31.1		Certification of the Chief Executive Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Certification of the Chief Financial Officer pursuant to 15 U.S.C. Section 10A, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002