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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



Form 10-Q



(Mark One)



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



For the quarterly period ended March 31, 2004



or



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



Commission File No. 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)



(305) 569-2000

(Registrants telephone number, including area code)



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



Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange
Act).    Yes  x    No ̈



The number of shares outstanding of the registrants common stock at the
close of business on May 5, 2004 was 29,444,797 shares of Class A Common Stock, $.01 par value, and 536,562 shares of Class B Common Stock, $.01 par value.



This Form 10-Q contains 36 pages.

The Index
to Exhibits appears on page 36.



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



FORM 10-Q REPORT FOR THE QUARTER ENDED MARCH 31, 2004



TABLE OF CONTENTS



|                                                                                                             |  |         
|------------------------------------------------------------------------------------------------------------ |  | --------
|                                                                                                             |  | Page No.
|PART IFINANCIAL INFORMATION                                                                                 |  |         
|                                                                                                             | 
|Item 1.    Financial Statements                                                                              |  |         
|                                                                                                             | 
|Consolidated Statements of Financial Condition as of March 31, 2004 and September 30, 2003 (unaudited)       |  | 3       
|                                                                                                             | 
|Consolidated Statements of Income (unaudited) for the Three and Six Months EndedMarch 31, 2004 and 2003      |  | 4       
|                                                                                                             | 
|Consolidated Statements of Stockholders Equity (unaudited) for the Six Months Ended March 31, 2004 and 2003 |  | 5       
|                                                                                                             | 
|Consolidated Statements of Cash Flows (unaudited) for the Six Months Ended March 31, 2004 and 2003           |  | 6       
|                                                                                                             | 
|Condensed Notes to Consolidated Financial Statements (unaudited)                                             |  | 7       
|                                                                                                             | 
|Item 2.    Managements Discussion and Analysis of Financial Condition and Results of Operations             |  | 16      
|                                                                                                             | 
|Item 3.    Quantitative and Qualitative Disclosures About Market Risk                                        |  | 31      
|                                                                                                             | 
|Item 4.    Controls and Procedures                                                                           |  | 32      
|                                                                                                             | 
|PART IIOTHER INFORMATION                                                                                    |  |         
|                                                                                                             | 
|Item 2.    Changes in Securities and Use of Proceeds                                                         |  | 33      
|                                                                                                             | 
|Item 4.    Submission of Matters to a Vote of Security Holders                                               |  | 33      
|                                                                                                             | 
|Item 6.    Exhibits and Reports on Form 8-K                                                                  |  | 33      



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION



|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|-------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------- | --------- | - | ----------------- | - | --------- | -
|                                                                                                                                       |  | March 31,2004                            |           |   | September 30,2003 |  
|                                                                                                                                       |  | (Dollars in thousands,except share data) |          
|Assets:                                                                                                                                |  |                                          |           |   |                   |   |           |  
|Cash                                                                                                                                   |  | $                                        | 36,763    |   |                   | $ | 28,810    |  
|Federal Home Loan Bank overnight deposits                                                                                              |  |                                          | 7,485     |   |                   |   | 195,365   |  
|Federal funds sold                                                                                                                     |  |                                          | 829       |   |                   |   | 2,723     |  
|Investments available for sale, at fair value                                                                                          |  |                                          | 339,506   |   |                   |   | 296,677   |  
|Mortgage-backed securities available for sale, at fair value                                                                           |  |                                          | 2,226,105 |   |                   |   | 2,064,981 |  
|Mortgage loans held for sale                                                                                                           |  |                                          | 123,590   |   |                   |   | 286,796   |  
|Loans held in portfolio                                                                                                                |  |                                          | 4,555,023 |   |                   |   | 3,925,077 |  
|Add: Unearned discounts, premiums and deferred fees, net                                                                               |  |                                          | 44,883    |   |                   |   | 36,806    |  
|Less: Allowance for loan losses                                                                                                        |  |                                          | (22,665   | ) |                   |   | (22,295   | )
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Loans held in portfolio, net                                                                                                           |  |                                          | 4,577,241 |   |                   |   | 3,939,588 |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|FHLB stock and other earning assets                                                                                                    |  |                                          | 131,130   |   |                   |   | 123,431   |  
|Office properties and equipment, net                                                                                                   |  |                                          | 22,198    |   |                   |   | 20,278    |  
|Real estate owned                                                                                                                      |  |                                          | 2,975     |   |                   |   | 4,290     |  
|Accrued interest receivable                                                                                                            |  |                                          | 29,142    |   |                   |   | 28,452    |  
|Mortgage servicing rights                                                                                                              |  |                                          | 13,585    |   |                   |   | 12,930    |  
|Goodwill                                                                                                                               |  |                                          | 28,353    |   |                   |   | 28,353    |  
|Bank-owned life insurance                                                                                                              |  |                                          | 86,204    |   |                   |   | 84,155    |  
|Prepaid expenses and other assets                                                                                                      |  |                                          | 24,897    |   |                   |   | 28,314    |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Total assets                                                                                                                           |  | $                                        | 7,650,003 |   |                   | $ | 7,145,143 |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Liabilities and Stockholders Equity:                                                                                                  |  |                                          |           |   |                   |   |           |  
|Liabilities:                                                                                                                           |  |                                          |           |   |                   |   |           |  
|Interest bearing deposits                                                                                                              |  | $                                        | 3,190,898 |   |                   | $ | 3,038,594 |  
|Non-interest bearing deposits                                                                                                          |  |                                          | 235,346   |   |                   |   | 197,512   |  
|Securities sold under agreements to repurchase                                                                                         |  |                                          | 738,567   |   |                   |   | 517,297   |  
|Advances from Federal Home Loan Bank                                                                                                   |  |                                          | 2,614,319 |   |                   |   | 2,460,291 |  
|Senior notes                                                                                                                           |  |                                          |          |   |                   |   | 200,000   |  
|Convertible debt                                                                                                                       |  |                                          | 120,000   |   |                   |   |          |  
|Trust preferred securities and subordinated debentures                                                                                 |  |                                          | 165,544   |   |                   |   | 162,219   |  
|Interest payable                                                                                                                       |  |                                          | 13,180    |   |                   |   | 14,331    |  
|Advance payments by borrowers for taxes and insurance                                                                                  |  |                                          | 27,000    |   |                   |   | 47,081    |  
|Payable for securities purchased pending settlement                                                                                    |  |                                          | 25,359    |   |                   |   |          |  
|Accrued expenses and other liabilities                                                                                                 |  |                                          | 41,714    |   |                   |   | 60,445    |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Total liabilities                                                                                                                      |  |                                          | 7,171,927 |   |                   |   | 6,697,770 |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Commitments and Contingencies (See notes 8 and 9)                                                                                      |  |                                          |           |   |                   |   |           |  
|                                                                                                                                       |  |                                         
|Stockholders Equity:                                                                                                                  |  |                                          |           |   |                   |   |           |  
|Preferred Stock, $0.01 par value                                                                                                       |  |                                          | 8         |   |                   |   | 7         |  
|Authorized shares10,000,000Issued shares793,405 and 739,007Outstanding shares766,685 and
712,287Treasury shares26,720              |  |                                          | (528      | ) |                   |   | (528      | )
|Class A common stock, $0.01 par value                                                                                                  |  |                                          | 297       |   |                   |   | 295       |  
|Authorized shares60,000,000Issued shares29,736,553 and 29,476,616Outstanding
shares29,399,061 and 29,139,124Treasury shares337,492 |  |                                          | (2,891    | ) |                   |   | (2,891    | )
|Class B common stock, $0.1 par value                                                                                                   |  |                                          | 6         |   |                   |   | 6         |  
|Authorized shares3,000,000Issued shares622,762 and 580,262Outstanding
shares536,562Treasury shares86,200 and 43,700                |  |                                          | (1,010    | ) |                   |   | (485      | )
|Additional paid-in capital                                                                                                             |  |                                          | 331,795   |   |                   |   | 328,017   |  
|Retained earnings                                                                                                                      |  |                                          | 139,778   |   |                   |   | 116,370   |  
|Deferred compensation                                                                                                                  |  |                                          | 1,039     |   |                   |   | 794       |  
|Accumulated other comprehensive income                                                                                                 |  |                                          | 9,582     |   |                   |   | 5,788     |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Total stockholders equity                                                                                                             |  |                                          | 478,076   |   |                   |   | 447,373   |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  
|Total liabilities and stockholders equity                                                                                             |  | $                                        | 7,650,003 |   |                   | $ | 7,145,143 |  
|                                                                                                                                       |  |                                          |           |   |                   |   |           |  



See accompanying
condensed notes to consolidated financial statements





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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONSOLIDATED STATEMENTS OF INCOME



|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|--------------------------------------------------------------------------------- |  | ------------------------------------------------------- | ------ | - | ---------------------------------- | - | ------ | ---- |  | - | ------- | - |  | - | ------- | -
|                                                                                  |  | For the Three Months EndedMarch 31,                     |        |   | For the Six Months Ended March 31, |  
|                                                                                  |  | 2004                                                    |        |   | 2003                               |   |        | 2004 |  |   | 2003    |  
|                                                                                  |  | (Dollars and shares in thousands,except per share data) |       
|Interest income:                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Interest and fees on loans                                                        |  | $                                                       | 55,095 |   |                                    | $ | 58,421 |      |  | $ | 109,456 |   |  | $ | 119,634 |  
|Interest on mortgage-backed securities                                            |  |                                                         | 20,189 |   |                                    |   | 19,296 |      |  |   | 39,986  |   |  |   | 32,967  |  
|Interest on short-term investments                                                |  |                                                         | 123    |   |                                    |   | 110    |      |  |   | 215     |   |  |   | 227     |  
|Interest and dividends on long-term investments and other interest-earning assets |  |                                                         | 4,932  |   |                                    |   | 3,463  |      |  |   | 9,383   |   |  |   | 6,722   |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Total interest income                                                             |  |                                                         | 80,339 |   |                                    |   | 81,290 |      |  |   | 159,040 |   |  |   | 159,550 |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Interest expense:                                                                 |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Interest on deposits                                                              |  |                                                         | 17,902 |   |                                    |   | 21,112 |      |  |   | 36,172  |   |  |   | 43,756  |  
|Interest on borrowings                                                            |  |                                                         | 25,151 |   |                                    |   | 24,754 |      |  |   | 51,151  |   |  |   | 47,886  |  
|Preferred dividends of subsidiary trusts                                          |  |                                                         | 2,322  |   |                                    |   | 5,259  |      |  |   | 4,674   |   |  |   | 10,135  |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Total interest expense                                                            |  |                                                         | 45,375 |   |                                    |   | 51,125 |      |  |   | 91,997  |   |  |   | 101,777 |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Net interest income before provision for loan losses                              |  |                                                         | 34,964 |   |                                    |   | 30,165 |      |  |   | 67,043  |   |  |   | 57,773  |  
|Provision for loan losses                                                         |  |                                                         | 1,200  |   |                                    |   | 1,250  |      |  |   | 2,175   |   |  |   | 2,550   |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Net interest income after provision for loan losses                               |  |                                                         | 33,764 |   |                                    |   | 28,915 |      |  |   | 64,868  |   |  |   | 55,223  |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Non-interest income:                                                              |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Loan servicing fees, net of amortization                                          |  |                                                         | (317   | ) |                                    |   | (1,090 | )    |  |   | (1,090  | ) |  |   | (1,882  | )
|Impairment of mortgage servicing rights                                           |  |                                                         | (1,200 | ) |                                    |   |       |      |  |   | (1,200  | ) |  |   |        |  
|Loan fees                                                                         |  |                                                         | 994    |   |                                    |   | 1,146  |      |  |   | 1,933   |   |  |   | 2,190   |  
|Deposit fees                                                                      |  |                                                         | 1,044  |   |                                    |   | 991    |      |  |   | 2,163   |   |  |   | 2,020   |  
|Other fees                                                                        |  |                                                         | 459    |   |                                    |   | 312    |      |  |   | 939     |   |  |   | 604     |  
|Net (loss) gain on sale of investments and mortgage-backed securities             |  |                                                         | 333    |   |                                    |   | 158    |      |  |   | (262    | ) |  |   | 755     |  
|Net gain on sale of loans and other assets                                        |  |                                                         | 1,528  |   |                                    |   | 1,702  |      |  |   | 3,280   |   |  |   | 3,768   |  
|Insurance and investment services income                                          |  |                                                         | 1,184  |   |                                    |   | 626    |      |  |   | 2,126   |   |  |   | 1,320   |  
|Other                                                                             |  |                                                         | 1,084  |   |                                    |   | 2,212  |      |  |   | 2,282   |   |  |   | 3,022   |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Total non-interest income                                                         |  |                                                         | 5,109  |   |                                    |   | 6,057  |      |  |   | 10,171  |   |  |   | 11,797  |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Non-interest expenses:                                                            |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Employee compensation and benefits                                                |  |                                                         | 10,004 |   |                                    |   | 9,708  |      |  |   | 20,065  |   |  |   | 18,369  |  
|Occupancy and equipment                                                           |  |                                                         | 4,332  |   |                                    |   | 3,005  |      |  |   | 8,036   |   |  |   | 5,953   |  
|Telecommunications and data processing                                            |  |                                                         | 1,409  |   |                                    |   | 1,209  |      |  |   | 2,793   |   |  |   | 2,419   |  
|Advertising and promotion expense                                                 |  |                                                         | 1,287  |   |                                    |   | 1,256  |      |  |   | 2,438   |   |  |   | 2,443   |  
|Professional fees-legal and accounting                                            |  |                                                         | 1,024  |   |                                    |   | 1,200  |      |  |   | 2,344   |   |  |   | 2,347   |  
|Loan closing fees                                                                 |  |                                                         | 672    |   |                                    |   | 709    |      |  |   | 1,415   |   |  |   | 2,202   |  
|Loan servicing expense                                                            |  |                                                         | 131    |   |                                    |   | 362    |      |  |   | 287     |   |  |   | 847     |  
|Postage and courier                                                               |  |                                                         | 447    |   |                                    |   | 349    |      |  |   | 869     |   |  |   | 666     |  
|Insurance                                                                         |  |                                                         | 370    |   |                                    |   | 289    |      |  |   | 727     |   |  |   | 569     |  
|Other operating expenses                                                          |  |                                                         | 1,526  |   |                                    |   | 3,224  |      |  |   | 1,341   |   |  |   | 3,731   |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Total non-interest expenses                                                       |  |                                                         | 21,202 |   |                                    |   | 21,311 |      |  |   | 40,315  |   |  |   | 39,546  |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Income before income taxes                                                        |  |                                                         | 17,671 |   |                                    |   | 13,661 |      |  |   | 34,724  |   |  |   | 27,474  |  
|Provision for income taxes                                                        |  |                                                         | 5,633  |   |                                    |   | 4,055  |      |  |   | 11,136  |   |  |   | 9,082   |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Net income                                                                        |  | $                                                       | 12,038 |   |                                    | $ | 9,606  |      |  | $ | 23,588  |   |  | $ | 18,392  |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|                                                                                  |  |                                                         |        |  
|Earnings Per Share:                                                               |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Basic earnings per share                                                          |  | $                                                       | 0.40   |   |                                    | $ | 0.37   |      |  | $ | 0.79    |   |  | $ | 0.72    |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Diluted earnings per share                                                        |  | $                                                       | 0.37   |   |                                    | $ | 0.35   |      |  | $ | 0.72    |   |  | $ | 0.67    |  
|                                                                                  |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Weighted average number of common shares outstanding:                             |  |                                                         |        |   |                                    |   |        |      |  |   |         |   |  |   |         |  
|Basic                                                                             |  |                                                         | 29,835 |   |                                    |   | 25,539 |      |  |   | 29,760  |   |  |   | 25,398  |  
|Diluted                                                                           |  |                                                         | 32,683 |   |                                    |   | 27,710 |      |  |   | 32,553  |   |  |   | 27,572  |  



See accompanying
condensed notes to consolidated financial statements



4



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY



|                                                   |  |                                                  |   |             |   |                |  |                  |         |  |               |         |   |                      |   |                                                |   |                          |   |       |  |   |       |  |   |         |  
|-------------------------------------------------- |  | ------------------------------------------------ | - | ----------- | - | -------------- |  | ---------------- | ------- |  | ------------- | ------- | - | -------------------- | - | ---------------------------------------------- | - | ------------------------ | - | ----- |  | - | ----- |  | - | ------- | -
|                                                   |  | For the Six Months Ended March 31, 2004 and 2003 |  
|                                                   |  | PreferredStock                                   |   | CommonStock |   | Paid-inCapital |  | RetainedEarnings |         |  | TreasuryStock |         |   | DeferredCompensation |   | AccumulatedOtherComprehensiveIncome Net of Tax |   | TotalStockholdersEquity |  
|                                                   |  | (In thousands)                                   |  
|Balance at September 30, 2003                      |  | $                                                | 7 |             | $ | 301            |  | $                | 328,017 |  | $             | 116,370 |   |                      | $ | (3,904                                         | ) |                          | $ | 794   |  | $ | 5,788 |  | $ | 447,373 |  
|Comprehensive income:                              |  |                                                  |   |             |   |                |  |                  |         |  |               |         |   |                      |   |                                                |   |                          |   |       |  |   |       |  |   |         |  
|Net income for the six months ended March 31, 2004 |  |                                                  |  |             |   |               |  |                  |        |  |               | 23,588  |   |                      |   |                                               |   |                          |   |      |  |   |      |  |   | 23,588  |  
|Other comprehensive income, net of tax             |  |                                                  |  |             |   |               |  |                  |        |  |               |        |   |                      |   |                                               |   |                          |   |      |  |   | 3,794 |  |   | 3,794   |  
|                                                   |  |                                                  |   |             |   |                |  |                  |         |  |               |         |   |                      |   |                                                |   |                          |   |       |  |   |       |  |   |         |  
|Total comprehensive income                         |  |                                                  |  |             |   |               |  |                  |        |  |               |        |   |                      |   |                                               |   |                          |   |      |  |   |      |  |   | 27,382  |  
|Payment of preferred stock dividends               |  |                                                  |   |             |   |               |  |                  |        |  |               | (180    | ) |                      |   |                                               |   |                          |   |      |  |   |      |  |   | (180    | )
|Deferral of compensation                           |  |                                                  |  |             |   |               |  |                  |        |  |               |        |   |                      |   |                                               |   |                          |   | 245   |  |   |      |  |   | 245     |  
|Purchase of stock                                  |  |                                                  |  |             |   |               |  |                  |        |  |               |        |   |                      |   | (525                                           | ) |                          |   |      |  |   |      |  |   | (525    | )
|Stock options and restricted stock                 |  |                                                  | 1 |             |   | 2              |  |                  | 3,778   |  |               |        |   |                      |   |                                               |   |                          |   |      |  |   |      |  |   | 3,781   |  
|                                                   |  |                                                  |   |             |   |                |  |                  |         |  |               |         |   |                      |   |                                                |   |                          |   |       |  |   |       |  |   |         |  
|Balance at March 31, 2004                          |  | $                                                | 8 |             | $ | 303            |  | $                | 331,795 |  | $             | 139,778 |   |                      | $ | (4,429                                         | ) |                          | $ | 1,039 |  | $ | 9,582 |  | $ | 478,076 |  
|                                                   |  |                                                  |   |             |   |                |  |                  |         |  |               |         |   |                      |   |                                                |   |                          |   |       |  |   |       |  |   |         |  

|                                                   |  |                |   |             |   |                |  |                  |         |  |               |        |   |                      |   |                                                |   |                          |      |  |   |        |  |   |         |  
|-------------------------------------------------- |  | -------------- | - | ----------- | - | -------------- |  | ---------------- | ------- |  | ------------- | ------ | - | -------------------- | - | ---------------------------------------------- | - | ------------------------ | ---- |  | - | ------ |  | - | ------- | -
|                                                   |  |                |   |             |   |                |  |                 
|                                                   |  | PreferredStock |   | CommonStock |   | Paid-inCapital |  | RetainedEarnings |         |  | TreasuryStock |        |   | DeferredCompensation |   | AccumulatedOtherComprehensiveIncome Net of Tax |   | TotalStockholdersEquity |     
|                                                   |  | (In thousands) |  
|Balance at September 30, 2002                      |  | $              | 6 |             | $ | 255            |  | $                | 253,511 |  | $             | 77,566 |   |                      | $ | (3,322                                         | ) |                          | $528 |  | $ | 16,605 |  | $ | 345,149 |  
|Comprehensive income:                              |  |                |   |             |   |                |  |                  |         |  |               |        |   |                      |   |                                                |   |                          |      |  |   |        |  |   |         |  
|Net income for the six months ended March 31, 2003 |  |                |  |             |   |               |  |                  |        |  |               | 18,392 |   |                      |   |                                               |   |                          |     |  |   |       |  |   | 18,392  |  
|Other comprehensive income, net of tax             |  |                |  |             |   |               |  |                  |        |  |               |       |   |                      |   |                                               |   |                          |     |  |   | 2,817  |  |   | 2,817   |  
|                                                   |  |                |   |             |   |                |  |                  |         |  |               |        |   |                      |   |                                                |   |                          |      |  |   |        |  |   |         |  
|Total comprehensive income                         |  |                |  |             |   |               |  |                  |        |  |               |       |   |                      |   |                                               |   |                          |     |  |   |       |  |   | 21,209  |  
|Payment of preferred stock dividends               |  |                |  |             |   |               |  |                  |        |  |               | (158   | ) |                      |   |                                               |   |                          |     |  |   |       |  |   | (158    | )
|Deferral of compensation                           |  |                |  |             |   |               |  |                  |        |  |               |       |   |                      |   |                                               |   |                          | 169  |  |   |       |  |   | 169     |  
|Purchase of stock                                  |  |                |  |             |   |               |  |                  |        |  |               |       |   |                      |   | (485                                           | ) |                          |     |  |   |       |  |   | (485    | )
|Stock options and restricted stock                 |  |                | 1 |             |   | 5              |  |                  | 3,696   |  |               |       |   |                      |   |                                               |   |                          |     |  |   |       |  |   | 3,702   |  
|                                                   |  |                |   |             |   |                |  |                  |         |  |               |        |   |                      |   |                                                |   |                          |      |  |   |        |  |   |         |  
|Balance at March 31, 2003                          |  | $              | 7 |             | $ | 260            |  | $                | 257,207 |  | $             | 95,800 |   |                      | $ | (3,807                                         | ) |                          | $697 |  | $ | 19,422 |  | $ | 369,586 |  
|                                                   |  |                |   |             |   |                |  |                  |         |  |               |        |   |                      |   |                                                |   |                          |      |  |   |        |  |   |         |  



See accompanying
condensed notes to consolidated financial statements



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONSOLIDATED STATEMENTS OF CASH FLOWS



|                                                                          |  |                                   |          |   |      |   |            |  
|------------------------------------------------------------------------- |  | --------------------------------- | -------- | - | ---- | - | ---------- | -
|                                                                          |  | For the Six Months EndedMarch 31, |         
|                                                                          |  | 2004                              |          |   | 2003 |  
|                                                                          |  | (In thousands)                    |         
|Cash flows used in operating activities                                   |  | $                                 | (58,056  | ) |      | $ | (293,465   | )
|Cash flows from investing activities:                                     |  |                                   |          |   |      |   |            |  
|Net increase in loans                                                     |  |                                   | (577,036 | ) |      |   | (28,794    | )
|Purchase of investment securities available for sale                      |  |                                   | (51,347  | ) |      |   | (77,461    | )
|Purchase of mortgage-backed securities available for sale                 |  |                                   | (663,746 | ) |      |   | (1,225,953 | )
|Purchase of other earning assets                                          |  |                                   | (56,049  | ) |      |   | (59,248    | )
|Purchase of bank-owned life insurance                                     |  |                                   |         |   |      |   | (20,000    | )
|Purchase of office properties and equipment                               |  |                                   | (4,075   | ) |      |   | (1,698     | )
|Proceeds from repayments of investment securities available for sale      |  |                                   | 33       |   |      |   |           |  
|Proceeds from repayments of mortgage-backed securities available for sale |  |                                   | 403,370  |   |      |   | 491,334    |  
|Proceeds from repayments of other earning assets                          |  |                                   | 48,350   |   |      |   | 49,450     |  
|Proceeds from sale of investment securities available for sale            |  |                                   | 11,044   |   |      |   | 40,892     |  
|Proceeds from sale of mortgage-backed securities available for sale       |  |                                   | 297,194  |   |      |   | 274,078    |  
|Proceeds from sale of real estate owned and other assets                  |  |                                   | 4,198    |   |      |   | 919        |  
|                                                                          |  |                                   |          |   |      |   |            |  
|Net cash used in investing activities                                     |  |                                   | (588,064 | ) |      |   | (556,481   | )
|                                                                          |  |                                   |          |   |      |   |            |  
|Cash flows from financing activities:                                     |  |                                   |          |   |      |   |            |  
|Net increase in deposits                                                  |  |                                   | 190,138  |   |      |   | 96,041     |  
|Net decrease in Federal Home Loan Bank advances                           |  |                                   | 154,028  |   |      |   | 203,182    |  
|Net increase in other borrowings                                          |  |                                   | 221,270  |   |      |   | 177,719    |  
|Guarantee fees for senior notes                                           |  |                                   |         |   |      |   | (113       | )
|Maturity of senior notes                                                  |  |                                   | (200,000 | ) |      |   |           |  
|Redemption of Trust Preferred Securities                                  |  |                                   |         |   |      |   | (46,501    | )
|Proceeds from issuance of convertible debt                                |  |                                   | 116,661  |   |      |   |           |  
|Net proceeds from issuance of Trust Preferred Securities                  |  |                                   |         |   |      |   | 51,080     |  
|Net proceeds from issuance of stock                                       |  |                                   | 2,463    |   |      |   | 2,857      |  
|Dividends paid on preferred stock                                         |  |                                   | (180     | ) |      |   | (158       | )
|Decrease in advances from borrowers for taxes and insurance               |  |                                   | (20,081  | ) |      |   | (18,788    | )
|                                                                          |  |                                   |          |   |      |   |            |  
|Net cash provided by financing activities                                 |  |                                   | 464,299  |   |      |   | 465,319    |  
|                                                                          |  |                                   |          |   |      |   |            |  
|(Decrease) increase in cash and cash equivalents                          |  |                                   | (181,821 | ) |      |   | 384,627    |  
|Cash and cash equivalents at beginning of period                          |  |                                   | 226,898  |   |      |   | 472,290    |  
|                                                                          |  |                                   |          |   |      |   |            |  
|Cash and cash equivalents at end of period                                |  | $                                 | 45,077   |   |      | $ | 87,663     |  
|                                                                          |  |                                   |          |   |      |   |            |  
|Supplemental disclosure of non-cash investing and financing activities:   |  |                                   |          |   |      |   |            |  
|Securitization of mortgage loans held for sale                            |  | $                                 | 177,051  |   |      | $ | 286,132    |  
|Transfer of loans held for sale to portfolio                              |  | $                                 | 70,760   |   |      | $ |           |  
|Securities purchased pending settlement                                   |  | $                                 | 25,359   |   |      | $ | 96,651     |  





See accompanying condensed notes to consolidated financial statements



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



1.    Principles of Consolidation and Basis of Presentation



The accompanying unaudited consolidated financial statements include the accounts of BankUnited Financial Corporation (BankUnited) and its
subsidiaries, including BankUnited, FSB (the Bank), with the exception of BankUniteds trust subsidiaries which do not meet the criteria for consolidation under FASB Interpretation No. 46, (see discussion FIN No. 46R in note 2.
Impact of Certain Accounting Pronouncements). All significant intercompany transactions and balances associated with consolidated subsidiaries have been eliminated.



The unaudited consolidated financial statements have been prepared in conformity with Rule 10-01 of Regulation S-X of the
Securities and Exchange Commission and therefore do not include information or footnotes necessary for a complete presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles.
However, all adjustments (consisting of normal recurring accruals), which, in the opinion of management, are necessary for a fair presentation of the financial statements, have been included. Operating results for the three-month period ended March
31, 2004 are not necessarily indicative of the results that may be expected for the year ending September 30, 2004. These condensed notes should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in
BankUniteds Annual Report on Form 10-K for the fiscal year ended September 30, 2003.



Certain prior period amounts have been reclassified to conform to the March 31, 2004 consolidated financial statements presentation.



2.    Impact of Certain Accounting Pronouncements



(a)    Stock Based Compensation



SFAS No. 148



In December of 2002, the Financial Accounting Standards Board (FASB) issued SFAS No. 148, Accounting for Stock Based
CompensationTransition and Disclosure. Under SFAS No. 148, alternative methods of transition are provided for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, SFAS No.
148 amends the disclosure requirements of SFAS 123, Accounting for Stock Based Compensation to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee
compensation and the effect of the method used on reported results.



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 123 and APB No. 28, Interim Financial Reporting, to provide additional disclosures in both annual and interim financial statements.



7



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##### Table of Contents

The disclosure requirements under SFAS No. 148 for interim financial statements are effective and were
adopted by BankUnited on January 1, 2003. The following table provides the required disclosures for the three and six-month periods ended March 31, 2004 compared to the same period in the prior year:



|                                                                                                                                                             |  |                                      |        |   |                                    |   |       |      |  |   |        |   |  |   |        |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------------------------ | ------ | - | ---------------------------------- | - | ----- | ---- |  | - | ------ | - |  | - | ------ | -
|                                                                                                                                                             |  | For the Three Months Ended March 31, |        |   | For the Six Months Ended March 31, |  
|                                                                                                                                                             |  | 2004                                 |        |   | 2003                               |   |       | 2004 |  |   | 2003   |  
|                                                                                                                                                             |  | (Dollars in thousands)               |       
|Net income, as reported                                                                                                                                      |  | $                                    | 12,038 |   |                                    | $ | 9,606 |      |  | $ | 23,588 |   |  | $ | 18,392 |  
|Add: Total stock-based employee and director compensation expense included in net income, net of related tax effects                                         |  |                                      | 474    |   |                                    |   | 95    |      |  |   | 674    |   |  |   | 160    |  
|Deduct: Total stock-based employee and director compensation expense determined under the fair value based method for all awards, net of
related tax effects |  |                                      | (962   | ) |                                    |   | (502  | )    |  |   | (1,520 | ) |  |   | (943   | )
|                                                                                                                                                             |  |                                      |        |   |                                    |   |       |      |  |   |        |   |  |   |        |  
|Pro forma net income                                                                                                                                         |  | $                                    | 11,550 |   |                                    | $ | 9,199 |      |  | $ | 22,742 |   |  | $ | 17,609 |  
|                                                                                                                                                             |  |                                      |        |   |                                    |   |       |      |  |   |        |   |  |   |        |  
|Earnings per share:                                                                                                                                          |  |                                      |        |   |                                    |   |       |      |  |   |        |   |  |   |        |  
|Basic  as reported                                                                                                                                          |  | $                                    | 0.40   |   |                                    | $ | 0.37  |      |  | $ | 0.79   |   |  | $ | 0.72   |  
|Basic  pro forma                                                                                                                                            |  | $                                    | 0.38   |   |                                    | $ | 0.36  |      |  | $ | 0.76   |   |  | $ | 0.69   |  
|Diluted  as reported                                                                                                                                        |  | $                                    | 0.37   |   |                                    | $ | 0.35  |      |  | $ | 0.73   |   |  | $ | 0.67   |  
|Diluted  pro forma                                                                                                                                          |  | $                                    | 0.35   |   |                                    | $ | 0.33  |      |  | $ | 0.70   |   |  | $ | 0.64   |  
|Assumptions for weighted average grant-date fair value of options using the Black Scholes option pricing model are as follows:                               |  |                                      |        |   |                                    |   |       |      |  |   |        |   |  |   |        |  
|Dividend yield                                                                                                                                               |  |                                      |       |   |                                    |   |      |      |  |   |       |   |  |   |       |  
|Expected volatility                                                                                                                                          |  |                                      | 36     | % |                                    |   | 38    | %    |  |   | 36     | % |  |   | 38     | %
|Risk free interest rate                                                                                                                                      |  |                                      | 3.24   | % |                                    |   | 3.23  | %    |  |   | 3.24   | % |  |   | 3.23   | %
|Expected life (years)                                                                                                                                        |  |                                      | 5.15   |   |                                    |   | 5.50  |      |  |   | 5.15   |   |  |   | 5.50   |  



(b)    Impact
of New Accounting Pronouncements



FIN 46R



On December 24, 2003, the FASB issued a revision to Interpretation 46
(FIN 46R) to clarify some of the provisions of FASB Interpretation No. 46, Consolidation of Variable Interest Entities (FIN 46). Under the new guidance contained in FIN 46R, special effective date provisions apply to
enterprises that have fully or partially applied FIN 46 prior to issuance of FIN 46R. Under the original provisions of FIN 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 46. Under the new guidance contained in FIN 46R, the effective date has been moved up to the first interim period
ending after December 15, 2003 for special purpose entities only. As a result of FIN 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. Currently, BankUnited is the primary beneficiary, and therefore consolidates only one of
its trust subsidiaries. FIN 46 does not require restatement of prior year balances. FIN 46R has 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 46R.



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



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BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



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. As of March 31, 2004, BankUnited had an investment in the common stock
of its Trust Subsidiaries of $7 million and Subordinated Debentures sold to its Trust Subsidiaries totaling $168 million. The Trust Subsidiaries had liabilities of $161 million in the form of Trust Preferred Securities.



SAB 105



On March 9, 2004, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 105, (SAB105)
Application of Accounting Principles to Loan Commitments. SAB 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. Current accounting guidance requires entities that make mortgage-loan commitments to recognize them on the balance sheet at fair value through expiration or funding, but does not address how to measure fair value. SAB 105 requires that
fair-value measurement, at the balance sheet date, include only the differences 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. Since BankUnited currently bases 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, SAB 105 will not have
a material impact on its financial statements.



3.    Securities Portfolio



Investments



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



|                                            |  |                |         |                      |   |                       |  |   |            |   |  |   |        
|------------------------------------------- |  | -------------- | ------- | -------------------- | - | --------------------- |  | - | ---------- | - |  | - | -------
|                                            |  | March 31, 2004
|                                            |  | AmortizedCost  |         | GrossUnrealizedGains |   | GrossUnrealizedLosses |  |   | Fair Value
|                                            |  | (In thousands)
|U.S. government agency securities           |  | $              | 52,956  |                      | $ | 1,014                 |  | $ |           |   |  | $ | 53,970 
|Equity securities                           |  |                | 928     |                      |   |                      |  |   |           |   |  |   | 928    
|Trust preferred securities of other issuers |  |                | 88,593  |                      |   | 4,677                 |  |   | (549       | ) |  |   | 92,721 
|Other(1)                                    |  |                | 189,906 |                      |   | 3,068                 |  |   | (1,087     | ) |  |   | 191,887
|                                            |  |                |         |                      |   |                       |  |   |            |   |  |   |        
|Total                                       |  | $              | 332,383 |                      | $ | 8,759                 |  | $ | (1,636     | ) |  | $ | 339,506
|                                            |  |                |         |                      |   |                       |  |   |            |   |  |   |        





|                                            |  |                    |         |                      |   |                       |  |   |            |   |  |   |        
|------------------------------------------- |  | ------------------ | ------- | -------------------- | - | --------------------- |  | - | ---------- | - |  | - | -------
|                                            |  | September 30, 2003
|                                            |  | AmortizedCost      |         | GrossUnrealizedGains |   | GrossUnrealizedLosses |  |   | Fair Value
|                                            |  | (In thousands)    
|U.S. government agency securities           |  | $                  | 52,980  |                      | $ | 714                   |  | $ |           |   |  | $ | 53,694 
|Equity securities                           |  |                    | 861     |                      |   |                      |  |   |           |   |  |   | 861    
|Trust preferred securities of other issuers |  |                    | 85,493  |                      |   | 3,931                 |  |   | (682       | ) |  |   | 88,742 
|Other(1)                                    |  |                    | 154,127 |                      |   | 353                   |  |   | (1,100     | ) |  |   | 153,380
|                                            |  |                    |         |                      |   |                       |  |   |            |   |  |   |        
|Total                                       |  | $                  | 293,461 |                      | $ | 4,998                 |  | $ | (1,782     | ) |  | $ | 296,677
|                                            |  |                    |         |                      |   |                       |  |   |            |   |  |   |        

---

|(1) |  | Other includes preferred stock of the Federal Home Loan Mortgage Corporation (FHLMC) and the Federal National Mortgage Association (FNMA), mutual
funds, and other bonds.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Investment securities available for sale as of March 31, 2004, by contractual maturity, are shown
below.



|                                       |  |                |         |            |   |        
|-------------------------------------- |  | -------------- | ------- | ---------- | - | -------
|                                       |  | March 31, 2004
|                                       |  | AmortizedCost  |         | Fair Value
|                                       |  | (In thousands)
|Due in one year or less                |  | $              | 11,886  |            | $ | 11,895 
|Due after one year through five years  |  |                | 38,051  |            |   | 38,318 
|Due after five years through ten years |  |                | 51,906  |            |   | 54,169 
|Due after ten years                    |  |                | 229,612 |            |   | 234,196
|Equity securities                      |  |                | 928     |            |   | 928    
|                                       |  |                |         |            |   |        
|Total                                  |  | $              | 332,383 |            | $ | 339,506
|                                       |  |                |         |            |   |        



Mortgage-Backed
Securities



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



|                                    |  |                |           |                      |   |                       |  |   |            |   |  |   |          
|----------------------------------- |  | -------------- | --------- | -------------------- | - | --------------------- |  | - | ---------- | - |  | - | ---------
|                                    |  | March 31, 2004
|                                    |  | AmortizedCost  |           | GrossUnrealizedGains |   | GrossUnrealizedLosses |  |   | Fair Value
|                                    |  | (In thousands)
|GNMA mortgage-backed securities(1)  |  | $              | 1,824     |                      | $ | 91                    |  | $ | (1         | ) |  | $ | 1,914    
|FNMA mortgage-backed securities     |  |                | 361,053   |                      |   | 2,338                 |  |   | (1,848     | ) |  |   | 361,543  
|FHLMC mortgage-backed securities    |  |                | 70,229    |                      |   | 369                   |  |   | (26        | ) |  |   | 70,572   
|Collateralized mortgage obligations |  |                | 5,581     |                      |   | 20                    |  |   | (62        | ) |  |   | 5,539    
|Mortgage pass-through certificates  |  |                | 1,777,389 |                      |   | 11,675                |  |   | (2,527     | ) |  |   | 1,786,537
|                                    |  |                |           |                      |   |                       |  |   |            |   |  |   |          
|Total(2)                            |  | $              | 2,216,076 |                      | $ | 14,493                |  | $ | (4,464     | ) |  | $ | 2,226,105
|                                    |  |                |           |                      |   |                       |  |   |            |   |  |   |          



|                                    |  |                    |           |                      |   |                       |  |   |            |   |  |   |          
|----------------------------------- |  | ------------------ | --------- | -------------------- | - | --------------------- |  | - | ---------- | - |  | - | ---------
|                                    |  | September 30, 2003
|                                    |  | AmortizedCost      |           | GrossUnrealizedGains |   | GrossUnrealizedLosses |  |   | Fair Value
|                                    |  | (In thousands)    
|GNMA mortgage-backed securities     |  | $                  | 2,399     |                      | $ | 116                   |  | $ |           |   |  | $ | 2,515    
|FNMA mortgage-backed securities     |  |                    | 450,997   |                      |   | 4,806                 |  |   | (1,937     | ) |  |   | 453,866  
|FHLMC mortgage-backed securities    |  |                    | 35,903    |                      |   | 549                   |  |   | (155       | ) |  |   | 36,297   
|Collateralized mortgage obligations |  |                    | 63,442    |                      |   | 40                    |  |   | (335       | ) |  |   | 63,147   
|Mortgage pass-through certificates  |  |                    | 1,505,278 |                      |   | 8,568                 |  |   | (4,690     | ) |  |   | 1,509,156
|                                    |  |                    |           |                      |   |                       |  |   |            |   |  |   |          
|Total(2)                            |  | $                  | 2,058,019 |                      | $ | 14,079                |  | $ | (7,117     | ) |  | $ | 2,064,981
|                                    |  |                    |           |                      |   |                       |  |   |            |   |  |   |          

---

|(1) |  | GNMA stands for Government National Mortgage Association.
|--- |  | ---------------------------------------------------------

|(2) |  | As of March 31, 2004 and September 30, 2003, there were $4.4 million and $37.3 million, respectively, of retained securities from securitized loans included in BankUniteds
portfolio of mortgage-backed securities. These amounts represent the fair value of those securities and do not include servicing rights.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Mortgage-backed securities available for sale as of March 31, 2004, by contractual maturity, and
adjusted for anticipated repayments, are shown below.



|                                       |  |                |           |            |   |          
|-------------------------------------- |  | -------------- | --------- | ---------- | - | ---------
|                                       |  | March 31, 2004
|                                       |  | Amortized Cost |           | Fair Value
|                                       |  | (In thousands)
|Due in one year or less                |  | $              | 567,780   |            | $ | 569,154  
|Due after one year through five years  |  |                | 1,357,475 |            |   | 1,361,134
|Due after five years through ten years |  |                | 249,159   |            |   | 254.155  
|Due after ten years                    |  |                | 41,662    |            |   | 41,662   
|                                       |  |                |           |            |   |          
|Total                                  |  | $              | 2,216,076 |            | $ | 2,226,105
|                                       |  |                |           |            |   |          



4.    Convertible Debt



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. This
contingent interest feature is an embedded derivative to which no value has been assigned at issuance and at March 31, 2004.



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 ending 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.



Upon conversion of the notes BankUnited may, at its discretion, in lieu of
delivering shares of Class A Common Stock, deliver cash or a combination of cash and shares of Class A Common Stock. 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.



Until the conversion contingency is met, the shares underlying the notes are not included in the calculation of basic (if converted) or fully diluted
earnings per share. Should this contingency be met, diluted earnings per share could decrease as a result of the possible inclusion of all or a part of the underlying shares in the fully diluted earnings per share calculation.



11



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



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.



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.



5.    Earnings Per
Share



The following tables reconcile basic and diluted
earnings per share for the three and six months ended March 31, 2004 and 2003.



|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|--------------------------------------------------- |  | -------------------------------------------------------- | ------ | --------------------------------- | - | ------ |  | ---- | ------ |  | - | ------
|                                                    |  | For the Three Months EndedMarch 31,                      |        | For the Six Months EndedMarch 31,
|                                                    |  | 2004                                                     |        | 2003                              |   | 2004   |  | 2003
|                                                    |  | (Dollars and shares in thousands, except per share data)
|Basic earnings per share:                           |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Numerator:                                          |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Net income                                          |  | $                                                        | 12,038 |                                   | $ | 9,606  |  | $    | 23,588 |  | $ | 18,392
|Preferred stock dividends                           |  |                                                          | 99     |                                   |   | 79     |  |      | 180    |  |   | 158   
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Net income available to common stockholders         |  | $                                                        | 11,939 |                                   | $ | 9,527  |  | $    | 23,408 |  | $ | 18,234
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Denominator:                                        |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Weighted average common shares outstanding          |  |                                                          | 29,835 |                                   |   | 25,539 |  |      | 29,760 |  |   | 25,398
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Basic earnings per share                            |  | $                                                        | 0.40   |                                   | $ | 0.37   |  | $    | 0.79   |  | $ | 0.72  
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Diluted earnings per share:                         |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Numerator:                                          |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Net income available to common stockholders         |  | $                                                        | 11,939 |                                   | $ | 9,527  |  | $    | 23,408 |  | $ | 18,234
|Plus:                                               |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Convertible preferred stock dividends               |  |                                                          | 99     |                                   |   | 79     |  |      | 180    |  |   | 158   
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Diluted net income available to common stockholders |  | $                                                        | 12,038 |                                   | $ | 9,606  |  | $    | 23,588 |  | $ | 18,392
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Denominator:                                        |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Weighted average common shares outstanding          |  |                                                          | 29,835 |                                   |   | 25,539 |  |      | 29,760 |  |   | 25,398
|Plus:                                               |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Stock options and restricted stock                  |  |                                                          | 2,090  |                                   |   | 1,088  |  |      | 2,035  |  |   | 1,116 
|Convertible preferred stock                         |  |                                                          | 758    |                                   |   | 1,083  |  |      | 758    |  |   | 1,058 
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Diluted weighted average shares outstanding         |  |                                                          | 32,683 |                                   |   | 27,710 |  |      | 32,553 |  |   | 27,572
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       
|Diluted earnings per share                          |  | $                                                        | 0.37   |                                   | $ | 0.35   |  | $    | 0.72   |  | $ | 0.67  
|                                                    |  |                                                          |        |                                   |   |        |  |      |        |  |   |       



Basic earnings per
share is calculated by dividing net income, adjusted for dividends declared on preferred stock, by the weighted number of shares of common stock outstanding.



12



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



Diluted earnings per share is calculated under the treasury stock method by dividing net income by
the weighted average number of shares of common stock outstanding, assuming conversion of outstanding convertible preferred stock from the beginning of the period, the exercise of stock options, and unvested restricted stock. Such adjustments to net
income and the weighted average number of shares of common stock are made only when such adjustments dilute earnings per share. There was no antidilutive effect from stock options, restricted stock, and convertible securities during the three or six
month periods ending March 31, 2004 and 2003.



6.    Regulatory Capital



The Banks regulatory capital levels as of March 31, 2004 and September 30, 2003 were as follows:



|                                        |  |                        |         |   |                         |   |         |  
|--------------------------------------- |  | ---------------------- | ------- | - | ----------------------- | - | ------- | -
|                                        |  | As of March 31,2004    |         |   | As of September 30,2003 |  
|                                        |  | (Dollars in thousands) |        
|Tier 1 Leverage Capital                 |  |                        |         |   |                         |   |         |  
|Amount                                  |  | $                      | 542,868 |   |                         | $ | 514,690 |  
|Actual Ratio                            |  |                        | 7.2     | % |                         |   | 7.3     | %
|Well-Capitalized Minimum Ratio(1)       |  |                        | 5.0     | % |                         |   | 5.0     | %
|Adequately Capitalized Minimum Ratio(1) |  |                        | 4.0     | % |                         |   | 4.0     | %
|                                        |  |                       
|Tier 1 Risk-Based Capital               |  |                        |         |   |                         |   |         |  
|Amount                                  |  | $                      | 542,868 |   |                         | $ | 514,690 |  
|Actual Ratio                            |  |                        | 14.9    | % |                         |   | 15.5    | %
|Well-Capitalized Minimum Ratio(1)       |  |                        | 6.0     | % |                         |   | 6.0     | %
|Adequately Capitalized Minimum Ratio(1) |  |                        | 4.0     | % |                         |   | 4.0     | %
|                                        |  |                       
|Total Risk-Based Capital                |  |                        |         |   |                         |   |         |  
|Amount                                  |  | $                      | 563,503 |   |                         | $ | 534,062 |  
|Actual Ratio                            |  |                        | 15.5    | % |                         |   | 16.1    | %
|Well-Capitalized Minimum Ratio(1)       |  |                        | 10.0    | % |                         |   | 10.0    | %
|Adequately Capitalized Minimum Ratio(1) |  |                        | 8.0     | % |                         |   | 8.0     | %

---

|(1) |  | Based on Office of Thrift Supervision regulations.
|--- |  | --------------------------------------------------



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



7.    Comprehensive Income



BankUniteds comprehensive income includes all items which comprise net income, plus other comprehensive income. For
the three and six months ended March 31, 2004 and 2003 BankUniteds other comprehensive income was as follows:



|                                                                                                                                                                                                                                                   |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------ | ------ | ---- | --------------------------------- | ------ | ---- |  | ---- | ------ |  | - | ------ | -
|                                                                                                                                                                                                                                                   |  | For the Three Months Ended March 31, |        |      | For the Six MonthsEnded March 31, |       
|                                                                                                                                                                                                                                                   |  | 2004                                 |        | 2003 |                                   |        | 2004 |  | 2003 |       
|                                                                                                                                                                                                                                                   |  | (In thousands)                       |       
|Net income                                                                                                                                                                                                                                         |  | $                                    | 12,038 |      | $                                 | 9,606  |      |  | $    | 23,588 |  | $ | 18,392 |  
|Other comprehensive income, net of tax:                                                                                                                                                                                                            |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  
|Unrealized income arising during the period on securities, net of tax of $5,060 and $2,382 for the three months ended March 31, 2004 and 2003,
respectively, and $1,390, and $1,233 for the six months ended March 31, 2004 and 2003, respectively |  |                                      | 9,398  |      |                                   | 4,235  |      |  |      | 2,582  |  |   | 2,186  |  
|Unrealized gain (loss) on cash flow hedges, net of tax expense (benefit) of $454 and $(85) for the three months ended March 31, 2004 and 2003,
respectively, and $399, and $(169) for the six months ended March 31, 2004 and 2003, respectively   |  |                                      | 843    |      |                                   | (144   | )    |  |      | 740    |  |   | (278   | )
|Less reclassification adjustment for:                                                                                                                                                                                                              |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  
|Realized gains on securities sold included in net income, net of tax of $263 for the three months ended March 31, 2004, and $254, and $569 for
the six months ended March 31, 2004 and 2003, respectively                                          |  |                                      | 488    |      |                                   |       |      |  |      | 472    |  |   | 909    |  
|                                                                                                                                                                                                                                                   |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  
|Total other comprehensive income, net of tax                                                                                                                                                                                                       |  |                                      | 10,729 |      |                                   | 4,091  |      |  |      | 3,794  |  |   | 2,817  |  
|                                                                                                                                                                                                                                                   |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  
|Comprehensive income                                                                                                                                                                                                                               |  | $                                    | 22,767 |      | $                                 | 13,697 |      |  | $    | 27,382 |  | $ | 21,209 |  
|                                                                                                                                                                                                                                                   |  |                                      |        |      |                                   |        |      |  |      |        |  |   |        |  



8.    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.



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



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. Accordingly, the fair value changes of forward sales
contracts, related to loan commitments, are also recorded in earnings under non-interest income or expense with an offset in other assets or liabilities on the balance sheet.



These forward contracts extend beyond the loan commitment period and are also used to offset fair value exposure of loans
held for sale to a change 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 in a relationship that qualifies for hedge
accounting, in which case any ineffectiveness is charged to earnings under non-interest expense with an offset to the balance sheet in 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 recorded in earnings under non-interest expense with an offset in other assets or liabilities on the balance sheet.



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). 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.



The following table summarizes certain information with respect to the use of derivatives and their impact on BankUniteds financial statements
during the three and six months ended March 31, 2004 and 2003:



|                                                            |  |                                     |      |                                  |      |   |      |  |      |     |  |   |    
|----------------------------------------------------------- |  | ----------------------------------- | ---- | -------------------------------- | ---- | - | ---- |  | ---- | --- |  | - | ---
|                                                            |  | For the Three MonthsEnded March 31, |      | For the Six MonthsEnded March31,
|                                                            |  | 2004                                |      |                                  | 2003 |   | 2004 |  | 2003
|                                                            |  | (In thousands)                     
|Fair Value Hedges                                           |  |                                     |      |                                  |      |   |      |  |      |     |  |   |    
|Net (loss) gain recorded in earnings due to ineffectiveness |  | $                                   | (79  | )                                |      |   |     |  | $    | 1   |  |   |   
|                                                            |  |                                     |      |                                 
|Other Derivatives (1)                                       |  |                                     |      |                                  |      |   |      |  |      |     |  |   |    
|Net (loss) gain recorded in earnings                        |  | $                                   | (147 | )                                |      | $ | 167  |  | $    | 741 |  | $ | 176

---

|Note: |  | There was no ineffectiveness related to cash flow hedges during the three and six months ended March 31, 2004 and 2003. Within the next 12 months, BankUnited estimates that $0.3
million will be reclassified out of comprehensive income as a charge to earnings.
|----- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(1) |  | These derivatives are used by BankUnited to hedge interest rate risk, but do not qualify for hedge accounting treatment.
|--- |  | ------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

BANKUNITED FINANCIAL CORPORATION AND SUBSIDIARIES



CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)



9.    Commitments and Contingencies



Standby letters of credit are off balance sheet instruments which represent
conditional commitments issued by BankUnited to guarantee the performance of a customer to a third party. BankUnited had outstanding standby letters of credit, and risk participations, in the amount of $42.3 million and $51.6 million as of March 31,
2004 and September 30, 2003, respectively.



BankUnited is a
party to certain claims and litigation arising in the ordinary course of business. In the opinion of management, the resolution of such claims and litigation will not materially affect BankUniteds consolidated financial position or results of
operations.



|ITEM  2. |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|-------- |  | -------------------------------------------------------------------------------------



As used in this Form 10-Q, BankUnited, we, us and our refers to BankUnited
and its subsidiaries on a consolidated basis. The following discussion and analysis and the related financial data present a review of BankUniteds consolidated operating results for the three and six month periods ended March 31, 2004 and 2003
and consolidated financial condition as of March 31, 2004. This discussion and analysis should be read in conjunction with the Consolidated Financial Statements and Notes thereto contained in BankUniteds Annual Report on Form 10-K for the year
ended September 30, 2003.



This Quarterly Report on Form 10-Q
contains forward-looking statements. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange Act of
1934, as amended (the Exchange Act). Words and phrases such as: will likely result, expect, will continue, anticipate, estimate, project, believe,
intend, should, may, can, plan, target and similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, discussions concerning:



| |  |  | Projections of revenues, expenses, income, earnings per share, margin, asset growth, loan production, deposit growth, and other performance measures;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Expansion of operations, including branch openings, entrance into new markets, development of products and services and plans for new marketing strategies; and
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Discussions on the outlook of the economy.
| | - |  | ------------------------------------------



BankUnited cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made, and are not
historical facts. Actual results may differ materially from the results discussed in these forward-looking statements due to the following factors, among other things: general business and economic conditions, either nationally or regionally;
changes or fluctuations in the interest rate environment; a deterioration in credit quality and/or a reduced demand for credit; reduced deposit flows and loan demand; competition from other financial services companies in our markets; legislative or
regulatory changes, including changes in accounting standards, guidelines and policies; changes in the regulation of financial services companies; fiscal and monetary policies; the issuance or redemption of additional equity or debt securities; the
concentration of operations in Florida, if the Florida economy or real estate values decline; volatility in the market price of its common stock, the threat and impact of war and terrorism, reliance on other companies for products and services; and
other economic, competitive, servicing capacity, governmental, regulatory and technological factors affecting the companys operations, pricing, products and delivery of services. BankUnited cautions that the foregoing factors are not
exclusive. BankUnited does not undertake, and specifically disclaims, any obligations to publicly release the result of any updates which might be made to any forward-looking statements to reflect the occurrence of anticipated or unanticipated
events or circumstances after the date of such statements.



16



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##### Table of Contents

Critical Accounting Policies



BankUniteds financial position and results of operations are impacted by managements application of accounting
policies involving judgments made to arrive at the carrying value of certain assets. In implementing its policies, management must make estimates and assumptions about the effect of matters that are inherently less than certain. Actual results could
differ significantly from these estimates which could materially affect the amounts of our assets, liabilities, income and expenses. Critical accounting policies applied by BankUnited include the allowance for loan losses and the valuation of
mortgage servicing rights pertaining to the sale or securitization of mortgage loans. A variety of estimates impact the carrying value of the loan portfolio, including the amount of the allowance for loan losses, the placement of loans on
non-accrual status, and the valuation of loans held for sale. On a periodic basis, management obtains a valuation of mortgage servicing rights prepared by independent third parties.



For a more detailed discussion on these critical accounting policies, see Critical Accounting Policies on page
20 of BankUniteds Annual Report on Form 10-K for the year ended September 30, 2003.



Purchases of BankUnited Stock



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. This plan does not have an expiration date. 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.
To date, there have been no purchases under this plan. In addition, there were no other purchases of BankUnited stock during the quarter ended March 31, 2004.



17



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##### Table of Contents

RESULTS OF OPERATIONS



For the Three Months Ended March 31, 2004 Compared to the Same Period in 2003



General



Net income reached $12.0 million for the three months ended March 31, 2004, up 25% over $9.6 million for the same period in 2003. Basic and diluted
earnings were $0.40 and $0.37 per share, respectively, for the quarter, up from $0.37 and $0.35 per share, respectively, for the same quarter last year. The increase in net income of $2.4 million for 2004 is primarily due to an improvement in net
interest income resulting from the growth in earning assets, an increase in funding from non-interest bearing liabilities, and an increase in capital from an equity offering in May 2003.



Analysis of Net Interest Income



Yields Earned and Rates Paid     The following table sets forth certain information relating to the categories of
BankUniteds interest-earning assets and interest-bearing liabilities for the periods indicated. All yield and rate information is calculated on an annualized basis by dividing the income or expense item for the period by the average balances
during the period for the appropriate balance sheet item. Net interest margin is calculated by dividing net interest income by average interest-earning assets. Net interest spread is the difference between the yield earned on average interest
earning assets and the rate paid on average interest bearing liabilities. Non-accrual loans are included for the appropriate periods, whereas recognition of interest on such loans is discontinued and any remaining accrued interest receivable is
reversed, in conformity with generally accepted accounting principles and federal regulations. The yields and net interest margins appearing in the following table have been calculated on a pre-tax basis.



Yields Earned and Rates Paid



|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|------------------------------------------------------------------- |  | ------------------------------------ | --------- | - | -------- | - | ---------- |  | ---- | -------------- |  | - | --------- | - | ---------- | - | ------ |  | ---- | -
|                                                                    |  | For the Three Months Ended March 31, |          
|                                                                    |  | 2004                                 |           |   | 2003     |  
|                                                                    |  | AverageBalance                       |           |   | Interest |   | Yield/Rate |  |      | AverageBalance |  |   | Interest  |   | Yield/Rate |  
|                                                                    |  | (Dollars in thousands)               |          
|Interest-earning assets:                                            |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Loans, net(1)                                                       |  | $                                    | 4,487,524 |   |          | $ | 55,095     |  | 4.92 | %              |  | $ | 4,013,507 |   |            | $ | 58,421 |  | 5.82 | %
|Mortgage-backed securities                                          |  |                                      | 2,111,979 |   |          |   | 20,189     |  | 3.82 | %              |  |   | 1,793,259 |   |            |   | 19,296 |  | 4.30 |  
|Short-term investments(2)                                           |  |                                      | 17,214    |   |          |   | 123        |  | 2.84 | %              |  |   | 12,623    |   |            |   | 110    |  | 3.49 |  
|Investment securities and FHLB stock                                |  |                                      | 455,803   |   |          |   | 4,932      |  | 4.33 | %              |  |   | 296,332   |   |            |   | 3,463  |  | 4.67 |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Total interest-earning assets                                       |  |                                      | 7,072,520 |   |          |   | 80,339     |  | 4.55 | %              |  |   | 6,115,721 |   |            |   | 81,290 |  | 5.32 |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Interest-bearing liabilities:                                       |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|NOW and money market                                                |  |                                      | 575,182   |   |          |   | 971        |  | 0.68 | %              |  |   | 578,844   |   |            |   | 1,570  |  | 1.08 |  
|Savings                                                             |  |                                      | 962,222   |   |          |   | 4,037      |  | 1.69 | %              |  |   | 706,397   |   |            |   | 3,161  |  | 1.79 |  
|Certificates of deposit                                             |  |                                      | 1,781,477 |   |          |   | 12,894     |  | 2.91 | %              |  |   | 1,786,009 |   |            |   | 16,381 |  | 3.67 |  
|Trust preferred securities and subordinated debentures(3)           |  |                                      | 165,854   |   |          |   | 2,322      |  | 5.60 | %              |  |   | 289,142   |   |            |   | 5,259  |  | 7.28 |  
|Senior notes(4)                                                     |  |                                      | 113,846   |   |          |   | 1,203      |  | 4.23 | %              |  |   | 200,000   |   |            |   | 2,796  |  | 5.59 |  
|FHLB advances and other borrowings                                  |  |                                      | 3,171,399 |   |          |   | 23,948     |  | 2.99 | %              |  |   | 2,380,854 |   |            |   | 21,958 |  | 3.69 |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Total interest-bearing liabilities                                  |  | $                                    | 6,769,980 |   |          | $ | 45,375     |  | 2.67 | %              |  | $ | 5,941,246 |   |            | $ | 51,125 |  | 3.46 | %
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Excess of interest-earning assets over interest-bearing liabilities |  | $                                    | 302,540   |   |          |   |            |  |      |                |  | $ | 174.475   |   |            |   |        |  |      |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Net interest income                                                 |  |                                      |           |   |          | $ | 34,964     |  |      |                |  |   |           |   |            | $ | 30.165 |  |      |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Interest rate spread                                                |  |                                      |           |   |          |   |            |  | 1.88 | %              |  |   |           |   |            |   |        |  | 1.86 | %
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Net interest margin                                                 |  |                                      |           |   |          |   |            |  | 1.99 | %              |  |   |           |   |            |   |        |  | 1.96 | %
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  
|Ratio of interest-earning assets to interest-bearing liabilities    |  |                                      | 104.47    | % |          |   |            |  |      |                |  |   | 102.94    | % |            |   |        |  |      |  
|                                                                    |  |                                      |           |   |          |   |            |  |      |                |  |   |           |   |            |   |        |  |      |  



18



---

##### Table of Contents

---

|Note: |  | The yields and rates along with the corresponding interest rate spread and net interest margin represent the yields earned and rates paid on BankUniteds interest-earning
assets and interest-bearing liabilities, respectively, for the periods presented and do not include any estimates of the effect that accelerated amortization of premiums or discounts would have on the yields earned. The yields are annualized and are
not calculated on a tax equivalent basis.
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(1) |  | Includes loans held for sale. Also includes average non-accruing loans of $25 million and $34 million for the three months ended March 31, 2004 and 2003, respectively.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Short-term investments include FHLB overnight deposits, federal funds sold, securities purchased under agreements to resell, and certificates of deposit.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes the effect of interest rate swaps. For more information on interest rate swaps see Note 8 of the accompanying condensed notes to consolidated financial statements.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes convertible debt issued in February and March of 2004.
|--- |  | ---------------------------------------------------------------



Rate/Volume Analysis



The following table presents, for the periods indicated, the changes in interest income and the changes in interest expense attributable to the changes in
interest rates and the changes in the volume of interest-earning assets and interest-bearing liabilities. Changes attributable to: (i) changes in volume (change in volume multiplied by prior year rate); (ii) changes in rate (change in rate
multiplied by prior year volume); and (iii) changes in rate/volume (change in rate multiplied by change in volume, which were allocated to the changes in rate), were as follows:



|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|--------------------------------------------------------- |  | ------------------------------------------------------- | ------ | - | -------------- | - | ------- | ------------------------ |  | - | ------ | -
|                                                          |  | For the Three Month Period EndedMarch 31, 2004 vs. 2003 |       
|                                                          |  | Increase (Decrease)Due to                               |        |   |                |  
|                                                          |  | Changes inVolume                                        |        |   | Changesin Rate |   |         | TotalIncrease/(Decrease) | 
|                                                          |  | (Dollars in thousands)                                  |       
|Interest income attributable to:                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|Loans, net (1)                                            |  | $                                                       | 6,900  |   |                | $ | (10,226 | )                        |  | $ | (3,326 | )
|Mortgage-backed securities                                |  |                                                         | 3,430  |   |                |   | (2,537  | )                        |  |   | 893    |  
|Short-term investments(2)                                 |  |                                                         | 40     |   |                |   | (27     | )                        |  |   | 13     |  
|Investment securities and FHLB stock                      |  |                                                         | 1,864  |   |                |   | (395    | )                        |  |   | 1,469  |  
|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|Total interest-earning assets                             |  |                                                         | 12,233 |   |                |   | (13,184 | )                        |  |   | (951   | )
|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|Interest expense attributable to:                         |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|NOW/Money market                                          |  |                                                         | (10    | ) |                |   | (589    | )                        |  |   | (599   | )
|Savings                                                   |  |                                                         | 1,145  |   |                |   | (269    | )                        |  |   | 876    |  
|Certificates of deposit                                   |  |                                                         | (42    | ) |                |   | (3,445  | )                        |  |   | (3,487 | )
|Trust Preferred Securities and subordinated debentures(3) |  |                                                         | (2,242 | ) |                |   | (695    | )                        |  |   | (2,937 | )
|Senior notes(4)                                           |  |                                                         | (1,204 | ) |                |   | (389    | )                        |  |   | (1,593 | )
|FHLB advances and other borrowings                        |  |                                                         | 7,291  |   |                |   | (5,301  | )                        |  |   | 1,990  |  
|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|Total interest-bearing liabilities                        |  |                                                         | 4,937  |   |                |   | (10,687 | )                        |  |   | (5,750 | )
|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  
|Increase (decrease) in net interest income                |  | $                                                       | 7,296  |   |                | $ | (2,497  | )                        |  | $ | 4,799  |  
|                                                          |  |                                                         |        |   |                |   |         |                          |  |   |        |  

---

|(1) |  | Includes interest earned on loans held for sale.
|--- |  | ------------------------------------------------

|(2) |  | Short-term investments include FHLB overnight deposits, federal funds sold, securities purchased under agreements to resell, and certificates of deposit.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes the effect of interest rate swaps. See Note 8 of the accompanying condensed notes to consolidated financial statements for more information on interest rate swaps.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes interest expense on convertible debt issued in February and March of 2004.
|--- |  | -----------------------------------------------------------------------------------



19



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Net interest income before provision for loan losses was $35.0 million for the three months ended March
31, 2004, compared to $30.2 million for the same period in 2003. This improvement is the result of growth in earning assets, an increase in funding from both non-interest bearing liabilities and capital from an equity offering in May 2003. The
increase in net interest income of $4.8 million is the result of favorable changes of $7.3 million due to volume offset by unfavorable changes due to rates of $2.5 million.



Net interest margin for the three months ended March 31, 2004 was 1.99% compared to 1.96% for the same period in 2003. The
improvement resulted from decreased levels of mortgage loan pre-payments, deposits re-pricing at lower rates and reduced debt expense.



Interest Income.    Interest income decreased by $1.0 million for the three months ended March 31, 2004, compared to the same
period in 2003. This is the net result of an increase of $12.2 million due to an increase in volume of earning assets, offset by a decrease of $13.2 million in yields earned on those assets.



The volume related increases stem mostly from an increase in interest earned
on loans of $6.9 million and also includes increases of $3.4 million from interest earned on mortgage-backed securities, and $1.9 million from interest earned on investment securities and FHLB stock. The rate related decreases stem mostly from a
decrease in interest earned on loans of $10.2 million, and a decrease of $2.5 million from interest earned on mortgage-backed securities, respectively.



Interest Expense.    Interest expense decreased by $5.8 million for the three months ended March 31, 2004, compared to the same
period in 2003. This is the net result of a $4.9 million increase due to an increase in volume of interest bearing liabilities, offset by a $10.7 million decrease due to a reduction in rates paid on those liabilities.



The most significant volume related activity stems from an increase in FHLB
advances and other borrowings, which increased interest expense by $7.3 million. The rate related decreases stem from a decrease in interest paid on all categories of interest bearing liabilities with the most significant decreases related to
certificates of deposit, and FHLB advances and other borrowings.



Provision for loan losses.    The provision for loan losses for the three months ended March 31, 2004 was $1.2 million, compared to $1.3 million for the same period in 2003, reflecting a low level of
non-performing assets and charge-offs. See Asset Quality for more information concerning BankUniteds allowance for loan losses.



Analysis of Non-Interest Income and Expenses



|                                                              |  |                                    |        |   |      |   |        |                     |  |   |        |   |  |       |   
|------------------------------------------------------------- |  | ---------------------------------- | ------ | - | ---- | - | ------ | ------------------- |  | - | ------ | - |  | ----- | --
|                                                              |  | For the Three MonthsEndedMarch 31, |        |   |      |  
|                                                              |  | 2004                               |        |   | 2003 |   |        | Increase/(Decrease) | 
|                                                              |  | (Dollars in thousands)             |       
|Non-interest income:                                          |  |                                    |        |   |      |   |        |                     |  |   |        |   |  |       |   
|Loan servicing fees                                           |  | $                                  | 776    |   |      | $ | 505    |                     |  | $ | 271    |   |  | 53.7  | % 
|Amortization of mortgage servicing rights                     |  |                                    | (1,093 | ) |      |   | (1,595 | )                   |  |   | 502    |   |  | 31.5  |   
|Impairment of mortgage servicing rights                       |  |                                    | (1,200 | ) |      |   |       |                     |  |   | (1,200 | ) |  |      |   
|Loan fees                                                     |  |                                    | 994    |   |      |   | 1,146  |                     |  |   | (152   | ) |  | (13.3 | ) 
|Deposit fees                                                  |  |                                    | 1,044  |   |      |   | 991    |                     |  |   | 53     |   |  | 5.3   |   
|Other fees                                                    |  |                                    | 459    |   |      |   | 312    |                     |  |   | 147    |   |  | 47.1  |   
|Net gain on sale of investment and mortgage-backed securities |  |                                    | 333    |   |      |   | 158    |                     |  |   | 175    |   |  | 110.8 |   
|Net gain on sale of loans and other assets                    |  |                                    | 1,528  |   |      |   | 1,702  |                     |  |   | (174   | ) |  | (10.2 | ) 
|Insurance and investment services income                      |  |                                    | 1,184  |   |      |   | 626    |                     |  |   | 558    |   |  | 89.1  |   
|Other                                                         |  |                                    | 1,084  |   |      |   | 2,212  |                     |  |   | (1,128 | ) |  | (51.0 | ) 
|                                                              |  |                                    |        |   |      |   |        |                     |  |   |        |   |  |       |   
|Total non-interest income                                     |  | $                                  | 5,109  |   |      | $ | 6,057  |                     |  | $ | (948   | ) |  | (15.7 | )%
|                                                              |  |                                    |        |   |      |   |        |                     |  |   |        |   |  |       |   



20



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##### Table of Contents

|                                         |  |                                    |        |      |   |                     |  |   |        |   |  |       |   
|---------------------------------------- |  | ---------------------------------- | ------ | ---- | - | ------------------- |  | - | ------ | - |  | ----- | --
|                                         |  | For the Three MonthsEndedMarch 31, |        |      |  
|                                         |  | 2004                               |        | 2003 |   | Increase/(Decrease) | 
|                                         |  | (Dollars in thousands)             |       
|Non-interest expenses:                   |  |                                    |        |      |   |                     |  |   |        |   |  |       |   
|Employee compensation and benefits       |  | $                                  | 10,004 |      | $ | 9,708               |  | $ | 296    |   |  | 3.0   | % 
|Occupancy and equipment                  |  |                                    | 4,332  |      |   | 3,005               |  |   | 1,327  |   |  | 44.2  |   
|Telecommunications and data processing   |  |                                    | 1,409  |      |   | 1,209               |  |   | 200    |   |  | 16.5  |   
|Advertising and promotion expense        |  |                                    | 1,287  |      |   | 1,256               |  |   | 31     |   |  | 2.5   |   
|Professional fees  legal and accounting |  |                                    | 1,024  |      |   | 1,200               |  |   | (176   | ) |  | (14.7 | ) 
|Loan closing expense                     |  |                                    | 672    |      |   | 709                 |  |   | (37    | ) |  | (5.2  |   
|Postage and courier                      |  |                                    | 447    |      |   | 349                 |  |   | 98     |   |  | 28.1  |   
|Loan servicing expense(1)                |  |                                    | 131    |      |   | 362                 |  |   | (231   | ) |  | (63.8 | ) 
|Insurance                                |  |                                    | 370    |      |   | 289                 |  |   | 81     |   |  | 28.0  |   
|Other operating expenses                 |  |                                    | 1,526  |      |   | 3,224               |  |   | (1,698 | ) |  | (52.7 | ) 
|                                         |  |                                    |        |      |   |                     |  |   |        |   |  |       |   
|Total non-interest expenses              |  | $                                  | 21,202 |      | $ | 21,311              |  | $ | (109   | ) |  | (0.5  | )%
|                                         |  |                                    |        |      |   |                     |  |   |        |   |  |       |   

---

|(1) |  | Loan servicing expense relates to loans serviced by others.
|--- |  | -----------------------------------------------------------



Analysis of Non-Interest Income and Expenses



Total non-interest income was $5.1 million for the three months ended March 31, 2004, down 16% from the same period in 2003, primarily due to an
impairment charge on mortgage servicing rights recorded in the quarter ended March 31, 2004 and a $1.1 million life insurance benefit received during the quarter ended March 31, 2003.



As a result of a slow down in pre-payments of mortgage loans in BankUniteds portfolio of residential loans serviced
for others during the second quarter of March 31, 2004, BankUnited provided for the amortization of $1.1 million of servicing rights for the three months ended March 31, 2004, compared to $1.6 million for the same period in the previous year. This
amortization, offset by fees earned on these loans of $0.8 million, resulted in a net loss of $0.3 million from loan servicing fees for the three months ended March 31, 2004 compared to a net loss of $1.1 million for the same period in 2003. In
addition, BankUnited recorded a $1.2 million impairment charge for the three months ended March 31, 2004 based on a current valuation of its mortgage servicing assets by independent third parties.



Fee income, which includes loan fees, deposit fees, and other fees, but
excluding servicing fees, was $2.5 million for the three months ended March 31, 2004, a 2% increase over the same period in 2003. This increase is the result of growth in core deposits and sales of other banking products and services.



BankUnited realized a net gain of $0.3 million on the sale of investments and
mortgage-backed securities during the three months ended March 31, 2004, comprised of $0.8 million of losses generated from BankUniteds securitization activities, and $1.1 million of gains from the sale of investment and mortgage-backed
securities available for sale. During the same period in 2003, BankUnited realized a net gain of $0.2 million on the sale of investment and mortgage-backed securities generated mostly from BankUniteds securitization activities.



The net gain on sale of loans and other assets of $1.5 million during the
three months ended March 31, 2004, is due mostly from the sale of securitized loans upon which BankUnited retains servicing rights. The net gain on sale of loans and other assets of $1.7 million during the same period in 2003 is also due mostly from
the sale of securitized loans.



Included in the insurance and
investment services income for the three months ended March 31, 2004, is approximately $1.2 million in commissions from the sale of annuity and other investment products. This amount represents an increase of 80% over such sales during the same
period in 2003.



Increases in the cash surrender value of
bank-owned life insurance and life insurance benefits are reported in other non-interest income and represent the majority of the 51% decrease in that category for the three months



21



---

##### Table of Contents

ended March 31, 2004, compared to the same period in 2003. During the three months ended March 31, 2003, BankUnited received a life insurance benefit of $1.1
million, none in 2004.



Total non-interest expense decreased by
$0.1 million or 0.5% for the three months ended March 31, 2004, compared to the same period in 2003. Included in other operating expenses for 2003, was a $1.8 million charge related to the redemption of trust preferred securities. Without this
occurrence, expenses related to normal operations for the quarter ended March 31, 2004 would have shown a 9% year over year increase. The most significant increase in non-interest expense was for occupancy and equipment, which increased by $1.3
million for the three months ended March 31, 2004 compared to the same period in 2003. This increase was the result of branch expansion and additional investment in infrastructure to support BankUniteds growth.



Provision for Income Taxes.    The effective
income tax rate for the three months ended March 31, 2004 was 31.9% compared to 29.7% for the same period in 2003. The effective income tax rate for the three months ended March 31, 2003 reflects the recognition of a non-taxable life insurance
benefit received during that quarter. BankUnited and its subsidiaries file tax returns in each of the tax jurisdictions in which they operate and are subject to the interpretation of the tax laws by each of those jurisdictions. No tax return is
currently subject to examination.



For the Six Months Ended March 31, 2004
Compared to the Same Period in 2003



General



Net income reached $23.6 million for the six months ended March 31, 2004, up
28% over $18.4 million for the same period in 2003. Basic and diluted earnings were $0.79 and $0.72 per share, respectively, for the quarter, up from $0.72 and $0.67 per share, respectively, for the same period last year. The increase in net income
of $5.2 million for 2004 is primarily due to growth in net interest income.



|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|------------------------------------------------------------------- |  | ---------------------------------- | --------- | - | -------- | - | ---------- |  | ---- | -------------- |  | - | --------- | - | ---------- | - | ------- |  | ---- | -
|                                                                    |  | For the Six Months Ended March 31, |          
|                                                                    |  | 2004                               |           |   | 2003     |  
|                                                                    |  | AverageBalance                     |           |   | Interest |   | Yield/Rate |  |      | AverageBalance |  |   | Interest  |   | Yield/Rate |  
|                                                                    |  | (Dollars in thousands)             |          
|Interest-earning assets:                                            |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Loans, net(1)                                                       |  | $                                  | 4,386,490 |   |          | $ | 109,456    |  | 4.99 | %              |  | $ | 4,021,920 |   |            | $ | 119,634 |  | 5.95 | %
|Mortgage-backed securities                                          |  |                                    | 2,106,686 |   |          |   | 39,986     |  | 3.80 | %              |  |   | 1,496,505 |   |            |   | 32,967  |  | 4.41 |  
|Short-term investments(2)                                           |  |                                    | 16,993    |   |          |   | 215        |  | 2.49 | %              |  |   | 13,287    |   |            |   | 227     |  | 3.32 |  
|Investment securities and FHLB stock                                |  |                                    | 438,255   |   |          |   | 9,383      |  | 4.28 | %              |  |   | 277,137   |   |            |   | 6,722   |  | 4.85 |  
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Total interest-earning assets                                       |  |                                    | 6,948,424 |   |          |   | 159,040    |  | 4.58 | %              |  | $ | 5,808,849 |   |            | $ | 159,550 |  | 5.49 | %
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Interest-bearing liabilities:                                       |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|NOW and money market                                                |  |                                    | 568,856   |   |          |   | 1,931      |  | 0.68 | %              |  | $ | 538,914   |   |            | $ | 3,086   |  | 1.15 | %
|Savings                                                             |  |                                    | 915,182   |   |          |   | 7,634      |  | 1.67 | %              |  |   | 721,189   |   |            |   | 7,232   |  | 2.01 |  
|Certificates of deposit                                             |  |                                    | 1,798,060 |   |          |   | 26,607     |  | 2.96 | %              |  |   | 1,765,628 |   |            |   | 33,438  |  | 3.79 |  
|Trust preferred securities and subordinated debentures(3)           |  |                                    | 165,641   |   |          |   | 4,674      |  | 5.64 | %              |  |   | 277,003   |   |            |   | 10,135  |  | 7.32 |  
|Senior notes                                                        |  |                                    | 157,158   |   |          |   | 4,639      |  | 5.90 | %              |  |   | 200,000   |   |            |   | 5,611   |  | 5.61 |  
|FHLB advances and other borrowings                                  |  |                                    | 3,036,245 |   |          |   | 46,512     |  | 3.01 | %              |  |   | 2,109,009 |   |            |   | 42,275  |  | 4.01 |  
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Total interest-bearing liabilities                                  |  | $                                  | 6,641,142 |   |          | $ | 91,997     |  | 2.75 | %              |  | $ | 5,611,743 |   |            | $ | 101,777 |  | 3.61 | %
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Excess of interest-earning assets over interest-bearing liabilities |  | $                                  | 307,282   |   |          |   |            |  |      |                |  | $ | 197,106   |   |            |   |         |  |      |  
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Net interest income                                                 |  |                                    |           |   |          | $ | 67,043     |  |      |                |  |   |           |   |            | $ | 57,773  |  |      |  
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Interest rate spread                                                |  |                                    |           |   |          |   |            |  | 1.83 | %              |  |   |           |   |            |   |         |  | 1.88 | %
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Net interest margin                                                 |  |                                    |           |   |          |   |            |  | 1.95 | %              |  |   |           |   |            |   |         |  | 2.00 | %
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  
|Ratio of interest-earning assets to interest-bearing liabilities    |  |                                    | 104.63    | % |          |   |            |  |      |                |  |   | 103.51    | % |            |   |         |  |      |  
|                                                                    |  |                                    |           |   |          |   |            |  |      |                |  |   |           |   |            |   |         |  |      |  



22



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##### Table of Contents

---

|Note: |  | The yields and rates along with the corresponding interest rate spread and net interest margin represent the yields earned and rates paid on BankUniteds interest-earning
assets and interest-bearing liabilities, respectively, for the periods presented and do not include any estimates of the effect that accelerated amortization of premiums or discounts would have on the yields earned. The yields are annualized and are
not calculated on a tax equivalent basis.
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(1) |  | Includes loans held for sale. Also includes average non-accruing loans of $29 million and $31.5 million for the six months ended March 31, 2004 and 2003, respectively.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Short-term investments include FHLB overnight deposits, federal funds sold, securities purchased under agreements to resell, and certificates of deposit.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes the effect of interest rate swaps. For more information on interest rate swaps see Note 8 of the accompanying condensed notes to consolidated financial statements.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes convertible debt issued in February and March of 2004.
|--- |  | ---------------------------------------------------------------



|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|--------------------------------------------------------- |  | ----------------------------------------------------- | ------ | - | -------------- | - | ------- | ------------------------ |  | - | ------- | -
|                                                          |  | For the Six Month Period EndedMarch 31, 2004 vs. 2003 |       
|                                                          |  | Increase (Decrease)Due to                             |        |   |                |  
|                                                          |  | ChangesinVolume                                       |        |   | Changesin Rate |   |         | TotalIncrease/(Decrease) | 
|                                                          |  | (Dollars in thousands)                                |       
|Interest income attributable to:                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|Loans, net(1)                                             |  | $                                                     | 10,846 |   |                | $ | (21,024 | )                        |  | $ | (10,178 | )
|Mortgage-backed securities                                |  |                                                       | 13,454 |   |                |   | (6,435  | )                        |  |   | 7,019   |  
|Short-term investments(2)                                 |  |                                                       | 62     |   |                |   | (74     | )                        |  |   | (12     | )
|Investment securities and FHLB stock                      |  |                                                       | 3,907  |   |                |   | (1,246  | )                        |  |   | 2,661   |  
|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|Total interest-earning assets                             |  |                                                       | 28,269 |   |                |   | (28,779 | )                        |  |   | (510    | )
|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|Interest expense attributable to:                         |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|NOW/Money market                                          |  |                                                       | 172    |   |                |   | (1,327  | )                        |  |   | (1,155  | )
|Savings                                                   |  |                                                       | 1,950  |   |                |   | (1,548  | )                        |  |   | 402     |  
|Certificates of deposit                                   |  |                                                       | 615    |   |                |   | (7,446  | )                        |  |   | (6,831  | )
|Trust Preferred Securities and subordinated debentures(3) |  |                                                       | (4,076 | ) |                |   | (1,385  | )                        |  |   | (5,461  | )
|Senior notes                                              |  |                                                       | (1,202 | ) |                |   | 230     |                          |  |   | (972    | )
|FHLB advances and other borrowings                        |  |                                                       | 18,591 |   |                |   | (14,354 | )                        |  |   | 4,237   |  
|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|Total interest-bearing liabilities                        |  |                                                       | 16,050 |   |                |   | (25,830 | )                        |  |   | (9,780  | )
|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  
|Increase (decrease) in net interest income                |  | $                                                     | 12,219 |   |                | $ | (2,949  | )                        |  | $ | (9,270  | )
|                                                          |  |                                                       |        |   |                |   |         |                          |  |   |         |  

---

|(1) |  | Includes interest earned on loans held for sale.
|--- |  | ------------------------------------------------

|(2) |  | Short-term investments include FHLB overnight deposits, federal funds sold, securities purchased under agreements to resell, and certificates of deposit.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) |  | Includes the effect of interest rate swaps. See Note 8 of the accompanying condensed notes to consolidated financial statements for more information on interest rate swaps.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) |  | Includes interest expense on convertible debt issued in February and March of 2004.
|--- |  | -----------------------------------------------------------------------------------



Net interest income before provision for loan losses was $67 million for the six months ended March 31, 2004, a $9.3 million
improvement over the same period in 2003. The net increase is the result of an increase of $12.2 million due to volume increases, offset by a decrease of $2.9 million due to changes in the yields earned and rates paid.



Net interest margin for the six months ended March 31, 2004 was 1.95%
compared to 2.00% for the same period in 2003. This decline in net interest margin is reflective of declining interest rates and the high level of residential pre-payments and refinancing activity during the second half of fiscal 2003. The
refinancing activity



23



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##### Table of Contents

impacting the industry as a whole, resulted in a larger decline on the yield of earning assets than the decline in the cost of interest bearing liabilities.
Efforts by BankUnited to reduce the volume of trust preferred securities and subordinated debentures over the past several periods, combined with increased funding from non-interest bearing funds, helped to reduce the impact of margin compression by
reducing the overall cost of funds. Evidence of improvement can be seen when comparing the net interest margin for the three months ended March 31, 2004 of 1.99% to the previous quarters net interest margin of 1.91%.



Interest Income. Interest income for the six months ended March 31,
2004 remained relatively flat at $159 million compared to the same period in 2003 as a result of an increase of $28 million related to volume, offset by relatively the same amount of decrease due to lower yields on earning assets.



The volume related increases of $28.3 million stem from an increase in
interest earned on loans of $10.8 million, $13.4 million in interest earned on mortgage-backed securities, and $3.9 million from interest earned on long-term investments and FHLB stock. The rate related decreases stem mostly from a decrease in
interest earned on loans of $21 million, and a decrease of $6.4 million from interest earned on mortgage-backed securities.



Interest Expense. Interest expense decreased by $9.8 million for the six months ended March 31, 2004, compared to the same period in 2003. This is
the result of an increase of $16.1 million due to an increase in volume of interest bearing liabilities, offset by a decrease of $25.8 million due to a reduction in rates paid on those liabilities.



The most significant volume related changes were an increase in interest
expense of $18.6 million from additional FHLB advances and other borrowing used during the six month period ending March 31, 2004 compared to the same period in 2003 and a decrease in interest expense of $4.1 million which is the result of
BankUnited redeeming its higher cost trust preferred securities. The most significant rate related changes in interest expense were decreases due to a downward repricing of deposits which reduced interest expense by $7.4 million, and a decrease of
$14.4 million due to lower rates paid on FHLB on advances and other borrowings.



Provision for loan losses. The provision for loan losses for the six months ended March 31, 2004 was $2.2 million, compared to $2.6 million for the same period in 2003, reflecting a lower level of
non-performing assets. See Asset Quality for more information concerning BankUniteds allowance for loan losses.



Analysis of Non-Interest Income and Expenses



|                                                                     |  |                                    |        |   |                     |   |        |        |  |   |        |   |  |        |   
|-------------------------------------------------------------------- |  | ---------------------------------- | ------ | - | ------------------- | - | ------ | ------ |  | - | ------ | - |  | ------ | --
|                                                                     |  | For the Six Months Ended March 31, |        |   | Increase/(Decrease) |  
|                                                                     |  | 2004                               |        |   | 2003                |   |        | Change | 
|                                                                     |  | (Dollars in thousands)             |       
|Non-interest income:                                                 |  |                                    |        |   |                     |   |        |        |  |   |        |   |  |        |   
|Loan servicing fees                                                  |  | $                                  | 1,514  |   |                     | $ | 963    |        |  | $ | 551    |   |  | 57.2   | % 
|Amortization of mortgage servicing rights                            |  |                                    | (2,604 | ) |                     |   | (2,845 | )      |  |   | 241    |   |  | (8.5   | ) 
|Impairment of mortgage servicing rights                              |  |                                    | (1,200 | ) |                     |   |       |        |  |   | (1,200 | ) |  |       |   
|Loan fees                                                            |  |                                    | 1,933  |   |                     |   | 2,190  |        |  |   | (257   | ) |  | (11.7  | ) 
|Deposit fees                                                         |  |                                    | 2,163  |   |                     |   | 2,020  |        |  |   | 143    |   |  | 7.1    |   
|Other fees                                                           |  |                                    | 939    |   |                     |   | 604    |        |  |   | 335    |   |  | 55.5   |   
|Net (loss) gain on sale of investment and mortgage-backed securities |  |                                    | (262   | ) |                     |   | 755    |        |  |   | (1,017 | ) |  | (134.7 | ) 
|Net gain on sale of loans and other assets                           |  |                                    | 3,280  |   |                     |   | 3,768  |        |  |   | (488   | ) |  | (13.0  | ) 
|Insurance and investment services income                             |  |                                    | 2,126  |   |                     |   | 1,320  |        |  |   | 806    |   |  | 61.1   |   
|Other                                                                |  |                                    | 2,282  |   |                     |   | 3,022  |        |  |   | (740   | ) |  | (24.5  | ) 
|                                                                     |  |                                    |        |   |                     |   |        |        |  |   |        |   |  |        |   
|Total non-interest income                                            |  | $                                  | 10,171 |   |                     | $ | 11,797 |        |  | $ | (1,626 | ) |  | (13.8  | )%
|                                                                     |  |                                    |        |   |                     |   |        |        |  |   |        |   |  |        |   



24



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##### Table of Contents

|                                         |  |                                    |        |                     |   |        |  |   |        |   |  |       |  
|---------------------------------------- |  | ---------------------------------- | ------ | ------------------- | - | ------ |  | - | ------ | - |  | ----- | -
|                                         |  | For the Six Months Ended March 31, |        | Increase/(Decrease) |  
|                                         |  | 2004                               |        | 2003                |   | Change | 
|                                         |  | (Dollars in thousands)             |       
|Non-interest expenses:                   |  |                                    |        |                     |   |        |  |   |        |   |  |       |  
|Employee compensation and benefits       |  | $                                  | 20,065 |                     | $ | 18,369 |  | $ | 1,696  |   |  | 9.2   | %
|Occupancy and equipment                  |  |                                    | 8,036  |                     |   | 5,953  |  |   | 2,083  |   |  | 35.0  |  
|Telecommunications and data processing   |  |                                    | 2,793  |                     |   | 2,419  |  |   | 374    |   |  | 15.5  |  
|Advertising and promotion expense        |  |                                    | 2,438  |                     |   | 2,443  |  |   | (5     | ) |  | (0.2  | )
|Professional fees  legal and accounting |  |                                    | 2,344  |                     |   | 2,347  |  |   | (3     | ) |  | (0.1  | )
|Loan closing expense                     |  |                                    | 1,415  |                     |   | 2,202  |  |   | (787   | ) |  | (35.7 | )
|Postage and courier                      |  |                                    | 287    |                     |   | 847    |  |   | (560   | ) |  | (66.1 | )
|Loan servicing expense(1)                |  |                                    | 869    |                     |   | 666    |  |   | 203    |   |  | 30.5  |  
|Insurance                                |  |                                    | 727    |                     |   | 569    |  |   | 158    |   |  | 27.8  |  
|Other operating expenses                 |  |                                    | 1,341  |                     |   | 3,731  |  |   | (2,390 | ) |  | (64.1 | )
|                                         |  |                                    |        |                     |   |        |  |   |        |   |  |       |  
|Total non-interest expenses              |  | $                                  | 40,315 |                     | $ | 39,546 |  | $ | 769    |   |  | 1.9   | %
|                                         |  |                                    |        |                     |   |        |  |   |        |   |  |       |  

---

|(1) |  | Loan servicing expense relates to loans serviced by others.
|--- |  | -----------------------------------------------------------



Analysis of Non-Interest Income and Expenses



Total non-interest income for the six months ended March 31, 2004 decreased by $1.6 million or 14% from the same period in 2003, primarily due to an
impairment charge on mortgage servicing rights recorded in the quarter ended March 31, 2004 and a $1.1 million life insurance benefit received during the quarter ended March 31, 2003.



As a result of pre-payments of mortgage loans in BankUniteds portfolio of residential loans serviced for others,
BankUnited provided for the amortization of $2.6 million of servicing rights for the six months ended March 31, 2004, compared to $2.8 million for the same period in the previous year. This amortization, offset by fees earned on these loans of $1.5
million, resulted in a net loss of $1.1 million from loan servicing fees. In addition, BankUnited recorded a $1.2 million impairment charge for the six months ended March 31, 2004, based on a current valuation of its mortgage servicing assets by
independent third parties.



Fee income, including loan fees,
deposit fees, and other fees, but excluding loan servicing fees, was $5.0 million for the six months ended March 31, 2004 and contributed to the 5% increase in non-interest income for the period. This increase is also the result of growth in core
deposits and sales of other banking products and services.



BankUnited realized a net loss of $0.3 million on the sale of investments and mortgage-backed securities during the six months ended March 31, 2004, comprised of $1.4 million in losses generated from BankUniteds securitization
activities offset by $1.1 million in gains from the sale of investment and mortgage-backed securities available for sale. During the same period in 2003, BankUnited realized a net gain of $0.8 million on the sale of investment and mortgage-backed
securities, comprised of $0.6 million of losses generated from BankUniteds securitization activities, and $1.4 million of gains from the sale of investment securities available for sale.



The net gain on sale of loans and other assets of $3.3 million during the six
months ended March 31, 2004, is due mostly from the sale of securitized loans upon which BankUnited retains servicing rights. The net gain on sale of loans and other assets of $3.8 million during the same period in 2003 is also due mostly from the
sale of securitized loans.



Included in the insurance and
investment services income for the six months ended March 31, 2004, is approximately $2.2 million in commissions from the sale of annuity and other investment products. This amount represents an increase of 64% over such sales during the same period
in 2003.



25



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Increases in the cash surrender value of bank-owned life insurance and life insurance benefits are
reported in other non-interest income and represent the majority of the 25% decrease in that category for the six months ended March 31, 2004, compared to the same period in 2003. During the six months ended March 31, 2003, BankUnited received a
life insurance benefit of $1.1 million, none for the same period in 2004. The appreciation of the cash surrender value for the six months ended March 31, 2004 was $2.0 million, a $0.6 million increase over the appreciation for the same period in
2003.



Total non-interest expense increased by $0.8 million or
1.9% for the six months ended March 31, 2004, compared to the same period in 2003. Included in other operating expenses for 2004, is a gain of $0.7 million from fair value adjustments to derivatives. See note 8. Accounting for Derivatives and
Hedging Activities. Included in other operating expenses for 2003, was a $1.8 million charge related to the redemption of trust preferred securities. The most significant increase in non-interest expense was for occupancy and equipment, which
increased by $2.1 million for the six months ended March 31, 2004 compared to the same period in 2003. This increase was the result of branch expansion and additional investment in infrastructure to support BankUniteds growth.



Provision for Income Taxes. The effective income tax rate for the six
months ended March 31, 2004 was 32.1% compared to 33.1% for the same period in 2003. BankUnited and its subsidiaries file tax returns in each of the tax jurisdictions in which they operate and are subject to the interpretation of the tax laws by
each of those jurisdictions. No tax return is currently subject to examination.



LIQUIDITY



Liquidity management is the process
of allocating assets and structuring liabilities to provide sufficient cash or cash equivalents to meet an entitys daily operating needs on an ongoing basis. It is the policy of BankUnited to manage our funds so that there is no need to make
unplanned sales of assets or to borrow funds under emergency conditions. Sources of liquidity include: cash and cash equivalents, retail deposit growth, FHLB advances, loan repayments, investment portfolio run-off, liquidation of investments and
mortgage-backed securities, and overnight and term reverse repurchase agreements.



BankUniteds objective in managing liquidity is to maintain sufficient resources of available cash to address both short and long-term business funding needs such as loan demand, investment purchases, deposit
fluctuations, and debt service requirements. In doing so, BankUnited maintains an overall liquidity position that has an aggregate amount of readily accessible and marketable assets, cash flow and borrowing capacity to meet unexpected deposit
outflows and/or increases in loan demand. Cash levels may vary but are maintained at levels required by regulation and necessary to meet the projected anticipated needs for business operations.



Significant Sources of Funds



During the six months ended March 31, 2004 and 2003, BankUnited received
$1.1 billion in payments on loans. Proceeds from repayment of mortgage-backed securities for the six months ended March 31, 2004 were $403 million compared to $491 million for the same period in 2003. BankUnited sold $297 million of mortgage-backed
securities during the six months ended March 31, 2004 compared to $274 million for the same period in 2003.



In addition, BankUnited sold $11 million of investment securities during the six months ended March 31, 2004, compared to $41 million for the same period
in 2003. BankUnited received $221 million from additional other borrowings during the six months ended March 31, 2004 compared to $178 million for the same period in 2003. BankUnited also issued $120 million of convertible debt during the six months
ended March 31, 2004, compared to none during the same period in 2003. BankUnited received $190 million from additional deposits during the six months ended March 31, 2004 compared to $96 million for the same period in 2003.



26



---

##### Table of Contents

Significant Uses of Funds



During the six months ended March 31, 2004, BankUnited funded $161 million in loans held for sale compared to $376 million
for the same period in 2003. This decrease in funding of loans explains the majority of the decrease in cash used by operating activities from $293 million for the six months ended March 31, 2003, compared to $61 million during the same period in
2004.



During the six months ended March 31, 2004, BankUnited
funded $1.7 billion of portfolio loans as compared to $1.2 billion in the same period of 2003. In addition, BankUnited purchased $664 million of investment and mortgage-backed securities during the six months ended March 31, 2004 compared to $1.2
billion in the same period of 2003. BankUnited used $20 million to purchase additional bank-owned life insurance during the six months ended March 31, 2003; there were no such purchases during the same period in 2004. BankUnited paid $200 million in
maturing senior notes during the three months ended March 31, 2004; there were no such payments during the same period in 2003.



BankUnited is not aware of any events, or uncertainties, which may impede liquidity in the short or long-term.



As of March 31, 2004, BankUnited had $800 million in investments and
mortgage-backed securities pledged against securities sold under agreements to repurchase with an outstanding balance of $739 million.



As of March 31, 2004 BankUnited had approximately $275 million of additional borrowings available on its line of credit with the FHLB of Atlanta.



FINANCIAL CONDITION



The following is a discussion of significant changes from September 30, 2003
to March 31, 2004 in the Statement of Financial Condition. For a discussion of changes in cash and cash equivalents, see LIQUIDITY.



Assets



Investment securities available for sale.    Investment securities available for sale increased by $42 million during the six months ended March 31, 2004 to reach $340 million. This net
increase is primarily due to purchases of $51 million, offset by sales of $13 million. In addition, there was an unrealized gain of $3.9 million during the six months ended March 31, 2004.



Mortgage-backed securities available for
sale.    Mortgage-backed securities available for sale increased by $161 million during the six months ended March 31, 2004 to reach $2.2 billion. This net increase is primarily due to purchases of $689 million and
securitizations of $177 million, offset by repayments of $403 million, and sales of $297 million. In addition, there was an unrealized gain of $3.1 million during the six months ended March 31, 2004.



(See Note 3. of the accompanying condensed notes to consolidated financial
statements for information on investment and mortgage-backed securities).



27



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##### Table of Contents

Loans.Loans receivable, net (including loans held for sale) increased by
$474 million during the six months ended March 31, 2004 to reach $4.7 billion. During the six months ended March 31, 2004, BankUnited funded $1.8 billion of loans, which was offset by repayments of $1.1 billion, securitizations of $177 million,
sales of $77 million, and a transfer to real estate owned of $2.7 million. The majority of the growth in the portfolio was in one-to-four family residential.



Loans Receivable



Loans receivable held for investment consist of the following:



|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|--------------------------------------------------- |  | ---------------------- | --------- | - | ----------------------- | ----- | - | ------ | - | --------- | -------------- |  | ----- | -
|                                                    |  | As of March 31,2004    |           |   | As of September 30,2003 |      
|                                                    |  | Amount                 |           |   | PercentofTotal          |       |   | Amount |   |           | PercentofTotal | 
|                                                    |  | (Dollars in thousands) |          
|Real estate loans:                                  |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|One-to-four family residential:                     |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Residential mortgages                               |  | $                      | 3,070,115 |   |                         | 67.1  | % |        | $ | 2,653,515 |                |  | 67.4  | %
|Specialty consumer mortgages                        |  |                        | 657,860   |   |                         | 14.4  |   |        |   | 613,287   |                |  | 15.5  |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total one-to-four family residential                |  |                        | 3,727,975 |   |                         | 81.5  |   |        |   | 3,266,802 |                |  | 82.9  |  
|Multi-family                                        |  |                        | 41,057    |   |                         | 0.9   |   |        |   | 32,583    |                |  | 0.8   |  
|Commercial real estate                              |  |                        | 241,492   |   |                         | 5.3   |   |        |   | 196,237   |                |  | 5.0   |  
|Construction                                        |  |                        | 167,730   |   |                         | 3.6   |   |        |   | 132,778   |                |  | 3.4   |  
|Land                                                |  |                        | 57,252    |   |                         | 1.2   |   |        |   | 27,569    |                |  | 0.7   |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total real estate loans                             |  |                        | 4,235,506 |   |                         | 92.5  |   |        |   | 3,655,969 |                |  | 92.8  |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Other loans:                                        |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Commercial                                          |  |                        | 170,710   |   |                         | 3.7   |   |        |   | 152,663   |                |  | 3.9   |  
|Consumer(1)                                         |  |                        | 148,807   |   |                         | 3.3   |   |        |   | 116,445   |                |  | 3.0   |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total other loans                                   |  |                        | 319,517   |   |                         | 7.0   |   |        |   | 269,108   |                |  | 6.9   |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total loans held in portfolio                       |  |                        | 4,555,023 |   |                         | 99.5  |   |        |   | 3,925,077 |                |  | 99.7  |  
|Unearned discounts, premiums and deferred fees, net |  |                        | 44,883    |   |                         | 1.0   |   |        |   | 36,806    |                |  | 0.9   |  
|Allowance for loan losses                           |  |                        | (22,665   | ) |                         | (0.5  | ) |        |   | (22,295   | )              |  | (0.6  | )
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total loans held in portfolio, net                  |  |                        | 4,577,241 |   |                         | 100.0 | % |        |   | 3,939,588 |                |  | 100.0 | %
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Mortgage loans held for sale                        |  |                        | 123,590   |   |                         |       |   |        |   | 286,796   |                |  |       |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  
|Total loans, net                                    |  | $                      | 4,700,831 |   |                         |       |   |        | $ | 4,226,384 |                |  |       |  
|                                                    |  |                        |           |   |                         |       |   |        |   |           |                |  |       |  

---

|(1) |  | Includes home equity loans and lines of credit
|--- |  | ----------------------------------------------



Liabilities



Deposits.    Deposits grew by $190 million during the six months ended March 31, 2004 to reach $3.4 billion. This increase is
due mostly to an increase in core deposits of $188 million.



Securities sold under agreements to repurchase.    Securities sold under agreements to repurchase increased by $221 million or 43% during the six months ended March 31, 2004 to reach $739 million as of that date.



Senior notes.    Senior notes of
$200 million matured during the second fiscal quarter of 2004.



Convertible debt.    BankUnited issued $120 million in convertible debt during the second fiscal quarter of 2004. See Note 4 of accompanying condensed notes to consolidated financial statements for more
information on the convertible debt.



28



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Advance payments by borrowers for taxes and insurance.    Advance payments by
borrowers for taxes and insurance decreased by $20 million, or 43%, during the six months ended March 31, 2004 to $27 million as of March 31, 2004. This decrease reflects tax payments by BankUnited during the first quarter of fiscal 2004.



Payable for securities purchased pending
settlement.    BankUnited purchased $25 million of securities at the end of the quarter which do not settle until the quarter ending June 30, 2004.



Equity



Equity.    For information on changes in BankUniteds stockholders equity for the six months ended March 31, 2004,
see BankUniteds Consolidated Statement of Stockholders Equity.



Asset Quality



Non-performing assets were
$25.3 million as of March 31, 2004, which represents a decrease of $17 million, or 40%, from $42.3 million as of September 30, 2003. The net annualized charge-off ratio decreased from 0.08% for the year ended September 30, 2003 to 0.05% for the
quarter ended March 31, 2004.



The following table sets forth
additional information concerning BankUniteds non-performing assets at March 31, 2004 and September 30, 2003.



|                                                                               |  |                        |        |   |                   |   |        |  
|------------------------------------------------------------------------------ |  | ---------------------- | ------ | - | ----------------- | - | ------ | -
|                                                                               |  | March 31,2004          |        |   | September 30,2003 |  
|                                                                               |  | (Dollars in thousands) |       
|Non-accrual loans                                                              |  | $                      | 21,645 |   |                   | $ | 37,080 |  
|Restructured loans                                                             |  |                        | 371    |   |                   |   | 306    |  
|Loans past due 90 days and still accruing                                      |  |                        | 52     |   |                   |   | 276    |  
|                                                                               |  |                        |        |   |                   |   |        |  
|Total non-performing loans                                                     |  |                        | 22,068 |   |                   |   | 37,662 |  
|Non-accrual tax certificates                                                   |  |                        | 212    |   |                   |   | 334    |  
|Real estate owned                                                              |  |                        | 2,975  |   |                   |   | 4,290  |  
|                                                                               |  |                        |        |   |                   |   |        |  
|Total non-performing assets                                                    |  |                        | 25,255 |   |                   |   | 42,286 |  
|                                                                               |  |                        |        |   |                   |   |        |  
|Allowance for losses on tax certificates                                       |  |                        | 208    |   |                   |   | 355    |  
|Allowance for loan losses                                                      |  |                        | 22,665 |   |                   |   | 22,295 |  
|                                                                               |  |                        |        |   |                   |   |        |  
|Total allowance                                                                |  | $                      | 22,873 |   |                   | $ | 22,650 |  
|                                                                               |  |                        |        |   |                   |   |        |  
|Non-performing assets as a percentage of total assets                          |  |                        | 0.33   | % |                   |   | 0.59   | %
|Non-performing loans as a percentage of total loans                            |  |                        | 0.47   | % |                   |   | 0.89   | %
|Allowance for loan losses as a percentage of total loans                       |  |                        | 0.48   | % |                   |   | 0.52   | %
|Allowance for loan losses as a percentage of non-performing loans              |  |                        | 102.71 | % |                   |   | 59.20  | %
|Net annualized year-to-date charge-offs as a percentage of average total loans |  |                        | 0.05   | % |                   |   | 0.08   | %



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The following table sets forth the change in BankUniteds allowance for loan losses for the six
months ended March 31, 2004 and 2003.



|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|----------------------------------------------------------------- |  | -------------------------- | - |  | ------------------------ | - |  | ------------- | ------ | - | ------------- | - | ------ | -
|                                                                  |  | For the Three Months Ended |   |  | For the Six Months Ended |  
|                                                                  |  | March 31,2004              |   |  | March 31,2003            |   |  | March 31,2004 |        |   | March 31,2003 |  
|                                                                  |  | (In thousands)             |  
|Allowance for loan losses, balance (at beginning of period)       |  | $22,125                    |   |  | $20,853                  |   |  | $             | 22,295 |   |               | $ | 20,293 |  
|Provisions for loan losses                                        |  | 1,200                      |   |  | 1,250                    |   |  |               | 2,175  |   |               |   | 2,550  |  
|Loans charged off:                                                |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|One-to-four family residential mortgages(1)                       |  | (151)                      |   |  | (88)                     |   |  |               | (286   | ) |               |   | (169   | )
|Commercial real-estate                                            |  | (298)                      |   |  |                         |   |  |               | (298   | ) |               |   |       |  
|Commercial business                                               |  | (253)                      |   |  | (339)                    |   |  |               | (860   | ) |               |   | (976   | )
|Consumer(1)                                                       |  | (25)                       |   |  | (44)                     |   |  |               | (38    | ) |               |   | (77    | )
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|Total loans charged off                                           |  | (727                       | ) |  | (471                     | ) |  |               | (1,482 | ) |               |   | (1,222 | )
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|Recoveries:                                                       |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|One-to-four family residential mortgages(1)                       |  |                           |   |  |                         |   |  |               | 192    |   |               |   |        |  
|Commercial business                                               |  | 66                         |   |  | 22                       |   |  |               | 77     |   |               |   | 27     |  
|Consumer(1)                                                       |  | 7                          |   |  | 8                        |   |  |               | 7      |   |               |   | 14     |  
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|Total recoveries                                                  |  | 67                         |   |  | 30                       |   |  |               | 276    |   |               |   | 41     |  
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|Reclassification of letter of credit reserve to other liabilities |  |                           |   |  |                         |   |  |               | (599   | ) |               |   |       |  
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  
|Allowance for loan losses, balance (at end of period)             |  | $22,665                    |   |  | $21,662                  |   |  | $             | 22,665 |   |               | $ | 21,662 |  
|                                                                  |  |                            |   |  |                          |   |  |               |        |   |               |   |        |  

---

|(1) |  | Specialty consumer mortgage loans originated through our branch network are included in one-to-four family residential loans.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------



The following table sets forth BankUniteds allocation of the allowance
for loan losses by category as of March 31, 2004 and September 30, 2003.



|                                                |  |                |        |                   |   |       
|----------------------------------------------- |  | -------------- | ------ | ----------------- | - | ------
|                                                |  | March 31,2004  |        | September 30,2003
|                                                |  | (In thousands)
|Balance at the end of the period applicable to: |  |                |        |                   |   |       
|One-to-four family residential mortgages(1)     |  | $              | 4,136  |                   | $ | 3,807 
|Multi-family residential mortgages              |  |                | 328    |                   |   | 358   
|Commercial real estate                          |  |                | 2,992  |                   |   | 4,166 
|Construction                                    |  |                | 1,342  |                   |   | 1,461 
|Land                                            |  |                | 458    |                   |   | 303   
|Commercial business                             |  |                | 7,808  |                   |   | 8,128 
|Consumer(1)                                     |  |                | 2,507  |                   |   | 2,415 
|Unallocated                                     |  |                | 3,094  |                   |   | 1,657 
|                                                |  |                |        |                   |   |       
|Total allowance for loan losses                 |  | $              | 22,665 |                   | $ | 22,295
|                                                |  |                |        |                   |   |       

---

|(1) |  | Specialty consumer mortgage loans originated through our branch network are included in one-to-four family residential loans.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------



BankUniteds allowance for loan losses as a percentage of total loans
was 0.48% as of March 31, 2004, down from 0.52% as of September 30, 2003. As a consequence of the decline in non-performing assets through the repayment of loans, the allowance for loan losses allocated to commercial real estate and commercial loans
declined from September 30, 2003 to March 31, 2004. The portfolio risk management allowance, reflected as unallocated in the table above, increased during this period reflecting risk factors associated with the portfolio as a whole. Management
believes the allowance for loan losses to be adequate given the composition of it loan portfolio, with more than 90% of loans secured by real estate, and considering the asset quality factors noted above.



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ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



The discussion contained in BankUniteds Annual Report on Form 10-K for the year ended September 30, 2003, under Item 7a, Quantitative and
Qualitative Disclosures about Market Risk, provides detailed quantitative and qualitative disclosures about market risk and should be referenced for information thereon. In addition, the following discussion addresses the sources and effects
of developments during the six months ended March 31, 2004 which related to risks associated with investments and mortgage-backed securities.



Risks Associated with Changing Interest Rates.    As a financial intermediary, BankUnited invests in various types of
interest-earning assets (primarily loans, mortgage-backed securities, and investment securities), which are funded largely by interest-bearing liabilities (primarily deposits, FHLB advances, senior notes, and Trust Preferred Securities). Such
financial instruments have varying levels of sensitivity to changes in market interest rates, which creates interest rate risk for BankUnited. Accordingly, BankUniteds net interest income, the most significant component of its net income, is
subject to substantial volatility due to changes in interest rates or market yield curves, particularly if there are differences, or gaps, in the re-pricing frequencies of its interest-earning assets and the interest-bearing liabilities which fund
them. BankUnited monitors such interest rate gaps and seeks to manage its interest rate risk by adjusting the re-pricing frequencies of its interest-earning assets and interest-bearing liabilities. Additionally, BankUnited utilizes derivative
financial instruments designed to reduce the interest rate risks associated with its interest-earning assets and interest-bearing liabilities.



Risks Associated with Investments and Mortgage-Backed Securities.    BankUnited purchases fixed and adjustable rate
mortgage-backed securities and other securities for liquidity, yield and risk management purposes. Changes in market interest rates associated with BankUniteds investments and mortgage-backed securities could have a material adverse effect on
BankUniteds carrying value of its securities. Such changes in the carrying value of mortgage-backed securities and other securities classified as available-for-sale would be reflected, net of taxes, as a component of stockholders equity.
See NOTE 7. to the accompanying condensed notes to consolidated financial statements and Managements Discussion and Analysis of Financial Condition and Results of Operations  Securities Portfolio.



Derivative and Hedging Activities.    BankUnited
uses derivative instruments as part of its interest rate risk management activities to reduce risks associated with its loan origination and borrowing activities. Derivatives used for interest rate risk management include various interest rate swaps
and caps that relate to the pricing of specific on-balance sheet instruments and forecasted transactions. In connection with SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133), we recognize
all derivatives as either assets or liabilities on the consolidated balance sheet and report them at fair value with realized and unrealized gains and losses included in either earnings or in other comprehensive income, depending on the purpose for
which the derivative is held and whether the derivative qualifies for hedge accounting.



BankUnited uses interest rate swap and cap agreements that qualify as fair value hedges and those that qualify as cash flow hedges. Fair value hedges are used to hedge fixed rate debt. BankUnited uses cash flow hedges
to hedge interest rate risk associated with variable rate debt.



In connection with its interest rate management activities, BankUnited may use other derivatives as economic hedges of on-balance sheet assets and liabilities or forecasted transactions which do not qualify for hedge accounting under SFAS
133. Accordingly, these derivatives are reported as fair value on the consolidated balance sheet with realized gains and losses included in earnings.



By using derivative instruments, BankUnited is exposed to credit and market risk. Credit risk, which is the risk that a counterparty to a derivative
instrument will fail to perform, is equal to the extent of the fair value gain in a derivative. Credit risk is created when the fair value of a derivative contract is positive, since this generally indicates that the counterparty owes us. When the
fair value of a derivative is negative, no credit risk exists since BankUnited would owe the counterparty. BankUnited minimizes the credit risk in derivative instruments by



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##### Table of Contents

entering into transactions with high-quality counterparties as evaluated by management. Market risk is the adverse effect on the value of a financial
instrument from a change in interest rates or implied volatility of rates. We manage the market risk associated with interest rate contracts by establishing and monitoring limits as to the types and degree of risk that may be undertaken. The market
risk associated with derivatives used for interest rate risk management activity is fully incorporated into our market risk sensitivity analysis.



ITEM 4.    CONTROLS AND PROCEDURES



An evaluation of the effectiveness of the design and operation of BankUniteds disclosure controls and procedures was carried out by BankUnited, as of period end under the supervision and with the participation
of BankUniteds management, including the Chief Executive Officer and Chief Financial Officer. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that BankUniteds disclosure controls and procedures
have been designed and are being operated in a manner that provides reasonable assurance that the information required to be disclosed by BankUnited in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the SECs rules and forms. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of
controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Subsequent to the date of the most recent evaluation of BankUniteds internal controls, there were no
significant changes in BankUniteds internal controls or in other factors that could significantly affect the internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses.



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##### Table of Contents

PART IIOTHER INFORMATION



Item
2.    CHANGES IN SECURITIES AND USE OF PROCEEDS



On February 27, 2004, BankUnited issued an aggregate of $100 million of 3.125% Convertible Senior Notes due 2034, to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended.
BankUnited issued an additional $20 million principal amount of the notes on March 4, 2004, to qualified institutional buyers pursuant to Rule 144A. BankUnited received approximately $116.3 million of net proceeds from the convertible debt issuance,
after deducting the initial purchasers discounts and commissions and offering expenses. The initial purchasers of this offering were Bear, Stearns & Co., Inc. and UBS Securities LLC. The notes are convertible into shares of
BankUniteds Class A Common Stock initially at a 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 approximately $38.06 per share of Class A
Common Stock (subject to adjustment in certain events). The notes pay cash interest semi-annually on March 1 and September 1 of each year at an annual rate of 3.125% of the principal amount of the notes. BankUnited will pay additional interest on
the notes if the average trading price of the notes is above a specified level. Holders of the notes may convert their notes only if: (i) the price of BankUniteds Class A Common Stock issuable upon conversion of a note reaches a specified
threshold; (ii) specified corporate transactions occur; or (iii) BankUnited calls the notes for redemption. The notes are effectively subordinated to all of BankUniteds senior secured indebtedness and all indebtedness and liabilities of
BankUniteds subsidiaries.



Item 4.    SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS



See Part II,
Item 4, of BankUniteds Form 10-Q for the quarterly period ended December 31, 2003, as filed with the Securities and Exchange Commission on February 12, 2004, for the information called for by this item.



Item 6.    EXHIBITS AND REPORTS ON FORM 8-K



(a) Exhibits.



| | 4.1 |  | Amendment to the Articles of Incorporation, as amended.
| | --- |  | -------------------------------------------------------



| | 4.2 |  | Indenture, dated February 27, 2004, between BankUnited Financial Corporation and U.S. Bank National Association.
| | --- |  | ----------------------------------------------------------------------------------------------------------------



| | 4.3 |  | Registration Rights Agreement, dated February 27, 2004, between BankUnited Financial Corporation and the initial purchasers named therein.
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------



| | 4.4 |  | Form of 3.125% Convertible Senior Note due 2034 (included as Exhibit A to the Indenture).
| | --- |  | -----------------------------------------------------------------------------------------



| | 4.5 |  | Purchase Agreement, dated February 24, 2004, between BankUnited Financial Corporation and the initial purchasers named therein.
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------



| | 31.1 |  | Certification of the Chief Executive Officer pursuant to Section 302, of the Sarbanes-Oxley Act of 2002.
| | ---- |  | --------------------------------------------------------------------------------------------------------



| | 31.2 |  | Certification of the Chief Financial Officer pursuant to Section 302, of the Sarbanes-Oxley Act of 2002.
| | ---- |  | --------------------------------------------------------------------------------------------------------



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| | 32 |  | Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|* |  | Contract with Management.
|- |  | -------------------------



(b) Reports on Form 8-K.



A current Report on Form 8-K was filed on January 27, 2004 relating to BankUniteds January 27, 2004 press release setting forth BankUniteds
first quarter 2004 earnings.



A current Report on Form 8-K was
filed on February 24, 2004 relating to BankUniteds February 23, 2004 press release announcing its intent to offer $100 million of convertible senior notes due 2034 to qualified institutional buyers.



A current Report on Form 8-K was filed on February 24, 2004 relating to
BankUniteds February 24, 2004 press release announcing the pricing of its 3.125% convertible senior notes due 2034.



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##### Table of Contents

SIGNATURES



Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed by the undersigned
thereunto duly authorized.



BANKUNITED FINANCIAL CORPORATION



/s/    Humberto L. Lopez

By:

Humberto L. Lopez

Senior Executive Vice President and Chief Financial Officer



Date:    May 12, 2004



/s/    Bernardo Argudin

By:

Bernardo Argudin

Senior Vice President and Principal Accounting Officer



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##### Table of Contents

Exhibit Index



|            |  |                                                                                                                                                                                    
|----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                        
|            | 
|4.1         |  | Amendment to the Articles of Incorporation, as amended.                                                                                                                            
|            | 
|4.2         |  | Indenture, dated February 27, 2004, between BankUnited Financial Corporation and U.S. Bank National Association.                                                                   
|            | 
|4.3         |  | Registration Rights Agreement, dated February 27, 2004, between BankUnited Financial Corporation and the initial purchasers named therein.                                         
|            | 
|4.4         |  | Form of 3.125% Convertible Senior Note due 2034 (included as Exhibit A to the Indenture).                                                                                          
|            | 
|4.5         |  | Purchase Agreement, dated February 24, 2004, between BankUnited Financial Corporation and the initial purchasers named therein.                                                    
|            | 
|31.1        |  | Certification of the Chief Executive Officer pursuant to Section 302, of the Sarbanes-Oxley Act of 2002.                                                                           
|            | 
|31.2        |  | Certification of the Chief Financial Officer pursuant to Section 302, of the Sarbanes-Oxley Act of 2002.                                                                           
|            | 
|32          |  | Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.



36