BankUnited, Florida’s biggest independent regional bank, was closed Thursday by the Office of Thrift Supervision and sold to a consortium of private equity firms for $900 million. The deal was brokered by the FDIC and represents the largest bank failure this year and one of the agency's costliest closures ever, second only to IndyMac's seizure last year.
The new owners of BankUnited are John Kanas -- the former head of the now defunct North Fork Bank, who will take over as the institution's chief executive -- and eight private investment companies: WL Ross & Company, Blackstone Capital, Centerbridge Partners, Carlyle Group, the New York real estate company LeFrak Organization, Wellcome Trust, Greenaap Investments, and the East Rock Endowment Fund. The group beat out a competing bid from TD Bank and Goldman Sachs.
For their $900 million investment, the buyers will assume $12.7 billion in assets, including all mortgages and loans, and $8.3 billion in non-brokered deposits. The FDIC has agreed to share in any losses the consortium incurs on approximately $10.7 billion of the assets, consisting mainly of subprime residential mortgages originated during the housing boom. The new institution will continue operations under the BankUnited name.
The FDIC said due to growing interest among private equity firms to purchase depository institutions that have gone under, the agency plans to develop and soon issue policy guidance on eligibility and other terms and conditions for investments in failed banks.