##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-K
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the Year Ended December 31, 2007
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission File Number
001-09071
 BFC Financial Corporation
  Florida
    
    59-2022148(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S Employer Identification No.)2100 West Cypress Creek Road 
Fort Lauderdale, Florida
    
    33309(Address of principal executive office)
    
    (Zip Code)
  
  Securities registered pursuant to Section 12(b) of the Act:
 Class A Common Stock, $.01 par Value
    
    NYSE Arca(Title of Class)
    
    (Name of each exchange on which registered)
 Securities registered pursuant to Section 12(g) of the Act:
 Class B Common Stock, $.01 par Value
    
    OTC BB(Title of Class)
    
    (Name of each exchange on which registered)
 o þ
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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Documents Incorporated by Reference






2



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##### 



PART IItem 1. Business
    
    
    6Item 1A. Risk Factors
    
    
    38Item 1B. Unresolved Staff Comments
    
    
    60Item 2. Properties
    
    
    61Item 3. Legal Proceedings
    
    
    62Item 4. Submission of Matters to a Vote of Security Holders
    
    
    64PART IIItem 5. Market for Registrants Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities
    
    
    65Item 6.
Selected Consolidated Financial Data
    
    
    68Item 7. Managements Discussion and Analysis of Financial Condition and
Results of Operations
    
    
    72Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
    
    149Item 8. Financial Statements and Supplementary Data
    
    
    155Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
    
    
    256Item 9A. Controls and Procedures
    
    
    256Item 9B. Other Information
    
    
    258PART IIIPART IVItem 15. Exhibits, Financial Statement Schedules
    
    
    259SIGNATURES
    
    
    261EX-3.3 Amended and Restated By-lawsEX-10.2 Executive Services AgreementEX-12.1 Ratio of Earnings to Fixed ChargesEX-14.1 Code of Business Conduct and EthicsEX-21.1 Subsidiaries of the RegistrantEX-23.1 Consent of PricewaterhouseCoopers LLPEX-23.2 Consent of Ernst & Young LLPEX-31.1 Section 302 Certification of CEOEX-31.2 Section 302 Certification of CFOEX-31.3 Section 302 Certification of CAOEX-32.1 Section 906 Certification of CEOEX-32.2 Section 906 Certification of CFOEX-32.3 Section 906 Certification of CAOEX-99.1 Audited Financial Statements of Bluegreen Corp.
  3




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##### Table of Contents



PART I
   
    
    the impact of economic, competitive and other factors affecting the Company and its
subsidiaries, and their operations, markets, products and services;
    
    that the performance of those entities in which investments are made may not be as
anticipated;
    
    that BFC will be subject to the unique business and industry risks and characteristics
of each entity in which an investment is made;
    
    that BFC may not have sufficient available cash to make desired investments;
    
    that appropriate investment opportunities on reasonable terms and at reasonable prices
may not be available; and
    
    that BFC shareholders interests may be diluted in transactions utilizing BFC stock for
consideration.
  
    
    the impact of economic, competitive and other factors affecting BankAtlantic Bancorp and
its operations, markets, products and services;
    
    credit risks and loan losses, and the related sufficiency of the allowance for loan
losses, including the impact on the performance of BankAtlantics loan portfolio of a
sustained downturn in the real estate and credit markets where BankAtlantics borrowers and
collateral are located;
    
    the quality of BankAtlantics residential land acquisition and development loans
(including Builder land bank loans) and home equity loans, and conditions in that market
sector;
    
    the risks of additional charge-offs, impairments and required increases in
BankAtlantics allowance for loan losses;
    
    changes in interest rates and the effects of, and changes in, trade, monetary and fiscal
policies and laws, including their impact on the banks net interest margin;
    
    adverse conditions in the stock market, the public debt market and other capital markets
and the impact of such conditions on our activities,
    
    the value of BankAtlantic Bancorps assets and the ability of BankAtlantics borrowers
to service their debt obligations;
    
    BankAtlantics seven-day banking initiatives and other growth, marketing or advertising
initiatives not resulting in continued growth of core deposits or results which justify
their costs;
    
    the success of BankAtlantic Bancorps expense discipline initiative and the ability to
achieve additional cost savings;
    
    the success of BankAtlantics new stores in achieving growth and profitability in the
time frames anticipated, if at all;
 4




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##### Table of Contents




    
    the impact of periodic testing of goodwill, deferred tax assets, and other intangible
assets for impairment;
    
    past performance, actual or estimated new account openings and growth rate may not be
achieved of;
    
    BankAtlantic Bancorp holds a significant investment in the equity securities of Stifel
Financial Corp. (Stifel) as a result of the sale of Ryan Beck Holdings, Inc. subjecting
it to the risks associated with the value of Stifel shares and warrants, and the risk that
no gain on these securities may be realized. The earn-out amounts payable under the
agreement with Stifel are contingent upon the performance of individuals and divisions of
Ryan Beck which are now under the exclusive control and direction of Stifel, and there is
no assurance that BankAtlantic Bancorp will be entitled to receive any earn-out payments;
and
    
    BankAtlantic Bancorps success at managing the risks involved in the foregoing.
  
    
    the impact of economic, competitive and other factors affecting Levitt and its
operations;
    
    the market for real estate in the areas where Levitt has developments, including the
impact of market conditions on Levitts margins and the fair value of its real estate
inventory;
    
    the risk that the value of the property held by Core Communities may decline, including
as a result of a sustained downturn in the residential real estate and homebuilding
industries;
    
    the impact of market conditions for commercial property and whether the factors
negatively impacting the homebuilding and residential real estate industries will impact
the market for commercial property;
    
    the risk that the development of parcels and master-planned communities will not be
completed as anticipated; continued declines in the estimated fair value of Levitts real
estate inventory and the potential for write-downs or impairment charges;
    
    continued declines in the estimated fair value of Levitts real estate inventory and
the potential for further write-downs or impairment charges;
    
    the effects of increases in interest rates and availability of credit to buyers of
Levitts inventory;
    
    accelerated principal payments of Levitts debt obligations due to re-margining or curtailment payment requirements;
    
    the ability to obtain financing and to renew existing credit facilities on acceptable
terms, if at all;
    
    Levitts ability to access additional capital on acceptable terms, if at all;
    
    the risks and uncertainties inherent in bankruptcy proceedings and the inability to
predict the possible effect of Levitt and Sons reorganization and/or liquidation process
on Levitt Corporation and its results of operation and financial condition;
    
    the risk that creditors of Levitt and Sons may be successful in asserting claims
against Levitt Corporation and the risk that any of Levitt Corporations assets may become
subject to or included in Levitt and Sons bankruptcy case;
    
    that Levitt Corporations administrative expense claims and secured and unsecured
claims will not be recovered from Levitt and Sons in the bankruptcy proceedings and that
Levitt Corporation will continue to pay for additional services for the benefit of the
bankrupt estate;
    
    Levitts success at managing the risks involved in the foregoing.
  5




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ITEM 1. BUSINESS
 The Company
     PercentShares
    
    Percent of
    
    ofOwned
    
    Ownership
    
    VoteBankAtlantic BancorpClass A Common Stock
    
    
    8,329,236
    
    
    
    16.27
    %
    
    
    8.62
    %Class B Common Stock
    
    
    4,876,124
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    13,205,360
    
    
    
    23.55
    %
    
    
    55.62
    %LevittClass A Common Stock
    
    
    18,676,955
    (1)
    
    
    19.65
    %
    
    
    6.99
    %(1)Class B Common Stock
    
    
    1,219,031
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    19,895,986
    (1)
    
    
    20.67
    %
    
    
    53.99
    %(1)
 
 (1)
    
    Our ownership interest includes, but our voting interest excludes, 6,145,582 shares of
Levitts Class A Common Stock which, subject to certain exceptions, BFC has agreed not to
vote, as discussed in further details below under Key Developments  Levitts Rights
Offering. 6




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www.bfcfinancial.com
 Key Developments in 2007
 Public Offering
  Levitts Rights Offering
  s
  Termination of Proposed BFC and Levitt Corporation Merger
  7




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##### Table of Contents



I.R.E. RAG Merger
  BankAtlantic Bancorp and Levitt
  Recent Developments
  8




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Business Segments
  BFC Activities Segment
   Benihana
    9




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Employees
   December 31, 2007
    
    December 31, 2006Full-time
    
    Part-time
    
    Full-time
    
    Part-timeBFC
    
    
    47
    
    
    
    1
    
    
    
    41
    
    
    
    1
  10




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##### Table of Contents



Financial Services Segment
 Our Financial Services segment consists of BankAtlantic Bancorp, which is consolidated with
BFC Financial Corporation. The only assets available to BFC Financial Corporation from BankAtlantic
Bancorp are dividends when and if declared and paid by BankAtlantic Bancorp. BankAtlantic Bancorp
is a separate public company and its management prepared the following Item 1. Business regarding
BankAtlantic Bancorp which was included in BankAtlantic Bancorps Annual Report on Form 10-K for
the year ended December 31, 2007 filed with the Securities and Exchange Commission. Accordingly,
references to the Company, we, us , our or Parent Company in the following discussion
under the caption Financial Services are references to BankAtlantic Bancorp and its subsidiaries,
and are not references to BFC Financial Corporation.
 BankAtlantic Bancorp  the Company
  www.bankatlanticbancorp.com
  BankAtlantic
   
    
    attracting checking and savings deposits from individuals and business customers,
    
    originating commercial real estate, business, consumer and small business loans,
    
    purchasing wholesale residential loans, and
    
    investing in mortgage-backed securities, tax certificates and other securities.
  
    
    Continuing its Floridas Most Convenient Bank Initiative.BankAtlantic began its
Floridas Most Convenient Bank initiative in 2002, when it introduced seven-day banking
and its free checking and free gift program in Florida. In addition to the seven-day
strategy and extended lobby hours, BankAtlantic developed products, promotions and services
that are an integral part of BankAtlantics strategy of customer convenience and WOW!
customer service, both intended to increase its core deposit accounts. BankAtlantic
defines its core deposits as its demand deposit accounts, NOW checking accounts and savings
accounts.
 11




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
    
    Increasing Core Deposits.From April, 2002, when the Floridas Most Convenient Bank
initiative was launched, to December 31, 2007, BankAtlantics core deposits increased 284%
from approximately $600 million to approximately $2.3 billion. These core deposits
represented 58% of BankAtlantics total deposits at December 31, 2007, compared to 26% of
total deposits at December 31, 2001. However, the growth of core deposits for the year
ending December 31, 2007 has slowed as core deposits increased $64.5 million or 3% from
their December 31, 2006 levels. We believe the slower growth was largely a result of
current economic conditions and competition. In response to changes in market and economic
conditions, BankAtlantic reduced its advertising expenditures and in December 2007,
shortened its lobby and customer service hours. Even with the reduced hours,
BankAtlantics stores remain open seven days a week and are generally open more hours than
its competitors. BankAtlantic anticipates a decline in short term interest rates during
2008 which it hopes will result in core deposit growth during 2008; however, increased
competition, general economic conditions and the overall economy in Florida, in particular,
may offset any favorable impact that declining interest rates may have on deposit growth.
    
    Improving Operational Efficiencies in our Stores and Support Functions. Management is
focused on improving its operating efficiencies during 2008. We anticipate consolidating
back-office support facilities and reducing costs by subleasing or terminating lease
contracts. We are also evaluating store and back-office support staffing levels with a
view toward reducing costs which do not impact the quality of customer service.
Additionally, we are seeking to implement technologies that we believe will reduce our
customer service expenses. Based on the current economic environment, BankAtlantic
decided in the fourth quarter of 2007 to delay its previously announced store expansion
initiatives. As part of this decision, BankAtlantic has entered into an agreement with an
unrelated financial institution to sell its five Orlando stores, is terminating certain
lease agreements, seeking to sublease certain properties, and is attempting to sell land
acquired for its store expansion program in all its markets. The sale of the Orlando
stores is subject to regulatory approval.
    
    Conservative and Targeted Growth in Loan Portfolio. BankAtlantic is focused on growth of
its retail banking business with an emphasis on generating small business and consumer
loans as well as measured growth in commercial loans collateralized by income producing
commercial real estate properties. The commercial real estate loan portfolio declined
during 2007 as a result of the significant deterioration in the Florida residential real
estate market. BankAtlantic continues to refine its underwriting criteria across all loan
categories in response to the deterioration of the real estate market and overall slowing
economic conditions.
    
    Managing Credit Risk.BankAtlantic strives to maintain strong underwriting standards
and has developed underwriting policies and procedures which it believes will enable it to
offer products and services to its customers while minimizing its exposure to unnecessary
credit risk. However, the residential real estate market in Florida is currently in a
period of substantial decline and this has had an adverse impact on the credit quality of
our commercial real estate and home equity loan portfolios. In response, BankAtlantic
continues to refine its underwriting criteria across all loan categories. Additionally,
our loan portfolio monitoring processes have been refined to include the following:
 o
    
    A specialized land acquisition, development and construction loan
committee to monitor developments affecting the collateral of commercial
residential development loans;o
    
    Additional resources to negotiate loan work-outs and if necessary
supervise the collection process; ando
    
    Additional loan review resources to support increased frequency of
targeted loan reviews.
 12




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
    
    Maintaining and Strengthening our Capital Position.BankAtlantic exceeded all
applicable regulatory capital requirements and was considered a well capitalized
financial institution at December 31, 2007. See Regulation and Supervision  Capital
Requirements for an explanation of capital standards. Management has implemented
initiatives to preserve capital in response to the current unfavorable economic
environment. These initiatives include decreasing the amount of cash dividends,
consolidating back-office facilities, reducing staffing levels, selling its Orlando stores
and slowing our retail network expansion. Additionally, BankAtlantic Bancorp has $180.6
million of financial assets that may be used to contribute capital to BankAtlantic.
  Residential:
  Commercial Real Estate:
  13




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Consumer:
 Small Business:
 Commercial Business:
 Standby Letters of Credit and Commitments:
 14




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As of December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003Amount
    
    Pct
    
    Amount
    
    Pct
    
    Amount
    
    Pct
    
    Amount
    
    Pct
    
    Amount
    
    PctLoans receivable:Real estate loans:Residential
    
    $
    2,156
    
    
    
    47.66
    
    
    
    2,151
    
    
    
    46.81
    
    
    
    2,030
    
    
    
    43.92
    
    
    
    2,057
    
    
    
    45.16
    
    
    
    1,343
    
    
    
    36.99
    %Consumer  home equity
    
    
    676
    
    
    
    14.94
    
    
    
    562
    
    
    
    12.23
    
    
    
    514
    
    
    
    11.12
    
    
    
    457
    
    
    
    10.03
    
    
    
    334
    
    
    
    9.20Construction and development
    
    
    416
    
    
    
    9.20
    
    
    
    475
    
    
    
    10.34
    
    
    
    785
    
    
    
    16.99
    
    
    
    766
    
    
    
    16.82
    
    
    
    685
    
    
    
    18.87Commercial
    
    
    882
    
    
    
    19.49
    
    
    
    973
    
    
    
    21.17
    
    
    
    979
    
    
    
    21.18
    
    
    
    1,004
    
    
    
    22.04
    
    
    
    997
    
    
    
    27.46Small business
    
    
    212
    
    
    
    4.69
    
    
    
    187
    
    
    
    4.07
    
    
    
    152
    
    
    
    3.29
    
    
    
    124
    
    
    
    2.72
    
    
    
    108
    
    
    
    2.97Loans to Levitt Corporation
    
    
    
    
    
    
    0.00
    
    
    
    
    
    
    
    0.00
    
    
    
    
    
    
    
    0.00
    
    
    
    9
    
    
    
    0.20
    
    
    
    18
    
    
    
    0.50Other loans:Commercial business
    
    
    131
    
    
    
    2.90
    
    
    
    157
    
    
    
    3.42
    
    
    
    88
    
    
    
    1.90
    
    
    
    93
    
    
    
    2.04
    
    
    
    116
    
    
    
    3.19Small business  non-mortgage
    
    
    106
    
    
    
    2.34
    
    
    
    98
    
    
    
    2.13
    
    
    
    83
    
    
    
    1.80
    
    
    
    67
    
    
    
    1.47
    
    
    
    52
    
    
    
    1.43Consumer
    
    
    31
    
    
    
    0.68
    
    
    
    26
    
    
    
    0.57
    
    
    
    27
    
    
    
    0.59
    
    
    
    18
    
    
    
    0.40
    
    
    
    22
    
    
    
    0.61Residential loans held for sale
    
    
    4
    
    
    
    0.09
    
    
    
    9
    
    
    
    0.20
    
    
    
    3
    
    
    
    0.06
    
    
    
    5
    
    
    
    0.11
    
    
    
    2
    
    
    
    0.05Total
    
    
    4,614
    
    
    
    101.99
    
    
    
    4,638
    
    
    
    100.94
    
    
    
    4,661
    
    
    
    100.85
    
    
    
    4,600
    
    
    
    100.99
    
    
    
    3,677
    
    
    
    101.27Adjustments:Unearned discounts (premiums)
    
    
    (4
    )
    
    
    -0.09
    
    
    
    (1
    )
    
    
    -0.02
    
    
    
    (2
    )
    
    
    -0.04
    
    
    
    (1
    )
    
    
    -0.02
    
    
    
    
    
    
    
    0.00Allowance for loan losses
    
    
    94
    
    
    
    2.08
    
    
    
    44
    
    
    
    0.96
    
    
    
    41
    
    
    
    0.89
    
    
    
    46
    
    
    
    1.01
    
    
    
    46
    
    
    
    1.27Total loans receivable,
net
    
    $
    4,524
    
    
    
    100.00
    
    
    
    4,595
    
    
    
    100.00
    
    
    
    4,622
    
    
    
    100.00
    
    
    
    4,555
    
    
    
    100.00
    
    
    
    3,631
    
    
    
    100.00
    %
  OutstandingBalancesLand acquisition, development and construction loans
    
    $
    151Construction loans collateralized by
income producing properties
    
    
    79Nonresidential construction loans
    
    
    186Total construction and development
    
    $
    416Builder land bank loans
    
    $
    150Land acquisition and development loans
    
    
    202Non-residential land loans
    
    
    102Permanent commercial loans
    
    
    428Total commercial
    
    $
    882
  Securities Available for Sale:
 15




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Tax Certificates:
 Derivative Investments:
  Treasury
    
    
    
    
    
    
    
    
    
    Mortgage-
    
    Bond
    
    
    
    
    
    Weightedand
    
    Tax
    
    Tax-Exempt
    
    Backed
    
    And
    
    
    
    
    
    AverageAgencies
    
    Certificates
    
    Securities
    
    Securities
    
    Other
    
    Total
    
    YieldDecember 31, 2007Maturity: (1)One year or less
    
    $
    
    
    
    
    188,401
    
    
    
    
    
    
    
    
    
    
    
    410
    
    
    
    188,811
    
    
    
    8.43
    %After one through five years
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    135,479
    
    
    
    271
    
    
    
    135,750
    
    
    
    4.74After five through ten years
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,947
    
    
    
    
    
    
    
    1,947
    
    
    
    5.89After ten years
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    651,035
    
    
    
    
    
    
    
    651,035
    
    
    
    5.41Fair values (2)
    
    $
    
    
    
    
    188,401
    
    
    
    
    
    
    
    788,461
    
    
    
    681
    
    
    
    977,543
    
    
    
    5.90
    %Amortized cost (2)
    
    $
    
    
    
    
    188,401
    
    
    
    
    
    
    
    785,682
    
    
    
    685
    
    
    
    974,768
    
    
    
    6.06
    %Weighted average yield based
on fair values
    
    
    
    
    
    
    8.43
    
    
    
    
    
    
    
    5.30
    
    
    
    3.54
    
    
    
    5.90Weighted average maturity (yrs)
    
    
    
    
    
    
    1.0
    
    
    
    
    
    
    
    19.63
    
    
    
    1.22
    
    
    
    16.01December 31, 2006Fair values (2)
    
    $
    
    
    
    
    195,391
    
    
    
    397,244
    
    
    
    361,750
    
    
    
    675
    
    
    
    955,060
    
    
    
    6.17
    %Amortized cost (2)
    
    $
    
    
    
    
    195,391
    
    
    
    397,469
    
    
    
    365,565
    
    
    
    685
    
    
    
    959,110
    
    
    
    6.05
    %December 31, 2005Fair values (2)
    
    $
    1,000
    
    
    
    163,726
    
    
    
    388,566
    
    
    
    381,540
    
    
    
    585
    
    
    
    935,417
    
    
    
    5.45
    %Amortized cost (2)
    
    $
    998
    
    
    
    163,726
    
    
    
    392,130
    
    
    
    387,178
    
    
    
    585
    
    
    
    944,617
    
    
    
    5.20
    %
 
 (1)
    
    Except for tax certificates, maturities are based upon contractual maturities. Tax
certificates do not have stated maturities, and estimates in the above table are based upon
historical repayment experience (generally 1 to 2 years).(2)
    
    Equity and tax exempt securities held by the parent company with a cost of $162.6, $88.6
million, and $95.1 million and a fair value of $179.5 million, $99.9 million, and $103.2
million, at December 31, 2007, 2006 and 2005, respectively, were excluded from the above
table. At December 31, 2007, equities held by BankAtlantic with a cost of $750,000 and a
fair value of $1.4 million were excluded from the above table. 16




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##### Table of Contents



December 31, 2007 (1)Gross
    
    GrossAmortized
    
    Unrealized
    
    Unrealized
    
    EstimatedCost
    
    Appreciation
    
    Depreciation
    
    Fair ValueTax certificates and investment
securities:Tax certificates:Cost equals market
    
    $
    188,401
    
    
    
    
    
    
    
    
    
    
    
    188,401Securities available for sale:Investment securities:Cost equals market
    
    
    235
    
    
    
    
    
    
    
    
    
    
    
    235Market over cost
    
    
    450
    
    
    
    
    
    
    
    4
    
    
    
    446Mortgage-backed securities :Cost equals market
    
    
    18,959
    
    
    
    
    
    
    
    
    
    
    
    18,959Market over cost
    
    
    612,539
    
    
    
    5,737
    
    
    
    
    
    
    
    618,276Cost over market
    
    
    154,184
    
    
    
    
    
    
    
    2,958
    
    
    
    151,226Total
    
    $
    974,768
    
    
    
    5,737
    
    
    
    2,962
    
    
    
    977,543
 
 1)
    
    The above table excludes Parent Company equity securities with a cost of $162.6
million and a fair value of $179.5 million at December 31, 2007.2)
    
    At December 31, 2007, equities held by BankAtlantic with a cost of $750,000 and a fair
value of $1.4 million was excluded from the above table.  Income-Producing Real Estate Joint Venture Investments:
 Lending Joint Venture:
  Deposits:
 Federal Home Loan Bank (FHLB) Advances:
 17




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##### Table of Contents



Other Short-Term Borrowings:
 
    
    Securities sold under agreements to repurchase include a sale of a portion of its
current investment portfolio (usually mortgage-backed securities and REMICs) at a
negotiated rate and an agreement to repurchase the same assets on a specified future date.
BankAtlantic issues repurchase agreements to institutions and to its customers. These
transactions are collateralized by securities in its investment portfolio but are not
insured by the FDIC. See Note 15 to the Notes to Consolidated Financial Statements for
more information regarding BankAtlantics Securities sold under agreements to repurchase
borrowings.
    
    Treasury tax and loan borrowings represent BankAtlantics participation in the Federal
Reserve Treasury Investment Program. Under this program the Federal Reserve places funds
with BankAtlantic obtained from treasury tax and loan payments received by financial
institutions. See Note 14 to the Notes to Consolidated Financial Statements for more
information regarding BankAtlantics Treasury tax and loan borrowings.
    
    Federal funds borrowings occur under established facilities with various
federally-insured banking institutions to purchase federal funds. We also have a borrowing
facility with various federal agencies which may place funds with us at overnight rates.
BankAtlantic uses these facilities on an overnight basis to assist in managing its cash
flow requirements. BankAtlantic also has a facility with the Federal Reserve Bank of
Atlanta for secured advances. These advances are collateralized by a security lien against
its consumer loans. See Note 14 to the Notes to Consolidated Financial Statements for
more information regarding BankAtlantics federal funds borrowings.
    
    BankAtlantics other borrowings have floating interest rates and consist of a
mortgage-backed bond and subordinated debentures. See Note 16 to the Notes to
Consolidated Financial Statements for more information regarding BankAtlantics other
borrowings.
 Parent Company
  18




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##### Table of Contents



December 31, 2007Gross
    
    GrossCarrying
    
    Unrealized
    
    Unrealized
    
    EstimatedValue
    
    Appreciation
    
    Depreciation
    
    Fair ValueSecurities available
for sale:Equity securities
    
    $
    122,997
    
    
    
    12,449
    
    
    
    
    
    
    
    135,446Investment securities:Investment
securities (1)
    
    
    39,617
    
    
    
    4,468
    
    
    
    
    
    
    
    44,085Total
    
    $
    162,614
    
    
    
    16,917
    
    
    
    
    
    
    
    179,531
 December 31, 2006Gross
    
    GrossCarrying
    
    Unrealized
    
    Unrealized
    
    EstimatedValue
    
    Appreciation
    
    Depreciation
    
    Fair ValueSecurities available
for sale:Equity securities
    
    $
    82,134
    
    
    
    9,554
    
    
    
    
    
    
    
    91,688Investment securities:Investment
securities (1)
    
    
    6,500
    
    
    
    1,714
    
    
    
    
    
    
    
    8,214Total
    
    $
    88,634
    
    
    
    11,268
    
    
    
    
    
    
    
    99,902
 
 (1)
    
    Investment securities in 2007 consist of Stifel common stock that is subject to
restrictions for more than one year and are accounted for as investment securities at
cost. Also included in investment securities at December 31, 2007 and 2006 were equity
instruments purchased through private placements and are accounted for at historical cost
adjusted for other-than-temporary declines in value. Employees
   December 31, 2007
    
    December 31, 2006Full-
    
    Part-
    
    Full-
    
    Part-Time
    
    time
    
    time
    
    timeBankAtlantic Bancorp
    
    
    7
    
    
    
    
    
    
    
    8
    
    
    
    BankAtlantic
    
    
    2,207
    
    
    
    355
    
    
    
    2,425
    
    
    
    386Total
    
    
    2,214
    
    
    
    355
    
    
    
    2,433
    
    
    
    386
 Competition
  19




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Regulation and Supervision
 Holding Company
   
    
    acquiring another savings institution or its holding company without prior written
approval of the OTS;
    
    acquiring or retaining, with certain exceptions, more than 5% of a non-subsidiary
savings institution, a non-subsidiary holding company, or a non-subsidiary company engaged
in activities other than those permitted by HOLA; or
    
    acquiring or retaining control of a depository institution that is not insured by the
FDIC.
    20




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##### Table of Contents



BankAtlantic
   Regulation of Federal Savings Banks
 Business Activities
 
    
    mortgage loans secured by residential and commercial real estate;
    
    commercial and consumer loans;
    
    certain types of debt securities; and
    
    certain other assets.
  Loans to One Borrower
 QTL Test
 21




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##### Table of Contents



Capital Requirements
 
    
    a tangible capital requirement for savings banks to have tangible capital in an amount
equal to at least 1.5% of adjusted total assets;
    
    a leverage ratio requirement:
 o
    
    for savings banks assigned the highest composite rating of 1, to have
core capital in an amount equal to at least 3% of adjusted total assets; oro
    
    for savings banks assigned any other composite rating, to have core
capital in an amount equal to at least 4% of adjusted total assets, or a higher
percentage if warranted by the particular circumstances or risk profile of the
savings bank; and
 
    
    a risk-based capital requirement for savings banks to have capital in an amount equal to
at least 8% of risk-weighted assets.
    Limitation on Capital Distributions
   Liquidity
 Assessments
 
    
    the size of the savings bank, on which the basic assessment is based;
    
    the savings banks supervisory condition, which results in an additional assessment
based on a percentage of the basic assessment for any savings bank with a composite rating
of 3, 4 or 5 in its most recent safety and soundness examination; and
 22




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##### Table of Contents




    
    the complexity of the savings banks operations, which results in an additional
assessment based on a percentage of the basic assessment for any savings bank that has more
than $1 billion in trust assets that it administers, loans that it services for others or
assets covered by its recourse obligations or direct credit substitutes.
  Branching
 Community Reinvestment
 
    
    a lending test, to evaluate the institutions record of making loans in its designated
assessment areas;
    
    an investment test, to evaluate the institutions record of investing in community
development projects, affordable housing, and programs benefiting low or moderate income
individuals and businesses; and
    
    a service test, to evaluate the institutions delivery of banking services throughout
its designated assessment area.
  Transactions with Related Parties
  
    
    making or renewing a loan or other extension of credit to an affiliate;
    
    purchasing, or investing in, a security issued by an affiliate;
    
    purchasing an asset from an affiliate;
    
    accepting a security issued by an affiliate as collateral for a loan or other extension
of credit to any person or entity; and
    
    issuing a guarantee, acceptance or letter of credit on behalf of an affiliate.
 23




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##### Table of Contents




    
    making a loan or other extension of credit to an affiliate that is engaged in any
non-bank holding company activity; and
    
    purchasing, or investing in, securities issued by an affiliate that is not a subsidiary.
  Enforcement
 Examination
 Standards for Safety and Soundness
 Shared National Credit Program
 24




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##### Table of Contents



Real Estate Lending Standards
 Prompt Corrective Regulatory Action
 
    
    its total capital is at least 10% of its risk-weighted assets;
    
    its core capital is at least 6% of its risk-weighted assets;
    
    its core capital is at least 5% of its adjusted total assets; and
    
    it is not subject to any written agreement, order, capital directive or prompt
corrective action directive issued by the OTS, or certain regulations, to meet or maintain
a specific capital level for any capital measure.
  Insurance of Deposit Accounts
    25




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Privacy and Security Protection
 Insurance Activities
 Federal Home Loan Bank System
 Federal Reserve System
 Anti-Terrorism and Anti-Money Laundering Regulations
 26




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##### Table of Contents




    
    internal policies, procedures and controls designed to implement and maintain the
savings banks compliance with all of the requirements of the USA PATRIOT Act, the BSA and
related laws and regulations;
    
    systems and procedures for monitoring and reporting of suspicious transactions and
activities;
    
    a designated compliance officer;
    
    employee training;
    
    an independent audit function to test the anti-money laundering program;
    
    procedures to verify the identity of each customer upon the opening of accounts; and
    
    heightened due diligence policies, procedures and controls applicable to certain foreign
accounts and relationships.
  Consumer Protection
 
    
    require lenders to disclose credit terms in meaningful and consistent ways;
    
    require financial institutions to establish policies and procedures regarding identity
theft and notify customers of certain information concerning their credit reporting;
    
    prohibit discrimination against an applicant in any consumer or business credit
transaction;
    
    prohibit discrimination in housing-related lending activities;
    
    require certain lender banks to collect and report applicant and borrower data regarding
loans for home purchase or improvement projects;
    
    require lenders to provide borrowers with information regarding the nature and cost of
real estate settlements;
    
    prohibit certain lending practices and limit escrow account amounts with respect to real
estate transactions; and
    
    prescribe penalties for violations of the requirements of consumer protection statutes
and regulations.
 27




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##### Table of Contents



Real Estate Division Segments
 Our Real Estate Development activities are comprised of the operations of Levitt Corporation.
Levitt presents its results in four reportable segments and its results of operations are
consolidated with BFC Financial Corporation. The only assets available to BFC Financial Corporation
are dividends when and if declared and paid by Levitt. Levitt is a separate public company and its
management prepared the following Item 1. Business regarding Levitt which was included in Levitts
Annual Report on Form 10-K for the year ended December 31, 2007 filed with the Securities and
Exchange Commission. Accordingly, references to the Company, we, us, our or Parent
Company in the following discussion under the caption Real Estate Development are references to
Levitt and its subsidiaries, and are not references to BFC Financial Corporation.
 General Description of Business
   Core Communities
    28




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Accounting for
the Impairment or Disposal of Long-Lived Assets
 29




---



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ther Operations
  See Recent Developments -
Acquisition of Carolina Oak.
 Levitt and Sons
 Recent Developments -
Bankruptcy of Levitt and Sons
     30




---



##### Table of Contents



Recent Developments
 Bankruptcy of Levitt and Sons
  Joint Home Purchase Deposit Creditors Committee of
Creditors Holding Unsecured Claims
 Debtors Motion for Authority to Incur
Chapter 11 Administrative Expense Claim
   31




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##### Table of Contents



Rights Offering
  Reductions in Force
   Acquisition of Carolina Oak Homes, LLC
  Acquisition of common stock
  32




---



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Business Strategy
  Pursue investment opportunities.
 Continue to develop master-planned communities
  Operate efficiently and effectively
 33




---



##### Table of Contents



Utilize community development districts to fund development costs
 Business Segments
  Land Division
   ThirdClosed
    
    
    
    
    
    Non-
    
    
    
    
    
    PartyDate
    
    Acres
    
    Acres
    
    Current
    
    Saleable
    
    Saleable
    
    Backlog
    
    AcresAcquired
    
    Acquired
    
    (a)
    
    Inventory
    
    Acres (b)
    
    Acres (b)
    
    (c)
    
    AvailableCurrently in DevelopmentTradition, Florida
    
    
    1998  2004
    
    
    
    8,246
    
    
    
    1,794
    
    
    
    6,452
    
    
    
    2,583
    
    
    
    3,869
    
    
    
    259
    
    
    
    3,610Tradition Hilton Head
    
    
    2005
    
    
    
    5,390
    
    
    
    163
    
    
    
    5,227
    
    
    
    2,417
    
    
    
    2,810
    
    
    
    
    
    
    
    2,810Total Currently in Development
    
    
    
    
    
    
    13,636
    
    
    
    1,957
    
    
    
    11,679
    
    
    
    5,000
    
    
    
    6,679
    
    
    
    259
    
    
    
    6,420
 
 (a)
    
    Closed acres for Tradition Hilton Head include 150 acres owned by Carolina Oak, a wholly owned subsidiary of Levitt
Corporation. The revenue from this sale was eliminated in consolidation.(b)
    
    Actual saleable and non-saleable acres may vary over time due to changes in zoning, project design, or other factors.
Non-saleable acres include, but are not limited to, areas set aside for roads, parks, schools, utilities, wetlands and other
public purposes.(c)
    
    Acres under contract to third parties. 34




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##### Table of Contents



Other Operations
  Levitt Commercial
  Investment in Bluegreen Corporation
      Corporate Operations Headquarters
  35




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##### Table of Contents



Other Investments and Joint Ventures
   Homebuilding Division
   Information Technologies
  Seasonality
  36




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##### Table of Contents



Competition
   Employees
  Full
    
    PartTime
    
    TimePrimary Homebuilding
    
    
    3
    
    
    
    Land
    
    
    67
    
    
    
    8Other Operations
    
    
    47
    
    
    
    Total
    
    
    117
    
    
    
    8
   Additional Information
 www.levittcorporation.com
  37




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ITEM 1A. RISK FACTORS
 Regulatory restrictions, bank performance and the terms of indebtedness limit BankAtlantic
Bancorps ability to pay dividends which may impact our cash flow.
     Restrictions, operating performance and the terms of indebtedness limit the ability for Levitt to
pay dividends, which may impact our cash flow.
  38




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We have in the past incurred operating cash flow deficits that we expect will continue in the
future.
  Conditions and events where our investments are currently concentrated, could adversely impact our
results and future growth.
  Our future acquisitions may reduce our earnings, require us to obtain additional financing and
expose us to additional risks.
  
    
    fail to accomplish our strategic objectives;
    
    not perform as expected; and/or
    
    expose us to the risks of the business that we acquire.
  39




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Our activities and our subsidiaries activities are subject to a wide range of bank regulatory
requirements that could have a material adverse effect on our business.
  
    
    limit the payment of dividends by BankAtlantic to BankAtlantic Bancorp;
    
    limit transactions between us, BankAtlantic, BankAtlantic Bancorp and the subsidiaries
or affiliates of either;
    
    limit the activities of BankAtlantic, BankAtlantic Bancorp or us; or
    
    impose capital requirements on us or BankAtlantic Bancorp.
  We have many competitors who may have greater financial resources or operate under fewer regulatory
constraints than us.
  Certain members of our Board of Directors and certain of our executive officers are also directors
and executive officers of our affiliates.
  Recent changes in accounting standards regarding the treatment of stock options could harm our
ability to attract and retain employees and negatively impacts our results of operations.
  40




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##### Table of Contents



Failure to achieve and maintain effective internal control over financial reporting in accordance
with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and
stock price.
  Risks Associated with Our Investment in Benihana and the Restaurant Industry
  
    
    Changes in consumer preferences and discretionary spending;
    
    Ability to compete with many food service businesses;
    
    The availability and quality of ingredients and changes in food and supply costs could
adversely affect results of operations;
    
    The food service industry is affected by litigation and publicity concerning food
quality, health and other issues, which could cause customers to avoid a particular
restaurant, result in significant liabilities or litigation costs or damage reputation or
brand recognition;
    
    Health concerns relating to the consumption of food products could affect consumer
preferences and could negatively impact results of operations;
    
    Increased labor costs or labor shortages could adversely affect results of operations;
    
    The ability to obtain and maintain licenses and permits necessary to operate restaurants
and compliance with laws could adversely affect operating results;
    
    Seasonal fluctuations in business could adversely impact stock price;
    
    The need for additional capital in the future which might not be available; and
    
    The loss of key management personnel.
 Issuance of Additional Securities In The Future.
  41




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Our portfolio of equity securities subjects us to equity pricing risks.
  Our control position may adversely affect the market price of BankAtlantic Bancorps and
Levitts Class A Common Stock.
  Alan B. Levan And John E. Abdos Control Position May Adversely Affect The Market Price Of Our
Common Stock.
  The terms of our articles of incorporation, which establish fixed relative voting percentages
between our Class A Common Stock and Class B Common Stock, may not be well accepted by the market.
  42




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43




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##### Table of Contents



Financial Services Segment Risk Factors
 Our Financial Services segment consists of BankAtlantic Bancorp, which is consolidated with
BFC Financial Corporation. The only assets available to BFC Financial Corporation from BankAtlantic
Bancorp are dividends when and if declared and paid by BankAtlantic Bancorp. BankAtlantic Bancorp
is a separate public company and its management prepared the following Item 1A. Risk Factors
regarding BankAtlantic Bancorp which was included in BankAtlantic Bancorps Annual Report on Form
10-K for the year ended December 31, 2007 filed with the Securities and Exchange Commission.
Accordingly, references to the Company, we, us , our or Parent Company in the following
discussion under the caption Financial Services are references to BankAtlantic Bancorp and its
subsidiaries, and are not references to BFC Financial Corporation.
 BankAtlantic
 A decline in the Florida real estate market has and may continue to adversely affect our earnings
and financial condition.
  BankAtlantics loan portfolio is concentrated in real estate lending which makes its loan portfolio
more susceptible to credit losses in the current depressed real estate market.
    44




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##### Table of Contents



BankAtlantics consumer loan portfolio is concentrated in home equity loans collateralized by
Florida properties primarily located in the markets where we operate our store network.
  BankAtlantics loan portfolio subjects it to high levels of credit risk.
  45




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##### Table of Contents



BankAtlantics interest-only residential loans expose it to greater credit risks.
  Increase in the Allowance for Loan Losses will result in reduced earnings.
  
    
    the risk characteristics of various classifications of loans;
    
    Previous loan loss experience;
    
    specific loans that have loss potential;
    
    delinquency trends;
    
    estimated fair value of the collateral;
    
    current economic conditions;
    
    the views of its regulators; and
    
    geographic and industry loan concentrations.
  46




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Adverse events in Florida, where our business is currently concentrated, could adversely impact our
results and future growth.
  Changes in interest rates could adversely affect our net interest income and profitability.
   
    
    interest income on interest-earning assets, such as loans; and
    
    interest expense on interest-bearing liabilities, such as deposits.
   
    
    it amortizes premiums on acquired loans and securities, and if loans
are prepaid, the unamortized premium will be charged off; and
    
    the yields it earns on the investment of funds that it receives from
prepaid loans and securities are generally less than the yields that
it earned on the prepaid loans.
  47




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BankAtlantics Floridas Most Convenient Bank initiative and related infrastructure expansion to
support a larger organization has resulted in higher operating expenses, which has had an adverse
impact on our earnings.
   BankAtlantics new stores may not achieve profitability.
  BankAtlantic obtains a significant portion of its non-interest income through service charges on
core deposit accounts.
  48




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##### Table of Contents



Regulatory Compliance.
  Parent Company
 BankAtlantic Bancorp services its debt and pays dividends primarily from dividends from
BankAtlantic, which are subject to regulatory limits.
      We are controlled by BFC Financial Corporation and its control position may adversely affect the
market price of our Class A common stock.
  49




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Our activities and our subsidiarys activities are subject to regulatory requirements that could
have a material adverse effect on our business.
  
    
    limit the payment of dividends by BankAtlantic to us;
    
    limit transactions between us, BankAtlantic and the subsidiaries or affiliates of either;
    
    limit our activities and the activities of BankAtlantic; or
    
    impose capital requirements on us.
  Our portfolio of equity securities subjects us to equity pricing risks.
   50




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##### Table of Contents



Real Estate Development Segment Risk Factors
 Our Real Estate Development segment consists of Levitt Corporation, which is consolidated with
BFC Financial Corporation. The only assets available to BFC Financial Corporation are dividends
when and if declared and paid by Levitt. Levitt is a separate public company and its management
prepared the following Item 1A. Risk Factors regarding Levitt which was included in Levitts Annual
Report on Form 10-K for the year ended December 31, 2007 filed with the Securities and Exchange
Commission. Accordingly, references to the Company, we, us, our or Parent Company in the
following discussion under the caption Real Estate Development are references to Levitt and its
subsidiaries, and are not references to BFC Financial Corporation.
 RISKS RELATING TO OUR BUSINESS AND THE REAL ESTATE BUSINESS GENERALLY
 We engage in real estate activities which are speculative and involve a high degree of risk
  
    
    overbuilding or decreases in demand to acquire land;
    
    the availability and cost of financing;
    
    unfavorable interest rates and increases in inflation;
    
    changes in national, regional and local economic conditions;
    
    cost overruns, inclement weather, and labor and material shortages;
    
    the impact of present or future environmental legislation, zoning laws and other
regulations;
    
    availability, delays and costs associated with obtaining permits, approvals or
licenses necessary to develop property; and
    
    increases in real estate taxes, insurance and other local government fees.
 There has been a decline in the homebuilding industry over the past two years and, if it continues,
it could adversely affect land development activities at our Land Division.
  Because real estate investments are illiquid, a decline in the real estate market or in the economy
in general could adversely impact our business and our cash flow
  51




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##### Table of Contents



Natural disasters could have an adverse effect on our real estate operations.
   A portion of our revenues from land sales in our master-planned communities are recognized for
accounting purposes under the percentage of completion method, therefore, if our actual results
differ from our assumptions, our profitability may be reduced.
  Product liability litigation and claims that arise in the ordinary course of business may be costly
which could adversely affect our business.
  We are subject to governmental regulations that may limit our operations, increase our expenses or
subject us to liability.
  
    
    environmental matters, including the presence of hazardous or toxic substances;
    
    wetland preservation;
    
    health and safety;
    
    zoning, land use and other entitlements;
    
    building design, and
    
    density levels.
 52




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##### Table of Contents




    
    installation of utility services such as gas, electric, water and waste
disposal;
    
    the dedication of acreage for open space, parks and schools;
    
    permitted land uses, and
    
    the construction design, methods and materials used.
  
    
    establish building moratoriums;
    
    limit the number of commercial properties that may be built;
    
    change building codes and construction requirements affecting property under
construction;
    
    increase the cost of development and construction, and
    
    delay development and construction.
   Building moratoriums and changes in governmental regulations may subject us to delays or increased
costs of construction or prohibit development of our properties
  We are subject to environmental laws and the cost of compliance could adversely affect our business.
  Increased insurance risk could negatively affect our business.
  53




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##### Table of Contents



We utilize community development district and special assessment district bonds to fund development
costs and we will be responsible for assessments until the underlying property is sold.
   RISKS ASSOCIATED WITH LEVITT AND SONS BANKRUPTCY FILING
 We cannot predict the effect that the Chapter 11 Cases will have on Levitt and Sons business and
creditors or on Levitt Corporation
  Levitt and Sons bankruptcy and the publicity surrounding its filing may adversely affect Levitt
Corporation and its subsidiaries other than Levitt and Sons.
  Levitt and Sons had surety bonds on most of their projects, some of which were subject to indemnity
by Levitt Corporation.
  54




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Levitt Corporations outstanding advances due from Levitt and Sons may not be repaid.
  RISKS RELATING TO OUR COMPANY
 Our outstanding debt instruments impose restrictions on our operations and activities and could
adversely affect our financial condition
   55




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##### Table of Contents



Our current land development plans may require additional capital, which may not be available on
favorable terms, if at all.
  Our results may vary.
  
    
    the cyclical nature of the real estate industry,
    
    prevailing interest rates and the availability of mortgage financing,
    
    weather,
    
    cost and availability of materials and labor,
    
    competitive conditions,
    
    timing of sales of land,
    
    the timing of receipt of regulatory and other governmental approvals for land
development projects, and
    
    the timing of the sale of our commercial leasing operations.
 Margins in our Land Division are subject to significant volatility.
  56




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##### Table of Contents




    
    shortages or increases in prices of construction materials;
    
    natural disasters in the areas in which we operate;
    
    lack of availability of adequate utility infrastructure and services; and
    
    our need to rely on local subcontractors who may not be adequately capitalized
or insured.
  When commercial leasing projects become available for sale, they may not yield anticipated returns,
which could harm our operating results, reduce cash flow, or cause management to choose not to sell
certain commercial assets.
    We are dependent upon certain key tenants and decisions made by these tenants or adverse
developments in the business of these tenants could have a negative impact on our financial
condition.
   57




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##### Table of Contents



It may be difficult and costly to rent vacant space and space which may become vacant in future
periods.
   The loss of the services of our key management and personnel could adversely affect our business
  Our future acquisitions may reduce our earnings, require us to obtain additional financing and
expose us to additional risks.
  
    
    fail to accomplish our strategic objectives;
    
    not perform as expected; and/or
    
    expose us to the risks of the business that we acquire.
  58




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Our controlling shareholders have the voting power to control the outcome of any shareholder vote,
except in limited circumstances.
  RISKS ASSOCIATED WITH OUR OWNERSHIP STAKE IN BLUEGREEN CORPORATION
   59




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##### Table of Contents



ITEM 1B. UNRESOLVED STAFF COMMENTS
  60




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##### Table of Contents



ITEM 2. PROPERTIES
 th
  Miami -
    
    
    
    
    
    Palm
    
    Tampa
    
    Orlando /Dade
    
    Broward
    
    Beach
    
    Bay
    
    JacksonvilleOwned full-service stores
    
    
    9
    
    
    
    12
    
    
    
    25
    
    
    
    7
    
    
    
    2Leased full-service stores
    
    
    13
    
    
    
    11
    
    
    
    5
    
    
    
    8
    
    
    
    1Ground leased full-service
stores (1)
    
    
    2
    
    
    
    3
    
    
    
    1
    
    
    
    3
    
    
    
    1Total full-service stores
    
    
    24
    
    
    
    26
    
    
    
    31
    
    
    
    18
    
    
    
    4Lease expiration dates
    
    
    2008-2026
    
    
    
    2008-2015
    
    
    
    2008-2012
    
    
    
    2008-2026
    
    
    
    2014Ground lease expiration dates
    
    
    2026-2027
    
    
    
    2017-2072
    
    
    
    2026
    
    
    
    2026
    
    
    
    2027
 
 (1)
    
    Stores in which BankAtlantic owns the building and leases the land.  Miami -
    
    
    
    
    
    Palm
    
    Tampa
    
    Orlando /Dade
    
    Broward
    
    Beach
    
    Bay
    
    JacksonvilleLeased drive-through facilities
    
    
    1
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    Leased drive through expiration dates
    
    
    2010
    
    
    
    2011-2014
    
    
    
    
    
    
    
    
    
    
    
    Leased back-office facilities
    
    
    
    
    
    
    3
    
    
    
    
    
    
    
    1
    
    
    
    1Leased back-office expiration dates
    
    
    
    
    
    
    2009-2011
    
    
    
    
    
    
    
    2011
    
    
    
    2013Leased loan production facilities
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    2Leased loan production expiration dates
    
    
    2009
    
    
    
    
    
    
    
    
    
    
    
    2009
    
    
    
    2009-2011
  Miami -
    
    
    
    
    
    Palm
    
    Tampa
    
    Orlando /Dade
    
    Broward
    
    Beach
    
    Bay
    
    JacksonvilleExecuted leases for expansion
    
    
    1
    
    
    
    1
    
    
    
    
    
    
    
    2
    
    
    
    Executed lease expiration dates
    
    
    2017
    
    
    
    2029
    
    
    
    
    
    
    
    2027-2028
    
    
    
    Executed leases held for sublease
    
    
    
    
    
    
    2
    
    
    
    1
    
    
    
    3
    
    
    
    6Executed lease expiration dates
    
    
    
    
    
    
    2012-2029
    
    
    
    2028
    
    
    
    2027-2048
    
    
    
    2027-2029Land held for sale
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    1
    
    
    
    6
  61




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##### Table of Contents



ITEM 3. LEGAL PROCEEDINGS
 Joseph C. Hubbard, individually and on behalf of all others similarly situated, vs. BankAtlantic
Bancorp, Inc., James A. White, Valerie C. Toalson, Jarett S. Levan, and Alan B. Levan ,
No. 0:07-cv-61542-UU, United States District Court, Southern District of Florida
 Alarm Specialties,
Inc. v. BankAtlantic Bancorp, Inc. Hubbard
  Wilmine Almonor, individually and on behalf of all others similarly situated, vs. BankAtlantic
Bancorp, Inc., Steven M. Coldren, Mary E. Ginestra, Willis N. Holcombe, Jarett S. Levan, John E.
Abdo, David A. Lieberman, Charlie C. Winningham II, D. Keith Cobb, Bruno L. DiGiulian, Alan B.
Levan, James A. White, the Security Plus Plan Committee, and Unknown Fiduciary Defendants 1-50 , No.
0:07-cv-61862-DMM, United States District Court, Southern District of Florida.
 Hubbard
 Levitt and Sons Bankruptcy
   Dance v Levitt Corp. et al., No. 08-CV-60111-DLG, United States District Court, Southern District
of Florida
  62




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##### Table of Contents



Other Litigation
  63




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##### Table of Contents



ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  Director
    
    For
    
    WithheldAlan B. Levan
    
    
    175,996,484
    
    
    
    2,069,943Neil Sterling
    
    
    175,849,630
    
    
    
    2,216,798
  Vote of Class A and Class B Common Stock
 Votes
    
    Votes
    
    VotesFor
    
    Against
    
    AbstainingI.R.E. RAG merger with and into
the Company
    
    
    150,171,616
    
    
    
    694,607
    
    
    
    21,138
 Vote of Class B Common Stock
 Votes
    
    Votes
    
    VotesFor
    
    Against
    
    AbstainingI.R.E. RAG merger with and into
the Company
    
    
    126,412,361
    
    
    
    93,427
    
    
    
    3,991
 64




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##### Table of Contents



PART II
 
 ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES
OF EQUITY SECURITIES
  
    
    Each share of Class A Common Stock is entitled to one vote for each share held, with
all holders of Class A Common Stock possessing in the aggregate 22% of the total voting
power. Holders of Class B Common Stock have the remaining 78% of the total voting
power. If the number of shares of Class B Common Stock outstanding decreases to
1,800,000 shares, the Class A Common Stock aggregate voting power will change to 40%
and the Class B Common Stock will have the remaining 60%. If the number of shares of
Class B Common Stock outstanding decreases to 1,400,000 shares, the Class A Common
Stock aggregate voting power will change to 53% and the Class B Common Stock will have
the remaining 47%. If the number of shares of Class B Common Stock outstanding
decreases to 500,000, the fixed voting percentages will be eliminated; and
    
    Each share of Class B Common Stock is convertible at the option of the holder
thereof into one share of Class A Common Stock.
 Market Information
   Class A Common Stock:
    
    High
    
    Low2006First Quarter
    
    $
    6.64
    
    
    $
    5.35Second Quarter
    
    
    8.16
    
    
    
    5.69Third Quarter
    
    
    7.10
    
    
    
    4.35Fourth Quarter
    
    
    7.06
    
    
    
    4.802007First Quarter
    
    $
    6.75
    
    
    $
    4.31Second Quarter
    
    
    4.50
    
    
    
    3.59Third Quarter
    
    
    4.04
    
    
    
    2.22Fourth Quarter
    
    
    3.38
    
    
    
    1.16
 65




---



##### Table of Contents



Class B Common Stock:
    
    High
    
    Low2006First Quarter
    
    $
    6.50
    
    
    $
    5.25Second Quarter
    
    
    7.70
    
    
    
    5.70Third Quarter
    
    
    8.25
    
    
    
    5.00Fourth Quarter
    
    
    6.80
    
    
    
    4.852007First Quarter
    
    $
    6.10
    
    
    $
    5.00Second Quarter
    
    
    4.65
    
    
    
    3.60Third Quarter
    
    
    3.50
    
    
    
    2.25Fourth Quarter
    
    
    3.00
    
    
    
    1.10
 Holders
  NYSE Arca Certification
  Dividends
    66




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##### Table of Contents



Issuer Purchases of Equity Securities
  Shareholder Return Performance Graph
  12/31/02
    
    
    12/31/03
    
    
    12/31/04
    
    
    12/31/05
    
    
    12/31/06
    
    
    12/31/07BFC Financial Corporation
    
    
    
    100
    
    
    
    
    343
    
    
    
    
    499
    
    
    
    
    263
    
    
    
    
    321
    
    
    
    
    73DJ Wilshire 5000 Index
    
    
    
    100
    
    
    
    
    129
    
    
    
    
    143
    
    
    
    
    150
    
    
    
    
    171
    
    
    
    
    178Nasdaq Bank Index
    
    
    
    100
    
    
    
    
    130
    
    
    
    
    144
    
    
    
    
    138
    
    
    
    
    153
    
    
    
    
    119
 
 67




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##### Table of Contents



ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA
   For the Years Ended December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Income StatementRevenuesBFC Activities
    
    $
    6,109
    
    
    
    3,682
    
    
    
    3,129
    
    
    
    5,683
    
    
    
    1,073Financial Services
    
    
    520,793
    
    
    
    507,746
    
    
    
    445,537
    
    
    
    358,703
    
    
    
    320,534Real Estate Development
    
    
    426,955
    
    
    
    581,371
    
    
    
    574,601
    
    
    
    558,838
    
    
    
    288,686953,857
    
    
    
    1,092,799
    
    
    
    1,023,267
    
    
    
    923,224
    
    
    
    610,293Costs and ExpensesBFC Activities
    
    
    15,015
    
    
    
    12,370
    
    
    
    9,665
    
    
    
    7,452
    
    
    
    7,019Financial Services
    
    
    579,458
    
    
    
    474,311
    
    
    
    381,916
    
    
    
    280,431
    
    
    
    275,507Real Estate Development
    
    
    696,058
    
    
    
    604,841
    
    
    
    498,283
    
    
    
    481,618
    
    
    
    253,1691,290,531
    
    
    
    1,091,522
    
    
    
    889,864
    
    
    
    769,501
    
    
    
    535,695Equity in earnings from unconsolidated
affiliates
    
    
    12,724
    
    
    
    10,935
    
    
    
    13,404
    
    
    
    19,603
    
    
    
    10,126(Loss) income from continuing operations
    
    
    (323,950
    )
    
    
    12,212
    
    
    
    146,807
    
    
    
    173,326
    
    
    
    84,724(Benefit) provision for income taxes
    
    
    (70,246
    )
    
    
    (515
    )
    
    
    59,672
    
    
    
    70,920
    
    
    
    36,466Noncontrolling interest
    
    
    (219,603
    )
    
    
    13,422
    
    
    
    79,399
    
    
    
    90,388
    
    
    
    43,616(Loss) income from continuing operations
    
    
    (34,101
    )
    
    
    (695
    )
    
    
    7,736
    
    
    
    12,018
    
    
    
    4,642(Loss) income from discontinued operations,
net of noncontrolling interest and income taxes
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038
    
    
    
    2,212
    
    
    
    2,380Extraordinary gain, net of income taxes
    
    
    2,403
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net (loss) income
    
    
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774
    
    
    
    14,230
    
    
    
    7,0225% Preferred Stock dividends
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )
    
    
    (392
    )
    
    
    Net (loss) income allocable to
common stock
    
    $
    (31,209
    )
    
    
    (2,971
    )
    
    
    12,024
    
    
    
    13,838
    
    
    
    7,022Common Share Data (a), (c), ( d)Basic (loss) earnings per share:Basic (loss) earnings per share
from continuing operations
    
    $
    (0.90
    )
    
    
    (0.04
    )
    
    
    0.24
    
    
    
    0.48
    
    
    
    0.21Discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.18
    
    
    
    0.09
    
    
    
    0.10Extraordinary items
    
    
    0.06
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Basic (loss) earnings per share of common stock
    
    $
    (0.81
    )
    
    
    (0.09
    )
    
    
    0.42
    
    
    
    0.57
    
    
    
    0.31Diluted (loss) earnings per share:Diluted (loss) earnings per share
from continuing operations
    
    $
    (0.90
    )
    
    
    (0.05
    )
    
    
    0.22
    
    
    
    0.40
    
    
    
    0.16Discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.15
    
    
    
    0.07
    
    
    
    0.09Extraordinary items
    
    
    0.06
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Diluted (loss) earnings per share of common stock
    
    $
    (0.81
    )
    
    
    (0.10
    )
    
    
    0.37
    
    
    
    0.47
    
    
    
    0.25Basic weighted average number of
common shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    28,952
    
    
    
    24,183
    
    
    
    22,818Diluted weighted average number of
common shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    31,219
    
    
    
    27,806
    
    
    
    26,031Ratio of earnings to fixed charges (e)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.28Dollar deficiency of earnings to
fixed charges (e)
    
    
    5,618
    
    
    
    5,196
    
    
    
    5,248
    
    
    
    4,145
    
    
    
    
 Continued
 68




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##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Balance Sheet (at period end)Loans and leases and held for sale, net
    
    $
    4,529,538
    
    
    
    4,603,505
    
    
    
    4,628,744
    
    
    
    4,561,073
    
    
    
    3,611,612Securities
    
    $
    1,191,173
    
    
    
    1,081,980
    
    
    
    1,064,857
    
    
    
    1,082,985
    
    
    
    553,148Total assets
    
    $
    7,114,433
    
    
    
    7,605,766
    
    
    
    7,395,755
    
    
    
    6,954,847
    
    
    
    5,136,235Deposits
    
    $
    3,953,405
    
    
    
    3,867,036
    
    
    
    3,752,676
    
    
    
    3,457,202
    
    
    
    3,058,142Securities sold under agreements to
repurchase and federal funds purchased
    
    $
    159,905
    
    
    
    128,411
    
    
    
    249,263
    
    
    
    257,002
    
    
    
    120,874Other borrowings (f)
    
    $
    1,992,718
    
    
    
    2,398,662
    
    
    
    2,121,315
    
    
    
    2,083,109
    
    
    
    1,209,571Shareholders equity
    
    $
    184,037
    
    
    
    177,585
    
    
    
    183,080
    
    
    
    125,251
    
    
    
    85,675Book value per share (d), (g)
    
    $
    3.73
    
    
    
    4.84
    
    
    
    5.25
    
    
    
    4.25
    
    
    
    3.68Return on average equity (b) (h)
    
    
    (16.94
    )%
    
    
    (1.24
    )%
    
    
    8.08
    %
    
    
    13.16
    %
    
    
    8.63
    %BankAtlantic Asset quality ratiosNon-performing assets, net of reserves as a
percent of total loans, tax certificates and
real estate owned
    
    
    4.10
    %
    
    
    0.55
    %
    
    
    0.17
    %
    
    
    0.19
    %
    
    
    0.36
    %Loan loss allowance as a percent of
non-performing loans
    
    
    52.65
    %
    
    
    982.89
    %
    
    
    605.68
    %
    
    
    582.18
    %
    
    
    422.06
    %Loan loss allowance as a percentage
of total loans
    
    
    2.04
    %
    
    
    0.94
    %
    
    
    0.88
    %
    
    
    1.00
    %
    
    
    1.24
    %Capital Ratios for BankAtlanticTotal risk based capital
    
    
    11.63
    %
    
    
    12.08
    %
    
    
    11.50
    %
    
    
    10.80
    %
    
    
    12.06
    %Tier I risk based capital
    
    
    9.85
    %
    
    
    10.50
    %
    
    
    10.02
    %
    
    
    9.19
    %
    
    
    10.22
    %Leverage
    
    
    6.94
    %
    
    
    7.55
    %
    
    
    7.42
    %
    
    
    6.83
    %
    
    
    8.52
    %Levitt CorporationConsolidated:Consolidated margin on sales of real estate (i)
    
    $
    (163,126
    )
    
    
    83,125
    
    
    
    150,030
    
    
    
    143,378
    
    
    
    73,627Consolidated Margin
    
    
    (39.8
    )%
    
    
    14.7
    %
    
    
    26.9
    %
    
    
    26.1
    %
    
    
    26.0
    %Homes delivered
    
    
    998
    
    
    
    1,320
    
    
    
    1,338
    
    
    
    1,783
    
    
    
    1,011Acres sold
    
    
    40
    
    
    
    371
    
    
    
    1,647
    
    
    
    1,212
    
    
    
    1,337Primary Homebuilding (m):Revenues from sales of real estate
    
    $
    345,666
    
    
    
    424,420
    
    
    
    352,723
    
    
    
    418,550
    
    
    
    222,257Cost of sales of real estate (i)
    
    
    501,206
    
    
    
    367,252
    
    
    
    272,680
    
    
    
    323,366
    
    
    
    173,072Margin (i)
    
    $
    (155,540
    )
    
    
    57,168
    
    
    
    80,043
    
    
    
    95,184
    
    
    
    49,185Margin percentage (j)
    
    
    -45.00
    %
    
    
    13.50
    %
    
    
    22.70
    %
    
    
    22.70
    %
    
    
    22.10
    %Construction starts
    
    
    558
    
    
    
    1,445
    
    
    
    1,212
    
    
    
    1,893
    
    
    
    1,593Homes delivered
    
    
    998
    
    
    
    1,320
    
    
    
    1,338
    
    
    
    1,783
    
    
    
    1,011Average selling price of homes delivered
    
    $
    338,000
    
    
    
    322,000
    
    
    
    264,000
    
    
    
    235,000
    
    
    
    220,000Net orders (units)
    
    
    383
    
    
    
    847
    
    
    
    1,289
    
    
    
    1,378
    
    
    
    2,240Net orders (value)
    
    $
    94,782
    
    
    
    324,217
    
    
    
    448,207
    
    
    
    376,435
    
    
    
    513,436Tennessee Homebuilding (m) :Revenues from sales of real estate
    
    $
    42,042
    
    
    
    76,299
    
    
    
    85,644
    
    
    
    53,746
    
    
    
    Cost of sales of real estate (i)
    
    
    51,360
    
    
    
    72,807
    
    
    
    74,328
    
    
    
    47,731
    
    
    
    Margin (i)
    
    $
    (9,318
    )
    
    
    3,492
    
    
    
    11,316
    
    
    
    6,015
    
    
    
    Margin percentage (j)
    
    
    -22.20
    %
    
    
    4.60
    %
    
    
    13.20
    %
    
    
    11.20
    %
    
    
    
    %Construction starts
    
    
    171
    
    
    
    237
    
    
    
    450
    
    
    
    401
    
    
    
    Homes delivered
    
    
    146
    
    
    
    340
    
    
    
    451
    
    
    
    343
    
    
    
    Average selling price of homes delivered
    
    $
    205,000
    
    
    
    224,000
    
    
    
    190,000
    
    
    
    157,000
    
    
    
    Net orders (units)
    
    
    110
    
    
    
    269
    
    
    
    478
    
    
    
    301
    
    
    
    Net orders (value)
    
    $
    20,621
    
    
    
    57,776
    
    
    
    98,838
    
    
    
    51,481
    
    
    
    Land Division (l):Revenues from sales of real estate
    
    $
    16,567
    
    
    
    69,778
    
    
    
    105,658
    
    
    
    96,200
    
    
    
    55,037Cost of sales of real estate
    
    
    7,447
    
    
    
    42,662
    
    
    
    50,706
    
    
    
    42,838
    
    
    
    31,362Margin (i)
    
    $
    9,120
    
    
    
    27,116
    
    
    
    54,952
    
    
    
    53,362
    
    
    
    23,675Margin percentage (j)
    
    
    55.00
    %
    
    
    38.90
    %
    
    
    52.00
    %
    
    
    55.50
    %
    
    
    43.00
    %Acres sold
    
    
    40
    
    
    
    371
    
    
    
    1,647
    
    
    
    1,212
    
    
    
    1,337Inventory of real estate (acres) (k),
    
    
    6,679
    
    
    
    6,871
    
    
    
    7,287
    
    
    
    5,965
    
    
    
    6,837Inventory of real estate (book value)
    
    $
    189,903
    
    
    
    176,356
    
    
    
    150,686
    
    
    
    122,056
    
    
    
    43,906Acres subject to sales contracts  Third parties
    
    
    259
    
    
    
    74
    
    
    
    246
    
    
    
    1,833
    
    
    
    1,433Aggregate sales price of acres subject to sales
contracts to third parties
    
    $
    77,888
    
    
    
    21,124
    
    
    
    39,283
    
    
    
    121,095
    
    
    
    103,174
 Continued
 69




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##### Table of Contents



(a)
    
    Since its inception, BFC has not paid any cash dividends on its common stock.(b)
    
    Ratios were computed using quarterly averages.(c)
    
    While the Company has two classes of common stock outstanding, the two-class method is not presented because the Companys
capital structure does not provide for different dividend rates or other preferences, other than voting rights, between the two classes.(d)
    
    I.R.E. Realty Advisory Group, Inc.(I.R.E. RAG) owned 4,764,285 shares of BFC Class A Common Stock and 500,000 shares of BFC Class B
Common Stock. Because the Company owned 45.5% of the outstanding common stock of I.R.E. RAG, 45.5% of the shares of BFCs
common stock previously held by I.R.E. RAG were eliminated from the number of shares outstanding for purposes of computing
earnings (loss) per share and book value per share. In November 2007, I.R.E. RAG was merged with and into the Company. In connection
with the merger, the shares of BFCs common stock previously held by I.R.E. RAG were canceled and the shareholders of I.R.E. RAG, other
than
BFC, received an aggregate of approximately 2,601,300 shares of BFC Class A Common Stock and 273,000 shares of BFC Class B Common Stock,
representing their respective pro rata beneficial ownership interests in I.R.E. RAGs BFC shares. See Note 32 to our consolidated financial
statements Earnings (Loss) per Share.(e)
    
    The operations, fixed charges and dividends of BankAtlantic Bancorp and Levitt are not included in the calculation because each of those
subsidiaries are separate, publicly traded companies whose Board of Directors are comprised of individuals, a majority of whom are
independent. Accordingly, decisions made by those Boards, including with respect to the payment of dividends, are not within our control.(f)
    
    Other borrowings consist of FHLB advances, subordinated debentures, notes, bonds payable, secured borrowings, and junior subordinated
debentures. Secured borrowings were recognized on loan participation agreements that constituted a legal sale of a portion of the loan
but that were not qualified to be accounted for as a loan sale.(g)
    
    Preferred stock redemption price is eliminated from shareholders equity for purposes of computing book value per share.(h)
    
    The return on average equity is equal to net income (loss) (numerator) divided by average consolidated shareholders equity (denominator)
during the respective year.(i)
    
    Margin is calculated as sales of real estate minus cost of sales of real estate. Included in cost of sales of real estate for the years
ended December 31, 2007 and 2006 are homebuilding inventory impairment charges and write-offs of deposits and pre-acquisition costs of
$206.4 million and $31.1 million, respectively, in our Primary Homebuilding segment. In our Tennessee Homebuilding segment, impairment
charges amounted to $11.2 million and $5.7 million in the years ended December 31, 2007 and 2006, respectively.(j)
    
    Margin percentage is calculated by dividing margin by sales of real estate.(k)
    
    Estimated net saleable acres (subject to final zoning, permitting, and other governmental regulations / approvals). Includes approximately
56 acres
related to assets held for sale as of December 31, 2007.(l)
    
    Revenues and costs of sales of real estate include land sales to Levitt and Sons, if any. These inter-segment transactions are eliminated
in consolidation. Included in total liabilities is a net receivable amount associated with intersegment loans. This amount eliminates fully in consolidation but has the effect of decreasing liabilities as shown on a stand alone basis. As of December 31, 2007,
Levitt Other Operations had outstanding advances from Core
Communities in the amount of $38.3 million which are generally subordinated to loans from third party lenders. These advances eliminate in consolidation.(m)
    
    Bowden Building Corporation was acquired in May 2004. Levitt had no homebuilding operations in Tennessee in 2003. 70




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December 31,2007
    
    
    2006
    
    
    2005Balance Sheet Data:AssetsCash and cash equivalents
    
    $
    17,999
    
    
    
    17,815
    
    
    
    26,683Investment securities
    
    
    862
    
    
    
    2,262
    
    
    
    2,034Investment in Benihana
    
    
    20,000
    
    
    
    20,000
    
    
    
    20,000Investment in venture partnerships
    
    
    864
    
    
    
    908
    
    
    
    950Investment in BankAtlantic Bancorp, Inc.
    
    
    108,173
    
    
    
    113,586
    
    
    
    112,218Investment in Levitt Corporation
    
    
    54,637
    
    
    
    57,009
    
    
    
    58,111Investment in other subsidiaries
    
    
    1,578
    
    
    
    1,525
    
    
    
    1,631Loans receivable
    
    
    3,782
    
    
    
    2,157
    
    
    
    2,071Other assets
    
    
    906
    
    
    
    2,261
    
    
    
    960Total assets
    
    
    208,801
    
    
    
    217,523
    
    
    
    224,658Liabilities and Shareholders EquityAdvances from and negative basis in wholly owned subsidiaries
    
    
    3,174
    
    
    
    1,290
    
    
    
    462Other liabilities
    
    
    7,722
    
    
    
    7,351
    
    
    
    7,417Deferred income taxes
    
    
    13,868
    
    
    
    31,297
    
    
    
    33,699Total liabilities
    
    
    24,764
    
    
    
    39,938
    
    
    
    41,578Total shareholders equity
    
    
    184,037
    
    
    
    177,585
    
    
    
    183,080Total liabilities and shareholders equity
    
    $
    208,801
    
    
    
    217,523
    
    
    
    224,658
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Statements of Operations Data:Revenues
    
    $
    3,977
    
    
    
    2,232
    
    
    
    1,775Expenses
    
    
    9,565
    
    
    
    8,413
    
    
    
    14,904(Loss) before earnings (loss) from subsidiaries
    
    
    (5,588
    )
    
    
    (6,181
    )
    
    
    (13,129
    )Equity from earnings (loss) in BankAtlantic Bancorp
    
    
    (7,206
    )
    
    
    5,807
    
    
    
    9,053Equity from earnings (loss) in Levitt
    
    
    (39,622
    )
    
    
    (1,519
    )
    
    
    9,151Equity from earnings (loss) in other subsidiaries
    
    
    (1,083
    )
    
    
    (658
    )
    
    
    6,671(Loss) income before income taxes
    
    
    (53,499
    )
    
    
    (2,551
    )
    
    
    11,746(Benefit) provision for income taxes
    
    
    (19,398
    )
    
    
    (1,856
    )
    
    
    4,010(Loss) income from continuing operations
    
    
    (34,101
    )
    
    
    (695
    )
    
    
    7,736Equity in subsidiaries discontinued operations, net of tax
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Extraordinary gain, net of tax
    
    
    2,403
    
    
    
    
    
    
    
    Net (loss) income before preferred stock dividends
    
    
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,7745% Preferred Stock dividends
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )Net (loss) income
    
    $
    (31,209
    )
    
    
    (2,971
    )
    
    
    12,024Statements of Cash Flow Data:Operating Activities:Net (loss) income
    
    $
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774Other operating activities
    
    
    25,954
    
    
    
    (820
    )
    
    
    (12,709
    )Net cash (used in) provided by operating activities
    
    
    (4,505
    )
    
    
    (3,041
    )
    
    
    65Net cash used in investing activities
    
    
    (30,869
    )
    
    
    (923
    )
    
    
    (10,029
    )Net cash provided by (used in) financing activities
    
    
    35,558
    
    
    
    (4,904
    )
    
    
    35,127(Decrease) increase in cash and cash equivalents
    
    
    184
    
    
    
    (8,868
    )
    
    
    25,163Cash at beginning of period
    
    
    17,815
    
    
    
    26,683
    
    
    
    1,520Cash at end of period
    
    $
    17,999
    
    
    
    17,815
    
    
    
    26,683
  71




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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Introduction
      72




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PercentShares
    
    Percent of
    
    ofOwned
    
    Ownership
    
    VoteBankAtlantic BancorpClass A Common Stock
    
    
    8,329,236
    
    
    
    16.27
    %
    
    
    8.62
    %Class B Common Stock
    
    
    4,876,124
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    13,205,360
    
    
    
    23.55
    %
    
    
    55.62
    %LevittClass A Common Stock
    
    
    18,676,955
    (1)
    
    
    19.65
    %
    
    
    6.99
    %(1)Class B Common Stock
    
    
    1,219,031
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    19,895,986
    (1)
    
    
    20.67
    %
    
    
    53.99
    %(1)
 
 (1)
    
    BFCs ownership interest includes, but BFCs voting interest excludes, 6,145,582 shares
of Levitts Class A Common Stock which, subject to certain exceptions, BFC has agreed not
to vote, as discussed in further detail below under Levitts Rights Offering and Step
Acquisition. BFC Financial Corporation Summary of Consolidated Results of Operations
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005BFC Activities
    
    $
    12,693
    
    
    
    (5,009
    )
    
    
    (10,460
    )Financial Services
    
    
    (30,012
    )
    
    
    26,879
    
    
    
    42,526Real Estate Development
    
    
    (236,385
    )
    
    
    (9,143
    )
    
    
    55,069(253,704
    )
    
    
    12,727
    
    
    
    87,135Noncontrolling interest
    
    
    (219,603
    )
    
    
    13,422
    
    
    
    79,399(Loss) income from continuing operations
    
    
    (34,101
    )
    
    
    (695
    )
    
    
    7,736Discontinued operations, less
noncontrolling interest and income tax
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Extraordinary gain, less income tax
    
    
    2,403
    
    
    
    
    
    
    
    Net (loss) income
    
    $
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774
   73




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Consolidated Financial Condition
 Consolidated Assets and Liabilities
  
    
    An increase in cash and due from depository institutions balances of approximately
$131.1 million which resulted from: i) an approximately $146.8 million increase at Levitt
primarily relating to proceeds received in Levitts Rights Offering to its shareholders;
ii) higher cash balances at BFC of approximately $0.7 million primarily due to cash
received from a public offering in the amount of $36.1 million and $1.7 million cash
generated from other investing activities, offset by $33.2 million used to acquire
additional shares of Levitt in Levitts Rights Offering, $3.3 million cash used in
operations and $0.5 million cash used in other financing activities; and iii) lower cash
balances at BankAtlantic Bancorp of approximately $14.2 million primarily due to lower
cash and due from depository institution balances resulting from a decline in cash letter
receivables;
    
    An increase in securities available for sale reflecting Stifel Common Stock received
by BankAtlantic upon the sale of Ryan Beck and BankAtlantics decision to transfer $203
million of tax exempt securities from investments held-to-maturity to securities
available for sale and the subsequent sale of BankAtlantics entire portfolio of tax
exempt securities, replacing these securities with government agency mortgage-backed
securities. These increases were partially offset by sales of BankAtlantics equity
securities to fund its Class A Common Stock repurchase program;
    
    A decrease in investment securities at cost reflecting BankAtlantics transfer of $203
million of tax exempt securities to securities available for sale partially offset by
Stifel equity securities received by BankAtlantic upon the sale of Ryan Beck which are
subject to contractual restrictions limiting sales;
    
    A decrease in BankAtlantics tax certificate balances primarily due to redemptions of
certificates outside of Florida;
    
    A decline in BankAtlantics FHLB stock at BankAtlantic related to lower FHLB advance
borrowings;
    
    A decline in loan receivable balances associated with a $50.4 million increase in
BankAtlantics allowance for loan losses and lower commercial loan balances partially
offset by higher purchased residential, small business and home equity loan balances;
    
    A net decrease in inventory of real estate held for development and sale primarily
associated with the deconsolidation of Levitt & Sons in 2007. This decrease was partially
offset by a net increase in Levitts inventory of real estate of approximately $45.8
million, primarily related to Cores development activities and an increase in
BankAtlantics real estate inventory related to a decision to sell properties that
BankAtlantic acquired for its store expansion program;
    
    Lower real estate owned balances associated with $7.2 million of write-downs as a
result of BankAtlantic taking possession of the real estate securing a land development
loan during the year ended December 31, 2006;
    
    The net increase in investments in unconsolidated affiliates was primarily driven by a
net increase of approximately $4.3 million in Levitts investment in Bluegreen associated
with $10.3 million of Levitts earnings from Bluegreen (net of purchase accounting),
partially offset by a decrease of approximately $4.7 million in purchase accounting
related to BFCs step acquisition of Levitt in October 2007;
    
    A decrease in discontinued operations assets held for sale reflecting BankAtlantics
sale of Ryan Beck to Stifel offset by an increase of approximately $11.0 million relating
to two commercial projects currently held for sale at Levitt;
    
    An increase in office properties and equipment associated with BankAtlantics opening
of 15 stores during 2007 partially offset by restructuring charges and impairments
associated with BankAtlantics decision to delay its store expansion program;
    
    An increase in the net deferred tax asset primarily due to an increase in BankAtlantic
Bancorps deferred tax assets resulting from the increase in the allowance for loan
losses, and BFCs equity losses in Levitt and BankAtlantic Bancorp; and
 74




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##### Table of Contents




    
    An increase in other assets primarily resulting from BankAtlantics federal income tax
receivable associated with a taxable loss for the year ended December 31, 2007 and an
increase in Levitts current tax asset of $22.8 million related to tax benefits incurred
due to the net operating losses recorded in 2007.
  
    
    Higher BankAtlantic interest-bearing deposit balances primarily associated with
increased high yield savings, checking and certificates of deposit balances primarily
reflecting transfers of customer deposit balances to higher yielding products;
    
    Lower BankAtlantic non-interest-bearing deposit balances reflecting the migration of
deposits to higher yielding products as a result of a higher interest rate environment
and competition;
    
    A decrease of $42.0 million in customer deposits at Levitt due to the deconsolidation
of Levitt & Sons;
    
    A decrease in BankAtlantic FHLB advance borrowings due to higher deposit balances and
an increase in short-term borrowings at BankAtlantic;
    
    A decrease in BankAtlantic development notes payable associated with the repayment of
real estate development borrowings from third party lenders. A decrease in Levitts notes
and mortgage notes payable primarily due to Levitt & Sons deconsolidation, offset by an
increase in Levitts notes and mortgage notes payable of $156.0 million, primarily
related to project debt associated with land development activities;
    
    An increase in BankAtlantic junior subordinated debentures primarily associated with
BankAtlantic Bancorps issuance of $31 million of junior subordinated debentures;
    
    An increase of $55.2 million in the deficit in the Levitt and Sons investment at
December 31, 2007 resulting from the deconsolidation of Levitt and Sons from Levitts
financial results, which is being accounted for as a cost method investment;
    
    A decrease in BankAtlantics discontinued operations liabilities held for sale
reflecting the sale of Ryan Beck to Stifel; and
    
    The decrease in other liabilities primarily due to Levitt and Sons deconsolidation
offset by an increase in BankAtlantic other liabilities primarily resulting from $18.9
million of securities available for sale purchased in December 2007 which was settled in
January 2008.
 Noncontrolling Interest
  December 31,
    
    
    December 31,2007
    
    
    2006BankAtlantic Bancorp
    
    $
    351,148
    
    
    $
    411,396Levitt
    
    
    207,138
    
    
    
    286,230Joint Venture Partnerships
    
    
    664
    
    
    
    697$
    558,950
    
    
    $
    698,323
 75




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BFC Impact of Inflation
    Critical Accounting Policies
   76




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BFC Activities
   Change
    
    
    ChangeFor the Years Ended December 31,
    
    
    2007 vs.
    
    
    2006 vs.(In thousands)
    
    2007
    
    
    2006
    
    
    2005
    
    
    2006
    
    
    2005RevenuesInterest and dividend income
    
    $
    2,374
    
    
    
    2,292
    
    
    
    1,623
    
    
    
    82
    
    
    
    669Securities activities
    
    
    1,295
    
    
    
    
    
    
    
    58
    
    
    
    1,295
    
    
    
    (58
    )Other income, net
    
    
    4,977
    
    
    
    3,680
    
    
    
    1,692
    
    
    
    1,297
    
    
    
    1,9888,646
    
    
    
    5,972
    
    
    
    3,373
    
    
    
    2,674
    
    
    
    2,599Cost and ExpensesInterest expense
    
    
    38
    
    
    
    30
    
    
    
    346
    
    
    
    8
    
    
    
    (316
    )Employee compensation and benefits
    
    
    10,932
    
    
    
    9,407
    
    
    
    6,245
    
    
    
    1,525
    
    
    
    3,162Other expenses, net
    
    
    4,302
    
    
    
    3,398
    
    
    
    3,505
    
    
    
    904
    
    
    
    (107
    )15,272
    
    
    
    12,835
    
    
    
    10,096
    
    
    
    2,437
    
    
    
    2,739Equity in loss from
unconsolidated affiliates
    
    
    (78
    )
    
    
    
    
    
    
    
    
    
    
    (78
    )
    
    
    Loss before income taxes
    
    
    (6,704
    )
    
    
    (6,863
    )
    
    
    (6,723
    )
    
    
    159
    
    
    
    (140
    )(Benefit) provision for income taxes
    
    
    (19,397
    )
    
    
    (1,854
    )
    
    
    3,737
    
    
    
    (17,543
    )
    
    
    (5,591
    )Noncontrolling interest
    
    
    (34
    )
    
    
    (25
    )
    
    
    6
    
    
    
    (9
    )
    
    
    (31
    )Income (loss) from continuing operations
    
    $
    12,727
    
    
    
    (4,984
    )
    
    
    (10,466
    )
    
    
    17,711
    
    
    
    5,482
    77




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##### Table of Contents



For the Years Ended December 31,2007
    
    
    2006
    
    
    2005BFC operating loss, net of permanent
differences
    
    $
    (8,006
    )
    
    
    (9,094
    )
    
    
    (8,518
    )Expired Net Operating Loss (NOLs)
carryforwards (1)
    
    
    4,557
    
    
    
    
    
    
    
    Equity from (loss) earnings in
BankAtlantic Bancorp
    
    
    (7,206
    )
    
    
    5,807
    
    
    
    9,053Equity from (loss) earnings in Levitt
    
    
    (39,622
    )
    
    
    (1,519
    )
    
    
    9,151(50,277
    )
    
    
    (4,806
    )
    
    
    9,686Income tax rate
    
    
    38.58
    %
    
    
    38.58
    %
    
    
    38.58
    %(Benefit) provision for income tax
    
    $
    (19,397
    )
    
    
    (1,854
    )
    
    
    3,737
 
 (1)
    
    See Liquidity and Capital Resources of BFC below. Levitts Rights Offering and Step Acquisition
  78




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s
   79




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Liquidity and Capital Resources of BFC
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Net cash provided by (used in):Operating activities
    
    $
    (3,267
    )
    
    
    (2,292
    )
    
    
    (236
    )Investing activities
    
    
    (31,548
    )
    
    
    (1,416
    )
    
    
    (9,775
    )Financing activities
    
    
    35,537
    
    
    
    (4,922
    )
    
    
    34,590Increase (decrease) in cash and cash equivalents
    
    
    722
    
    
    
    (8,630
    )
    
    
    24,579Cash and cash equivalents at beginning of period
    
    
    18,176
    
    
    
    26,806
    
    
    
    2,227Cash and cash equivalents at end of period
    
    $
    18,898
    
    
    
    18,176
    
    
    
    26,806
      80




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81




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82




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83




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Financial Services
 The Financial Services segment of BFC consists of BankAtlantic Bancorp, which is consolidated
with BFC Financial Corporation. The only assets available to BFC Financial Corporation from
BankAtlantic Bancorp are dividends when and if paid by BankAtlantic Bancorp. BankAtlantic Bancorp
is a separate public company and its management prepared the following discussion regarding
BankAtlantic Bancorp which was included in BankAtlantic Bancorps Annual Report on Form 10-K for
the year ended December 31, 2007 filed with the Securities and Exchange Commission. Accordingly,
references to the Company, we, us or our in the following discussion under the caption
Financial Services are references to BankAtlantic Bancorp and its subsidiaries, and are not
references to BFC Financial Corporation.
 Introduction
   Consolidated Results of Operations
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005BankAtlantic
    
    $
    (19,440
    )
    
    $
    36,322
    
    
    $
    55,820Parent Co.
    
    
    (10,572
    )
    
    
    (9,443
    )
    
    
    (13,294
    )Net (loss) income
    
    $
    (30,012
    )
    
    $
    26,879
    
    
    $
    42,526
  84




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Floridas
Most Convenient Bank
   BankAtlantic Results of Operations
 Summary
  Floridas Most Convenient Bank
   85




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For the Years Ended
    
    Change
    
    ChangeEnded December 31,
    
    2007 vs
    
    2006 vs2007
    
    2006
    
    2005
    
    2006
    
    2005Net interest income
    
    $
    199,510
    
    
    
    219,605
    
    
    
    221,075
    
    
    
    (20,095
    )
    
    
    (1,470
    )(Provision for) recovery from loan
losses
    
    
    (70,842
    )
    
    
    (8,574
    )
    
    
    6,615
    
    
    
    (62,268
    )
    
    
    (15,189
    )Net income after provision for loan
losses
    
    
    128,668
    
    
    
    211,031
    
    
    
    227,690
    
    
    
    (82,363
    )
    
    
    (16,659
    )Non-interest income
    
    
    144,412
    
    
    
    131,844
    
    
    
    100,060
    
    
    
    12,568
    
    
    
    31,784Non-interest expense
    
    
    (313,898
    )
    
    
    (293,448
    )
    
    
    (241,092
    )
    
    
    (20,450
    )
    
    
    (52,356
    )BankAtlantic (loss) income before
income taxes
    
    
    (40,818
    )
    
    
    49,427
    
    
    
    86,658
    
    
    
    (90,245
    )
    
    
    (37,231
    )Benefit (provision) for income taxes
    
    
    21,378
    
    
    
    (13,105
    )
    
    
    (30,838
    )
    
    
    34,483
    
    
    
    17,733BankAtlantic net (loss) contribution
    
    $
    (19,440
    )
    
    
    36,322
    
    
    
    55,820
    
    
    
    (55,762
    )
    
    
    (19,498
    )
 86




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##### Table of Contents



BankAtlantics Net Interest Income
 For the Years EndedDecember 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005Average
    
    
    Revenue/
    
    
    Yield/
    
    
    Average
    
    
    Revenue/
    
    
    Yield/
    
    
    Average
    
    
    Revenue/
    
    
    Yield/(Dollars are in thousands)
    
    Balance
    
    
    Expense
    
    
    Rate
    
    
    Balance
    
    
    Expense
    
    
    Rate
    
    
    Balance
    
    
    Expense
    
    
    RateInterest earning assetsLoans: (a)Residential real estate
    
    $
    2,209,832
    
    
    
    120,768
    
    
    
    5.47
    %
    
    $
    2,099,664
    
    
    
    109,103
    
    
    
    5.20
    %
    
    $
    2,177,432
    
    
    
    106,992
    
    
    
    4.91
    %Commercial real estate
    
    
    1,367,095
    
    
    
    108,931
    
    
    
    7.97
    
    
    
    1,530,282
    
    
    
    128,420
    
    
    
    8.39
    
    
    
    1,828,557
    
    
    
    130,379
    
    
    
    7.13Consumer
    
    
    650,764
    
    
    
    47,625
    
    
    
    7.32
    
    
    
    558,769
    
    
    
    41,997
    
    
    
    7.52
    
    
    
    514,822
    
    
    
    31,348
    
    
    
    6.09Commercial business
    
    
    142,455
    
    
    
    12,720
    
    
    
    8.93
    
    
    
    140,465
    
    
    
    12,452
    
    
    
    8.86
    
    
    
    94,420
    
    
    
    7,455
    
    
    
    7.90Small business
    
    
    298,774
    
    
    
    23,954
    
    
    
    8.02
    
    
    
    259,816
    
    
    
    20,988
    
    
    
    8.08
    
    
    
    211,371
    
    
    
    16,520
    
    
    
    7.82Total loans
    
    
    4,668,920
    
    
    
    313,998
    
    
    
    6.73
    
    
    
    4,588,996
    
    
    
    312,960
    
    
    
    6.82
    
    
    
    4,826,602
    
    
    
    292,694
    
    
    
    6.06Tax exempt securities (c)
    
    
    328,583
    
    
    
    19,272
    
    
    
    5.87
    
    
    
    396,539
    
    
    
    23,162
    
    
    
    5.84
    
    
    
    368,807
    
    
    
    21,391
    
    
    
    5.80Taxable investment securities (b)
    
    
    689,263
    
    
    
    42,849
    
    
    
    6.22
    
    
    
    618,913
    
    
    
    36,912
    
    
    
    5.96
    
    
    
    698,279
    
    
    
    37,184
    
    
    
    5.33Federal funds sold
    
    
    3,638
    
    
    
    195
    
    
    
    5.36
    
    
    
    1,824
    
    
    
    22
    
    
    
    1.21
    
    
    
    4,275
    
    
    
    17
    
    
    
    0.40Total investment securities
    
    
    1,021,484
    
    
    
    62,316
    
    
    
    6.10
    
    
    
    1,017,276
    
    
    
    60,096
    
    
    
    5.91
    
    
    
    1,071,361
    
    
    
    58,592
    
    
    
    5.47Total interest earning assets
    
    
    5,690,404
    
    
    
    376,314
    
    
    
    6.61
    %
    
    
    5,606,272
    
    
    
    373,056
    
    
    
    6.65
    %
    
    
    5,897,963
    
    
    
    351,286
    
    
    
    5.96
    %Total non-interest earning assets
    
    
    510,173
    
    
    
    
    
    
    
    
    
    
    
    448,296
    
    
    
    
    
    
    
    
    
    
    
    389,186Total assets
    
    $
    6,200,577
    
    
    
    
    
    
    
    
    
    
    $
    6,054,568
    
    
    
    
    
    
    
    
    
    
    $
    6,287,149Interest bearing liabilitiesDeposits:Savings
    
    $
    584,542
    
    
    
    12,559
    
    
    
    2.15
    %
    
    $
    369,504
    
    
    
    2,936
    
    
    
    0.79
    %
    
    $
    298,867
    
    
    
    909
    
    
    
    0.30
    %NOW, money funds and checking
    
    
    1,450,960
    
    
    
    26,031
    
    
    
    1.79
    
    
    
    1,502,058
    
    
    
    20,413
    
    
    
    1.36
    
    
    
    1,582,182
    
    
    
    16,593
    
    
    
    1.05Certificate accounts
    
    
    992,043
    
    
    
    45,886
    
    
    
    4.63
    
    
    
    868,777
    
    
    
    35,610
    
    
    
    4.10
    
    
    
    784,525
    
    
    
    22,582
    
    
    
    2.88Total interest bearing deposits
    
    
    3,027,545
    
    
    
    84,476
    
    
    
    2.79
    
    
    
    2,740,339
    
    
    
    58,959
    
    
    
    2.15
    
    
    
    2,665,574
    
    
    
    40,084
    
    
    
    1.50Securities sold under agreements
to repurchase and federal funds
purchased
    
    
    194,222
    
    
    
    9,829
    
    
    
    5.06
    
    
    
    304,635
    
    
    
    15,309
    
    
    
    5.03
    
    
    
    314,782
    
    
    
    9,760
    
    
    
    3.10Advances from FHLB
    
    
    1,379,106
    
    
    
    73,256
    
    
    
    5.31
    
    
    
    1,265,772
    
    
    
    66,492
    
    
    
    5.25
    
    
    
    1,538,852
    
    
    
    62,175
    
    
    
    4.04Subordinated debentures and
notes payable
    
    
    28,946
    
    
    
    2,498
    
    
    
    8.63
    
    
    
    66,287
    
    
    
    5,513
    
    
    
    8.32
    
    
    
    191,050
    
    
    
    12,584
    
    
    
    6.59Total interest bearing liabilities
    
    
    4,629,819
    
    
    
    170,059
    
    
    
    3.67
    
    
    
    4,377,033
    
    
    
    146,273
    
    
    
    3.34
    
    
    
    4,710,258
    
    
    
    124,603
    
    
    
    2.65Non-interest bearing liabilitiesDemand deposit and escrow accounts
    
    
    946,356
    
    
    
    
    
    
    
    
    
    
    
    1,056,254
    
    
    
    
    
    
    
    
    
    
    
    979,075Other liabilities
    
    
    55,683
    
    
    
    
    
    
    
    
    
    
    
    61,392
    
    
    
    
    
    
    
    
    
    
    
    53,150Total non-interest bearing liabilities
    
    
    1,002,039
    
    
    
    
    
    
    
    
    
    
    
    1,117,646
    
    
    
    
    
    
    
    
    
    
    
    1,032,225Stockholders equity
    
    
    568,719
    
    
    
    
    
    
    
    
    
    
    
    559,889
    
    
    
    
    
    
    
    
    
    
    
    544,666Total liabilities and stockholders
equity
    
    $
    6,200,577
    
    
    
    
    
    
    
    
    
    
    $
    6,054,568
    
    
    
    
    
    
    
    
    
    
    $
    6,287,149Net interest income/net interest spread
    
    
    
    
    
    
    206,255
    
    
    
    2.94
    %
    
    
    
    
    
    
    226,783
    
    
    
    3.31
    %
    
    
    
    
    
    
    226,683
    
    
    
    3.31
    %Tax equivalent adjustment
    
    
    
    
    
    
    (6,745
    )
    
    
    
    
    
    
    
    
    
    
    (8,107
    )
    
    
    
    
    
    
    
    
    
    
    (7,487
    )Capitalized interest from real estate
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    929
    
    
    
    
    
    
    
    
    
    
    
    1,879Net interest income
    
    
    
    
    
    
    199,510
    
    
    
    
    
    
    
    
    
    
    
    219,605
    
    
    
    
    
    
    
    
    
    
    
    221,075MarginInterest income/interest earning assets
    
    
    
    
    
    
    
    
    
    
    6.61
    %
    
    
    
    
    
    
    
    
    
    
    6.65
    %
    
    
    
    
    
    
    
    
    
    
    5.96
    %Interest expense/interest earning
assets
    
    
    
    
    
    
    
    
    
    
    2.99
    
    
    
    
    
    
    
    
    
    
    
    2.61
    
    
    
    
    
    
    
    
    
    
    
    2.11Tax equivalent net interest margin
    
    
    
    
    
    
    
    
    
    
    3.62
    %
    
    
    
    
    
    
    
    
    
    
    4.04
    %
    
    
    
    
    
    
    
    
    
    
    3.85
    %
 
 (a)
    
    Includes non-accruing loans(b)
    
    Average balances were based on amortized cost.(c)
    
    The tax equivalent basis is computed using a 35% tax rate. For the Year Ended December 31, 2007 Compared to the Same 2006 Period
    87




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For the Year Ended December 31, 2006 Compared to the Same 2005 Period
     88




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##### Table of Contents



Year Ended
    
    Year EndedDecember 31, 2007
    
    December 31, 2006Compared to Year Ended
    
    Compared to Year EndedDecember 31, 2006
    
    December 31, 2005Volume (a)
    
    Rate
    
    Total
    
    Volume (a)
    
    Rate
    
    TotalIncrease (decrease) due to:Loans
    
    $
    5,375
    
    
    
    (4,337
    )
    
    
    1,038
    
    
    
    (16,204
    )
    
    
    36,470
    
    
    
    20,266Tax exempt securities
    
    
    (3,986
    )
    
    
    96
    
    
    
    (3,890
    )
    
    
    1,620
    
    
    
    151
    
    
    
    1,771Taxable investment securities (b)
    
    
    4,373
    
    
    
    1,564
    
    
    
    5,937
    
    
    
    (4,733
    )
    
    
    4,461
    
    
    
    (272
    )Federal funds sold
    
    
    97
    
    
    
    76
    
    
    
    173
    
    
    
    (30
    )
    
    
    35
    
    
    
    5Total earning assets
    
    
    5,859
    
    
    
    (2,601
    )
    
    
    3,258
    
    
    
    (19,347
    )
    
    
    41,117
    
    
    
    21,770Deposits:Savings
    
    
    4,620
    
    
    
    5,003
    
    
    
    9,623
    
    
    
    561
    
    
    
    1,466
    
    
    
    2,027NOW, money funds,
and checking
    
    
    (917
    )
    
    
    6,535
    
    
    
    5,618
    
    
    
    (1,089
    )
    
    
    4,909
    
    
    
    3,820Certificate accounts
    
    
    5,702
    
    
    
    4,574
    
    
    
    10,276
    
    
    
    3,453
    
    
    
    9,575
    
    
    
    13,028Total deposits
    
    
    9,405
    
    
    
    16,112
    
    
    
    25,517
    
    
    
    2,925
    
    
    
    15,950
    
    
    
    18,875Securities sold under
agreements to repurchase
    
    
    (5,588
    )
    
    
    108
    
    
    
    (5,480
    )
    
    
    (510
    )
    
    
    6,059
    
    
    
    5,549Advances from FHLB
    
    
    6,020
    
    
    
    744
    
    
    
    6,764
    
    
    
    (14,345
    )
    
    
    18,662
    
    
    
    4,317Subordinated debentures
    
    
    (3,222
    )
    
    
    207
    
    
    
    (3,015
    )
    
    
    (10,376
    )
    
    
    3,305
    
    
    
    (7,071
    )(2,790
    )
    
    
    1,059
    
    
    
    (1,731
    )
    
    
    (25,231
    )
    
    
    28,026
    
    
    
    2,795Total interest bearing liabilities
    
    
    6,615
    
    
    
    17,171
    
    
    
    23,786
    
    
    
    (22,306
    )
    
    
    43,976
    
    
    
    21,670Change in tax equivalent
interest income
    
    $
    (756
    )
    
    
    (19,772
    )
    
    
    (20,528
    )
    
    
    2,959
    
    
    
    (2,859
    )
    
    
    100
 
 (a)
    
    Changes attributable to rate/volume have been allocated to volume.(b)
    
    Average balances were based on amortized cost.   89




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##### Table of Contents



BankAtlantics Allowance for Loan Losses
  For the Years Ended December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003Balance, beginning of period
    
    $
    43,602
    
    
    
    41,192
    
    
    
    46,010
    
    
    
    45,595
    
    
    
    48,022Charge-offs:Commercial business
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,394
    )Commercial real estate
    
    
    (12,562
    )
    
    
    (7,000
    )
    
    
    
    
    
    
    (645
    )
    
    
    Small business
    
    
    (2,554
    )
    
    
    (951
    )
    
    
    (764
    )
    
    
    (238
    )
    
    
    (771
    )Consumer  home equity
    
    
    (7,065
    )
    
    
    (681
    )
    
    
    (259
    )
    
    
    (585
    )
    
    
    (1,563
    )Residential real estate
    
    
    (461
    )
    
    
    (239
    )
    
    
    (453
    )
    
    
    (582
    )
    
    
    (681
    )Continuing loan products
    
    
    (22,642
    )
    
    
    (8,871
    )
    
    
    (1,476
    )
    
    
    (2,050
    )
    
    
    (5,409
    )Discontinued loan products
    
    
    
    
    
    
    (34
    )
    
    
    (1,218
    )
    
    
    (2,026
    )
    
    
    (6,314
    )Total charge-offs
    
    
    (22,642
    )
    
    
    (8,905
    )
    
    
    (2,694
    )
    
    
    (4,076
    )
    
    
    (11,723
    )Recoveries:Commercial business
    
    
    96
    
    
    
    291
    
    
    
    18
    
    
    
    536
    
    
    
    95Commercial real estate
    
    
    304
    
    
    
    419
    
    
    
    1,471
    
    
    
    4,052
    
    
    
    3Small business
    
    
    417
    
    
    
    566
    
    
    
    899
    
    
    
    418
    
    
    
    559Consumer  home equity
    
    
    578
    
    
    
    536
    
    
    
    401
    
    
    
    370
    
    
    
    622Residential real estate loans
    
    
    15
    
    
    
    348
    
    
    
    65
    
    
    
    486
    
    
    
    726Continuing loan products
    
    
    1,410
    
    
    
    2,160
    
    
    
    2,854
    
    
    
    5,862
    
    
    
    2,005Discontinued loan products
    
    
    808
    
    
    
    581
    
    
    
    1,637
    
    
    
    3,738
    
    
    
    8,572Total recoveries
    
    
    2,218
    
    
    
    2,741
    
    
    
    4,491
    
    
    
    9,600
    
    
    
    10,577Net (charge-offs) recoveries
    
    
    (20,424
    )
    
    
    (6,164
    )
    
    
    1,797
    
    
    
    5,524
    
    
    
    (1,146
    )Provision for (recovery from)
loan losses
    
    
    70,842
    
    
    
    8,574
    
    
    
    (6,615
    )
    
    
    (5,109
    )
    
    
    (547
    )Adjustments to acquired loan
losses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (734
    )Balance, end of period
    
    $
    94,020
    
    
    
    43,602
    
    
    
    41,192
    
    
    
    46,010
    
    
    
    45,595
   90




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##### Table of Contents



91




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##### Table of Contents



December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005ALL
    
    
    Loans
    
    
    
    
    
    
    ALL
    
    
    Loans
    
    
    
    
    
    
    ALL
    
    
    Loansto gross
    
    
    by
    
    
    
    
    
    
    to gross
    
    
    by
    
    
    
    
    
    
    to gross
    
    
    byALL
    
    
    loans
    
    
    category
    
    
    ALL
    
    
    loans
    
    
    category
    
    
    ALL
    
    
    loans
    
    
    categoryby
    
    
    in each
    
    
    to gross
    
    
    by
    
    
    in each
    
    
    to gross
    
    
    by
    
    
    in each
    
    
    to grosscategory
    
    
    category
    
    
    loans
    
    
    category
    
    
    category
    
    
    loans
    
    
    category
    
    
    category
    
    
    loansCommercial business
    
    $
    2,668
    
    
    
    2.04
    %
    
    
    2.65
    %
    
    $
    2,359
    
    
    
    1.50
    %
    
    
    3.07
    %
    
    $
    1,988
    
    
    
    2.30
    %
    
    
    1.63
    %Commercial real estate
    
    
    72,948
    
    
    
    4.51
    
    
    
    32.78
    
    
    
    24,632
    
    
    
    1.28
    
    
    
    37.54
    
    
    
    17,984
    
    
    
    0.75
    
    
    
    45.20Small business
    
    
    4,576
    
    
    
    1.44
    
    
    
    6.43
    
    
    
    4,495
    
    
    
    1.58
    
    
    
    5.57
    
    
    
    2,640
    
    
    
    1.12
    
    
    
    4.43Residential real estate
    
    
    4,177
    
    
    
    0.19
    
    
    
    43.82
    
    
    
    4,242
    
    
    
    0.20
    
    
    
    42.33
    
    
    
    2,592
    
    
    
    0.13
    
    
    
    38.53Consumer  home equity
    
    
    9,651
    
    
    
    1.37
    
    
    
    14.32
    
    
    
    7,874
    
    
    
    1.34
    
    
    
    11.49
    
    
    
    6,354
    
    
    
    1.17
    
    
    
    10.19Discontinued loan
products
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    156
    
    
    
    12.92
    
    
    
    0.02Total assigned
    
    
    94,020
    
    
    
    
    
    
    
    
    
    
    
    43,602
    
    
    
    
    
    
    
    
    
    
    
    31,714Unassigned
    
    
    
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    9,478
    
    
    
    N/A
    
    
    
    N/A$
    94,020
    
    
    
    1.90
    
    
    
    
    
    
    $
    43,602
    
    
    
    0.85
    
    
    
    100.00
    
    
    $
    41,192
    
    
    
    0.78
    
    
    
    100.00
 December 31, 2004
    
    
    December 31, 2003ALL
    
    
    Loans
    
    
    
    
    
    
    ALL
    
    
    Loansto gross
    
    
    by
    
    
    
    
    
    
    to gross
    
    
    byALL
    
    
    loans
    
    
    category
    
    
    ALL
    
    
    loans
    
    
    categoryby
    
    
    in each
    
    
    to gross
    
    
    by
    
    
    in each
    
    
    to grosscategory
    
    
    category
    
    
    loans
    
    
    category
    
    
    category
    
    
    loansCommercial business
    
    $
    2,507
    
    
    
    2.94
    %
    
    
    1.59
    %
    
    $
    1,715
    
    
    
    2.15
    %
    
    
    1.81
    %Commercial real estate
    
    
    23,345
    
    
    
    0.92
    
    
    
    47.28
    
    
    
    24,005
    
    
    
    0.99
    
    
    
    55.12Small business
    
    
    2,403
    
    
    
    1.26
    
    
    
    3.55
    
    
    
    2,300
    
    
    
    1.44
    
    
    
    3.63Residential real estate
    
    
    2,565
    
    
    
    0.12
    
    
    
    38.57
    
    
    
    2,111
    
    
    
    0.16
    
    
    
    30.56Consumer  direct
    
    
    4,281
    
    
    
    0.90
    
    
    
    8.86
    
    
    
    3,900
    
    
    
    1.10
    
    
    
    8.07Discontinued loan
products
    
    
    1,431
    
    
    
    17.27
    
    
    
    0.15
    
    
    
    4,553
    
    
    
    12.81
    
    
    
    0.81Total assigned
    
    
    36,532
    
    
    
    
    
    
    
    
    
    
    
    38,584Unassigned
    
    
    9,478
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    7,011
    
    
    
    N/A
    
    
    
    N/A$
    46,010
    
    
    
    0.86
    
    
    
    100.00
    
    
    $
    45,595
    
    
    
    1.04
    
    
    
    100.00
  92




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AmountCommercial business
    
    $
    264Commercial real estate
    
    
    5,285Small business
    
    
    1,566Residential real estate
    
    
    1,262Consumer
    
    
    1,101$
    9,478
     93




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BankAtlantics Non-performing Assets and Potential Problem Loans
 December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003NONPERFORMING ASSETSTax certificates
    
    $
    2,094
    
    
    
    632
    
    
    
    388
    
    
    
    381
    
    
    
    894Residential
    
    
    8,678
    
    
    
    2,629
    
    
    
    5,981
    
    
    
    5,538
    
    
    
    9,777Commercial (2)
    
    
    165,818
    
    
    
    
    
    
    
    340
    
    
    
    1,067
    
    
    
    77Small business
    
    
    877
    
    
    
    244
    
    
    
    9
    
    
    
    88
    
    
    
    155Consumer
    
    
    3,218
    
    
    
    1,563
    
    
    
    471
    
    
    
    1,210
    
    
    
    794Total non-accrual assets
    
    
    180,685
    
    
    
    5,068
    
    
    
    7,189
    
    
    
    8,284
    
    
    
    11,697Residential real estate owned
    
    
    413
    
    
    
    617
    
    
    
    86
    
    
    
    309
    
    
    
    1,474Commercial real estate owned
    
    
    16,763
    
    
    
    21,130
    
    
    
    881
    
    
    
    383
    
    
    
    948Consumer
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total repossessed assets
    
    
    17,216
    
    
    
    21,747
    
    
    
    967
    
    
    
    692
    
    
    
    2,422Total nonperforming assets
    
    $
    197,901
    
    
    
    26,815
    
    
    
    8,156
    
    
    
    8,976
    
    
    
    14,119Total nonperforming assets as
a percentage of:Total assets
    
    
    3.21
    
    
    
    0.43
    
    
    
    0.13
    
    
    
    0.15
    
    
    
    0.31Loans, tax certificates and
real estate owned
    
    
    4.10
    
    
    
    0.55
    
    
    
    0.17
    
    
    
    0.19
    
    
    
    0.36TOTAL ASSETS
    
    $
    6,161,962
    
    
    
    6,187,122
    
    
    
    6,109,330
    
    
    
    6,044,988
    
    
    
    4,566,850TOTAL LOANS, TAX CERTIFICATES
AND NET REAL ESTATE OWNED
    
    $
    4,823,825
    
    
    
    4,903,961
    
    
    
    4,830,268
    
    
    
    4,771,682
    
    
    
    3,872,473Allowance for loan losses
    
    $
    94,020
    
    
    
    43,602
    
    
    
    41,192
    
    
    
    46,010
    
    
    
    45,595Tax certificates
    
    $
    191,690
    
    
    
    199,090
    
    
    
    166,697
    
    
    
    170,028
    
    
    
    193,776Allowance for tax certificate losses
    
    $
    3,289
    
    
    
    3,699
    
    
    
    3,271
    
    
    
    3,297
    
    
    
    2,870OTHER POTENTIAL PROBLEM
LOANSContractually past due 90 days
or more (1)
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    135Performing impaired loans
    
    
    
    
    
    
    163
    
    
    
    193
    
    
    
    320
    
    
    
    180Restructured loans (2)
    
    
    2,488
    
    
    
    
    
    
    
    77
    
    
    
    24
    
    
    
    1,387TOTAL POTENTIAL
PROBLEM LOANS
    
    $
    2,488
    
    
    
    163
    
    
    
    270
    
    
    
    344
    
    
    
    1,702
 
 (1)
    
    The majority of these loans have matured and the borrower continues to make payments under
the matured loan agreement.(2)
    
    $114.0 million of impaired loans had specific reserves of $17.8 million and specific
reserves were determined not to be required on the remaining impaired loans.   95




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BankAtlantics Non- Interest Income
  For the Years Ended
    
    Change
    
    ChangeDecember 31,
    
    2007 vs
    
    2006 vs2007
    
    2006
    
    2005
    
    2006
    
    2005Service charges on deposits
    
    $
    102,639
    
    
    
    90,472
    
    
    
    61,956
    
    
    
    12,167
    
    
    
    28,516Other service charges and fees
    
    
    28,950
    
    
    
    27,542
    
    
    
    23,347
    
    
    
    1,408
    
    
    
    4,195Securities activities, net
    
    
    2,307
    
    
    
    657
    
    
    
    117
    
    
    
    1,650
    
    
    
    540Income
(loss) from real estate operations
    
    
    538
    
    
    
    (982
    )
    
    
    4,480
    
    
    
    1,520
    
    
    
    (5,462
    )Income from unconsolidated subsidiaries
    
    
    1,219
    
    
    
    33
    
    
    
    
    
    
    
    1,186
    
    
    
    33Gains associated with debt redemption
    
    
    
    
    
    
    1,528
    
    
    
    
    
    
    
    (1,528
    )
    
    
    1,528(Losses) gains on dispositions of office
properties and equipment, net
    
    
    (1,121
    )
    
    
    1,627
    
    
    
    1,200
    
    
    
    (2,748
    )
    
    
    427Gains on sales of loans, net
    
    
    494
    
    
    
    680
    
    
    
    742
    
    
    
    (186
    )
    
    
    (62
    )Other
    
    
    9,386
    
    
    
    10,287
    
    
    
    8,218
    
    
    
    (901
    )
    
    
    2,069Non-interest income
    
    $
    144,412
    
    
    
    131,844
    
    
    
    100,060
    
    
    
    12,568
    
    
    
    31,784
      97




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BankAtlantics Non- Interest Expense
  For the Years Ended
    
    Change
    
    ChangeDecember 31,
    
    2007 vs
    
    2006 vs2007
    
    2006
    
    2005
    
    2006
    
    2005Employee compensation and benefits
    
    $
    148,758
    
    
    
    146,099
    
    
    
    113,526
    
    
    
    2,659
    
    
    
    32,573Occupancy and equipment
    
    
    65,840
    
    
    
    57,291
    
    
    
    41,611
    
    
    
    8,549
    
    
    
    15,680Advertising and promotion
    
    
    19,684
    
    
    
    34,659
    
    
    
    26,895
    
    
    
    (14,975
    )
    
    
    7,764Check losses
    
    
    11,476
    
    
    
    8,615
    
    
    
    5,176
    
    
    
    2,861
    
    
    
    3,439Professional fees
    
    
    8,266
    
    
    
    7,653
    
    
    
    9,695
    
    
    
    613
    
    
    
    (2,042
    )Supplies and postage
    
    
    6,078
    
    
    
    6,833
    
    
    
    5,638
    
    
    
    (755
    )
    
    
    1,195Telecommunication
    
    
    5,552
    
    
    
    4,774
    
    
    
    3,944
    
    
    
    778
    
    
    
    830Amortization of intangible assets
    
    
    1,437
    
    
    
    1,561
    
    
    
    1,627
    
    
    
    (124
    )
    
    
    (66
    )Cost associated with debt redemption
    
    
    
    
    
    
    1,457
    
    
    
    
    
    
    
    (1,457
    )
    
    
    1,457Fines and penalties, compliance matters
    
    
    
    
    
    
    
    
    
    
    10,000
    
    
    
    
    
    
    
    (10,000
    )Restructuring charges, impairments
and exit activities
    
    
    8,351
    
    
    
    
    
    
    
    3,706
    
    
    
    8,351
    
    
    
    (3,706
    )Impairment of real estate held for sale
    
    
    5,240
    
    
    
    
    
    
    
    
    
    
    
    5,240
    
    
    
    Impairment of real estate owned
    
    
    7,299
    
    
    
    9
    
    
    
    
    
    
    
    7,290
    
    
    
    Other
    
    
    25,917
    
    
    
    24,497
    
    
    
    19,274
    
    
    
    1,420
    
    
    
    5,223Total non-interest expense
    
    $
    313,898
    
    
    
    293,448
    
    
    
    241,092
    
    
    
    20,450
    
    
    
    52,356
    99




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BankAtlantics Provision for Income Taxes
 For the Years Ended
    
    Change
    
    ChangeDecember 31,
    
    2007 vs.
    
    2006 vs.2007
    
    2006
    
    2005
    
    2006
    
    2005(Loss) income before income taxes
    
    $
    (40,818
    )
    
    
    49,427
    
    
    
    86,658
    
    
    
    (90,245
    )
    
    
    (37,231
    )Benefit (provision) for income
taxes
    
    
    21,378
    
    
    
    (13,105
    )
    
    
    (30,838
    )
    
    
    34,483
    
    
    
    17,733BankAtlantic net (loss) income
    
    $
    (19,440
    )
    
    
    36,322
    
    
    
    55,820
    
    
    
    (55,762
    )
    
    
    (19,498
    )Effective tax rate
    
    
    52.37
    %
    
    
    26.51
    %
    
    
    35.59
    %
  101




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Parent Company Results of Operations
  For the Years Ended
    
    Change
    
    ChangeDecember 31,
    
    2007 vs
    
    2006 vs2007
    
    2006
    
    2005
    
    2006
    
    2005Net interest income
(expense):Interest income on loans
    
    $
    
    
    
    
    
    
    
    
    556
    
    
    
    
    
    
    
    (556
    )Interest and dividend income
on investments
    
    
    2,320
    
    
    
    2,448
    
    
    
    1,701
    
    
    
    (128
    )
    
    
    747Interest expense on Junior
subordinated debentures
    
    
    (23,054
    )
    
    
    (21,933
    )
    
    
    (19,347
    )
    
    
    (1,121
    )
    
    
    (2,586
    )Net interest (expense)
    
    
    (20,734
    )
    
    
    (19,485
    )
    
    
    (17,090
    )
    
    
    (1,249
    )
    
    
    (2,395
    )Non-interest income:Income from unconsolidated
subsidiaries
    
    
    1,281
    
    
    
    1,634
    
    
    
    621
    
    
    
    (353
    )
    
    
    1,013Securities activities, net
    
    
    6,105
    
    
    
    9,156
    
    
    
    731
    
    
    
    (3,051
    )
    
    
    8,425Other income
    
    
    824
    
    
    
    23
    
    
    
    1,172
    
    
    
    801
    
    
    
    (1,149
    )Non-interest income
    
    
    8,210
    
    
    
    10,813
    
    
    
    2,524
    
    
    
    (2,603
    )
    
    
    8,289Non-interest expense:Employee compensation and
benefits
    
    
    2,421
    
    
    
    4,705
    
    
    
    4,047
    
    
    
    (2,284
    )
    
    
    658Advertising and promotion
    
    
    317
    
    
    
    408
    
    
    
    422
    
    
    
    (91
    )
    
    
    (14
    )Professional fees
    
    
    424
    
    
    
    638
    
    
    
    1,179
    
    
    
    (214
    )
    
    
    (541
    )Other
    
    
    1,080
    
    
    
    1,028
    
    
    
    515
    
    
    
    52
    
    
    
    513Non-interest expense
    
    
    4,242
    
    
    
    6,779
    
    
    
    6,163
    
    
    
    (2,537
    )
    
    
    616Loss before income taxes
    
    
    (16,766
    )
    
    
    (15,451
    )
    
    
    (20,729
    )
    
    
    (1,315
    )
    
    
    5,278Income tax benefit
    
    
    6,194
    
    
    
    6,008
    
    
    
    7,435
    
    
    
    186
    
    
    
    (1,427
    )Parent Company loss
    
    $
    (10,572
    )
    
    
    (9,443
    )
    
    
    (13,294
    )
    
    
    (1,129
    )
    
    
    3,851
     102




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BankAtlantic Bancorp Consolidated Financial Condition
  
    
    Lower cash and due from depository institution balances resulting from a decline in
cash letter receivables;
    
    Increase in securities available for sale reflecting Stifel Common Stock received upon
the sale of Ryan Beck, the execution of an investment strategy to transfer $203 million
of tax exempt securities from investments held-to-maturity to securities available for
sale and the sale of BankAtlantics entire portfolio of tax exempt securities and
replacing these securities with government agency mortgage-backed securities. These
increases were partially offset by sales of Parent Company equity securities to fund the
Companys Class A Common Stock repurchase program;
    
    Decrease in investment securities at cost reflecting the transfer of $203 million of
tax exempt securities to securities available for sale partially offset by Stifel equity
securities received upon the sale of Ryan Beck which are subject to contractual
restrictions limiting sales;
    
    Decrease in tax certificate balances primarily due to redemptions of tax certificates
outside of Florida:
    
    Decline in FHLB stock related to lower FHLB advance borrowings;
    
    Decrease in loan receivable balances associated with a $50.4 million increase in the
allowance for loan losses and lower commercial loan balances partially offset by higher
purchased residential, small business and home equity loan balances;
    
    Increase in real estate inventory related to a decision to sell properties that
BankAtlantic acquired for its store expansion program;
    
    Lower real estate owned balances associated with $7.2 million of write-downs of the
real estate securing a land development loan which BankAtlantic took possession of during
the year ended December 31, 2006;
    
    Increase in office properties and equipment associated with BankAtlantics opening of
15 stores during 2007 partially offset by restructuring charges and impairments
associated with the a decision to slow the store expansion program;
    
    Decrease in discontinued operations assets held for sale reflecting the sale of Ryan
Beck to Stifel; and
    
    Increase in other assets primarily resulting from a federal income tax receivable
associated with a taxable loss for the year ended December 31, 2007.
  
    
    Lower non-interest-bearing deposit balances reflecting the migration of deposits to
higher yielding products as a result of a higher interest rate environment and
competition;
    
    Higher interest-bearing deposit balances primarily associated with increased high
yield savings, checking and certificates of deposit balances primarily reflecting
transfers of customer deposit balances to higher yielding products;
    
    Lower FHLB advance borrowings due to higher deposit balances and an increase in
short-term borrowings;
    
    Decrease in development notes payable associated with the repayment of real estate
development borrowings from third party lenders;
    
    Increase in subordinated debentures and bonds payable primarily associated with the
Parent Companys issuance of $31 million of junior subordinated debentures;
    
    Decrease in discontinued operations liabilities held for sale reflecting the sale of
Ryan Beck to Stifel; and
    
    Increase in other liabilities primarily resulting from $18.9 million of securities
available for sale purchased in December 2007 pending settlement in January 2008.
 104




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Liquidity and Capital Resources
 BankAtlantic Bancorp, Inc.
      105




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BankAtlantic
      106




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##### Table of Contents



Outstanding atDecember 31,
    
    For the Period Ending December 31, (1)Total
    
    2008
    
    2009-2010
    
    2011-2015
    
    2016-2020
    
    2021-2025
    
    >2026Commercial real estate
    
    $
    1,510,588
    
    
    
    727,769
    
    
    
    389,331
    
    
    
    196,595
    
    
    
    134,149
    
    
    
    59,988
    
    
    
    2,756Residential real estate
    
    
    2,159,839
    
    
    
    59,613
    
    
    
    19,136
    
    
    
    41,703
    
    
    
    284,600
    
    
    
    111,866
    
    
    
    1,642,921Consumer (1)
    
    
    706,934
    
    
    
    1,508
    
    
    
    3,193
    
    
    
    146,294
    
    
    
    431,986
    
    
    
    123,953
    
    
    
    Commercial business
    
    
    236,911
    
    
    
    131,752
    
    
    
    18,920
    
    
    
    81,425
    
    
    
    4,114
    
    
    
    700
    
    
    
    Total loans
    
    $
    4,614,272
    
    
    
    920,642
    
    
    
    430,580
    
    
    
    466,017
    
    
    
    854,849
    
    
    
    296,507
    
    
    
    1,645,677Total securities
available
for sale (2)
    
    $
    789,142
    
    
    
    410
    
    
    
    331
    
    
    
    135,661
    
    
    
    37,915
    
    
    
    184,462
    
    
    
    430,363
 
 (1)
    
    Includes home equity loans.(2)
    
    Does not include $136.2 million of equity securities. 107




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Commercial
    
    Real EstateBusiness
    
    Construction
    
    TotalOne year or less
    
    $
    204,578
    
    
    
    405,036
    
    
    
    609,614Over one year, but less than five
years
    
    
    32,249
    
    
    
    11,101
    
    
    
    43,350Over five years
    
    
    84
    
    
    
    347
    
    
    
    431$
    236,911
    
    
    
    416,484
    
    
    
    653,395Due After One Year:Pre-determined interest rate
    
    $
    32,333
    
    
    
    11,448
    
    
    
    43,781Floating or adjustable interest rate
    
    
    
    
    
    
    
    
    
    
    $
    32,333
    
    
    
    11,448
    
    
    
    43,781
  Florida
    
    
    57
    %Eastern U.S.A.
    
    
    23
    %Western U.S.A.
    
    
    16
    %Central U.S.A
    
    
    4
    %100
    %
   Minimum RatiosAdequately
    
    WellActual
    
    Capitalized
    
    CapitalizedAmount
    
    Ratio
    
    Ratio
    
    RatioAt December 31, 2007:Total risk-based capital
    
    $
    495,668
    
    
    
    11.63
    %
    
    
    8.00
    %
    
    
    10.00
    %Tier 1 risk-based
capital
    
    $
    420,063
    
    
    
    9.85
    %
    
    
    4.00
    %
    
    
    6.00
    %Tangible capital
    
    $
    420,063
    
    
    
    6.94
    %
    
    
    1.50
    %
    
    
    1.50
    %Core capital
    
    $
    420,063
    
    
    
    6.94
    %
    
    
    4.00
    %
    
    
    5.00
    %At December 31, 2006:Total risk-based capital
    
    $
    529,497
    
    
    
    12.08
    %
    
    
    8.00
    %
    
    
    10.00
    %Tier 1 risk-based
capital
    
    $
    460,359
    
    
    
    10.50
    %
    
    
    4.00
    %
    
    
    6.00
    %Tangible capital
    
    $
    460,359
    
    
    
    7.55
    %
    
    
    1.50
    %
    
    
    1.50
    %Core capital
    
    $
    460,359
    
    
    
    7.55
    %
    
    
    4.00
    %
    
    
    5.00
    %
  108




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Consolidated Cash Flows
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Net cash provided (used) by:Operating activities
    
    $
    40,928
    
    
    $
    3,359
    
    
    $
    57,339Investing activities
    
    
    (22,066
    )
    
    
    (205,891
    )
    
    
    132,220Financing activities
    
    
    (30,183
    )
    
    
    174,460
    
    
    
    (154,358
    )(Decrease) increase in cash
and cash equivalents
    
    $
    (11,321
    )
    
    $
    (28,072
    )
    
    $
    35,201
    Off Balance Sheet Arrangements, Contractual Obligations and Loan Commitments
  Amount of Commitment Expiration Per PeriodTotalAmounts
    
    Less than
    
    
    
    
    
    
    
    
    
    After 5Commercial Commitments
    
    Committed
    
    1 year
    
    1-3 years
    
    4-5 years
    
    yearsLines of credit
    
    $
    767,147
    
    
    
    100,828
    
    
    
    
    
    
    
    
    
    
    
    666,319Standby letters of credit
    
    
    41,151
    
    
    
    41,151
    
    
    
    
    
    
    
    
    
    
    
    Other commercial
commitments
    
    
    238,043
    
    
    
    238,043
    
    
    
    
    
    
    
    
    
    
    
    Total commercial
commitments
    
    $
    1,046,341
    
    
    
    380,022
    
    
    
    
    
    
    
    
    
    
    
    666,319
   109




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##### Table of Contents



Payments Due by Period (2)Less than
    
    
    
    
    
    
    
    
    
    After 5Contractual Obligations
    
    Total
    
    1 year
    
    1-3 years
    
    4-5 years
    
    yearsTime deposits
    
    $
    1,018,595
    
    
    
    865,080
    
    
    
    119,867
    
    
    
    33,543
    
    
    
    105Long-term debt
    
    
    320,849
    
    
    
    
    
    
    
    
    
    
    
    22,000
    
    
    
    298,849Advances from FHLB (1)
    
    
    1,397,044
    
    
    
    1,215,044
    
    
    
    182,000
    
    
    
    
    
    
    
    Operating lease obligations held
for sublease
    
    
    51,245
    
    
    
    1,530
    
    
    
    4,057
    
    
    
    4,152
    
    
    
    41,506Operating lease obligations held
for use
    
    
    86,115
    
    
    
    10,010
    
    
    
    16,053
    
    
    
    11,243
    
    
    
    48,809Pension obligation
    
    
    15,041
    
    
    
    983
    
    
    
    2,588
    
    
    
    2,873
    
    
    
    8,597Other obligations
    
    
    24,947
    
    
    
    5,097
    
    
    
    5,600
    
    
    
    6,250
    
    
    
    8,000Total contractual cash obligations
    
    $
    2,913,836
    
    
    
    2,097,744
    
    
    
    330,165
    
    
    
    80,061
    
    
    
    405,866
 
 (1)
    
    Payments due by period are based on contractual maturities(2)
    
    The above table excludes interest payments on interest bearing liabilities       110




---



##### Table of Contents



Critical Accounting Policies
  Allowance for loan losses
    111




---



##### Table of Contents



Valuation of investment securities
  112




---



##### Table of Contents



QuotedMarket
    
    Matrix
    
    ValuationPrices
    
    Pricing
    
    Model
    
    TotalSecurities:Mortgage-backed securities
    
    $
    
    
    
    
    589,619
    
    
    
    
    
    
    
    589,619Real estate mortgage conduits
    
    
    
    
    
    
    198,842
    
    
    
    
    
    
    
    198,842Other securities
    
    
    
    
    
    
    
    
    
    
    681
    
    
    
    681Total debt securities
    
    
    
    
    
    
    788,461
    
    
    
    681
    
    
    
    789,142Private investment securities
    
    
    8,091
    
    
    
    
    
    
    
    
    
    
    
    8,091Derivatives
    
    
    
    
    
    
    
    
    
    
    10,661
    
    
    
    10,661Stifel common stock
    
    
    107,078
    
    
    
    
    
    
    
    
    
    
    
    107,078Equity securities
    
    
    64,240
    
    
    
    
    
    
    
    1,500
    
    
    
    65,740Total equity securities
    
    
    179,409
    
    
    
    
    
    
    
    12,161
    
    
    
    191,570Total
    
    $
    179,409
    
    
    
    788,461
    
    
    
    12,842
    
    
    
    980,712
     113




---



##### Table of Contents



Impairment of Goodwill and Other Intangible Assets
  Impairment of Long-Lived Assets
   114




---



##### Table of Contents



Accounting for Business Combinations
  Accounting for Contingencies
  Accounting for Uncertain Tax Positions
  115




---



##### Table of Contents



Share-based Compensation
   Dividends
   Impact of Inflation
   116




---



##### Table of Contents



Real Estate Development
 The Real Estate Development activities of BFC are comprised of the operations of Levitt
Corporation. Levitt presents its results in four reportable segments and its results of operations
are consolidated with BFC Financial Corporation. The only assets available to BFC Financial
Corporation are dividends when and if paid by Levitt. Levitt is a separate public company and its
management prepared the following discussion regarding Levitt which was included in Levitts Annual
Report on Form 10-K for the year ended December 31, 2007 filed with the Securities and Exchange
Commission. Accordingly, references to the Company, we, us or our in the following
discussion under the caption Homebuilding & Real Estate Development are references to Levitt and
its subsidiaries, and are not references to BFC Financial Corporation.
 Executive Overview
   Outlook
 Item 1. Business  Recent Developments  Bankruptcy of
Levitt and Sons
   117




---



##### Table of Contents



Financial and Non-Financial Metrics
  Critical Accounting Policies and Estimates
  118




---



##### Table of Contents



Loss in excess of investment in Levitt and Sons
    Inventory of Real Estate
     119




---



##### Table of Contents



Investments in Unconsolidated Subsidiaries  Equity Method
 Consolidation of Variable Interest Entities
 The Equity Method of Accounting for Investments in Common Stock
 120




---



##### Table of Contents



Homesite Contracts and Consolidation of Variable Interest Entities
  Revenue Recognition
 Accounting for Sales of Real Estate
   Accounting
for Real Estate Time-Sharing Transactions Accounting for Costs and Initial Rental Operations of Real Estate Projects
 121




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##### Table of Contents



Capitalized Interest
  Income Taxes
   Accounting for Uncertainty in
Income Taxes  an interpretation of FASB No. 109
 Stock-based Compensation
 Share-Based
Payment
  122




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##### Table of Contents



Goodwill
 Goodwill and Other Intangible Assets
 Discontinued Operations
  123




---



##### Table of Contents



Consolidated Results of Operations
 2007
    
    
    2006Year Ended December 31,
    
    
    vs. 2006
    
    
    vs. 20052007
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    Change(In thousands, except per share data)RevenuesSales of real estate
    
    $
    410,115
    
    
    
    566,086
    
    
    
    558,112
    
    
    
    (155,971
    )
    
    
    7,974Other revenues
    
    
    5,766
    
    
    
    7,488
    
    
    
    6,585
    
    
    
    (1,722
    )
    
    
    903Total revenues
    
    
    415,881
    
    
    
    573,574
    
    
    
    564,697
    
    
    
    (157,693
    )
    
    
    8,877Costs and expensesCost of sales of real estate
    
    
    573,241
    
    
    
    482,961
    
    
    
    408,082
    
    
    
    90,280
    
    
    
    74,879Selling, general and administrative expenses
    
    
    116,087
    
    
    
    119,337
    
    
    
    87,162
    
    
    
    (3,250
    )
    
    
    32,175Other expenses
    
    
    3,929
    
    
    
    3,677
    
    
    
    4,855
    
    
    
    252
    
    
    
    (1,178
    )Total costs and expenses
    
    
    693,257
    
    
    
    605,975
    
    
    
    500,099
    
    
    
    87,282
    
    
    
    105,876Earnings from Bluegreen Corporation
    
    
    10,275
    
    
    
    9,684
    
    
    
    12,714
    
    
    
    591
    
    
    
    (3,030
    )Interest and other income, net of interest
expense
    
    
    7,439
    
    
    
    7,816
    
    
    
    10,289
    
    
    
    (377
    )
    
    
    (2,473
    )(Loss) income from continuing operations
before income taxes
    
    
    (259,662
    )
    
    
    (14,901
    )
    
    
    87,601
    
    
    
    (244,761
    )
    
    
    (102,502
    )Benefit (provision) for income taxes
    
    
    23,277
    
    
    
    5,758
    
    
    
    (32,532
    )
    
    
    17,519
    
    
    
    38,290(Loss) income from continuing operations
    
    
    (236,385
    )
    
    
    (9,143
    )
    
    
    55,069
    
    
    
    (227,242
    )
    
    
    (64,212
    )Discontinued operations:Income (loss) from discontinued operations,
net of tax
    
    
    1,765
    
    
    
    (21
    )
    
    
    (158
    )
    
    
    1,786
    
    
    
    137Net (loss) income
    
    $
    (234,620
    )
    
    
    (9,164
    )
    
    
    54,911
    
    
    
    (225,456
    )
    
    
    (64,075
    )Basic (loss) earnings per common share:Continuing operations
    
    $
    (6.05
    )
    
    
    (0.45
    )
    
    
    2.73
    
    
    
    (5.60
    )
    
    
    (3.18
    )Discontinued operations
    
    
    0.05
    
    
    
    
    
    
    
    (0.01
    )
    
    
    0.05
    
    
    
    0.01Total basic (loss) earnings per share
    
    $
    (6.00
    )
    
    
    (0.45
    )
    
    
    2.72
    
    
    
    (5.55
    )
    
    
    (3.17
    )Diluted (loss) earnings per common share:Continuing operations
    
    $
    (6.05
    )
    
    
    (0.46
    )
    
    
    2.70
    
    
    
    (5.59
    )
    
    
    (3.16
    )Discontinued operations
    
    
    0.05
    
    
    
    
    
    
    
    (0.01
    )
    
    
    0.05
    
    
    
    0.01Total diluted (loss) earnings per share (a)
    
    $
    (6.00
    )
    
    
    (0.46
    )
    
    
    2.69
    
    
    
    (5.54
    )
    
    
    (3.15
    )Basic weighted average shares outstanding (b)
    
    
    39,092
    
    
    
    20,214
    
    
    
    20,208
    
    
    
    18,878
    
    
    
    6Diluted weighted average shares outstanding
(b)
    
    
    39,092
    
    
    
    20,214
    
    
    
    20,320
    
    
    
    18,878
    
    
    
    (106
    )
 
 (a)
    
    Diluted (loss) earnings per share takes into account (i) the dilution in earnings we recognize from Bluegreen as a result of outstanding
securities issued by Bluegreen that enable the holders thereof to acquire shares of Bluegreens common stock and (ii) the dilutive effect of our stock options and restricted stock using the treasury
stock method.(b)
    
    The weighted average number of common shares outstanding in basic and diluted (loss) earnings per common share for 2006 and 2005 have been retroactively adjusted for a number of shares representing
the bonus element arising from the rights offering that closed on October 1, 2007. Under the rights offering, stock was issued on October 1, 2007 at a purchase price below the market price on October
1, 2007 resulting in the bonus element of 1.97%. The number of weighted average shares of Class A common stock is required to be retroactively increased by this percentage for all prior periods
presented.  124




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For the Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
       125




---



##### Table of Contents



126




---



##### Table of Contents



For the Year Ended December 31, 2006 Compared to the Year Ended December 31, 2005
     127




---



##### Table of Contents



128




---



##### Table of Contents



129




---



##### Table of Contents



Land Division Results of Operations
 2007
    
    
    2006Year Ended December 31,
    
    
    vs. 2006
    
    
    vs. 20052007
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    Change(Dollars in thousands)RevenuesSales of real estate
    
    $
    16,567
    
    
    
    69,778
    
    
    
    105,658
    
    
    
    (53,211
    )
    
    
    (35,880
    )Other revenues
    
    
    2,893
    
    
    
    2,063
    
    
    
    924
    
    
    
    830
    
    
    
    1,139Total revenues
    
    
    19,460
    
    
    
    71,841
    
    
    
    106,582
    
    
    
    (52,381
    )
    
    
    (34,741
    )Costs and expensesCost of sales of real estate
    
    
    7,447
    
    
    
    42,662
    
    
    
    50,706
    
    
    
    (35,215
    )
    
    
    (8,044
    )Selling, general and administrative expenses
    
    
    17,240
    
    
    
    13,305
    
    
    
    11,918
    
    
    
    3,935
    
    
    
    1,387Other expenses
    
    
    
    
    
    
    
    
    
    
    1,177
    
    
    
    
    
    
    
    (1,177
    )Total costs and expenses
    
    
    24,687
    
    
    
    55,967
    
    
    
    63,801
    
    
    
    (31,280
    )
    
    
    (7,834
    )Interest and other income, net of interest
expense
    
    
    1,842
    
    
    
    2,622
    
    
    
    7,861
    
    
    
    (780
    )
    
    
    (5,239
    )(Loss) income from continuing operations
before income taxes
    
    
    (3,385
    )
    
    
    18,496
    
    
    
    50,642
    
    
    
    (21,881
    )
    
    
    (32,146
    )Provision for income taxes
    
    
    (4,802
    )
    
    
    (6,948
    )
    
    
    (19,088
    )
    
    
    2,146
    
    
    
    12,140(Loss) income from continuing operations
    
    
    (8,187
    )
    
    
    11,548
    
    
    
    31,554
    
    
    
    (19,735
    )
    
    
    (20,006
    )Discontinued operations:Income (loss) from discontinued operations,
net of tax
    
    
    1,765
    
    
    
    (21
    )
    
    
    (158
    )
    
    
    1,786
    
    
    
    137Net (loss) income
    
    $
    (6,422
    )
    
    
    11,527
    
    
    
    31,396
    
    
    
    (17,949
    )
    
    
    (19,869
    )Operational data:Acres sold
    
    
    40
    
    
    
    371
    
    
    
    1,647
    
    
    
    (331
    )
    
    
    (1,276
    )Margin percentage (a)
    
    
    55.0
    %
    
    
    38.9
    %
    
    
    52.0
    %
    
    
    16.1
    %
    
    
    (13.1
    )%Unsold saleable acres (b)
    
    
    6,679
    
    
    
    6,871
    
    
    
    7,287
    
    
    
    (192
    )
    
    
    (416
    )Acres subject to sales contracts  Third
parties
    
    
    259
    
    
    
    74
    
    
    
    246
    
    
    
    185
    
    
    
    (172
    )Aggregate sales price of acres subject to
sales contracts to third parties
    
    
    77,888
    
    
    
    21,124
    
    
    
    39,283
    
    
    
    56,764
    
    
    
    (18,159
    )
 
 (a)
    
    Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate.(b)
    
    Includes approximately 56 acres related to assets held for sale as of December 31, 2007.  130




---



##### Table of Contents



For the Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
       131




---



##### Table of Contents



For the Year Ended December 31, 2006 Compared to the Year Ended December 31, 2005
     132




---



##### Table of Contents



Other Operations Results of Operations
 2007
    
    
    2006Year Ended December 31,
    
    
    Vs. 2006
    
    
    Vs. 20052007
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    Change(Dollars in thousands)RevenuesSales of real estate
    
    $
    6,574
    
    
    
    11,041
    
    
    
    14,709
    
    
    
    (4,467
    )
    
    
    (3,668
    )Other revenues
    
    
    952
    
    
    
    1,435
    
    
    
    1,963
    
    
    
    (483
    )
    
    
    (528
    )Total revenues
    
    
    7,526
    
    
    
    12,476
    
    
    
    16,672
    
    
    
    (4,950
    )
    
    
    (4,196
    )Costs and expensesCost of sales of real estate
    
    
    16,793
    
    
    
    11,649
    
    
    
    12,520
    
    
    
    5,144
    
    
    
    (871
    )Selling, general and administrative expenses
    
    
    32,508
    
    
    
    28,174
    
    
    
    17,841
    
    
    
    4,334
    
    
    
    10,333Other expenses
    
    
    2,390
    
    
    
    8
    
    
    
    72
    
    
    
    2,382
    
    
    
    (64
    )Total costs and expenses
    
    
    51,691
    
    
    
    39,831
    
    
    
    30,433
    
    
    
    1,860
    
    
    
    9,398Earnings from Bluegreen Corporation
    
    
    10,275
    
    
    
    9,684
    
    
    
    12,714
    
    
    
    591
    
    
    
    (3,030
    )Interest and other income, net of interest expense
    
    
    6,294
    
    
    
    4,059
    
    
    
    2,108
    
    
    
    2,235
    
    
    
    1,951(Loss) income before income taxes
    
    
    (27,596
    )
    
    
    (13,612
    )
    
    
    1,061
    
    
    
    (13,984
    )
    
    
    (14,673
    )Benefit (provision) for income taxes
    
    
    34,297
    
    
    
    5,639
    
    
    
    (378
    )
    
    
    28,658
    
    
    
    6,017Net income (loss)
    
    $
    6,701
    
    
    
    (7,973
    )
    
    
    683
    
    
    
    14,674
    
    
    
    (8,656
    )
  133




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##### Table of Contents



For the Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
       134




---



##### Table of Contents



For the Year Ended December 31, 2006 Compared to the Year Ended December 31, 2005
      135




---



##### Table of Contents



Primary Homebuilding Segment Results of Operations
 2007
    
    
    2006Year Ended December 31,
    
    
    vs. 2006
    
    
    vs. 20052007
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    Change(Dollars in thousands, except average price data)RevenuesSales of real estate
    
    $
    345,666
    
    
    
    424,420
    
    
    
    352,723
    
    
    
    (78,754
    )
    
    
    71,697Other revenues
    
    
    2,243
    
    
    
    4,070
    
    
    
    3,750
    
    
    
    (1,827
    )
    
    
    320Total revenues
    
    
    347,909
    
    
    
    428,490
    
    
    
    356,473
    
    
    
    (80,581
    )
    
    
    72,017Costs and expensesCost of sales of real estate
    
    
    501,206
    
    
    
    367,252
    
    
    
    272,680
    
    
    
    133,954
    
    
    
    94,572Selling, general and administrative expenses
    
    
    61,568
    
    
    
    65,052
    
    
    
    46,917
    
    
    
    (3,484
    )
    
    
    18,135Other expenses
    
    
    1,539
    
    
    
    2,362
    
    
    
    3,606
    
    
    
    (823
    )
    
    
    (1,244
    )Total costs and expenses
    
    
    564,313
    
    
    
    434,666
    
    
    
    323,203
    
    
    
    129,647
    
    
    
    111,463Interest and other income, net of interest expense
    
    
    (325
    )
    
    
    2,982
    
    
    
    639
    
    
    
    (3,307
    )
    
    
    2,343(Loss) income before income taxes
    
    
    (216,729
    )
    
    
    (3,194
    )
    
    
    33,909
    
    
    
    (213,535
    )
    
    
    (37,103
    )Benefit (provision) for income taxes
    
    
    1,396
    
    
    
    1,508
    
    
    
    (12,270
    )
    
    
    (112
    )
    
    
    13,778Net (loss) income
    
    $
    (215,333
    )
    
    
    (1,686
    )
    
    
    21,639
    
    
    
    (213,647
    )
    
    
    (23,325
    )Operational data:Homes delivered
    
    
    998
    
    
    
    1,320
    
    
    
    1,338
    
    
    
    (322
    )
    
    
    (18
    )Construction starts
    
    
    558
    
    
    
    1,445
    
    
    
    1,212
    
    
    
    (887
    )
    
    
    233Average selling price of homes delivered
    
    $
    338,000
    
    
    
    322,000
    
    
    
    264,000
    
    
    
    16,000
    
    
    
    58,000Margin percentage (a)
    
    
    (45.0
    )%
    
    
    13.5
    %
    
    
    22.7
    %
    
    
    (58.5
    )%
    
    
    (9.2
    )%Gross sales contracts (units)
    
    
    765
    
    
    
    1,108
    
    
    
    1,398
    
    
    
    (343
    )
    
    
    (290
    )Sales contracts cancellations (units)
    
    
    382
    
    
    
    261
    
    
    
    109
    
    
    
    121
    
    
    
    152Net orders (units)
    
    
    383
    
    
    
    847
    
    
    
    1,289
    
    
    
    (464
    )
    
    
    (442
    )Net orders (value)
    
    $
    94,782
    
    
    
    324,217
    
    
    
    448,207
    
    
    
    (229,435
    )
    
    
    (123,990
    )Backlog of homes (units)
    
    
    
    
    
    
    1,126
    
    
    
    1,599
    
    
    
    (1,126
    )
    
    
    (473
    )Backlog of homes (value)
    
    $
    
    
    
    
    411,578
    
    
    
    512,140
    
    
    
    (411,578
    )
    
    
    (100,562
    )
 
 (a)
    
    Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate.  For the Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
  136




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For the Year Ended December 31, 2006 Compared to the Year ended December 31, 2005
  137




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138




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Tennessee Homebuilding Segment Results of Operations
 2007
    
    
    2006Year Ended December 31,
    
    
    vs. 2006
    
    
    vs. 20052007
    
    
    2006
    
    
    2005
    
    
    Change
    
    
    Change(Dollars in thousands, except average price data)RevenuesSales of real estate
    
    $
    42,042
    
    
    
    76,299
    
    
    
    85,644
    
    
    
    (34,257
    )
    
    
    (9,345
    )Total revenues
    
    
    42,042
    
    
    
    76,299
    
    
    
    85,644
    
    
    
    (34,257
    )
    
    
    (9,345
    )Costs and expensesCost of sales of real estate
    
    
    51,360
    
    
    
    72,807
    
    
    
    74,328
    
    
    
    (21,447
    )
    
    
    (1,521
    )Selling, general and administrative expenses
    
    
    5,010
    
    
    
    12,806
    
    
    
    10,486
    
    
    
    (7,796
    )
    
    
    2,320Other expenses
    
    
    
    
    
    
    1,307
    
    
    
    
    
    
    
    (1,307
    )
    
    
    1,307Total costs and expenses
    
    
    56,370
    
    
    
    86,920
    
    
    
    84,814
    
    
    
    (30,550
    )
    
    
    2,106Interest and other income, net of interest expense
    
    
    (68
    )
    
    
    127
    
    
    
    188
    
    
    
    (195
    )
    
    
    (61
    )(Loss) income before income taxes
    
    
    (14,396
    )
    
    
    (10,494
    )
    
    
    1,018
    
    
    
    (3,902
    )
    
    
    (11,512
    )(Provision) benefit for income taxes
    
    
    (1,700
    )
    
    
    3,241
    
    
    
    (421
    )
    
    
    (4,941
    )
    
    
    3,662Net (loss) income
    
    $
    (16,096
    )
    
    
    (7,253
    )
    
    
    597
    
    
    
    (8,843
    )
    
    
    (7,850
    )Operational data:Homes delivered
    
    
    146
    
    
    
    340
    
    
    
    451
    
    
    
    (194
    )
    
    
    (111
    )Construction starts
    
    
    171
    
    
    
    237
    
    
    
    450
    
    
    
    (66
    )
    
    
    (213
    )Average selling price of homes delivered
    
    $
    205,000
    
    
    
    224,000
    
    
    
    190,000
    
    
    
    (19,000
    )
    
    
    34,000Margin percentage (a)
    
    
    (22.2
    )%
    
    
    4.6
    %
    
    
    13.2
    %
    
    
    (26.8
    )%
    
    
    (8.6
    )%Gross sales contracts (units)
    
    
    266
    
    
    
    412
    
    
    
    641
    
    
    
    (146
    )
    
    
    (229
    )Sales contracts cancellations (units)
    
    
    156
    
    
    
    143
    
    
    
    163
    
    
    
    13
    
    
    
    (20
    )Net orders (units)
    
    
    110
    
    
    
    269
    
    
    
    478
    
    
    
    (159
    )
    
    
    (209
    )Net orders (value)
    
    $
    20,621
    
    
    
    57,776
    
    
    
    98,838
    
    
    
    (37,155
    )
    
    
    (41,062
    )Backlog of homes (units)
    
    
    
    
    
    
    122
    
    
    
    193
    
    
    
    (122
    )
    
    
    (71
    )Backlog of homes (value)
    
    $
    
    
    
    
    26,662
    
    
    
    45,185
    
    
    
    (26,662
    )
    
    
    (18,523
    )
 
 (a)
    
    Margin percentage is calculated by dividing margin (sales of real estate minus cost of sales of real estate) by sales of real estate.  For the Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
  139




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For the Year Ended December 31, 2006 Compared to the Year Ended December 31, 2005
   140




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FINANCIAL CONDITION
  
    
    a net increase in inventory of real estate of approximately
$69.8 million, primarily
related to the Land Divisions development activities and the
acqusition of Carolina Oak;
    
    an increase of $41.8 million in property and equipment and assets held for sale
associated with increased investment in commercial properties under construction by our
Land Division and support for infrastructure in our master-planned communities;
    
    a net increase of approximately $9.0 million in our investment in Bluegreen
associated primarily with $10.3 million of earnings from Bluegreen (net of purchase
accounting adjustments);
    
    a net increase in cash and cash equivalents of $146.8 million, which resulted from
cash provided by financing activities of $228.5 million, offset by cash used in
operations and investing activities of $36.7 million and $45.0 million, respectively.
The increase in financing activities relates to the $152.8 million of proceeds from the
Rights Offering, as well as increases in our borrowings associated with commercial and
residential development; and
    
    An increase in our current tax asset of $22.8 million related to tax benefits
incurred due to the net operating losses recorded in 2007.
 141




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##### Table of Contents




    
    a net increase in notes and mortgage notes payable of $156.0 million, primarily
related to project debt associated with land development activities
and the acquisition of Carolina Oak;
    
    an increase of $55.2 million associated with the loss in excess of the investment in
Levitt and Sons created as a result of Levitt and Sons declaring bankruptcy on November
9, 2007; and
    
    The above increases were partially offset by a decrease in our deferred tax
liability of $12.8 million.
 LIQUIDITY AND CAPITAL RESOURCES
     Levitt Corporation (Parent level)
   
    
    approximately $85.1 million of junior subordinated debentures associated with the
issuance of Trust Preferred Securities;
    
    approximately $746,000 in subordinated investment notes which are unsecured and do not
contain any financial covenants;
    
    approximately $39.7 million in debt in connection with the loan assumption related to
Carolina Oak; and
    
    approximately $12.0 million in debt consisting principally of secured financing on our
Corporate headquarters building.
 142




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##### Table of Contents



Core Communities
 see Item 1. Business  Recent Developments  Acquisition
of Carolina Oak Homes LLC).
 143




---



##### Table of Contents



Off Balance Sheet Arrangements and Contractual Obligations
  144




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145




---



##### Table of Contents



Payments due by periodLess than
    
    
    13 - 36
    
    
    37 - 60
    
    
    More thanCategory (1)
    
    Total
    
    
    12 Months
    
    
    Months
    
    
    Months
    
    
    60 MonthsLong-term debt obligations (2)
    
    $
    274,820
    
    
    
    3,242
    
    
    
    45,942
    
    
    
    118,193
    
    
    
    107,443Interest payable on long-term debt
    
    
    181,293
    
    
    
    21,202
    
    
    
    36,592
    
    
    
    18,116
    
    
    
    105,383Long term debt obligations associated
with assets held for sale
    
    
    78,970
    
    
    
    8,914
    
    
    
    5,709
    
    
    
    61,250
    
    
    
    3,097Operating lease obligations
    
    
    4,714
    
    
    
    1,276
    
    
    
    1,599
    
    
    
    557
    
    
    
    1,282Severance related termination obligations
    
    
    1,949
    
    
    
    1,912
    
    
    
    37
    
    
    
    
    
    
    
    Independent contractor agreements
    
    
    1,596
    
    
    
    915
    
    
    
    681
    
    
    
    
    
    
    
    Total obligations
    
    $
    543,342
    
    
    
    37,461
    
    
    
    90,560
    
    
    
    198,116
    
    
    
    217,205
 
 (1)
    
    Long-term debt obligations consist of notes, mortgage notes and bonds payable.
Interest payable on these long-term debt obligations is the interest that will be incurred
related to the outstanding debt. Operating lease obligations consist of lease commitments.
The timing of contractual payments for debt obligations assumes the exercise of all
extensions available at the borrowers sole discretion.(2)
    
    In addition to the above scheduled payments, the Core borrowing agreement requires
repayment of specified amounts upon a sale of a portion of the property collateralizing the
debt or upon a reappraisal of the underlying collateral if declines in value cause the loan
to exceed maximum loan to value ratios. In addition, Core is subject to provisions in its
borrowing agreement that require additional principal payments, known as curtailment
payments, in the event that sales are below those agreed to at the inception of the
borrowing. In the event that agreed upon sales targets are not met in Tradition Hilton
Head, total curtailment payments during 2008 could amount to $34.2 million. In January
2008, a $14.9 million curtailment payment was paid and an additional $19.3 million would be
due in June 2008, if actual sales continue to be below the contractual requirements of the
development loan. Additionally certain borrowings may require increased principal payments
on our debt obligations due to re-margining requirements.
     146




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##### Table of Contents



Fair MarketValue atPayments due by year
    
    December 31,2008
    
    2009
    
    2010
    
    2011
    
    2012
    
    Thereafter
    
    Total
    
    2007Fixed rate debt:Notes and mortgage
payable (a)
    
    
    999
    
    
    
    427
    
    
    
    271
    
    
    
    298
    
    
    
    244
    
    
    
    100,983
    
    
    
    103,222
    
    
    
    90,398Average interest rate
    
    
    8.08
    %
    
    
    8.09
    %
    
    
    8.10
    %
    
    
    8.11
    %
    
    
    5.27
    %
    
    
    5.27
    %
    
    
    7.16
    %Variable rate debt:Notes and mortgage payable(a)
    
    
    2,243
    
    
    
    41,892
    
    
    
    3,352
    
    
    
    115,276
    
    
    
    2,375
    
    
    
    6,460
    
    
    
    171,598
    
    
    
    168,365Average interest rate
    
    
    7.53
    %
    
    
    7.53
    %
    
    
    7.61
    %
    
    
    7.61
    %
    
    
    7.73
    %
    
    
    7.73
    %
    
    
    7.57
    %Total debt obligations
    
    
    3,242
    
    
    
    42,319
    
    
    
    3,623
    
    
    
    115,574
    
    
    
    2,619
    
    
    
    107,443
    
    
    
    274,820
    
    
    
    258,763
 
 (a)
    
    Fair value calculated using current estimated borrowing rates.  Impact of Inflation
   New Accounting Pronouncements
 Applicability of
the Assessment of a Buyers Continuing Investment under FASB Statement No. 66, Accounting for Sales
of Real Estate
 147




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##### Table of Contents



The Fair Value Option for Financial Assets
and Financial Liabilities
 Fair Value Measurements
 Noncontrolling Interests in Consolidated
Financial Statementsan amendment of ARB No. 51,
 Business Combinations
 148




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##### Table of Contents



ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 BFC
     149




---



##### Table of Contents



BankAtlantic Bancorp
 Interest Rate Risk
  BankAtlantic Repricing Gap TableAs of December 31, 20071 Year
    
    
    3 Years
    
    
    5 Years
    
    
    More Thanor Less
    
    
    or Less
    
    
    or Less
    
    
    5 Years
    
    
    TotalInterest earning assets:Loans:Residential loans (1)Fixed rate
    
    $
    175,170
    
    
    
    132,347
    
    
    
    93,301
    
    
    
    311,344
    
    
    
    712,162Hybrids ARM less than 5 years
    
    
    102,127
    
    
    
    76,831
    
    
    
    4,225
    
    
    
    
    
    
    
    183,183Hybrids ARM more than 5 years
    
    
    410,712
    
    
    
    294,147
    
    
    
    250,007
    
    
    
    318,486
    
    
    
    1,273,352Commercial loans
    
    
    1,100,001
    
    
    
    137,273
    
    
    
    53,399
    
    
    
    136,273
    
    
    
    1,426,946Small business loans
    
    
    194,591
    
    
    
    83,926
    
    
    
    26,525
    
    
    
    11,691
    
    
    
    316,733Consumer
    
    
    676,212
    
    
    
    5,746
    
    
    
    3,984
    
    
    
    19,890
    
    
    
    705,832Total loans
    
    
    2,658,813
    
    
    
    730,270
    
    
    
    431,441
    
    
    
    797,684
    
    
    
    4,618,208Investment securitiesMortgage backed securities
    
    
    297,125
    
    
    
    229,248
    
    
    
    105,317
    
    
    
    154,677
    
    
    
    786,367Taxable investment securities
    
    
    71,505
    
    
    
    250
    
    
    
    
    
    
    
    2,248
    
    
    
    74,003Tax certificates
    
    
    188,401
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    188,401Total investment securities
    
    
    557,031
    
    
    
    229,498
    
    
    
    105,317
    
    
    
    156,925
    
    
    
    1,048,771Total interest earning assets
    
    
    3,215,844
    
    
    
    959,768
    
    
    
    536,758
    
    
    
    954,609
    
    
    
    5,666,979Total non-earning assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    494,983
    
    
    
    494,983Total assets
    
    $
    3,215,844
    
    
    
    959,768
    
    
    
    536,758
    
    
    
    1,449,592
    
    
    
    6,161,962Total interest bearing liabilities
    
    $
    3,424,912
    
    
    
    494,525
    
    
    
    242,964
    
    
    
    1,464,675
    
    
    
    5,627,076Non-interest bearing liabilities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    534,886
    
    
    
    534,886Total non-interest bearing liabilities
and equity
    
    $
    3,424,912
    
    
    
    494,525
    
    
    
    242,964
    
    
    
    1,999,561
    
    
    
    6,161,962GAP (repricing difference)
    
    $
    (209,068
    )
    
    
    465,243
    
    
    
    293,794
    
    
    
    (510,066
    )Cumulative GAP
    
    $
    (209,068
    )
    
    
    256,175
    
    
    
    549,969
    
    
    
    39,903Repricing Percentage
    
    
    -3.39
    %
    
    
    7.55
    %
    
    
    4.77
    %
    
    
    -8.28
    %Cumulative Percentage
    
    
    -3.39
    %
    
    
    4.16
    %
    
    
    8.93
    %
    
    
    0.65
    %
 
 (1)
    
    Hybrid adjustable rate mortgages (ARM) earn fixed rates for designated periods and
adjust annually thereafter based on the one year U.S. Treasury note rate. 150




---



##### Table of Contents



Year Ending December 31,
    
    Amount (1)2008
    
    $
    49,3512009
    
    
    46,1492010
    
    
    49,2792011
    
    
    94,8372012
    
    
    76,791Thereafter
    
    
    802,402Total interest only loans
    
    $
    1,118,809
    i.
    
    Calculating interest income and interest expense from existing assets and liabilities
using current repricing, prepayment and volume assumptions;ii.
    
    Estimating the change in expected net interest income based on instantaneous and
parallel shifts in the yield curve to determine the effect on net interest income; andiii.
    
    Calculating the percentage change in net interest income calculated in (i) and (ii).
   
    
    Interest rates,
    
    Loan prepayment rates,
    
    Deposit decay rates,
    
    Re-pricing of certain borrowings, and
    
    Reinvestment in earning assets.The
prepayment assumptions used in the model are:
    
    Fixed rate mortgages
    
    20%
    
    Fixed rate securities
    
    20%
    
    Tax certificates
    
    10%
    
    Adjustable rate mortgages
    
    27%
    
    Adjustable rate securities
    
    36%
 151




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##### Table of Contents



Within
    
    1-3
    
    3-5
    
    Over 51 Year
    
    Years
    
    Years
    
    YearsMoney fund savings accounts decay rates
    
    
    17
    %
    
    
    17
    %
    
    
    16
    %
    
    
    14
    %NOW and savings accounts decay rates
    
    
    37
    %
    
    
    32
    %
    
    
    17
    %
    
    
    17
    %
  As of December 31, 2007NetChanges
    
    Interest
    
    Percentin Rate
    
    Income
    
    Change+200 bp
    
    $
    187,031
    
    
    
    -7.81
    %+100 bp
    
    $
    198,147
    
    
    
    -2.33
    %0
    
    $
    202,876
    
    
    
    -100 bp
    
    $
    203,331
    
    
    
    0.22
    %-200 bp
    
    $
    204,354
    
    
    
    0.73
    %
 As of December 31, 2006NetChanges
    
    Interest
    
    Percentin Rate
    
    Income
    
    Change+200 bp
    
    $
    241,341
    
    
    
    -5.94
    %+100 bp
    
    $
    252,047
    
    
    
    -1.74
    %0
    
    $
    256,482
    
    
    
    -100 bp
    
    $
    256,485
    
    
    
    0.00
    %-200 bp
    
    $
    252,346
    
    
    
    -1.62
    %
  Levitt
  152




---



##### Table of Contents



Consolidated Equity Price Risk
  AvailablePercent
    
    for SaleChange in
    
    Securities
    
    DollarFair Value
    
    Fair Value
    
    Change20
    %
    
    $
    164,598
    
    
    $
    27,43310
    %
    
    $
    150,882
    
    
    $
    13,7170
    %
    
    $
    137,165
    
    
    $
    -10
    %
    
    $
    123,449
    
    
    $
    (13,717
    )-20
    %
    
    $
    109,732
    
    
    $
    (27,433
    )
   153




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##### Table of Contents



[This Page Intentionally Left Blank]
 154




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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 BFC FINANCIAL CORPORATION
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 Report
of Independent Registered Certified Public Accounting Firm of
PricewaterhouseCoopers LLP
    
    
    156Financial Statements:Consolidated
Statements of Financial Condition as of December 31, 2007 and
2006
    
    
    158Consolidated Statements of Operations for each of the years in the three year period ended
December 31, 2007
    
    
    159Consolidated Statements of Comprehensive (Loss) Income for each of the years in the three year
period ended December 31, 2007
    
    
    161Consolidated Statements of Shareholders Equity for each of the years in the three year period
ended December 31, 2007
    
    
    162Consolidated Statements of Cash Flows for each of the years in the three year period ended
December 31, 2007
    
    
    163Notes
to Consolidated Financial Statements
    
    
    166
 Bluegreen Corporation
  155




---



##### Table of Contents



Report of Independent Registered Certified Public Accounting Firm
  Internal Control  Integrated Framework
    156




---



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157




---



##### Table of Contents



BFC
Financial Corporation
 
 Consolidated Statements of Financial Condition
(In thousands, except share data)
 December 31,2007
    
    
    2006ASSETSCash and cash equivalents
    
    $
    326,524
    
    
    
    195,401Federal funds sold and other short-term investments
    
    
    5,631
    
    
    
    5,722Securities available for sale (at fair value)
    
    
    926,307
    
    
    
    653,659Financial instruments accounted for at fair value
    
    
    10,661
    
    
    
    Investment securities at cost or amortized costs (approximate fair value: $65,244 and $229,546)
    
    
    60,173
    
    
    
    227,208Tax certificates, net of allowance of $3,289 in 2007 and $3,699 in 2006
    
    
    188,401
    
    
    
    195,391Federal Home Loan Bank stock, at cost which approximates fair value
    
    
    74,003
    
    
    
    80,217Residential loans held for sale
    
    
    4,087
    
    
    
    9,313Loans receivable, net of allowance for loan losses
of $94,020 in 2007 and $44,173 in 2006
    
    
    4,524,451
    
    
    
    4,594,192Accrued interest receivable
    
    
    46,271
    
    
    
    47,676Real estate held for development and sale
    
    
    270,229
    
    
    
    847,492Real estate owned
    
    
    17,216
    
    
    
    21,747Investments in unconsolidated affiliates
    
    
    128,321
    
    
    
    125,287Properties and equipment, net
    
    
    276,078
    
    
    
    252,953Goodwill
    
    
    70,490
    
    
    
    70,490Core deposit intangible asset, net
    
    
    5,396
    
    
    
    6,834Deferred tax asset, net
    
    
    16,330
    
    
    
    Discontinued operations assets held for sale
    
    
    96,348
    
    
    
    238,047Other assets
    
    
    67,516
    
    
    
    34,137Total assets
    
    $
    7,114,433
    
    
    
    7,605,766LIABILITIES AND SHAREHOLDERS EQUITYLiabilities:DepositsInterest bearing
    
    $
    3,129,194
    
    
    
    2,871,116Non-interest bearing
    
    
    824,211
    
    
    
    995,920Total deposits
    
    
    3,953,405
    
    
    
    3,867,036Customer deposits on real estate held for sale
    
    
    541
    
    
    
    42,571Advances from FHLB
    
    
    1,397,044
    
    
    
    1,517,058Securities sold under agreements to repurchase
    
    
    50,930
    
    
    
    96,385Federal funds purchased and other short term borrowings
    
    
    108,975
    
    
    
    32,026Subordinated debentures, notes and bonds payable
    
    
    216,451
    
    
    
    533,286Junior subordinated debentures
    
    
    379,223
    
    
    
    348,318Deferred tax liabilities, net
    
    
    
    
    
    
    10,646Loss in excess of investment in Levitts subsidiary
    
    
    55,214
    
    
    
    Other liabilities
    
    
    129,570
    
    
    
    159,023Discontinued operations liabilities related to assets held for sale
    
    
    80,093
    
    
    
    123,509Total liabilities
    
    
    6,371,446
    
    
    
    6,729,858Noncontrolling interest
    
    
    558,950
    
    
    
    698,323Commitments and contingenciesShareholders equity:Preferred stock of $.01 par value; authorized 10,000,000 shares;
5% Cumulative Convertible Preferred Stock (5% Preferred Stock)
issued and outstanding 15,000 shares in 2007 and 2006
    
    
    
    
    
    
    Class A common stock of $.01 par value, authorized 70,000,000 shares;
issued and outstanding 38,232,932 in 2007 and 28,755,882 in 2006
    
    
    382
    
    
    
    266Class B common stock of $.01 par value, authorized 20,000,000 shares;
issued and outstanding 6,876,081 in 2007 and 7,090,652 in 2006
    
    
    69
    
    
    
    69Additional paid-in capital
    
    
    131,189
    
    
    
    93,910Retained earnings
    
    
    50,801
    
    
    
    81,889Total shareholders equity before
accumulated other comprehensive income
    
    
    182,441
    
    
    
    176,134Accumulated other comprehensive income
    
    
    1,596
    
    
    
    1,451Total shareholders equity
    
    
    184,037
    
    
    
    177,585Total liabilities and shareholders equity
    
    $
    7,114,433
    
    
    
    7,605,766
 See accompanying notes to consolidated financial statements.
 158




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##### Table of Contents



BFC
Financial Corporation
 
 Consolidated Statements of Operations
(In thousands, except per share data)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005RevenuesBFC Activities:Interest and dividend income
    
    $
    2,335
    
    
    
    2,249
    
    
    
    1,591Securities activities
    
    
    1,295
    
    
    
    
    
    
    
    58Other income
    
    
    2,479
    
    
    
    1,433
    
    
    
    1,4806,109
    
    
    
    3,682
    
    
    
    3,129Financial Services:Interest and dividend income
    
    
    371,633
    
    
    
    367,177
    
    
    
    345,002Service charges on deposits
    
    
    102,639
    
    
    
    90,472
    
    
    
    61,956Other service charges and fees
    
    
    28,950
    
    
    
    27,542
    
    
    
    23,347Securities activities
    
    
    8,412
    
    
    
    9,813
    
    
    
    847Other income
    
    
    9,159
    
    
    
    12,742
    
    
    
    14,385520,793
    
    
    
    507,746
    
    
    
    445,537Real Estate Development:Sales of real estate
    
    
    410,115
    
    
    
    566,086
    
    
    
    558,112Interest and dividend income
    
    
    3,918
    
    
    
    2,446
    
    
    
    2,204Other income
    
    
    12,922
    
    
    
    12,839
    
    
    
    14,285426,955
    
    
    
    581,371
    
    
    
    574,601Total revenues
    
    
    953,857
    
    
    
    1,092,799
    
    
    
    1,023,267Costs and ExpensesBFC Activities:Interest expense
    
    
    38
    
    
    
    30
    
    
    
    346Employee compensation and benefits
    
    
    10,932
    
    
    
    9,407
    
    
    
    6,245Other expenses
    
    
    4,045
    
    
    
    2,933
    
    
    
    3,07415,015
    
    
    
    12,370
    
    
    
    9,665Financial Services:Interest expense, net of interest capitalized
    
    
    192,672
    
    
    
    166,578
    
    
    
    141,561Provision for (recovery of) loan losses
    
    
    70,842
    
    
    
    8,574
    
    
    
    (6,615
    )Employee compensation and benefits
    
    
    151,178
    
    
    
    150,804
    
    
    
    117,573Occupancy and equipment
    
    
    65,851
    
    
    
    57,308
    
    
    
    41,621Advertising and promotion
    
    
    20,002
    
    
    
    35,067
    
    
    
    27,317Impairment of office properties and equipment
    
    
    
    
    
    
    
    
    
    
    3,706Amortization of intangible assets
    
    
    1,437
    
    
    
    1,561
    
    
    
    1,627Cost associated with debt redemption
    
    
    
    
    
    
    1,457
    
    
    
    Fines and penalties, compliance matters
    
    
    
    
    
    
    
    
    
    
    10,000Restructuring charges and exit activities
    
    
    8,351
    
    
    
    
    
    
    
    Impairment of real estate held for sale
    
    
    5,240
    
    
    
    
    
    
    
    Impairment of real estate owned
    
    
    7,299
    
    
    
    9
    
    
    
    Other expenses
    
    
    56,586
    
    
    
    52,953
    
    
    
    45,126579,458
    
    
    
    474,311
    
    
    
    381,916Real Estate Development:Cost of sales of real estate
    
    
    573,241
    
    
    
    482,961
    
    
    
    407,190Interest expense, net of interest capitalized
    
    
    3,807
    
    
    
    
    
    
    
    Selling, general and administrative expenses
    
    
    115,081
    
    
    
    118,203
    
    
    
    86,238Other expenses
    
    
    3,929
    
    
    
    3,677
    
    
    
    4,855696,058
    
    
    
    604,841
    
    
    
    498,283Total costs and expenses
    
    
    1,290,531
    
    
    
    1,091,522
    
    
    
    889,864Equity in earnings from unconsolidated affiliates
    
    
    12,724
    
    
    
    10,935
    
    
    
    13,404(Loss) income from continuing operations before income taxes
and noncontrolling interest
    
    
    (323,950
    )
    
    
    12,212
    
    
    
    146,807(Benefit) provision for income taxes
    
    
    (70,246
    )
    
    
    (515
    )
    
    
    59,672Noncontrolling interest
    
    
    (219,603
    )
    
    
    13,422
    
    
    
    79,399(Loss) income from continuing operations
    
    
    (34,101
    )
    
    
    (695
    )
    
    
    7,736Discontinued operations, less noncontrolling interest and income tax
provision (benefit) of $(2,237) in 2007, $(8,972) in 2006 and $13,099 in 2005
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Extraordinary gain, less income tax of $1,509 in 2007
    
    
    2,403
    
    
    
    
    
    
    
    Net (loss) income
    
    
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,7745% Preferred Stock dividends
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )Net (loss) income allocable to common stock
    
    $
    (31,209
    )
    
    
    (2,971
    )
    
    
    12,024
  See accompanying notes to consolidated financial statements.
 159




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##### Table of Contents



BFC Financial Corporation
Consolidated Statements of Operations
(In thousands, except per share data)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005(Loss) earnings per common share:Basic (loss) earnings per share from
continuing operations
    
    $
    (0.90
    )
    
    
    (0.04
    )
    
    
    0.24Basic (loss) earnings per share from
discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.18Earnings per share from extraordinary gain
    
    
    0.06
    
    
    
    
    
    
    
    Basic (loss) earnings per share
    
    $
    (0.81
    )
    
    
    (0.09
    )
    
    
    0.42Diluted (loss) earnings per share from
continuing operations
    
    $
    (0.90
    )
    
    
    (0.05
    )
    
    
    0.22Diluted (loss) earnings per share from
discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.15Earnings per share from extraordinary gain
    
    
    0.06
    
    
    
    
    
    
    
    Diluted (loss) earnings per share
    
    $
    (0.81
    )
    
    
    (0.10
    )
    
    
    0.37Basic
weighted average number of common shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    28,952Diluted weighted average number of common
and common equivalent shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    31,219
 See accompanying notes to consolidated financial statements.
 160




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##### Table of Contents



BFC
Financial Corporation
 
 Consolidated Statements of Comprehensive (Loss) Income
(In thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Net (loss) income
    
    $
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774Other comprehensive income (loss), net of tax:Unrealized gains (loss) on securities available for sale
    
    
    2,543
    
    
    
    2,471
    
    
    
    (594
    )Provision (benefit) for income taxes
    
    
    981
    
    
    
    953
    
    
    
    (229
    )Unrealized gains (loss) on securities available for sale, net of tax
    
    
    1,562
    
    
    
    1,518
    
    
    
    (365
    )Unfunded pension liability
    
    
    102
    
    
    
    345
    
    
    
    (215
    )Provision (benefit) for income taxes
    
    
    39
    
    
    
    133
    
    
    
    (83
    )Unfunded pension liability, net of tax
    
    
    63
    
    
    
    212
    
    
    
    (132
    )Unrealized (losses) gains associated with investment in
unconsolidated affiliates
    
    
    (12
    )
    
    
    129
    
    
    
    247(Benefit) provision for income taxes
    
    
    (5
    )
    
    
    50
    
    
    
    95Unrealized (losses) gains associated with investment in
unconsolidated affiliates, net of tax
    
    
    (7
    )
    
    
    79
    
    
    
    152Reclassification adjustments:Realized net periodic pension income (costs)
    
    
    35
    
    
    
    (42
    )
    
    
    Provision (benefit) for income taxes
    
    
    14
    
    
    
    (16
    )
    
    
    Realized net periodic pension income (costs), net of tax
    
    
    21
    
    
    
    (26
    )
    
    
    Net realized gains reclassified into net loss
    
    
    (2,423
    )
    
    
    (1,395
    )
    
    
    (117
    )(Benefit) for income taxes
    
    
    (929
    )
    
    
    (538
    )
    
    
    (45
    )Net realized gains reclassified into net loss, net of tax
    
    
    (1,494
    )
    
    
    (857
    )
    
    
    (72
    )145
    
    
    
    926
    
    
    
    (417
    )Comprehensive (loss) income
    
    $
    (30,314
    )
    
    
    (1,295
    )
    
    
    12,357
 See accompanying notes to consolidated financial statements.
 161




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##### Table of Contents



BFC
Financial Corporation
 
 Consolidated Statements of Shareholders Equity
For each of the years in the three year period ended December 31, 2007
(In thousands)
 Unearned
    
    
    
    
    
    
    AccumulatedCompen-
    
    
    
    
    
    
    Othersation
    
    
    
    
    
    
    Compre-Shares of Common
    
    
    Class A
    
    
    Class B
    
    
    Additional
    
    
    Restricted
    
    
    
    
    
    
    hensiveStock Outstanding
    
    
    Common
    
    
    Common
    
    
    Paid-in
    
    
    Stock
    
    
    Retained
    
    
    IncomeClass A
    
    
    Class B
    
    
    Stock
    
    
    Stock
    
    
    Capital
    
    
    Grants
    
    
    Earnings
    
    
    (Loss)
    
    
    TotalBalance, December 31, 2004
    
    
    23,861
    
    
    
    4,280
    
    
    $
    217
    
    
    $
    41
    
    
    $
    50,962
    
    
    $
    
    
    
    $
    73,089
    
    
    $
    942
    
    
    $
    125,251Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,774
    
    
    
    
    
    
    
    12,774Other comprehensive loss, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (417
    )
    
    
    (417
    )Issuance of Class A Common Stock,
net of stock issuance costs
    
    
    5,958
    
    
    
    
    
    
    
    60
    
    
    
    
    
    
    
    46,376
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46,436Issuance of common stock
upon exercise of stock options and restricted stock
    
    
    124
    
    
    
    12
    
    
    
    1
    
    

    

    
    
    
    371
    
    
    
    (200
    )
    
    
    
    
    
    
    
    
    
    
    172Net effect
of subsidiaries capital transactions, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (474
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (474
    )Cash dividends on 5% Preferred Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (750
    )
    
    
    
    
    
    
    (750
    )Amortization
of unearned compensation on restricted stock grants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    100
    
    
    
    
    
    
    
    
    
    
    
    100Tax effect relating to share-based
compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12
    )Transfer of shares of Common Stock
    
    
    7
    
    
    
    (7
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance, December 31, 2005
    
    
    29,950
    
    
    
    4,285
    
    
    $
    278
    
    
    $
    41
    
    
    $
    97,223
    
    
    $
    (100
    )
    
    $
    85,113
    
    
    $
    525
    
    
    $
    183,080Cumulative effect adjustment
upon adoption of Staff Accounting
Bulletin No. 108 (SAB No. 108)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (253
    )
    
    
    
    
    
    
    (253
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,221
    )
    
    
    
    
    
    
    (2,221
    )Other comprehensive income, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    926
    
    
    
    926Issuance of Common Stock,
upon exercise of stock options
    
    
    30
    
    
    
    3,929
    
    
    
    1
    
    
    
    39
    
    
    
    9,076
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,116Retirement of Common Stock relating to
exercise of stock options
    
    
    (1,279
    )
    
    
    (1,068
    )
    
    
    (13
    )
    
    
    (11
    )
    
    
    (13,246
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,270
    )Net effect of subsidiaries capital
transactions, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (16
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (16
    )Cash dividends on 5% Preferred Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (750
    )
    
    
    
    
    
    
    (750
    )Share-based compensation related
to stock options and restricted stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    973
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    973Reversal of unamortized stock
compensation related to restricted stock
upon adoption of FAS 123 ( R)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (100
    )
    
    
    100
    
    
    
    
    
    
    
    
    
    
    
    Transfer of shares of Common Stock
    
    
    55
    
    
    
    (55
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance, December 31, 2006
    
    
    28,756
    
    
    
    7,091
    
    
    $
    266
    
    
    $
    69
    
    
    $
    93,910
    
    
    $
    
    
    
    $
    81,889
    
    
    $
    1,451
    
    
    $
    177,585Cumulative effect adjustment
upon adoption of
FASB Interpretation No. 48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    121
    
    
    
    
    
    
    
    121Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,459
    )
    
    
    
    
    
    
    (30,459
    )Other comprehensive income,
net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    145
    
    
    
    145Issuance of common stock,
net of issuance costs
    
    
    11,500
    
    
    
    
    
    
    
    115
    
    
    
    
    
    
    
    36,006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    36,121Issuance of common stock
upon exercise of stock options and
restricted stock
    
    
    152
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    187
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    188Cancelled shares of common stock
upon merger. (See notes 32 and 35)
    
    
    (2,163
    )
    
    
    (227
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net effect of subsidiaries capital
transactions, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (101
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (101
    )Cash dividends on 5% Preferred Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (750
    )
    
    
    
    
    
    
    (750
    )Share-based compensation related
to stock options and restricted stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,187
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,187Transfer of shares of Common Stock
    
    
    (12
    )
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance, December 31, 2007
    
    
    38,233
    
    
    
    6,876
    
    
    $
    382
    
    
    $
    69
    
    
    $
    131,189
    
    
    $
    
    
    
    $
    50,801
    
    
    $
    1,596
    
    
    $
    184,037
 See accompanying notes to consolidated financial statements.
 162




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##### Table of Contents



BFC
Financial Corporation
 
 Consolidated Statements of Cash Flows
(In thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Operating activities:Net (loss) income
    
    $
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774Adjustment to reconcile net income to net cash
provided by operating activities:Extraordinary gain, net of taxes
    
    
    (2,403
    )
    
    
    
    
    
    
    Noncontrolling interest
    
    
    (224,874
    )
    
    
    4,393
    
    
    
    91,144Provision (recovery) for loan losses
    
    
    78,441
    
    
    
    8,883
    
    
    
    (6,265
    )Restructuring charges, impairments and exit activities
    
    
    13,591
    
    
    
    
    
    
    
    3,706Impairment of inventory and long lived assets
    
    
    226,879
    
    
    
    38,083
    
    
    
    Cumulative effect adjustment before noncontrolling interest
    
    
    700
    
    
    
    (1,899
    )
    
    
    Depreciation, amortization and accretion, net
    
    
    23,693
    
    
    
    31,845
    
    
    
    22,503Share-based compensation expense
    
    
    9,386
    
    
    
    9,291
    
    
    
    Tax benefits from share-based compensation
    
    
    (1,265
    )
    
    
    (3,719
    )
    
    
    Securities activities, net
    
    
    (9,707
    )
    
    
    (9,795
    )
    
    
    (847
    )Net gain on transfer of net assets for settlement of note
    
    
    
    
    
    
    
    
    
    
    (3,439
    )Net losses (gains) on sales of real estate owned, loans and
office properties and equipment
    
    
    734
    
    
    
    (4,834
    )
    
    
    (2,859
    )Net gain on sale of Ryan Beck Holdings, Inc.
    
    
    (2,175
    )
    
    
    
    
    
    
    Originations and repayments of loans held for sale, net
    
    
    (90,745
    )
    
    
    (93,887
    )
    
    
    (125,487
    )Proceeds from sales of loans held for sale
    
    
    96,470
    
    
    
    87,793
    
    
    
    128,337Gain on sale of branch
    
    
    
    
    
    
    
    
    
    
    (922
    )Equity in earnings from unconsolidated affiliates
    
    
    (10,390
    )
    
    
    (9,267
    )
    
    
    (12,783
    )(Increase) decrease in deferred tax assets
    
    
    (44,024
    )
    
    
    (20,625
    )
    
    
    3,512Net gains associated with debt redemption
    
    
    
    
    
    
    (71
    )
    
    
    Reserve for fines and penalties, compliance matters
    
    
    
    
    
    
    
    
    
    
    10,000Increase in forgivable notes receivable, net
    
    
    (673
    )
    
    
    (6,111
    )
    
    
    (6,999
    )Decrease (increase) in real estate held for development and sale
    
    
    27,006
    
    
    
    (259,629
    )
    
    
    (191,610
    )(Increase) decrease in securities owned, net
    
    
    (23,855
    )
    
    
    67,910
    
    
    
    (54,849
    )Increase (decrease) securities sold but not yet purchased
    
    
    28,419
    
    
    
    (3,770
    )
    
    
    (4,285
    )Decrease (increase) in accrued interest receivable
    
    
    1,405
    
    
    
    (6,183
    )
    
    
    (5,501
    )Changes related to Levitts subsidiary deconsolidation
    
    
    
    
    
    
    
    
    
    
    Decrease (increase) in other assets
    
    
    (7,071
    )
    
    
    3,021
    
    
    
    2,556Increase (decrease) in due to clearing agent
    
    
    9,657
    
    
    
    (40,115
    )
    
    
    41,105Decrease in customer deposits
    
    
    (23,974
    )
    
    
    (8,990
    )
    
    
    (Decrease) increase in other liabilities
    
    
    (45,712
    )
    
    
    (21,058
    )
    
    
    21,343Net cash used in operating activities
    
    
    (946
    )
    
    
    (240,955
    )
    
    
    (78,866
    )Investing activities:Proceeds from redemption and maturity of investment securities
and certificates
    
    
    208,345
    
    
    
    199,482
    
    
    
    210,493Purchase of investment securities and tax certificates
    
    
    (211,402
    )
    
    
    (236,962
    )
    
    
    (278,509
    )Purchase of securities available for sale
    
    
    (682,231
    )
    
    
    (143,272
    )
    
    
    (227,179
    )Proceeds from sales and maturities of securities available for sale
    
    
    719,898
    
    
    
    181,444
    
    
    
    300,469Purchases of FHLB stock
    
    
    (22,725
    )
    
    
    (49,950
    )
    
    
    (29,870
    )Redemption of FHLB stock
    
    
    28,939
    
    
    
    39,664
    
    
    
    38,558Distributions from unconsolidated subs
    
    
    8,186
    
    
    
    5,303
    
    
    
    447Investments in unconsolidated subsidiaries
    
    
    (6,863
    )
    
    
    (10,323
    )
    
    
    (6,228
    )Net repayments (purchases and originations) of loans
    
    
    (2,173
    )
    
    
    (106,123
    )
    
    
    105,186Additions to real estate owned
    
    
    (2,011
    )
    
    
    
    
    
    
    Proceeds from sales of real estate owned
    
    
    2,252
    
    
    
    4,382
    
    
    
    3,872Proceeds from sales of property and equipment
    
    
    969
    
    
    
    2,055
    
    
    
    651Purchases of office property and equipment, net
    
    
    (103,033
    )
    
    
    (121,680
    )
    
    
    (56,335
    )Deconsolidation of Levitts subsidiary cash balance
    
    
    (6,387
    )
    
    
    
    
    
    
    Net proceeds from the sale of Ryan Beck Holdings, Inc.
    
    
    2,628
    
    
    
    
    
    
    
    Acquisition of Levitt Class A shares
    
    
    (33,205
    )
    
    
    
    
    
    
    Net cash (used in) provided by investing activities
    
    $
    (98,813
    )
    
    
    (235,980
    )
    
    
    61,555
  See accompanying notes to consolidated financial statements.
 163




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##### Table of Contents



BFC
Financial Corporation
 Consolidated Statements of Cash Flows
(In thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Financing activities:Net increase in deposits
    
    $
    86,369
    
    
    
    114,360
    
    
    
    313,190Cash outflows from the sale of branch
    
    
    
    
    
    
    
    
    
    
    (13,605
    )Repayments of FHLB advances
    
    
    (3,825,000
    )
    
    
    (2,551,344
    )
    
    
    (1,506,832
    )Proceeds from FHLB advances
    
    
    3,705,000
    
    
    
    2,785,000
    
    
    
    1,246,000Net decrease in securities sold under
agreements to repurchase
    
    
    (45,456
    )
    
    
    (13,403
    )
    
    
    (147,214
    )Net increase (decrease) in federal funds purchased
    
    
    76,949
    
    
    
    (107,449
    )
    
    
    34,475Repayments of secured borrowings
    
    
    
    
    
    
    (26,516
    )
    
    
    (101,924
    )Proceeds from secured borrowings
    
    
    
    
    
    
    
    
    
    
    65,293Repayment of notes and bonds payable
    
    
    (162,213
    )
    
    
    (216,891
    )
    
    
    (266,432
    )Proceeds from notes and bonds payable
    
    
    236,839
    
    
    
    384,732
    
    
    
    388,781Issuance of junior subordinated debentures
    
    
    30,929
    
    
    
    30,928
    
    
    
    54,124Payments for debt issuance costs
    
    
    (1,695
    )
    
    
    (3,043
    )
    
    
    (3,498
    )Capital contributions in managed fund by investors
    
    
    
    
    
    
    2,905
    
    
    
    Capital withdrawals in managed fund by investors
    
    
    
    
    
    
    (4,203
    )
    
    
    Excess tax benefits from share-based compensation
    
    
    1,265
    
    
    
    3,719
    
    
    
    Proceeds from the issuance of BFC Class A Common Stock,
net of issuance costs
    
    
    36,121
    
    
    
    
    
    
    
    46,436Proceeds from the exercise of stock options
    
    
    187
    
    
    
    
    
    
    
    1725% Preferred Stock dividends paid
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )Purchase and retirement of BankAtlantic Bancorp
Class A common stock
    
    
    (53,769
    )
    
    
    
    
    
    
    Proceeds from the issuance of Levitt Class A common stock,
net of issuance costs
    
    
    152,651
    
    
    
    
    
    
    
    Payment of the minimum withholding tax upon the exercise of
stock options
    
    
    
    
    
    
    (6,871
    )
    
    
    (3,519
    )Proceeds from issuance of BankAtlantic Bancorp
Class A common stock
    
    
    2,449
    
    
    
    1,479
    
    
    
    1,179Purchase of subsidiary common stock
    
    
    
    
    
    
    (7,833
    )
    
    
    (491
    )BankAtlantic Bancorp common stock dividends
paid to non-BFC shareholders
    
    
    (5,746
    )
    
    
    (7,592
    )
    
    
    (6,930
    )Levitt common stock dividends paid to non-BFC shareholders
    
    
    (330
    )
    
    
    (1,322
    )
    
    
    (1,322
    )Change in noncontrolling interest
    
    
    
    
    
    
    
    
    
    
    895Net cash provided by financing activities
    
    
    233,800
    
    
    
    375,906
    
    
    
    98,028Increase (decrease) in cash and cash equivalents
    
    
    134,041
    
    
    
    (101,029
    )
    
    
    80,717Cash and cash equivalents at beginning of period
    
    
    201,123
    
    
    
    305,437
    
    
    
    224,720Cash and cash equivalents of discontinued assets held for sale
at disposal date
    
    
    (6,294
    )
    
    
    
    
    
    
    Cash and cash equivalents of discontinued assets held for sale
    
    
    3,285
    
    
    
    (3,285
    )
    
    
    (5,366
    )Cash and cash equivalents at end of period
    
    $
    332,155
    
    
    
    201,123
    
    
    
    300,071
  See accompanying notes to consolidated financial statements.
 164




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##### Table of Contents



BFC Financial Corporation
Consolidated Statements of Cash Flows
(In thousands)
 For the Years Ended December 31,2007
    
    2006
    
    2005Supplemental cash flow information:Interest on borrowings and deposits
    
    $
    197,157
    
    
    
    167,430
    
    
    
    143,499Income taxes paid
    
    
    5,409
    
    
    
    39,770
    
    
    
    30,002Supplementary disclosure of non-cash investing and financing activities:Loans and tax certificates transferred to REO
    
    
    2,528
    
    
    
    23,728
    
    
    
    2,307Securities held-to-maturity transferred to securities available for sale
    
    
    203,004
    
    
    
    
    
    
    
    Long-lived assets held-for-use transferred to assets held for sale
    
    
    13,704
    
    
    
    
    
    
    
    Decreases in current income taxes payable from the tax
effect of fair value of employee stock options
    
    
    
    
    
    
    
    
    
    
    4,538Securities purchased pending settlement
    
    
    18,926
    
    
    
    
    
    
    
    6,183Decrease in inventory from the reclassification to
to property and equipment
    
    
    2,859
    
    
    
    8,412
    
    
    
    1,809Reduction in loan participations sold accounted for
as secured borrowings
    
    
    
    
    
    
    111,754
    
    
    
    Exchange branch facilities
    
    
    
    
    
    
    2,350
    
    
    
    Decrease in shareholders equity for the tax effect relating
to share-based compensation
    
    
    
    
    
    
    
    
    
    
    (12
    )Increase (decrease) in accumulated other comprehensive income,
net of taxes
    
    
    145
    
    
    
    926
    
    
    
    (417
    )Net decrease in shareholders equity from
the effect of subsidiaries capital transactions, net of taxes
    
    
    (101
    )
    
    
    (16
    )
    
    
    (474
    )Issuance and retirement of BFC Class A Common Stock accepted as
consideration for the exercise price of stock options
    
    
    
    
    
    
    4,154
    
    
    
    Increase in deferred tax liability due to cumulative impact of change
in accounting for uncertainties in income taxes (FIN 48 - see note 23)
    
    
    121
    
    
    
    
    
    
    
    
 See accompanying notes to consolidated financial statements.
 165




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 1. Organization and Summary of Significant Accounting Policies
 Organization and Business
     166




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BFC Financial Corporation
Notes to Consolidated Financial Statements
       167




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
    PercentShares
    
    Percent of
    
    ofOwned
    
    Ownership
    
    VoteBankAtlantic BancorpClass A Common Stock
    
    
    8,329,236
    
    
    
    16.27
    %
    
    
    8.62
    %Class B Common Stock
    
    
    4,876,124
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    13,205,360
    
    
    
    23.55
    %
    
    
    55.62
    %LevittClass A Common Stock
    
    
    18,676,955
    (1)
    
    
    19.65
    %
    
    
    6.99
    %(1)Class B Common Stock
    
    
    1,219,031
    
    
    
    100.00
    %
    
    
    47.00
    %Total
    
    
    19,895,986
    (1)
    
    
    20.67
    %
    
    
    53.99
    %(1)
 
 (1)
    
    BFCs ownership interest includes, but BFCs voting interest excludes, 6,145,582 shares
of Levitts Class A Common Stock which, subject to certain exceptions, BFC has agreed not
to vote in accordance with the Letter Agreement, as discussed in Note
5. Summary of Significant Accounting Policies
   Consolidation Policy 
  Use of Estimates 
 168




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Loss in excess of investment in Levitt and Sons -
   Cash Equivalents 
 Restricted Cash 
 Investment Securities at Cost or Amortized Costs 
  169




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##### Table of Contents



BFC
Financial Corporation
 
 Notes to Consolidated Financial Statements
      Financial instruments and derivatives
 Tax Certificates
 Allowance for Tax Certificate Losses 
 Loans 
 Loans Held for Sale
 Transfer of Loan Participations 
 170




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Impaired Loans
 Allowance for Loan Losses
   Non-performing Loans
  Real Estate Owned (REO)
 171




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Real Estate Held for Development and Sale 
     Capitalized Interest 
 172




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Homebuilding and Land Sales Revenue Recognition Accounting for Sales of Real Estate. (
   Accounting
for Real Estate Time-Sharing Transactions Accounting for Costs and Initial Rental Operations of Real Estate Projects (FAS No. 67)
 Homesite Contracts and Consolidation of Variable Interest Entities
 Investments in Unconsolidated Affiliates Consolidation of Variable Interest Entities
 173




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
    Goodwill and Other Intangible Assets Goodwill and Other Intangible
Assets
   Purchase Accounting  Step Acquisition
 174




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Properties and Equipment
  Impairment of Long Lived Assets
  Advertising 
 Income Taxes 
   175




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Noncontrolling Interest
 Accounting for Contingencies
 (Loss) Earnings Per Share
  Brokered Deposits
 Stock-Based Compensation Plans
 Discontinued Operations
  176




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   New Accounting Pronouncements:
  Applicability of
the Assessment of a Buyers Continuing Investment
 The Fair Value Option for Financial Assets and
Financial Liabilities,
 Business Combinations
 177




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Noncontrolling Interests in Consolidated
Financial StatementsAn Amendment of ARB No. 51
 2. Cumulative-Effect Adjustment for Quantifying Financial Statement Misstatements
   178




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Cumulative EffectAdjustmentAs of January 1, 2006Other liabilities:Recurring
operating expenses (1)
    
    
    
    
    
    $
    1,618Deferred
data processing expenses (2)
    
    
    
    
    
    
    1,474Current taxes payable
    
    
    
    
    
    
    (696
    )Increase in other liabilities
    
    
    
    
    
    
    2,396Decrease in deferred tax liability
    
    
    
    
    
    
    (657
    )Decrease
in noncontrolling interest(3)
    
    
    
    
    
    
    (1,486
    )Decrease in retained earnings
    
    
    
    
    
    $
    253
 
 (1)
    
    BankAtlantic has historically expensed certain recurring invoices when
paid. The effect of this accounting policy was not material to BankAtlantics
financial statements in any given year as the rollover impact of expenses in the
following year approximated the expenses that rolled over from the prior year.(2)
    
    BankAtlantic pays a fixed fee for certain data processing transaction
services, and at the end of each contract year, the actual number of transactions
is determined and the fees related to any greater or lesser transactions are
invoiced or repaid to BankAtlantic over a twelve month period. BankAtlantic
accounted for these charges when paid. The effect of this accounting policy was
not material to BankAtlantics financial statements in any given year and the
amount of the error had accumulated over a four year period as follows (in
thousands): For
the Years
    
    Occupancy andEnded
December 31,
    
    Equipment Expense2002
    
    $
    2212003
    
    
    2762004
    
    
    5332005
    
    
    444$
    1,474
 
 (3)
    
    Noncontrolling interest amount represents third parties interest of
approximately 78% in BankAtlantic Bancorp.  179




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 3. Segment Reporting
     BFC Activities
   Financial Services
  Primary Homebuilding
  Tennessee Homebuilding
  Land Division
  180




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt Other Operations
    181




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Levitt
    
    AdjustingBFC
    
    Financial
    
    Primary
    
    Tennessee
    
    Land
    
    Other
    
    andActivities
    
    Services
    
    Homebuilding
    
    Homebuilding
    
    Division
    
    Operations
    
    Eliminations
    
    Total2007Revenues:Sales of real estate
    
    $
    
    
    
    
    
    
    
    
    345,666
    
    
    
    42,042
    
    
    
    16,567
    
    
    
    6,574
    
    
    
    (734
    )
    
    
    410,115Interest and dividend income
    
    
    2,374
    
    
    
    371,633
    
    
    
    613
    
    
    
    39
    
    
    
    3,862
    
    
    
    7,158
    
    
    
    (7,793
    )
    
    
    377,886Other income
    
    
    6,272
    
    
    
    149,332
    
    
    
    8,523
    
    
    
    44
    
    
    
    3,502
    
    
    
    1,174
    
    
    
    (2,991
    )
    
    
    165,8568,646
    
    
    
    520,965
    
    
    
    354,802
    
    
    
    42,125
    
    
    
    23,931
    
    
    
    14,906
    
    
    
    (11,518
    )
    
    
    953,857Costs and Expenses:Cost of sales of real estate
    
    
    
    
    
    
    
    
    
    
    501,206
    
    
    
    51,360
    
    
    
    7,447
    
    
    
    16,793
    
    
    
    (3,565
    )
    
    
    573,241Interest expense, net
    
    
    38
    
    
    
    192,857
    
    
    
    7,258
    
    
    
    151
    
    
    
    2,629
    
    
    
    1,073
    
    
    
    (7,489
    )
    
    
    196,517Provision for loan losses
    
    
    
    
    
    
    70,842
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,842Other expenses
    
    
    15,234
    
    
    
    317,350
    
    
    
    63,107
    
    
    
    5,010
    
    
    
    17,240
    
    
    
    34,898
    
    
    
    (2,908
    )
    
    
    449,93115,272
    
    
    
    581,049
    
    
    
    571,571
    
    
    
    56,521
    
    
    
    27,316
    
    
    
    52,764
    
    
    
    (13,962
    )
    
    
    1,290,531Equity in (loss) earnings from
unconsolidated affiliates
    
    
    (78
    )
    
    
    2,500
    
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    10,262
    
    
    
    
    
    
    
    12,724(Loss) income from
continuing operations before
income taxes and
noncontrolling interest
    
    
    (6,704
    )
    
    
    (57,584
    )
    
    
    (216,729
    )
    
    
    (14,396
    )
    
    
    (3,385
    )
    
    
    (27,596
    )
    
    
    2,444
    
    
    
    (323,950
    )(Benefit) provision for
income taxes
    
    
    (19,397
    )
    
    
    (27,572
    )
    
    
    (1,396
    )
    
    
    1,700
    
    
    
    4,802
    
    
    
    (34,297
    )
    
    
    5,914
    
    
    
    (70,246
    )Noncontrolling interest
    
    
    (34
    )
    
    
    (22,806
    )
    
    
    (179,239
    )
    
    
    (13,398
    )
    
    
    (6,815
    )
    
    
    5,578
    
    
    
    (2,889
    )
    
    
    (219,603
    )(Loss) income from continuing
operations
    
    $
    12,727
    
    
    
    (7,206
    )
    
    
    (36,094
    )
    
    
    (2,698
    )
    
    
    (1,372
    )
    
    
    1,123
    
    
    
    (581
    )
    
    
    (34,101
    )At December 31, 2007Total assets
    
    $
    30,166
    
    
    
    6,378,817
    
    
    
    38,497
    
    
    
    
    
    
    
    380,961
    
    
    
    298,700
    
    
    
    (12,708
    )
    
    
    7,114,433
 182




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt
    
    AdjustingBFC
    
    Financial
    
    Primary
    
    Tennessee
    
    Land
    
    Other
    
    andActivities
    
    Services
    
    Homebuilding
    
    Homebuilding
    
    Division
    
    Operations
    
    Eliminations
    
    Total2006Revenues:Sales of real estate
    
    $
    
    
    
    
    
    
    
    
    424,420
    
    
    
    76,299
    
    
    
    69,778
    
    
    
    11,041
    
    
    
    (15,452
    )
    
    
    566,086Interest and dividend income
    
    
    2,292
    
    
    
    367,177
    
    
    
    434
    
    
    
    110
    
    
    
    933
    
    
    
    3,377
    
    
    
    (2,451
    )
    
    
    371,872Other income
    
    
    3,680
    
    
    
    140,949
    
    
    
    6,897
    
    
    
    17
    
    
    
    3,752
    
    
    
    2,254
    
    
    
    (2,708
    )
    
    
    154,8415,972
    
    
    
    508,126
    
    
    
    431,751
    
    
    
    76,426
    
    
    
    74,463
    
    
    
    16,672
    
    
    
    (20,611
    )
    
    
    1,092,799Costs and Expenses:Cost of sale of real estate
    
    
    
    
    
    
    
    
    
    
    367,252
    
    
    
    72,807
    
    
    
    42,662
    
    
    
    11,649
    
    
    
    (11,409
    )
    
    
    482,961Interest expense, net
    
    
    30
    
    
    
    167,057
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (479
    )
    
    
    166,608Provision for loan losses
    
    
    
    
    
    
    8,574
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,574Other expenses
    
    
    12,805
    
    
    
    300,186
    
    
    
    67,414
    
    
    
    14,113
    
    
    
    13,305
    
    
    
    28,182
    
    
    
    (2,626
    )
    
    
    433,37912,835
    
    
    
    475,817
    
    
    
    434,666
    
    
    
    86,920
    
    
    
    55,967
    
    
    
    39,831
    
    
    
    (14,514
    )
    
    
    1,091,522Equity in (loss) earnings from
unconsolidated affiliates
    
    
    
    
    
    
    1,667
    
    
    
    (279
    )
    
    
    
    
    
    
    
    
    
    
    9,547
    
    
    
    
    
    
    
    10,935(Loss) income from
continuing operations before
income taxes and
noncontrolling interest
    
    
    (6,863
    )
    
    
    33,976
    
    
    
    (3,194
    )
    
    
    (10,494
    )
    
    
    18,496
    
    
    
    (13,612
    )
    
    
    (6,097
    )
    
    
    12,212Provision (benefit) for
income taxes
    
    
    (1,854
    )
    
    
    7,097
    
    
    
    (1,508
    )
    
    
    (3,241
    )
    
    
    6,948
    
    
    
    (5,639
    )
    
    
    (2,318
    )
    
    
    (515
    )Noncontrolling interest
    
    
    (25
    )
    
    
    21,072
    
    
    
    (1,406
    )
    
    
    (6,049
    )
    
    
    9,630
    
    
    
    (6,649
    )
    
    
    (3,151
    )
    
    
    13,422(Loss) income from continuing
operations
    
    $
    (4,984
    )
    
    
    5,807
    
    
    
    (280
    )
    
    
    (1,204
    )
    
    
    1,918
    
    
    
    (1,324
    )
    
    
    (628
    )
    
    
    (695
    )At December 31, 2006Total assets
    
    $
    45,756
    
    
    
    6,495,662
    
    
    
    583,805
    
    
    
    49,230
    
    
    
    284,335
    
    
    
    206,427
    
    
    
    (59,449
    )
    
    
    7,605,766
 183




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt
    
    AdjustingBFC
    
    Financial
    
    Primary
    
    Tennessee
    
    Land
    
    Other
    
    andActivities
    
    Services
    
    Homebuilding
    
    Homebuilding
    
    Division
    
    Operations
    
    Eliminations
    
    Total2005Revenues:Sales of real estate
    
    $
    
    
    
    
    
    
    
    
    352,723
    
    
    
    85,644
    
    
    
    105,658
    
    
    
    14,709
    
    
    
    (622
    )
    
    
    558,112Interest and dividend income
    
    
    1,623
    
    
    
    345,894
    
    
    
    379
    
    
    
    130
    
    
    
    971
    
    
    
    1,548
    
    
    
    (1,748
    )
    
    
    348,797Other income
    
    
    1,750
    
    
    
    101,678
    
    
    
    3,906
    
    
    
    58
    
    
    
    7,814
    
    
    
    2,558
    
    
    
    (1,406
    )
    
    
    116,3583,373
    
    
    
    447,572
    
    
    
    357,008
    
    
    
    85,832
    
    
    
    114,443
    
    
    
    18,815
    
    
    
    (3,776
    )
    
    
    1,023,267Costs and Expenses:Cost of sale of real estate
    
    
    
    
    
    
    
    
    
    
    272,680
    
    
    
    74,328
    
    
    
    50,706
    
    
    
    12,520
    
    
    
    (3,044
    )
    
    
    407,190Interest expense, net
    
    
    346
    
    
    
    141,909
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (348
    )
    
    
    141,907Recovery for loan losses
    
    
    
    
    
    
    (6,615
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,615
    )Other expenses
    
    
    9,750
    
    
    
    246,970
    
    
    
    50,523
    
    
    
    10,486
    
    
    
    13,095
    
    
    
    17,913
    
    
    
    (1,355
    )
    
    
    347,38210,096
    
    
    
    382,264
    
    
    
    323,203
    
    
    
    84,814
    
    
    
    63,801
    
    
    
    30,433
    
    
    
    (4,747
    )
    
    
    889,864Equity in (loss) earnings from
unconsolidated affiliates
    
    
    
    
    
    
    621
    
    
    
    104
    
    
    
    
    
    
    
    
    
    
    
    12,679
    
    
    
    
    
    
    
    13,404(Loss) income from
continuing operations before
income taxes and
noncontrolling interest
    
    
    (6,723
    )
    
    
    65,929
    
    
    
    33,909
    
    
    
    1,018
    
    
    
    50,642
    
    
    
    1,061
    
    
    
    971
    
    
    
    146,807Provision (benefit) for
income taxes
    
    
    3,737
    
    
    
    23,403
    
    
    
    12,270
    
    
    
    421
    
    
    
    19,088
    
    
    
    378
    
    
    
    375
    
    
    
    59,672Noncontrolling interest
    
    
    6
    
    
    
    33,475
    
    
    
    18,043
    
    
    
    498
    
    
    
    26,310
    
    
    
    569
    
    
    
    498
    
    
    
    79,399(Loss) income from continuing
operations
    
    $
    (10,466
    )
    
    
    9,051
    
    
    
    3,596
    
    
    
    99
    
    
    
    5,244
    
    
    
    114
    
    
    
    98
    
    
    
    7,736At December 31, 2005Total assets
    
    $
    54,118
    
    
    
    6,471,411
    
    
    
    421,560
    
    
    
    68,838
    
    
    
    228,634
    
    
    
    194,264
    
    
    
    (43,070
    )
    
    
    7,395,755
 184




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 4. Discontinued Operations
 Sale of Ryan Beck
   185




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Consideration received:Stifel common stock and Warrants
    
    $
    107,445Cash
    
    
    2,628Total consideration received
    
    
    110,073Net assets disposed:Discontinued operations assets held for sale at disposal date
    
    
    206,763Discontinued operations liabilities held for sale at disposal date
    
    
    (117,364
    )Net assets available for sale at disposal date
    
    
    89,399Transaction cost
    
    
    2,709Gain on disposal of Ryan Beck
before income taxes and noncontrolling interest
    
    
    17,965Provision for income taxes
    
    
    2,959Noncontrolling interest
    
    
    12,831Net gain on sale of Ryan Beck
    
    $
    2,175
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Financial Services:Investment banking revenue
    
    $
    37,836
    
    
    
    218,461
    
    
    
    251,361Expenses:Employee compensation and benefits
    
    
    27,532
    
    
    
    170,605
    
    
    
    165,325Occupancy and equipment
    
    
    2,984
    
    
    
    16,588
    
    
    
    15,816Advertising and promotion
    
    
    740
    
    
    
    5,788
    
    
    
    5,418Transaction related costs (1)
    
    
    14,263
    
    
    
    
    
    
    
    Other expenses:Professional fees
    
    
    1,106
    
    
    
    8,790
    
    
    
    6,706Communications
    
    
    2,255
    
    
    
    15,187
    
    
    
    13,554Floor broker and clearing fees
    
    
    1,162
    
    
    
    8,612
    
    
    
    9,118Interest expense
    
    
    985
    
    
    
    5,995
    
    
    
    3,419Other
    
    
    1,086
    
    
    
    6,389
    
    
    
    7,204Total expenses
    
    
    52,113
    
    
    
    237,954
    
    
    
    226,560(Loss) income from Ryan Beck discontinued
operations
before income taxes and noncontrolling interest
    
    
    (14,277
    )
    
    
    (19,493
    )
    
    
    24,801Income tax (benefit) provision
    
    
    (6,431
    )
    
    
    (8,958
    )
    
    
    10,690Noncontrolling interest
    
    
    (6,709
    )
    
    
    (9,011
    )
    
    
    11,877(Loss) income from Ryan Beck discontinued
operations, net of income taxes and
noncontrolling interest
    
    $
    (1,137
    )
    
    
    (1,524
    )
    
    
    2,234
 
 (1)
    
    Ryan Beck transaction related costs include $9.3 million of change in control payments, $3.5 million
of one-time employee termination benefits and $1.5 million of share-based compensation. 186




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  December 31,2006ASSETS:Cash
    
    $
    3,285Securities owned
    
    
    112,382Office properties and equipment, net
    
    
    9,644Deferred tax asset, net
    
    
    16,411Goodwill
    
    
    6,184Due from clearing agent
    
    
    15,629Other assets
    
    
    27,228Total assets
    
    $
    190,763LIABILITIES:Securities sold but not yet purchased
    
    $
    31,407Other liabilities
    
    
    63,839Total liabilities
    
    $
    95,246
  For the Years Ended December 31,2007
    
    2006
    
    2005Net cash provided by operating activities
    
    $
    5,611
    
    
    
    516
    
    
    
    1,467Net cash (used in) provided by investing activities
    
    $
    (299
    )
    
    
    (1,298
    )
    
    
    225Net cash used in financing activities
    
    $
    (2,307
    )
    
    
    (1,299
    )
    
    
    
 Sale of Two Core Communities Commercial Leasing Projects
   187




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   December 31,2007
    
    
    2006Property and equipment, net
    
    $
    84,811
    
    
    
    45,560Other assets
    
    
    11,537
    
    
    
    1,724Assets held for sale
    
    $
    96,348
    
    
    
    47,284Accounts payable, accrued liabilities and other
    
    $
    1,123
    
    
    
    925Notes and mortgage payable
    
    
    78,970
    
    
    
    27,338Liabilities related to assets held for sale
    
    $
    80,093
    
    
    
    28,263
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Revenue
    
    $
    4,710
    
    
    
    1,781
    
    
    
    223Costs and expenses
    
    
    1,837
    
    
    
    1,814
    
    
    
    477Income (loss) before income taxes
    
    
    2,873
    
    
    
    (33
    )
    
    
    (254
    )Provision (benefit) for income taxes
    
    
    1,234
    
    
    
    (14
    )
    
    
    (106
    )Noncontrolling interest
    
    
    1,438
    
    
    
    (18
    )
    
    
    (132
    )Income (loss) from discontinued operations
    
    $
    201
    
    
    
    (1
    )
    
    
    (16
    )
 BFC Activities  BMOC
  188




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  2005BFC Activities  RevenuesOther income
    
    $
    117BFC Activities  ExpensesInterest expense
    
    
    736Gain on disposition
    
    
    5,146Income (loss) from discontinued operations
    
    
    4,527Provision (benefit) for income taxes
    
    
    1,707Income (loss) from discontinued operations, net of tax
    
    $
    2,820
  5. Levitts Rights Offering and Step Acquisition
  s
   189




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 6. Restructuring Charges, Impairments and Exit Activities
 BankAtlantic Bancorp
  EmployeeTerminationBenefits
    
    
    Contract
    
    
    Total
    
    
    AssetLiability
    
    
    Liability
    
    
    Liability
    
    
    Impairments
    
    
    TotalBalance at December 31,
2006
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Restructuring charges
    
    
    2,527
    
    
    
    1,016
    
    
    
    3,543
    
    
    
    4,808
    
    
    
    8,351Amounts paid or amortized
    
    
    (2,425
    )
    
    
    (26
    )
    
    
    (2,451
    )Balance at December 31,
2007
    
    $
    102
    
    
    
    990
    
    
    
    1,092
     190




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt
  Severance
    
    
    
    
    
    IndependentRelated and
    
    
    
    
    
    Contractor
    
    Surety BondBenefits
    
    Facilities
    
    agreements
    
    Accrual
    
    TotalBalance at December 31, 2006
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Restructuring charges
    
    
    4,864
    
    
    
    1,010
    
    
    
    1,497
    
    
    
    1,826
    
    
    
    9,197Cash payments
    
    
    (2,910
    )
    
    
    
    
    
    
    (76
    )
    
    
    
    
    
    
    (2,986
    )Balance at December 31, 2007
    
    $
    1,954
    
    
    
    1,010
    
    
    
    1,421
    
    
    
    1,826
    
    
    
    6,211
      191




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   7. Federal Funds Sold and Other Short Term Investments
  For the Years Ended2007
    
    2006
    
    2005Ending Balance
    
    $
    484
    
    
    
    691
    
    
    
    1,057Maximum outstanding at any month end
within period
    
    $
    21,555
    
    
    
    16,276
    
    
    
    8,648Average amount invested during period
    
    $
    3,638
    
    
    
    1,824
    
    
    
    4,275Average yield during period
    
    
    4.77
    %
    
    
    3.00
    %
    
    
    1.87
    %
  8. Securities Available for Sale
  December 31, 2007Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    EstimatedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueMortgage-Backed Securities:U.S government agencies
mortgage-backed securities
    
    $
    585,796
    
    
    
    4,378
    
    
    
    555
    
    
    
    589,619U.S. government agencies real estate
mortgage investment conduits (1)
    
    
    199,886
    
    
    
    1,359
    
    
    
    2,403
    
    
    
    198,842Total mortgage-backed securities
    
    
    785,682
    
    
    
    5,737
    
    
    
    2,958
    
    
    
    788,461Investment Securities:Other bonds
    
    
    685
    
    
    
    
    
    
    
    4
    
    
    
    681Equity securities
    
    
    123,876
    
    
    
    13,289
    
    
    
    
    
    
    
    137,165Total investment securities
    
    
    124,561
    
    
    
    13,289
    
    
    
    4
    
    
    
    137,846Total
    
    $
    910,243
    
    
    
    19,026
    
    
    
    2,962
    
    
    
    926,307
 192




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 December 31, 2006Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    EstimatedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueMortgage-Backed Securities:U.S government agencies
mortgage-backed securities
    
    $
    324,646
    
    
    
    1,366
    
    
    
    3,113
    
    
    
    322,899U.S. government agencies real estate
mortgage investment conduits (1)
    
    
    40,919
    
    
    
    
    
    
    
    2,068
    
    
    
    38,851Total mortgage-backed securities
    
    
    365,565
    
    
    
    1,366
    
    
    
    5,181
    
    
    
    361,750Investment Securities:Tax-exempt securities
    
    
    197,287
    
    
    
    822
    
    
    
    1,671
    
    
    
    196,438Other bonds
    
    
    685
    
    
    
    
    
    
    
    10
    
    
    
    675Equity securities
    
    
    83,013
    
    
    
    11,783
    
    
    
    
    
    
    
    94,796Total investment securities
    
    
    280,985
    
    
    
    12,605
    
    
    
    1,681
    
    
    
    291,909Total
    
    $
    646,550
    
    
    
    13,971
    
    
    
    6,862
    
    
    
    653,659
 
 (1)
    
    Real estate mortgage investment conduits are pass-through entities that hold residential
loans, and investors are issued ownership interests in the entities in the form of a bond. The
securities were issued by government agencies.  Less Than 12 Months
    
    
    12 Months or Greater
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesAvailable for sale securities:Mortgage-backed securities
    
    $
    68,821
    
    
    
    (396
    )
    
    
    14,792
    
    
    
    (159
    )
    
    
    83,613
    
    
    
    (555
    )Real estate mortgage
investment conduits
    
    
    3,475
    
    
    
    (5
    )
    
    
    35,398
    
    
    
    (2,398
    )
    
    
    38,873
    
    
    
    (2,403
    )Other bonds
    
    
    200
    
    
    
    
    
    
    
    246
    
    
    
    (4
    )
    
    
    446
    
    
    
    (4
    )Total available for sale
securities:
    
    $
    72,496
    
    
    
    (401
    )
    
    
    50,436
    
    
    
    (2,561
    )
    
    
    122,932
    
    
    
    (2,962
    )
   193




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Less Than 12 Months
    
    
    12 Months or Greater
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesAvailable for sale securities:Mortgage-backed securities
    
    $
    30,868
    
    
    
    (88
    )
    
    
    142,632
    
    
    
    (3,025
    )
    
    
    173,500
    
    
    
    (3,113
    )Real estate mortgage
investment conduits
    
    
    
    
    
    
    
    
    
    
    38,851
    
    
    
    (2,068
    )
    
    
    38,851
    
    
    
    (2,068
    )Tax exempt securities
    
    
    29,715
    
    
    
    (65
    )
    
    
    79,169
    
    
    
    (1,606
    )
    
    
    108,884
    
    
    
    (1,671
    )Other bonds
    
    
    242
    
    
    
    (8
    )
    
    
    198
    
    
    
    (2
    )
    
    
    440
    
    
    
    (10
    )Total available for sale
securities:
    
    $
    60,825
    
    
    
    (161
    )
    
    
    260,850
    
    
    
    (6,701
    )
    
    
    321,675
    
    
    
    (6,862
    )
  Debt SecuritiesAvailable for SaleEstimatedAmortized
    
    
    FairCost
    
    
    ValueDecember 31, 2007 (1) (2)Due within one year
    
    $
    410
    
    
    
    410Due after one year, but within five years
    
    
    134,548
    
    
    
    135,750Due after five years, but within ten years
    
    
    1,936
    
    
    
    1,947Due after ten years
    
    
    649,473
    
    
    
    651,035Total
    
    $
    786,367
    
    
    
    789,142
 
 (1)
    
    Scheduled maturities in the above table may vary
significantly from actual maturities due to prepayments.(2)
    
    Scheduled maturities are based upon contractual
maturities.  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Gross gains on securities activities
    
    $
    17,026
    
    
    
    10,137
    
    
    
    917Gross losses on securities activities
    
    
    (4,341
    )
    
    
    (168
    )
    
    
    (18
    )Other-than
temporary impairments
    
    
    (3,316
    )
    
    
    
    
    
    
    Unrealized gains securities
    
    
    338
    
    
    
    
    
    
    
    12Realized losses on securities
    
    
    
    
    
    
    (156
    )
    
    
    (6
    )Securities activities, net
    
    $
    9,707
    
    
    
    9,813
    
    
    
    905
   194




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   For The Years Ended December 31,2007
    
    
    2006
    
    
    2005Change in other comprehensive income (loss) on
securities available for sale
    
    $
    122
    
    
    
    1,076
    
    
    
    (711
    )Income tax provision (benefit)
    
    
    52
    
    
    
    415
    
    
    
    (274
    )Change in shareholders equity from net
unrealized appreciation (depreciation) on
securities available for sale, net of tax
    
    $
    70
    
    
    
    661
    
    
    
    (437
    )
 9. Investment Securities
  December 31, 2007Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueStifel restricted common stock (1)
    
    $
    31,433
    
    
    
    3,061
    
    
    
    
    
    
    
    34,494Benihana Convertible Preferred Stock (2)
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    20,000Private investment securities (3)
    
    
    8,740
    
    
    
    1,407
    
    
    
    
    
    
    
    10,147Equity securities (5)
    
    
    
    
    
    
    603
    
    
    
    
    
    
    
    603$
    60,173
    
    
    
    5,071
    
    
    
    
    
    
    
    65,244
 December 31, 2006Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueTax-exempt securities (4)
    
    $
    200,182
    
    
    
    962
    
    
    
    338
    
    
    
    200,806Benihana Convertible Preferred Stock (2)
    
    
    20,000
    
    
    
    
    
    
    
    
    
    
    
    20,000Private investment securities (3)
    
    
    7,026
    
    
    
    1,714
    
    
    
    
    
    
    
    8,740$
    227,208
    
    
    
    2,676
    
    
    
    338
    
    
    
    229,546
 
 (1)
    
    Stifel common stock that is subject to restrictions for more than one
year is accounted for as investment securities at cost.(2)
    
    The Companys investment in Benihanas Convertible Preferred Stock is
classified as investment securities and is carried at historical cost (see Note
11).(3)
    
    Private investment securities consist of equity instruments purchased
through private placements and are accounted for at historical cost adjusted for
other-than-temporary declines in value.(4)
    
    Tax exempt securities consist of municipal bonds.(5)
    
    Equity securities consisted of 3,587 shares of MasterCard Class B
common stock acquired through MasterCards 2006 initial public offering).  195




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   10. Tax Certificates
  December 31, 2007
    
    
    December 31, 2006Estimated
    
    
    
    
    
    
    EstimatedFair
    
    
    
    
    
    
    FairCost
    
    
    Value
    
    
    Cost
    
    
    ValueTax certificates (1)(2) Net of allowance of $3,289
and $3,699, respectively
    
    $
    188,401
    
    
    
    188,401
    
    
    
    195,391
    
    
    
    195,391
 
 (1)
    
    Management considers the estimated fair value equivalent to book value for tax
certificates since these securities have no readily traded market value.(2)
    
    Based on historical repayment experience, the majority of tax certificates are
redeemed in two years or less.  For the Years Ended December 312007
    
    
    2006
    
    
    2005Balance, beginning of period
    
    $
    3,699
    
    
    
    3,271
    
    
    
    3,297Charge-offs
    
    
    (867
    )
    
    
    (295
    )
    
    
    (979
    )Recoveries
    
    
    157
    
    
    
    423
    
    
    
    603Net (charge-offs) recoveries
    
    
    (710
    )
    
    
    128
    
    
    
    (376
    )Provision charged to operations
    
    
    300
    
    
    
    300
    
    
    
    350Balance, end of period
    
    $
    3,289
    
    
    
    3,699
    
    
    
    3,271
 11. Benihana Convertible Preferred Stock Investment
   196




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   12. Loans Receivable and Loans Held for Sale
  December 31,2007
    
    
    2006Real estate loans:Residential
    
    $
    2,155,752
    
    
    
    2,150,626Construction and development
    
    
    416,484
    
    
    
    475,041Commercial
    
    
    886,657
    
    
    
    980,840Consumer  home equity
    
    
    676,262
    
    
    
    562,318Small business
    
    
    211,797
    
    
    
    186,833Other loans:Commercial business
    
    
    131,044
    
    
    
    157,109Small business  non-mortgage
    
    
    105,867
    
    
    
    98,225Consumer loans
    
    
    15,667
    
    
    
    17,406Deposit overdrafts
    
    
    15,005
    
    
    
    8,440Other loans
    
    
    
    
    
    
    425Total gross loans
    
    
    4,614,535
    
    
    
    4,637,263Adjustments:Premiums, discounts and net deferred fees
    
    
    3,936
    
    
    
    1,306Deferred profit on commercial real estate loans
    
    
    
    
    
    
    (204
    )Allowance for loan losses
    
    
    (94,020
    )
    
    
    (44,173
    )Loans receivable  net
    
    $
    4,524,451
    
    
    
    4,594,192Loans held for sale
    
    $
    4,087
    
    
    
    9,313
  197




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   December 31,2007
    
    
    2006Residential
    
    $
    2,982
    
    
    
    7,880Construction and development
    
    
    214,159
    
    
    
    384,515Commercial
    
    
    105,336
    
    
    
    90,447Total undisbursed loans in process
    
    $
    322,477
    
    
    
    482,842
  Florida
    
    
    57
    %Eastern U.S.A.
    
    
    23
    %Western U.S.A.
    
    
    16
    %Central U.S.A
    
    
    4
    %100
    %
 Allowance for Loan Losses (in thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Balance, beginning of period
    
    $
    44,173
    
    
    
    41,830
    
    
    
    47,082Loans charged-off
    
    
    (23,213
    )
    
    
    (8,905
    )
    
    
    (2,694
    )Recoveries of loans previously charged-off
    
    
    2,218
    
    
    
    2,674
    
    
    
    4,057Net (charge-offs) recoveries
    
    
    (20,995
    )
    
    
    (6,231
    )
    
    
    1,363Provision for loan losses
    
    
    70,842
    
    
    
    8,574
    
    
    
    (6,615
    )Balance, end of period
    
    $
    94,020
    
    
    
    44,173
    
    
    
    41,830
  December 31, 2007
    
    
    December 31, 2006Gross
    
    
    
    
    
    
    GrossRecorded
    
    
    Specific
    
    
    Recorded
    
    
    SpecificInvestment
    
    
    Allowances
    
    
    Investment
    
    
    AllowancesImpaired loans with specific valuation allowances
    
    $
    113,955
    
    
    
    17,809
    
    
    
    325
    
    
    
    162Impaired loans without specific valuation allowances
    
    
    67,124
    
    
    
    
    
    
    
    10,319
    
    
    
    Total
    
    $
    181,079
    
    
    
    17,809
    
    
    
    10,644
    
    
    
    162
  198




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Contracted interest income
    
    $
    15,042
    
    
    
    2,715
    
    
    
    343Interest income recognized
    
    
    (10,071
    )
    
    
    (2,203
    )
    
    
    (192
    )Foregone interest income
    
    $
    4,971
    
    
    
    512
    
    
    
    151
  Non-performing assets (in thousands):
 December 31,2007
    
    
    2006
    
    
    2005Non-accrual  tax certificates
    
    $
    2,094
    
    
    
    632
    
    
    
    388Loans 90 days past due and still accruing
    
    
    
    
    
    
    
    
    
    
    Non-accrual  loansResidential
    
    
    8,678
    
    
    
    2,629
    
    
    
    5,981Commercial real estate and business
    
    
    165,818
    
    
    
    
    
    
    
    340Small business
    
    
    877
    
    
    
    244
    
    
    
    9Consumer  home equity
    
    
    3,218
    
    
    
    1,563
    
    
    
    471Total non-accrual loans
    
    
    178,591
    
    
    
    4,436
    
    
    
    6,801Real estate owned
    
    
    17,216
    
    
    
    21,747
    
    
    
    967Total non-performing assets
    
    $
    197,901
    
    
    
    26,815
    
    
    
    8,156
 Other potential problem loans (in thousands):
 At December 31,2007
    
    
    2006
    
    
    2005Performing impaired loans,
net of specific allowances
    
    $
    
    
    
    
    162
    
    
    
    193Restructured loans
    
    
    2,488
    
    
    
    
    
    
    
    77Total potential problem loans
    
    $
    2,488
    
    
    
    162
    
    
    
    270
   For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Real estate acquired in settlement of loans and
tax certificates:Operating expenses, net
    
    $
    (243
    )
    
    
    (224
    )
    
    
    (75
    )Impairment of REO
    
    
    (7,299
    )
    
    
    
    
    
    
    Net gain on sales
    
    
    427
    
    
    
    1,443
    
    
    
    1,840Net real estate owned activity
    
    $
    (7,115
    )
    
    
    1,219
    
    
    
    1,765
 199




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 13. Accrued Interest Receivable
  December 31,2007
    
    
    2006Loans receivable
    
    $
    27,648
    
    
    
    29,604Tax exempt securities
    
    
    
    
    
    
    1,913Tax certificates
    
    
    13,428
    
    
    
    11,215Securities available for sale
    
    
    5,195
    
    
    
    4,944Accrued interest receivable
    
    $
    46,271
    
    
    
    47,676
 14. Properties and Equipment
  December 31,2007
    
    
    2006Land, buildings and improvements
    
    $
    230,788
    
    
    
    205,138Furniture and equipment
    
    
    118,538
    
    
    
    111,891Water irrigation facilities
    
    
    6,594
    
    
    
    6,588Total
    
    
    355,920
    
    
    
    323,617Less accumulated depreciation
    
    
    79,842
    
    
    
    70,664Properties and equipment  net
    
    $
    276,078
    
    
    
    252,953
    200




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 15. Real Estate Held for Development and Sale
  December 31,2007
    
    
    2006Land held for sale
    
    $
    13,704
    
    
    
    1,239Land and land development costs
    
    
    216,090
    
    
    
    578,017Construction costs
    
    
    5,426
    
    
    
    180,005Capitalized interest and other costs
    
    
    35,009
    
    
    
    88,231Total
    
    $
    270,229
    
    
    
    847,492
  BankAtlantic Bancorp
   Levitt
   201




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  16. Capitalized Interest
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Interest expense
    
    $
    239,429
    
    
    
    208,010
    
    
    
    162,655Interest capitalized
    
    
    (42,912
    )
    
    
    (41,402
    )
    
    
    (20,748
    )Interest expense, net
    
    $
    196,517
    
    
    
    166,608
    
    
    
    141,907
  For the year ended December 31,2007
    
    
    2006
    
    
    2005Interest incurred to non-affiliates
    
    $
    46,719
    
    
    
    40,473
    
    
    
    17,977Interest incurred to affiliates
    
    
    
    
    
    
    
    
    
    
    892Interest capitalized
    
    
    (42,912
    )
    
    
    (40,473
    )
    
    
    (18,869
    )Interest expense, net
    
    $
    3,807
    
    
    
    
    
    
    
    Interest included in cost of sales
    
    $
    17,949
    
    
    
    15,358
    
    
    
    8,959
   202




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 17. Investments in Unconsolidated Affiliates
  December 31,2007
    
    
    2006Investment in Bluegreen Corporation
    
    $
    111,321
    
    
    
    107,063Investments in joint ventures
    
    
    5,615
    
    
    
    7,749BankAtlantic Bancorp investment in statutory business trusts
    
    
    8,820
    
    
    
    7,910Levitt investment in statutory business trusts
    
    
    2,565
    
    
    
    2,565$
    128,321
    
    
    
    125,287
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Equity in Bluegreen earnings
    
    $
    10,275
    
    
    
    9,684
    
    
    
    12,714Equity in joint ventures (loss) earnings
    
    
    (51
    )
    
    
    (416
    )
    
    
    69Earnings from statutory trusts
    
    
    2,500
    
    
    
    1,667
    
    
    
    621$
    12,724
    
    
    
    10,935
    
    
    
    13,404
     Investment in Bluegreen
  203




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
      
 December 31,2007
    
    
    2006Total assets
    
    $
    1,039,578
    
    
    
    854,212Total liabilities
    
    
    632,047
    
    
    
    486,487Minority interest
    
    
    22,423
    
    
    
    14,702Total shareholders equity
    
    
    385,108
    
    
    
    353,023Total liabilities and shareholders equity
    
    $
    1,039,578
    
    
    
    854,212
 204




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Revenues and other income
    
    $
    691,494
    
    
    
    673,373
    
    
    
    684,156Cost and other expenses
    
    
    632,279
    
    
    
    610,882
    
    
    
    603,624Income before minority interest and provision for income taxes
    
    
    59,215
    
    
    
    62,491
    
    
    
    80,532Minority interest
    
    
    7,721
    
    
    
    7,319
    
    
    
    4,839Income before provision for income taxes
    
    
    51,494
    
    
    
    55,172
    
    
    
    75,693Provision for income taxes
    
    
    (19,568
    )
    
    
    (20,861
    )
    
    
    (29,142
    )Income before cumulative effect of change in accounting principle
    
    
    31,926
    
    
    
    34,311
    
    
    
    46,551Cumulative effect of change in accounting principle, net of tax
    
    
    
    
    
    
    (5,678
    )
    
    
    Minority interest in cumulative effect of change in accounting
principle
    
    
    
    
    
    
    1,184
    
    
    
    Net income
    
    $
    31,926
    
    
    
    29,817
    
    
    
    46,551
  BankAtlantic Bancorp Investment in Statutory Business Trusts
  December 31,2007
    
    
    2006Statement of Financial ConditionJunior subordinated debentures
    
    $
    294,195
    
    
    
    263,266Other assets
    
    
    1,072
    
    
    
    918Total Assets
    
    $
    295,267
    
    
    
    264,184Trust preferred securities
    
    $
    285,375
    
    
    
    255,375Other liabilities
    
    
    1,072
    
    
    
    899Total Liabilities
    
    
    286,447
    
    
    
    256,274Common securities
    
    
    8,820
    
    
    
    7,910Total Liabilities and Equity
    
    $
    295,267
    
    
    
    264,184
 For the Years EndedDecember 31,2007
    
    
    2006
    
    
    2005Statement of OperationsInterest income from subordinated debentures
    
    $
    22,274
    
    
    
    20,913
    
    
    
    18,538Interest expense
    
    
    (21,612
    )
    
    
    (20,286
    )
    
    
    (17,982
    )Net income
    
    $
    662
    
    
    
    627
    
    
    
    556
  205




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 18. Deposits
  December 31,2007
    
    
    2006Amount
    
    
    Percent
    
    
    Amount
    
    
    PercentInterest free checking
    
    $
    824,211
    
    
    
    20.85
    %
    
    
    995,920
    
    
    
    25.75
    %Insured money fund savings2.45% at December 31, 2007,
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2.30% at December 31, 2006,
    
    
    624,390
    
    
    
    15.79
    
    
    
    677,642
    
    
    
    17.52NOW accounts1.50% at December 31, 2007,
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.10% at December 31, 2006,
    
    
    900,233
    
    
    
    22.77
    
    
    
    779,383
    
    
    
    20.16Savings accounts1.50% at December 31, 2007,
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.10% at December 31, 2006,
    
    
    580,497
    
    
    
    14.68
    
    
    
    465,172
    
    
    
    12.03Total non-certificate accounts
    
    
    2,929,331
    
    
    
    74.09
    
    
    
    2,918,117
    
    
    
    75.46Certificate accounts:Less than 2.00%
    
    
    16,261
    
    
    
    0.41
    
    
    
    11,923
    
    
    
    0.312.01% to 3.00%
    
    
    52,435
    
    
    
    1.33
    
    
    
    16,425
    
    
    
    0.433.01% to 4.00%
    
    
    164,744
    
    
    
    4.17
    
    
    
    174,165
    
    
    
    4.504.01% to 5.00%
    
    
    445,498
    
    
    
    11.27
    
    
    
    278,934
    
    
    
    7.215.01% to 6.00%
    
    
    339,625
    
    
    
    8.59
    
    
    
    459,046
    
    
    
    11.876.01% to 7.00%
    
    
    32
    
    
    
    0.00
    
    
    
    2,691
    
    
    
    0.07Total certificate accounts
    
    
    1,018,595
    
    
    
    25.77
    
    
    
    943,184
    
    
    
    24.39Total deposit accounts
    
    
    3,947,926
    
    
    
    99.86
    
    
    
    3,861,301
    
    
    
    99.85Premium on brokered deposits
    
    
    
    
    
    
    
    
    
    
    (7
    )
    
    
    Interest earned not credited
to deposit accounts
    
    
    5,479
    
    
    
    0.14
    
    
    
    5,742
    
    
    
    0.15Total
    
    $
    3,953,405
    
    
    
    100.00
    %
    
    
    3,867,036
    
    
    
    100.00
    %
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Money fund savings and NOW accounts
    
    $
    26,031
    
    
    
    20,413
    
    
    
    16,592Savings accounts
    
    
    12,559
    
    
    
    2,936
    
    
    
    909Certificate accounts  below $100,000
    
    
    25,512
    
    
    
    23,136
    
    
    
    12,676Certificate accounts, $100,000 and
above
    
    
    21,002
    
    
    
    13,048
    
    
    
    10,225Less early withdrawal penalty
    
    
    (628
    )
    
    
    (574
    )
    
    
    (318
    )Total
    
    $
    84,476
    
    
    
    58,959
    
    
    
    40,084
 206




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ending December 31,2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    Thereafter0.00% to 2.00%
    
    $
    15,552
    
    
    
    534
    
    
    
    87
    
    
    
    4
    
    
    
    83
    
    
    
    12.01% to 3.00%
    
    
    51,274
    
    
    
    928
    
    
    
    223
    
    
    
    
    
    
    
    10
    
    
    
    3.01% to 4.00%
    
    
    143,381
    
    
    
    12,042
    
    
    
    5,535
    
    
    
    1,927
    
    
    
    1,755
    
    
    
    1044.01% to 5.00%
    
    
    382,109
    
    
    
    26,191
    
    
    
    8,992
    
    
    
    2,094
    
    
    
    26,112
    
    
    
    5.01% to 6.00%
    
    
    272,764
    
    
    
    40,098
    
    
    
    25,231
    
    
    
    688
    
    
    
    844
    
    
    
    6.01% and greater
    
    
    
    
    
    
    6
    
    
    
    
    
    
    
    26
    
    
    
    
    
    
    
    Total
    
    $
    865,080
    
    
    
    79,799
    
    
    
    40,068
    
    
    
    4,739
    
    
    
    28,804
    
    
    
    105
  December 31,20073 months or less
    
    $
    119,1554 to 6 months
    
    
    128,1557 to 12 months
    
    
    94,775More than 12 months
    
    
    117,840Total
    
    $
    459,925
  December 31,2007
    
    
    2006Brokered deposits
    
    $
    14,665
    
    
    
    60,956Public deposits
    
    
    323,879
    
    
    
    62,940Total institutional deposits
    
    $
    338,544
    
    
    
    123,896
   207




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 19. Advances from Federal Home Loan Bank
 Advances from Federal Home Loan Bank (FHLB) (dollars in thousands
 Maturity Date
    
    
    
    
    
    December 31,Ending December 31,
    
    Interest Rate
    
    
    20072008
    
    4.51% to  5.61%
    
    $
    1,190,0002009
    
    4.97% to 5.25%
    
    
    100,0002010
    
    5.84% to 7.22%
    
    
    32,000Total fixed rate advances
    
    
    
    
    
    
    1,322,0002008
    
    
    5.01%
    
    
    
    25,0002009
    
    
    4.99%
    
    
    
    50,000Total adjustable rate advances
    
    
    
    
    
    
    75,000Purchase accounting fair
value adjustments
    
    
    
    
    
    
    44Total FHLB advances
    
    
    
    
    
    $
    1,397,044Average cost during period
    
    
    
    
    
    
    5.31
    %Average cost end of period
    
    
    
    
    
    
    4.82
    %
   20. Federal Funds Purchased and Treasury Borrowings
    December 31,2007
    
    2006
    
    2005Ending balance
    
    $
    108,975
    
    
    
    32,026
    
    
    
    139,475Maximum outstanding at any month end
within period
    
    $
    175,000
    
    
    
    266,237
    
    
    
    181,065Average amount outstanding during
period
    
    $
    115,334
    
    
    
    176,237
    
    
    
    124,605Average cost during period
    
    
    5.17
    %
    
    
    5.17
    %
    
    
    3.42
    %
 208




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 21. Securities Sold Under Agreements to Repurchase
   For the Years Ended December 31,2007
    
    2006
    
    2005Maximum borrowing at any month-end within
the period
    
    $
    109,430
    
    
    
    202,607
    
    
    
    287,088Average borrowing during the period
    
    $
    73,848
    
    
    
    123,944
    
    
    
    185,111Average interest cost during the period
    
    
    4.88
    %
    
    
    4.83
    %
    
    
    2.88
    %Average interest cost at end of the period
    
    
    3.46
    %
    
    
    5.17
    %
    
    
    4.10
    %
  WeightedEstimated
    
    
    
    
    
    
    AverageAmortized
    
    
    Fair
    
    
    Repurchase
    
    
    InterestCost
    
    
    Value
    
    
    Balance
    
    
    RateDecember 31, 2007 (1)Mortgage-backed securities
    
    $
    30,028
    
    
    
    30,251
    
    
    
    23,468
    
    
    
    3.46
    %REMICs
    
    
    37,796
    
    
    
    35,398
    
    
    
    27,462
    
    
    
    3.46Total
    
    $
    67,824
    
    
    
    65,649
    
    
    
    50,930
    
    
    
    5.17
    %December 31, 2006 (1)Mortgage-backed securities
    
    $
    65,313
    
    
    
    64,856
    
    
    
    60,277
    
    
    
    5.17
    %REMICs
    
    
    40,919
    
    
    
    38,851
    
    
    
    36,108
    
    
    
    5.17Total
    
    $
    106,232
    
    
    
    103,707
    
    
    
    96,385
    
    
    
    5.17
    %
 
 (1)
    
    At December 31, 2007 and 2006, all securities were classified as available for
sale and were recorded at fair value in the consolidated statements of financial
condition.  209




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 22. Subordinated Debentures, Notes and Bonds Payable, Secured Borrowings, Junior Subordinated
Debentures and Other Liabilities
  Issue
    
    
    December 31,
    
    
    Interest
    
    
    MaturityDate
    
    
    2007
    
    
    2006
    
    
    Rate
    
    
    DateBFC borrowings
    
    
    
    
    
    VariousRevolving Line of Credit
    
    
    
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    LIBOR +2.80
    
    December 15, 2007Mortgage payables
    
    
    
    
    
    
    
    
    
    
    29
    
    
    
    50
    
    
    

6.00%

    
    
    June 2009Total BFC borrowings
    
    
    
    
    
    
    
    
    
    
    29
    
    
    
    50BankAtlantic borrowingsSubordinated debentures (1)
    
    
    
    
    
    
    10/29/2002
    
    
    
    22,000
    
    
    
    22,000
    
    
    LIBOR + 3.45%
    
    November 7, 2012Mortgage-Backed Bond
    
    
    
    
    
    
    03/22/2002
    
    
    
    4,654
    
    
    
    7,923
    
    
    

(2)
    
    
    September 30, 2013Total BankAtlantic borrowings
    
    
    
    
    
    
    
    
    
    
    26,654
    
    
    
    29,923Levitt BorrowingsPrimary Homebuilding
    
    
    (a
    )
    
    VariousMortgage notes payable
    
    
    (b
    )
    
    
    
    
    
    
    
    
    
    
    48,633
    
    
    From Prime - 0.50% to Prime + 0.50%
    
    Range from July 2007 to September 2009South Carolina borrowing base facility
    
    
    (c
    )
    
    
    
    
    
    
    39,674
    
    
    
    
    
    
    Prime
    
    March 2011Other borrowing base facilities
    
    
    (d
    )
    
    
    
    
    
    
    
    
    
    
    316,000
    
    
    From LIBOR + 2.00% to LIBOR + 2.40%
    
    Range from August 2009   to January 2010Line of credit
    
    
    (e
    )
    
    
    
    
    
    
    
    
    
    
    14,000
    
    
    Prime
    
    September 200739,674
    
    
    
    378,633Tennessee Homebuilding
    
    
    (a
    )Mortgage notes payable
    
    
    (b
    )
    
    
    
    
    
    
    
    
    
    
    6,674
    
    
    From Prime - 0.25% to Prime + 0.50%
    
    Range from March 2007 to March 2008Other borrowing base facilities
    
    
    (d
    )
    
    
    
    
    
    
    
    
    
    
    32,600
    
    
    From LIBOR + 2.00% to LIBOR + 2.40%
    
    December 2009
    
    
    
    39,274Land BorrowingsLand acquisition mortgage notes payable
    
    
    (f
    )
    
    
    
    
    
    
    97,594
    
    
    
    66,932
    
    
    From Fixed 6.88% to LIBOR + 2.80%
    
    Range from June 2011 to October 2019Construction mortgage notes payable
    
    
    (f
    )(g)
    
    
    
    
    
    
    39,330
    
    
    
    1,546
    
    
    From LIBOR + 2.00% to Prime
    
    Range from February 2009 to November 2009Other borrowings
    
    
    
    
    
    
    
    
    
    
    133
    
    
    
    164
    
    
    Fixed 7.48%
    
    August 2011137,057
    
    
    
    68,642Other Operations BorrowingsLand
acquisition and construction mortgage notes payable
    
    
    
    
    
    
    
    
    
    
    
    
    1,641
    
    
    LIBOR + 2.75%
    
    September 2007Mortgage notes payable
    
    
    (h
    )
    
    
    
    
    
    
    12,027
    
    
    
    12,197
    
    
    Fixed 5.47%
    
    April 2015Subordinated investment notes
    
    
    
    
    
    
    
    
    
    
    746
    
    
    
    2,489
    
    
    Fixed from 7.25% to 9.15%
    
    Range from January 2008 to August 2011Promissory note payable
    
    
    
    
    
    
    
    
    
    
    264
    
    
    
    437
    
    
    Fixed 2.44%
    
    July 200913,037
    
    
    
    16,764Total Levitt borrowings
    
    
    
    
    
    
    
    
    
    
    189,768
    
    
    
    503,313Total
    
    
    
    
    
    
    
    
    
    $
    216,451
    
    
    
    533,286
 
 (1)
    
    LIBOR interest rates are indexed to three-month LIBOR and adjust quarterly.(2)
    
    The bonds adjust semi-annually to the ten year treasury constant maturity rate minus 23 basis points. 210




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 (a)
    
    Levitt Corporation deconsolidated Levitt and Sons from its consolidated financial
statements as of November 9, 2007. Thus, notes and mortgage notes payable related to the
Primary Homebuilding and Tennessee Homebuilding segments as of December 31, 2007 with the
exception of outstanding debt related to Carolina Oak, are not included in borrowings in
the above table, see Note 26 for more information regarding Levitt and Sons financial
statements with the exception of outstanding debt related to Carolina Oak. The South
Carolina borrowing base facility represents the Carolina Oak Loan and is included in the
Primary Homebuilding segment because it is engaged in homebuilding activities and because
the financial metrics from this company are similar in nature to the other homebuilding
projects that existed in this segment in 2006 and 2007.(b)
    
    Levitt and Sons entered into various loan agreements to provide financing for the
acquisition, site improvements and construction of residential units. As of December 31,
2006, these loan agreements provided for advances on a revolving loan basis up to a maximum
outstanding balance of $79.2 million. The loans were collateralized by inventory of real
estate with net carrying values aggregating $100.4 million at December 31, 2006.(c)
    
    On March 21, 2007, Levitt and Sons entered into a $100.0 million revolving working
capital, land acquisition, development and residential construction borrowing base facility
agreement and borrowed $30.2 million under the facility. The proceeds were used to finance
the inter-company purchase of a 150 acre parcel in Tradition Hilton Head from Core
Communities and to refinance a $15.0 million line of credit. On October 25, 2007, in
connection with Levitt Corporations acquisition from Levitt and Sons of the membership
interests in Carolina Oak.Levitt Corporation became the obligor for the entire Carolina
Oak Loan outstanding balance of $34.1 million. The Carolina Oak Loan was modified in
connection with the acquisition. Levitt Corporation was previously a guarantor of this loan
and as partial consideration for the Carolina Oak Loan, the membership interest in Levitt
and Sons, previously pledged by Levitt Corporation to the lender, was released. The
outstanding balance under the Carolina Oak Loan may be increased by approximately $11.2
million to fund certain infrastructure improvements and to complete the construction of
fourteen residential units currently under construction. The Carolina Oak Loan is
collateralized by a first mortgage on the 150 acre parcel in
Tradition, Hilton Head and
guaranteed by Carolina Oak. The Carolina Oak Loan is due and payable on March
21, 2011 and may be extended on the anniversary date of the facility at the Prime Rate
(7.25% at December 31, 2007) and interest is payable monthly. The Carolina Oak Loan is
subject to customary terms, conditions and covenants, including the lenders right to
accelerate the debt upon a material adverse change with respect to the borrower. At
December 31, 2007, there was no immediate availability to draw on this facility based on
available collateral.(d)
    
    During 2006, Levitt and Sons entered into a revolving credit facility and amended
certain of its existing credit facilities, increasing the amount available for borrowings
under these facilities to $450.0 million and amending certain of the initial credit
agreements definitions. Advances under these facilities bore interest, at Levitt and Sons
option; at either (i) the lenders Prime Rate less 50 basis points or (ii) 30-day LIBOR
plus a spread of between 200 and 240 basis points, depending on the facility. As of December 31, 2006, these facilities provided for advances on a revolving loan basis
up to a maximum outstanding balance of $357.7 million. The loans were collateralized by
mortgages on respective properties including improvements. The facilities were
collateralized by inventory of real estate with net carrying values aggregating $483.6
million at December 31, 2006.(e)
    
    As of December 31, 2006, Levitt and Sons had a credit agreement with a financial
institution to provide a $15.0 million line of credit. At December 31, 2006, Levitt and
Sons had available credit of $1.0 million and had $14.0 million outstanding. The credit
facility was refinanced in connection with the $100.0 million revolving working capital,
land acquisition, development and residential construction borrowing base facility
agreement that Levitt and Sons entered into on March 21, 2007.(f)
    
    Core Communities notes and mortgage notes payable are collateralized by inventory of
real estate and property and equipment with net carrying values aggregating $172.1 million
and $150.6 million as of December 31, 2007 and 2006, respectively. In September 2006, Core
entered into credit agreements with a financial institution to provide an additional $40.0
million in financing on an existing credit facility increasing the total maximum
outstanding balance to $88.9 million. This facility matures in June 2011. As of December
31, 2007, $77.2 million was outstanding, with $11.0 million under the line currently
available for borrowing based on available collateral. In September 2007, Core entered
into credit agreements with a financial institution to provide an additional $8.0 million
in financing on an existing credit facility increasing the total maximum outstanding
balance to $33.0 million. This facility matures in October 2019. As of December 31, 2007,
$15.4 million is outstanding with $8.0 million under the line currently available for
borrowing based on available collateral. These notes accrue interest at varying rates tied
to various indices as noted above and interest is payable monthly. For certain notes
principal payments are required monthly or quarterly as the note dictates.
 211




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 (g)
    
    On February 28, 2007, Core Communities of South Carolina, LLC, a wholly-owned
subsidiary of Core Communities entered into a $50.0 million revolving credit facility for
construction financing for the development of Tradition Hilton Head. The facility is due
and payable on February 28, 2009 and is subject to a one year extension upon compliance
with the conditions set forth in the agreement. The loan is collateralized by 1,829 gross
acres of land and the related improvements, easements as well as assignments of rents and
leases. A payment guarantee for the loan amount was provided by Core Communities. The loan
accrues interest at the banks Prime Rate and interest is payable monthly. The loan
documents include customary conditions to funding, collateral release and acceleration
provisions and financial, affirmative and negative covenants.(h)
    
    Levitt Corporation entered into a mortgage note payable agreement with a financial
institution in March 2005 to repay the bridge loan used to temporarily fund Levitts
purchase of an office building in Fort Lauderdale, which has served as Levitts principal
executive offices since November 2006. This note payable is collateralized by the office
building and contains a balloon payment provision of approximately $10.4 million at the
maturity date in April 2015. Principal and interest are payable monthly.
    As of December 31,
    
    
    
    
    
    
    
    
    
    
    Beginning2007
    
    
    2006
    
    
    
    
    
    
    
    
    
    
    OptionalIssue
    
    
    Outstanding
    
    
    Outstanding
    
    
    Interest
    
    
    Maturity
    
    
    RedemptionJunior Subordinated Debentures
    
    Date
    
    
    Amount
    
    
    Amount
    
    
    Rate
    
    
    Date
    
    
    DateBBX Capital Trust I(A)
    
    
    06/26/2007
    
    
    $
    25,774
    
    
    
    
    
    
    LIBOR + 1.45%
    
    
    09/15/2037
    
    
    
    09/15/2012BBX Capital Trust II(A)
    
    
    09/20/2007
    
    
    
    5,155
    
    
    
    
    
    
    LIBOR + 1.50%
    
    
    12/15/2037
    
    
    
    12/15/2012BBX Capital Trust II
    
    
    03/05/2002
    
    
    
    57,088
    
    
    
    57,088
    
    
    
    8.50
    %
    
    
    03/31/2032
    
    
    
    03/31/2007BBX Capital Trust III
    
    
    06/26/2002
    
    
    
    25,774
    
    
    
    25,774
    
    
    LIBOR + 3.45%
    
    
    06/26/2032
    
    
    
    06/26/2007BBX Capital Trust IV
    
    
    09/26/2002
    
    
    
    25,774
    
    
    
    25,774
    
    
    LIBOR + 3.40%
    
    
    09/26/2032
    
    
    
    09/26/2007BBX Capital Trust V
    
    
    09/27/2002
    
    
    
    10,310
    
    
    
    10,310
    
    
    LIBOR + 3.40%
    
    
    09/30/2032
    
    
    
    09/27/2007BBX Capital Trust VI
    
    
    12/10/2002
    
    
    
    15,450
    
    
    
    15,450
    
    
    LIBOR + 3.35%
    
    
    12/10/2032
    
    
    
    12/10/2007BBX Capital Trust VII
    
    
    12/19/2002
    
    
    
    25,774
    
    
    
    25,774
    
    
    LIBOR + 3.25%
    
    
    12/19/2032
    
    
    
    12/19/2007BBX Capital Trust VIII
    
    
    12/19/2002
    
    
    
    15,464
    
    
    
    15,464
    
    
    LIBOR + 3.35%
    
    
    01/07/2033
    
    
    
    12/19/2007BBX Capital Trust IX
    
    
    12/19/2002
    
    
    
    10,310
    
    
    
    10,310
    
    
    LIBOR + 3.35%
    
    
    01/07/2033
    
    
    
    12/19/2007BBX Capital Trust X
    
    
    03/26/2003
    
    
    
    51,548
    
    
    
    51,548
    
    
    
    6.40%
    (2)
    
    
    03/26/2033
    
    
    
    03/26/2008BBX Capital Trust XI
    
    
    04/10/2003
    
    
    
    10,310
    
    
    
    10,310
    
    
    
    6.45%
    (2)
    
    
    04/24/2033
    
    
    
    04/24/2008BBX Capital Trust XII
    
    
    03/27/2003
    
    
    
    15,464
    
    
    
    15,464
    
    
    
    6.65%
    (2)
    
    
    04/07/2033
    
    
    
    04/07/2008Total BankAtlantic
Bancorp (1)
    
    
    
    
    
    
    294,195
    
    
    
    263,266Unsecured junior
subordinated debentures -
Levitt Capital Trust I
    
    
    03/15/2005
    
    
    
    23,196
    
    
    
    23,196
    
    
    From fixed 8.11% to
LIBOR + 3.85%
    
    
    03/01/2035
    
    
    
    3/15/2010Unsecured junior
subordinated debentures -
Levitt Capital Trust II
    
    
    05/04/2005
    
    
    
    30,928
    
    
    
    30,928
    
    
    From fixed 8.09% to
LIBOR + 3.80%
    
    
    06/30/2035
    
    
    
    05/04/2010Unsecured junior
subordinated debentures -
Levitt Capital Trust III
    
    
    06/01/2006
    
    
    
    15,464
    
    
    
    15,464
    
    
    From fixed 9.25% to
LIBOR + 3.80%
    
    
    06/30/2036
    
    
    
    06/30/2011Unsecured junior
subordinated debentures -
Levitt Capital Trust IV
    
    
    07/18/2006
    
    
    
    15,464
    
    
    
    15,464
    
    
    From fixed 9.35% to
LIBOR + 3.80%
    
    
    09/30/2036
    
    
    
    09/30/2011Total Levitt
    
    
    
    
    
    
    85,052
    
    
    
    85,052Purchase Accounting
    
    
    
    
    
    
    (24
    )
    
    
    Total Junior Subordinated
Debentures
    
    
    
    
    
    $
    379,223
    
    
    
    348,318
 
 (1)
    
    LIBOR interest rates are indexed to three-month LIBOR and adjust
quarterly. 212




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Year ended December 31,2008
    
    $
    3,2622009
    
    
    42,3282010
    
    
    3,6232011
    
    
    115,5742012
    
    
    24,619Thereafter
    
    
    406,268$
    595,674
   BankAtlantic Bancorp Junior Subordinated Debentures
  BankAtlantic
   213




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  BankAtlantic Bancorp Indentures
  Levitt Junior Subordinated Debentures
     Levitt Development Bonds Payable
  214




---



##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Accounting
for Contingencies
  BFC Borrowings
  215




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Other Liabilities
  23. Income Taxes
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Continuing operations
    
    $
    (70,246
    )
    
    
    (515
    )
    
    
    59,672Discontinued operations
    
    
    (2,237
    )
    
    
    (8,972
    )
    
    
    13,099Extraordinary items
    
    
    1,509
    
    
    
    
    
    
    
    Total provision (benefit) for income taxes
    
    $
    (70,974
    )
    
    
    (9,487
    )
    
    
    72,771Continuing operations:Current:Federal
    
    $
    (34,502
    )
    
    
    13,521
    
    
    
    45,199State
    
    
    2
    
    
    
    948
    
    
    
    6,213(34,500
    )
    
    
    14,469
    
    
    
    51,412Deferred:Federal
    
    
    (28,779
    )
    
    
    (13,977
    )
    
    
    7,131State
    
    
    (6,967
    )
    
    
    (1,007
    )
    
    
    1,129(35,746
    )
    
    
    (14,984
    )
    
    
    8,260(Benefit) provision for income
taxes from continuing operations
    
    $
    (70,246
    )
    
    
    (515
    )
    
    
    59,672
  For the Years Ended December 31,2007 (1)
    
    
    2006 (1)
    
    
    2005 (1)Income tax provision at expected
federal income tax rate of 35%
    
    $
    (113,383
    )
    
    
    35.00
    %
    
    $
    4,274
    
    
    
    35.00
    %
    
    $
    51,382
    
    
    
    35.00
    %Increase (decrease) resulting from:Taxes related to subsidiaries not
consolidated for income tax purposes
    
    
    (16,378
    )
    
    
    5.06
    
    
    
    1,510
    
    
    
    12.36
    
    
    
    6,369
    
    
    
    4.34Tax-exempt interest income
    
    
    (4,180
    )
    
    
    1.29
    
    
    
    (5,110
    )
    
    
    (41.84
    )
    
    
    (5,032
    )
    
    
    (3.43
    )(Benefit) provision for state taxes,
Net of federal effect
    
    
    (14,623
    )
    
    
    4.51
    
    
    
    (938
    )
    
    
    (7.68
    )
    
    
    4,885
    
    
    
    3.33Change in valuation allowances
    
    
    77,586
    
    
    
    (23.95
    )
    
    
    1,694
    
    
    
    13.87
    
    
    
    777
    
    
    
    0.53Expired NOLs
    
    
    1,595
    
    
    
    (0.49
    )
    
    
    
    
    
    
    Low income housing tax credits
    
    
    (856
    )
    
    
    0.26
    
    
    
    (721
    )
    
    
    (5.90
    )
    
    
    (549
    )
    
    
    (0.37
    )Goodwill impairment adjustment
    
    
    
    
    
    
    
    
    
    
    458
    
    
    
    3.75
    
    
    
    
    
    
    
    Non-deductible fines and penalties
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,500
    
    
    
    2.38Other  net
    
    
    (7
    )
    
    
    0.00
    
    
    
    (1,682
    )
    
    
    (13.77
    )
    
    
    (1,660
    )
    
    
    (1.13
    )(Benefit) provision for income taxes
    
    $
    (70,246
    )
    
    
    21.68
    %
    
    $
    (515
    )
    
    
    (4.22)
    %
    
    $
    59,672
    
    
    
    40.65
    %
 
 (1)
    
    Expected tax is computed based upon income (loss) from continuing operations before
noncontrolling interest. 216




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Deferred tax assets:Allowance for loans, REO, tax certificate losses and other reserves, for
financial statement purposes
    
    $
    38,786
    
    
    
    20,546
    
    
    
    20,234Federal and State net operating loss carryforwards
    
    
    51,645
    
    
    
    30,191
    
    
    
    25,612Investment in Levitt and Sons
    
    
    68,339
    
    
    
    
    
    
    
    Compensation expensed for books and deferred for tax purposes
    
    
    410
    
    
    
    13,099
    
    
    
    10,225Real estate held for development and sale capitalized costs for tax purposes
in excess of amounts capitalized for financial statement purposes
    
    
    2,358
    
    
    
    6,579
    
    
    
    5,762Write-down of real estate inventory
    
    
    
    
    
    
    12,889
    
    
    
    Accumulated other comprehensive income
    
    
    
    
    
    
    896
    
    
    
    4,057Stock based compensation
    
    
    3,073
    
    
    
    1,922
    
    
    
    Income recognized for tax purposes and deferred for financial statement purposes
    
    
    7,228
    
    
    
    6,949
    
    
    
    4,426Other
    
    
    8,715
    
    
    
    5,000
    
    
    
    3,639Total gross deferred tax assets
    
    
    180,554
    
    
    
    98,071
    
    
    
    73,955Less valuation allowance
    
    
    84,028
    
    
    
    5,035
    
    
    
    3,341Total deferred tax assets
    
    
    96,526
    
    
    
    93,036
    
    
    
    70,614Deferred tax liabilities:Subsidiaries not consolidated for income tax purposes
    
    
    39,592
    
    
    
    55,404
    
    
    
    55,302Investment in Bluegreen
    
    
    21,768
    
    
    
    19,501
    
    
    
    15,167Deferred loan income
    
    
    1,993
    
    
    
    1,956
    
    
    
    1,452Purchase accounting adjustments
    
    
    2,830
    
    
    
    1,929
    
    
    
    2,219Accumulated other comprehensive income
    
    
    3,618
    
    
    
    853
    
    
    
    591Prepaid pension expense
    
    
    2,530
    
    
    
    2,438
    
    
    
    2,454Depreciation for tax greater than book
    
    
    3,293
    
    
    
    2,685
    
    
    
    665Property and equipment
    
    
    496
    
    
    
    985
    
    
    
    1,397Securities owned recorded at fair value for books and historical cost for tax purposes
    
    
    
    
    
    
    188
    
    
    
    931Other
    
    
    4,076
    
    
    
    1,332
    
    
    
    1,127Total gross deferred tax liabilities
    
    
    80,196
    
    
    
    87,271
    
    
    
    81,305Net deferred tax asset (liability)
    
    
    16,330
    
    
    
    5,766
    
    
    
    (10,691
    )Less net deferred tax (asset) liability at beginning of period
    
    
    (5,766
    )
    
    
    10,691
    
    
    
    8,456Net deferred tax liability acquired due to purchase accounting
    
    
    1,866
    
    
    
    
    
    
    
    Implementation of FIN 48
    
    
    (1,798
    )
    
    
    
    
    
    
    Increase in deferred tax liability from BFCs tax effect relating to exercise stock option
    
    
    
    
    
    
    
    
    
    
    12(Decrease) increase in deferred tax liability from subsidiaries other capital transactions
    
    
    12
    
    
    
    (173
    )
    
    
    (189
    )Reduction in deferred tax asset associated with Ryan Beck sale
    
    
    16,593
    
    
    
    
    
    
    
    Increase (decrease) in BFCs accumulated other comprehensive income
    
    
    95
    
    
    
    580
    
    
    
    (262
    )Increase (decrease) in Levitts accumulated other comprehensive income
    
    
    894
    
    
    
    600
    
    
    
    981Increase (decrease) in BankAtlantic Bancorp accumulated other comprehensive income
    
    
    4,200
    
    
    
    3,161
    
    
    
    (3,451
    )Benefit (provision) for deferred income taxes
    
    
    32,426
    
    
    
    20,625
    
    
    
    (5,144
    )Less: Provision (benefit) for deferred income taxes  discontinued operations
    
    
    1,811
    
    
    
    (5,641
    )
    
    
    (3,116
    )Less: Provision (benefit) for deferred income taxes  extraordinary income
    
    
    1,509
    
    
    
    
    
    
    
    Benefit (provision) for deferred income taxes  continuing operations
    
    $
    35,746
    
    
    
    14,984
    
    
    
    (8,260
    )
 217




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Balance, beginning of period
    
    $
    5,035
    
    
    
    3,341
    
    
    
    2,564Increase in deferred tax valuation allowance
    
    
    77,586
    
    
    
    1,694
    
    
    
    777Increase in deferred tax allowance  paid in capital
    
    
    1,407
    
    
    
    
    
    
    
    Balance, end of period
    
    $
    84,028
    
    
    
    5,035
    
    
    
    3,341
   Expiration Year
    
    State
    
    
    Federal2008
    
    $
    2,332
    
    
    $
    3,3222011
    
    
    1,662
    
    
    
    1,8312012
    
    
    669
    
    
    
    9842021
    
    
    806
    
    
    
    1,4222022
    
    
    824
    
    
    
    1,5152023
    
    
    2,008
    
    
    
    3,7922024
    
    
    28,059
    
    
    
    34,7142025
    
    
    4,964
    
    
    
    5,7972026
    
    
    18,497
    
    
    
    18,5312027
    
    
    6,754
    
    
    
    6,767$
    66,575
    
    
    $
    78,675
    218




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
    December 31,2007BankAtlantic
    
    $
    46,134BankAtlantic Bancorp Inc.
    
    
    129,265Leasing Technology Inc.
    
    
    9,263Palm River Development Corp.
    
    
    14,364Total State NOL carryforwards
    
    $
    199,026
     219




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Balance as of January 1, 2007
    
    $
    2,185Additions based on tax position related to current year
    
    
    1,322Additions based on tax positions related to prior year
    
    
    88Reductions of tax positions for prior years
    
    
    (1,036
    )Balance as of December 31, 2007
    
    $
    2,559
    24. Stock Based Compensation
  2007
    
    
    2006Pre-tax income before noncontrolling interest
    
    $
    (6,656
    )
    
    
    (7,805
    )Benefit from income tax
    
    
    2,940
    
    
    
    2,320Noncontrolling interest
    
    
    2,574
    
    
    
    4,315Decrease to income from continuing operations
    
    
    (1,142
    )
    
    
    (1,170
    )Discontinued operations, net of income tax and
noncontrolling interest
    
    
    (138
    )
    
    
    (52
    )Increase to net loss
    
    $
    (1,280
    )
    
    
    (1,222
    )Basic loss per share from continuing operations
    
    $
    (0.03
    )
    
    
    (0.04
    )Diluted loss per share from continuing operations
    
    $
    (0.03
    )
    
    
    (0.04
    )
 220




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  (In thousands, except per share data)
    
    2005Pro forma net incomeNet income allocable to common shareholders, as reported
    
    $
    12,024Add: Stock-based employee compensation
expense included in reported net income, net of
related tax effects and noncontrolling interest
    
    
    51Deduct: Total stock-based employee compensation
expense determined under fair value based
method for all awards, net of related income tax
effects and noncontrolling interest
    
    
    (1,168
    )Pro forma net income
    
    $
    10,907Earnings per share:Basic as reported
    
    $
    0.42Basic pro forma
    
    $
    0.38Diluted as reported
    
    $
    0.37Diluted pro forma
    
    $
    0.34
  BFCs Stock Option Plans and Restricted Stock
    221




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   Weighted AverageFor the Twelve Months Ended December 31,Employees
    
    2007
    
    2006
    
    2005Expected volatility
    
    
    43.05
    %
    
    
    44.22
    %
    
    
    41.38
    %Expected dividends
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %Expected term (in years)
    
    
    7.5
    
    
    
    7.5
    
    
    
    7.5Average risk-free interest rate
    
    
    4.94
    %
    
    
    5.01
    %
    
    
    4.61
    %Option value
    
    $
    2.43
    
    
    $
    3.54
    
    
    $
    4.71
 Weighted AverageFor the Twelve Months EndedNon-Employee Directors
    
    December 31, 2007Volatility
    
    
    43.05
    %Expected dividends
    
    
    0.00
    %Expected term (in years)
    
    
    5.00Risk-free rate
    
    
    4.89
    %Option value
    
    $
    1.99
 222




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Weighted
    
    
    WeightedAverage
    
    
    Average
    
    
    AggregateOutstanding
    
    
    Exercise
    
    
    Remaining
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Contractual Term
    
    
    Value ($000)Outstanding at December 31, 2004
    
    
    5,240,120
    
    
    $
    2.63
    
    
    
    3.80Exercised
    
    
    (113,153
    )
    
    
    1.53Forfeited
    
    
    (58,898
    )
    
    
    3.74Expired
    
    
    
    
    
    
    0.00Granted
    
    
    231,500
    
    
    
    8.92Outstanding at December 31, 2005
    
    
    5,299,569
    
    
    $
    2.92
    
    
    
    3.12Exercised
    
    
    (3,928,982
    )
    
    
    2.32Forfeited
    
    
    
    
    
    
    0.00Expired
    
    
    
    
    
    
    0.00Granted
    
    
    236,500
    
    
    
    6.36Outstanding at December 31, 2006
    
    
    1,607,087
    
    
    $
    4.88
    
    
    
    6.25
    
    
    $
    Exercised
    
    
    (129,769
    )
    
    
    1.45Forfeited
    
    
    (18,397
    )
    
    
    4.99Expired
    
    
    
    
    
    
    0.00Granted
    
    
    264,296
    
    
    
    4.44Outstanding at December 31, 2007
    
    
    1,723,217
    
    
    $
    5.07
    
    
    
    6.31
    
    
    $
    Exercisable at December 31, 2007
    
    
    285,054
    
    
    $
    3.85
    
    
    
    3.11
    
    
    $
    Available for grant at December
31, 2007
    
    
    2,211,027
     223




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Unvested
    
    
    WeightedRestricted
    
    
    AverageStock
    
    
    Fair ValueOutstanding at December 31, 2004
    
    $
    
    
    
    $
    Granted
    
    
    22,524
    
    
    
    8.88Vested
    
    
    (11,262
    )
    
    
    6.68Forfeited
    
    
    
    
    
    
    Outstanding at December 31, 2005
    
    $
    11,262
    
    
    $
    5.52Granted
    
    
    30,028
    
    
    
    6.66Vested
    
    
    (26,276
    )
    
    
    6.29Forfeited
    
    
    
    
    
    
    Outstanding at December 31, 2006
    
    $
    15,014
    
    
    $
    6.65Granted
    
    
    22,522
    
    
    
    4.44Vested
    
    
    (28,152
    )
    
    
    3.71Forfeited
    
    
    
    
    
    
    Outstanding at December 31, 2007
    
    $
    9,384
    
    
    $
    5.62
   224




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 BankAtlantic Bancorp Restricted Stock and Stock Option Plans:
 Stock Option PlansShares
    
    
    
    Vesting
    
    Type ofMaximum
    
    Authorized
    
    Class of
    
    Requirements
    
    OptionsTerm
    
    (3)
    
    Stock
    
    (1)
    
    (2)1996 Stock Option Plan
    
    10 years
    
    
    2,246,094
    
    
    A
    
    5 Years(1)
    
    ISO, NQ1999 Non-qualifying Stock Option Plan
    
    10 years
    
    
    862,500
    
    
    A
    
    
    (1
    )
    
    NQ1999 Stock Option Plan
    
    10 years
    
    
    862,500
    
    
    A
    
    
    (1
    )
    
    ISO, NQ2000 Non-qualifying Stock Option Plan
    
    10 years
    
    
    1,704,148
    
    
    A
    
    Immediately
    
    NQ2001 Amended and Restated Stock
Option Plan
    
    10 years
    
    
    3,918,891
    
    
    A
    
    5 Years (1)
    
    ISO, NQ2005 Restricted Stock and Option
Plan (4)
    
    10 years
    
    
    6,000,000
    
    
    A
    
    5 Years (1)
    
    ISO, NQ
 
 (1)
    
    Vesting is established by BankAtlantic Bancorps Compensation Committee in
connection with each grant of options or restricted stock. All directors stock options
vest immediately.(2)
    
    ISO  Incentive Stock Option
NQ  Non-qualifying Stock Option(3)
    
    During 2001, shares underlying options available for grant under all stock option
plans except the 2001 stock option plan were canceled. During 2005, restricted stock and
options available for grant under the 2001 stock option plan were canceled.(4)
    
    BankAtlantic Bancorps 2005 restricted stock and option plan provides that up to
6,000,000 shares of BankAtlantic Bancorp Class A common stock may be issued for
restricted stock awards and upon the exercise of options granted under the plan.  225




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Weighted Average2007
    
    2006
    
    2005Expected volatility
    
    
    29.44
    %
    
    
    31.44
    %
    
    
    31.00
    %Expected dividends
    
    
    1.75
    %
    
    
    1.03
    %
    
    
    0.76
    %Expected term (in years)
    
    
    7.23
    
    
    
    7.45
    
    
    
    7.00Risk-free rate
    
    
    4.92
    %
    
    
    5.19
    %
    
    
    4.10
    %
  Weighted
    
    
    WeightedClass A
    
    
    Average
    
    
    Average
    
    
    AggregateOutstanding
    
    
    Exercise
    
    
    Remaining
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Contractual Term
    
    
    Value ($000)Outstanding at December 31, 2004
    
    
    6,174,845
    
    
    
    6.79
    
    
    
    5.4Exercised
    
    
    (923,140
    )
    
    
    2.52Forfeited
    
    
    (71,023
    )
    
    
    11.13Expired
    
    
    
    
    
    
    Granted
    
    
    858,571
    
    
    
    18.74Outstanding at December 31, 2005
    
    
    6,039,253
    
    
    
    9.08
    
    
    
    5.7Exercised
    
    
    (1,459,740
    )
    
    
    4.13Forfeited
    
    
    (259,776
    )
    
    
    13.58Expired
    
    
    (32,100
    )
    
    
    9.30Granted
    
    
    951,268
    
    
    
    14.75Outstanding at December 31, 2006
    
    
    5,238,905
    
    
    
    11.29
    
    
    
    6.4Exercised
    
    
    (441,137
    )
    
    
    5.55Forfeited
    
    
    (377,432
    )
    
    
    13.59Expired
    
    
    (79,098
    )
    
    
    11.85Granted
    
    
    981,247
    
    
    
    9.36Outstanding at December 31, 2007
    
    
    5,322,485
    
    
    
    11.23
    
    
    
    6.2
    
    
    $
    474Exercisable at December 31, 2007
    
    
    1,669,220
    
    
    
    6.76
    
    
    
    3.5
    
    
    $
    474Available for grant at December 31, 2007
    
    
    3,459,860
    226




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Class A
    
    
    WeightedNonvested
    
    
    AverageRestricted
    
    
    Grant dateStock
    
    
    Fair ValueOutstanding at December 31, 2004
    
    
    163,787
    
    
    $
    7.40Vested
    
    
    (40,421
    )
    
    
    8.10Forfeited
    
    
    
    
    
    
    Granted
    
    
    9,268
    
    
    
    18.88Outstanding at December 31, 2005
    
    
    132,634
    
    
    $
    8.00Vested
    
    
    (34,826
    )
    
    
    11.12Forfeited
    
    
    
    
    
    
    Granted
    
    
    31,389
    
    
    
    14.74Outstanding at December 31, 2006
    
    
    129,197
    
    
    $
    8.79Vested
    
    
    (37,913
    )
    
    
    9.79Forfeited
    
    
    
    
    
    
    Granted
    
    
    62,160
    
    
    
    8.44Outstanding at December 31, 2007
    
    
    153,444
    
    
    $
    8.40
  BankAtlantic Bancorp Common Stock Repurchase
   Levitt Restricted Stock and Stock Option Plan
   227




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Year ended
    
    Year ended
    
    Year endedDecember 31, 2007
    
    December 31, 2006
    
    December 31, 2005Expected volatility
    
    40.05%  52.59%
    
    37.37%  39.80%
    
    37.99%  50.35%Expected dividend yield
    
    0.00%  .83%
    
    0.39%  0.61%
    
    0.00%  0.33%Risk-free interest rate
    
    4.58%  5.14%
    
    4.57%  5.06%
    
    4.02%  4.40%Expected life
    
    5  7.5 years
    
    5  7.5 years
    
    7.5 yearsForfeiture rate  executives
    
    5%
    
    5%
    
    Forfeiture rate  non-executives
    
    10%
    
    10%
    
    
   228




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Weighted
    
    
    Weighted Average
    
    
    AggregateAverage
    
    
    Remaining
    
    
    IntrinsicNumber
    
    
    Exercise
    
    
    Contractual
    
    
    Valueof Options
    
    
    Price
    
    
    Term
    
    
    (thousands)Options outstanding at December 31, 2005
    
    
    1,305,176
    
    
    $
    25.59
    
    
    
    
    
    
    $
    Granted
    
    
    759,655
    
    
    
    13.53
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    172,650
    
    
    
    25.79
    
    
    
    
    
    
    
    Options outstanding at December 31, 2006
    
    
    1,892,181
    
    
    $
    20.73
    
    
    8.33 years

    
    
    Granted
    
    
    752,409
    
    
    
    9.18
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    782,200
    
    
    
    17.71
    
    
    
    
    
    
    
    Options outstanding at December 31, 2007
    
    
    1,862,390
    
    
    $
    17.33
    
    
    8.00 years

    
    $
    Options exercisable at December 31, 2007
    
    
    99,281
    
    
    $
    19.56
    
    
    7.27 years

    
    $
    Stock available for equity compensation
grants at December 31, 2007
    
    
    1,137,610
  Weighted Average
    
    
    Weighted Average
    
    
    Aggregate IntrinsicNumber of
    
    
    Grant Date
    
    
    Remaining
    
    
    Value (inOptions
    
    
    Fair Value
    
    
    Contractual Term
    
    
    thousands)Non-vested at December 31, 2005
    
    
    1,250,000
    
    
    $
    13.44
    
    
    
    
    
    
    $
    Grants
    
    
    759,655
    
    
    
    6.44
    
    
    
    
    
    
    
    Vested
    
    
    44,105
    
    
    
    6.33
    
    
    
    
    
    
    
    Forfeited
    
    
    172,650
    
    
    
    12.98
    
    
    
    
    
    
    
    Non-vested at December 31, 2006
    
    
    1,792,900
    
    
    
    10.70
    
    
    8.28 years
    
    
    Grants
    
    
    752,409
    
    
    
    4.95
    
    
    
    
    
    
    
    Vested
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    782,200
    
    
    
    9.11
    
    
    
    
    
    
    
    Non-vested at December 31, 2007
    
    
    1,763,109
    
    
    $
    8.95
    
    
    8.04 years
    
    $
    
 229




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Options OutstandingNumber of
    
    
    Remaining
    
    
Options ExercisableRange of Exercise Price
    
    Stock Options
    
    
    Contractual Life
    
    
    Options
    
    
    Exercise Price$0.00 - $3.21
    
    
    12,000
    
    
    
    9.66
    
    
    
    
    
    
    $
    $6.43 - $9.64
    
    
    522,909
    
    
    
    9.47
    
    
    
    
    
    
    
    $9.64 - $12.85
    
    
    7,500
    
    
    
    9.24
    
    
    
    
    
    
    
    $12.85 - $16.07
    
    
    439,950
    
    
    
    8.57
    
    
    
    
    
    
    
    $16.07 - $19.28
    
    
    51,605
    
    
    
    8.48
    
    
    
    44,105
    
    
    
    16.09$19.28 - $22.49
    
    
    451,800
    
    
    
    6.09
    
    
    
    45,000
    
    
    
    20.15$22.49 - $25.70
    
    
    48,250
    
    
    
    6.61
    
    
    
    
    
    
    
    $28.92 - $32.13
    
    
    328,376
    
    
    
    7.56
    
    
    
    10,176
    
    
    
    31.951,862,390
    
    
    
    8.00
    
    
    
    99,281
    
    
    $
    19.56
  25. Pension, Profit Sharing Plan, 401(k) Plans and Deferred Retirement Agreement
 BFC
 BFC Defined Contribution 401(k) Plan
  BFC Profit Sharing Plan
  BFC Deferred Retirement Agreement
  230




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  BankAtlantic Bancorp
 Defined Benefit Pension Plan
   December 31,2007
    
    
    2006Benefit obligation at the beginning of the year
    
    $
    29,620
    
    
    $
    29,381Interest cost
    
    
    1,656
    
    
    
    1,624Actuarial (gains)
    
    
    (1,403
    )
    
    
    (557
    )Benefits paid
    
    
    (955
    )
    
    
    (828
    )Benefit obligation at end of year
    
    $
    28,918
    
    
    $
    29,620
  December 31,2007
    
    
    2006Fair value of plan assets at the beginning of year
    
    $
    28,626
    
    
    $
    26,151Actual return on plan assets
    
    
    1,433
    
    
    
    3,303Employer contribution
    
    
    
    
    
    
    Benefits paid
    
    
    (955
    )
    
    
    (828
    )Fair value of plan assets as of actuarial date
    
    $
    29,104
    
    
    $
    28,626Funded status at end of year (1)
    
    
    186
    
    
    
    (994
    )
 
 (1)
    
    The funded accumulated benefit obligation at December 31, 2007 was recorded in other assets
and the unfunded accumulated benefit obligation at December 31, 2006 was recorded in other
liabilities in the Companys consolidated statement of financial condition. 231




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended2007
    
    
    2006
    
    
    2005Interest cost on projected benefit obligation
    
    
    1,656
    
    
    
    1,624
    
    
    
    1,565Expected return on plan assets
    
    
    (2,396
    )
    
    
    (2,190
    )
    
    
    (2,100
    )Amortization of net losses (1)
    
    
    501
    
    
    
    933
    
    
    
    698Net periodic pension (income) expense (2)
    
    $
    (239
    )
    
    $
    367
    
    
    $
    163Other changes in plan assets and benefit
Obligations Recognized in Other
Comprehensive IncomeChange in accumulated benefit obligations
    
    
    1,180
    
    
    
    2,236
    
    
    
    (2,094
    )Change in deferred tax assets
    
    
    (363
    )
    
    
    (1,204
    )
    
    
    942Total recognized net periodic benefit cost and
other comprehensive income
    
    
    578
    
    
    
    1,399
    
    
    
    (989
    )
 
 (1)
    
    The estimated net losses that will be amortized from other comprehensive
income into net periodic benefit cost for the year ended December 31, 2008 are
$433,000.(2)
    
    Periodic pension (income) expense is included in compensation expense.   For the Years Ended December 31,2007
    
    2006
    
    2005Weighted average discount rate used to
determine benefit obligation
    
    
    6.00
    %
    
    
    5.75
    %
    
    
    5.50Weighted average discount rate used to
To determine net periodic benefit cost
    
    
    5.75
    %
    
    
    5.50
    
    
    
    6.00Rate of increase in future compensation levels
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/AExpected long-term rate of return
    
    
    8.50
    %
    
    
    8.50
    %
    
    
    8.50
  232




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  Plan AssetsAt December 31,2007
    
    
    2006Equity securities
    
    
    71.93
    %
    
    
    74.66
    %Debt securities
    
    
    22.36
    
    
    
    20.87Cash
    
    
    5.71
    
    
    
    4.47Total
    
    
    100.00
    %
    
    
    100.00
    %
    PensionExpected Future Service
    
    Benefits2008
    
    $   9832009
    
    1,1912010
    
    1,3972011
    
    1,4142012
    
    1,459Years 2013-2017
    
    8,597
 233




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Defined Contribution 401(k) Plan
  For the Years Ended December 31,2007
    
    2006
    
    2005Employee salary contribution limit (1)
    
    $
    15
    
    
    $
    15
    
    
    $
    14Percentage of salary limitation
    
    
    75
    %
    
    
    75
    %
    
    
    75
    %Total match contribution (2)
    
    $
    2,930
    
    
    $
    2,461
    
    
    $
    2,037Vesting of employer match
    
    Immediate
    
    Immediate
    
    Immediate
 
 (1)
    
    For the 2007, 2006 and 2005 plan year, employees over the age of 50 were entitled to
contribute $20,000, $20,000 and $18,000, respectively.(2)
    
    The employer matched 100% of the first 3% of employee contributions and 50% of the next
2% of employee contributions. Profit Sharing Plan
  Levitt
  26. Commitments and Contingencies
  Year Ending December 31,2008
    
    $
    12,8162009
    
    
    11,6962010
    
    
    10,0132011
    
    
    8,5032012
    
    
    7,449Thereafter
    
    
    91,597Total
    
    $
    142,074
 234




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended December 31,(In thousands)
    
    2007
    
    
    2006
    
    
    2005Rental expense for premises and equipment
    
    $
    16,191
    
    
    
    13,037
    
    
    
    8,257
   December 31,2007
    
    2006BFC ActivitiesGuaranty agreements
    
    $
    59,113
    
    
    
    34,396Financial ServicesCommitments to sell fixed rate residential loans
    
    
    21,029
    
    
    
    30,696Commitments to sell variable rate residential loans
    
    
    1,518
    
    
    
    2,921Commitments to purchase variable rate residential
loans
    
    
    39,921
    
    
    
    69,525Commitments to purchase fixed rate residential loans
    
    
    21,189
    
    
    
    Commitments to originate loans held for sale
    
    
    18,344
    
    
    
    26,346Commitments to originate loans held to maturity
    
    
    158,589
    
    
    
    223,060Commitments to extend credit, including the
undisbursed
portion of loans in process
    
    
    992,838
    
    
    
    890,036Commitments to purchase branch facilities land
    
    
    
    
    
    
    11,180Standby letters of credit
    
    
    41,151
    
    
    
    67,831Commercial lines of credit
    
    
    96,786
    
    
    
    86,992Real Estate DevelopmentLevitts commitments to purchase properties for
development
    
    
    
    
    
    
    14,200
 BFC Activities
   235




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
      236




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Financial Services
       Real Estate Development
  237




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
    27. Regulatory Matters
    238




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For Capital
    
    To Be ConsideredActual
    
    Adequacy Purposes
    
    Well CapitalizedAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    RatioAs of December 31, 2007:Total risk-based capital
    
    $
    495,668
    
    
    
    11.63
    %
    
    $
    340,998
    
    
    
    8.00
    %
    
    $
    426,248
    
    
    
    10.00
    %Tier I risk-based capital
    
    $
    420,063
    
    
    
    9.85
    %
    
    $
    170,499
    
    
    
    4.00
    %
    
    $
    255,749
    
    
    
    6.00
    %Tangible capital
    
    $
    420,063
    
    
    
    6.94
    %
    
    $
    90,821
    
    
    
    1.50
    %
    
    $
    90,821
    
    
    
    1.50
    %Core capital
    
    $
    420,063
    
    
    
    6.94
    %
    
    $
    242,190
    
    
    
    4.00
    %
    
    $
    302,738
    
    
    
    5.00
    %As of December 31, 2006:Total risk-based capital
    
    $
    529,497
    
    
    
    12.08
    %
    
    $
    350,714
    
    
    
    8.00
    %
    
    $
    438,392
    
    
    
    10.00
    %Tier I risk-based capital
    
    $
    460,359
    
    
    
    10.50
    %
    
    $
    175,357
    
    
    
    4.00
    %
    
    $
    263,035
    
    
    
    6.00
    %Tangible capital
    
    $
    460,359
    
    
    
    7.55
    %
    
    $
    91,425
    
    
    
    1.50
    %
    
    $
    91,425
    
    
    
    1.50
    %Core capital
    
    $
    460,359
    
    
    
    7.55
    %
    
    $
    243,799
    
    
    
    4.00
    %
    
    $
    304,749
    
    
    
    5.00
    %
 28. Litigation
  Joint Home Purchase Deposit Creditors Committee of
Creditors Holding Unsecured Claims
 Debtors Motion for Authority to Incur
Chapter 11 Administrative Expense Claim
   239




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Class Action Lawsuit
   29. Parent Company Financial Information
   Parent Company Condensed Statements of Financial Condition
(In thousands)
 December 31,2007
    
    
    2006AssetsCash and cash equivalents
    
    $
    17,999
    
    
    
    17,815Investment securities
    
    
    862
    
    
    
    2,262Investment in Benihana, Inc.
    
    
    20,000
    
    
    
    20,000Investment in venture partnerships
    
    
    864
    
    
    
    908Investment in BankAtlantic Bancorp, Inc.
    
    
    108,173
    
    
    
    113,586Investment in Levitt Corporation
    
    
    54,637
    
    
    
    57,009Investment in and advances to wholly-owned subsidiaries
    
    
    1,578
    
    
    
    1,525Loans receivable
    
    
    3,782
    
    
    
    2,157Other assets
    
    
    906
    
    
    
    2,261Total assets
    
    $
    208,801
    
    
    
    217,523Liabilities and Shareholders EquityAdvances from and negative basis in wholly-owned subsidiaries
    
    $
    3,174
    
    
    
    1,290Other liabilities
    
    
    7,722
    
    
    
    7,351Deferred income taxes
    
    
    13,868
    
    
    
    31,297Total liabilities
    
    
    24,764
    
    
    
    39,938Total shareholders equity
    
    
    184,037
    
    
    
    177,585Total liabilities and shareholders equity
    
    $
    208,801
    
    
    
    217,523
 Parent Company Condensed Statements of Operations
(In thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Revenues
    
    $
    3,977
    
    
    
    2,232
    
    
    
    1,775Expenses
    
    
    9,565
    
    
    
    8,413
    
    
    
    14,904Loss before (loss) earnings from subsidiaries
    
    
    (5,588
    )
    
    
    (6,181
    )
    
    
    (13,129
    )Equity from (loss) earnings in BankAtlantic Bancorp
    
    
    (7,206
    )
    
    
    5,807
    
    
    
    9,053Equity from (loss) earnings in Levitt
    
    
    (39,622
    )
    
    
    (1,519
    )
    
    
    9,151Equity from (loss) earnings in other subsidiaries
    
    
    (1,083
    )
    
    
    (658
    )
    
    
    6,671(Loss) income before income taxes
    
    
    (53,499
    )
    
    
    (2,551
    )
    
    
    11,746(Benefit) provision for income taxes
    
    
    (19,398
    )
    
    
    (1,856
    )
    
    
    4,010(Loss) income from continuing operations
    
    
    (34,101
    )
    
    
    (695
    )
    
    
    7,736Equity in subsidiaries discontinued operations, net of tax
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Extraordinary gain, net of tax
    
    
    2,403
    
    
    
    
    
    
    
    Net (loss) income
    
    
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,7745% Preferred Stock dividends
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )Net loss allocable to common stock
    
    $
    (31,209
    )
    
    
    (2,971
    )
    
    
    12,024
 240




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Parent Company Condensed Statements of Cash Flow
(In thousands)
 For the Years Ended December 31,2007
    
    
    2006
    
    
    2005Operating Activities:Net (loss) income
    
    $
    (30,459
    )
    
    
    (2,221
    )
    
    
    12,774Adjustments to reconcile net (loss) income to net
cash used in operating activities:Increase (decrease) in operating activities
    
    
    25,954
    
    
    
    (820
    )
    
    
    (12,709
    )Net cash used in operating activities
    
    
    (4,505
    )
    
    
    (3,041
    )
    
    
    65Investing Activities:Proceeds from sale of investment in real estate limited partnership
    
    
    1,000
    
    
    
    
    
    
    
    Proceeds from the sale of securities
    
    
    1,336
    
    
    
    
    
    
    
    Investment in real estate limited partnership
    
    
    
    
    
    
    (1,000
    )
    
    
    Additions to property and equipment
    
    
    
    
    
    
    77
    
    
    
    (29.00
    )Investment in Benihana convertible preferred stock
    
    
    
    
    
    
    
    
    
    
    (10,000
    )Acquisition of Levitt Class A shares
    
    
    (33,205
    )
    
    
    
    
    
    
    Net cash used in investing activities
    
    
    (30,869
    )
    
    
    (923
    )
    
    
    (10,029
    )Financing Activities:Borrowing
    
    
    
    
    
    
    
    
    
    
    1,000Repayments of borrowing
    
    
    
    
    
    
    
    
    
    
    (11,483
    )Proceeds from the issuance of Class B Common Stock
upon exercise of stock options
    
    
    
    
    
    
    
    
    
    
    172Proceeds from issuance of Class A Common Stock net of issuance costs
    
    
    36,121
    
    
    
    
    
    
    
    46,188Proceeds from issuance of Common Stock upon exercise of stock option
    
    
    187
    
    
    
    Payment of the minimum withholding tax upon the exercise of stock options
    
    
    
    
    
    
    (4,154
    )5% Preferred Stock dividends paid
    
    
    (750
    )
    
    
    (750
    )
    
    
    (750
    )Net cash provided by (used in) financing activities
    
    
    35,558
    
    
    
    (4,904
    )
    
    
    35,127Increase (decrease) in cash and cash equivalents
    
    
    184
    
    
    
    (8,868
    )
    
    
    25,163Cash at beginning of period
    
    
    17,815
    
    
    
    26,683
    
    
    
    1,520Cash at end of period
    
    $
    17,999
    
    
    
    17,815
    
    
    
    26,683Supplementary disclosure of non-cash investing and financing activitiesInterest paid on borrowings
    
    $
    
    
    
    
    
    
    
    
    320Net decrease in shareholders equity from the effect of subsidiaries
capital transactions, net of income taxes
    
    
    (101
    )
    
    
    (16
    )
    
    
    (474
    )Decrease (increase) in accumulated other comprehensive income, net of taxes
    
    
    145
    
    
    
    926
    
    
    
    (417
    )Issuance and retirement of Common Stock accepted as consideration for the
exercise price of stock options
    
    
    
    
    
    
    4,154
    
    
    
    (Decrease) increase in shareholders equity for the tax effect related to the
exercise of employee stock options
    
    
    
    
    
    
    
    
    
    
    (12
    )Decrease in advances due from wholly-owned subsidiaries
    
    
    
    
    
    
    
    
    
    
    (23,744
    )Dividends from wholly-owned subsidiaries
    
    
    
    
    
    
    
    
    
    
    23,744Cumulative effect adjustment upon adoption of FASB Interpretation No. 48
    
    
    121
    
    
    
    
   241




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 30. Selected Quarterly Results (Unaudited)
  First
    
    
    Second
    
    
    Third
    
    
    Fourth2007
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalRevenues
    
    $
    275,938
    
    
    
    271,764
    
    
    
    259,454
    
    
    
    146,701
    
    
    
    953,857Costs and expenses
    
    
    281,639
    
    
    
    333,957
    
    
    
    493,183
    
    
    
    181,752
    
    
    
    1,290,531(5,701
    )
    
    
    (62,193
    )
    
    
    (233,729
    )
    
    
    (35,051
    )
    
    
    (336,674
    )Equity in earnings from unconsolidated affiliates
    
    
    2,893
    
    
    
    2,026
    
    
    
    4,763
    
    
    
    3,042
    
    
    
    12,724Loss before income taxes and
noncontrolling interest
    
    
    (2,808
    )
    
    
    (60,167
    )
    
    
    (228,966
    )
    
    
    (32,009
    )
    
    
    (323,950
    )Benefit for income taxes
    
    
    (270
    )
    
    
    (17,860
    )
    
    
    (39,248
    )
    
    
    (12,868
    )
    
    
    (70,246
    )Noncontrolling interest
    
    
    (913
    )
    
    
    (39,397
    )
    
    
    (164,388
    )
    
    
    (14,905
    )
    
    
    (219,603
    )Loss from continuing operations
    
    
    (1,625
    )
    
    
    (2,910
    )
    
    
    (25,330
    )
    
    
    (4,236
    )
    
    
    (34,101
    )Discontinued operations, net of tax
    
    
    1,052
    
    
    
    (4
    )
    
    
    83
    
    
    
    108
    
    
    
    1,239Extraordinary gain, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,403
    
    
    
    2,403Net loss
    
    
    (573
    )
    
    
    (2,914
    )
    
    
    (25,247
    )
    
    
    (1,725
    )
    
    
    (30,459
    )5% Preferred Stock dividends
    
    
    (188
    )
    
    
    (187
    )
    
    
    (187
    )
    
    
    (188
    )
    
    
    (750
    )Net loss allocable to common shareholders
    
    $
    (761
    )
    
    
    (3,101
    )
    
    
    (25,434
    )
    
    
    (1,913
    )
    
    
    (31,209
    )Basic loss per share from continuing operations
    
    $
    (0.05
    )
    
    
    (0.09
    )
    
    
    (0.59
    )
    
    
    (0.10
    )
    
    
    (0.90
    )Basic earnings per share from discontinued operations
    
    
    0.03
    
    
    
    (0.00
    )
    
    
    0.00
    
    
    
    0.00
    
    
    
    0.03Basic earnings per share from extraordinary gain
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.05
    
    
    
    0.06Basic loss per share
    
    $
    (0.02
    )
    
    
    (0.09
    )
    
    
    (0.59
    )
    
    
    (0.05
    )
    
    
    (0.81
    )Diluted loss per share from continuing operations
    
    $
    (0.05
    )
    
    
    (0.09
    )
    
    
    (0.60
    )
    
    
    (0.10
    )
    
    
    (0.90
    )Diluted earnings per share from discontinued
operations
    
    
    0.03
    
    
    
    (0.00
    )
    
    
    0.00
    
    
    
    0.00
    
    
    
    0.03Diluted earnings per share from extraordinary gain
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.05
    
    
    
    0.06Diluted loss per share
    
    $
    (0.02
    )
    
    
    (0.09
    )
    
    
    (0.60
    )
    
    
    (0.05
    )
    
    
    (0.81
    )Basic weighted average number of common
Shares outstanding
    
    
    33,444
    
    
    
    33,451
    
    
    
    42,942
    
    
    
    45,096
    
    
    
    38,778Diluted weighted average number of common
Shares outstanding
    
    
    33,444
    
    
    
    33,451
    
    
    
    42,942
    
    
    
    45,096
    
    
    
    38,778
    242




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 First
    
    
    Second
    
    
    Third
    
    
    Fourth2006
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalRevenues
    
    $
    246,269
    
    
    
    260,815
    
    
    
    265,978
    
    
    
    319,737
    
    
    
    1,092,799Costs and expenses
    
    
    238,838
    
    
    
    251,996
    
    
    
    261,094
    
    
    
    339,594
    
    
    
    1,091,5227,431
    
    
    
    8,819
    
    
    
    4,884
    
    
    
    (19,857
    )
    
    
    1,277Equity in earnings from unconsolidated affiliates
    
    
    771
    
    
    
    2,353
    
    
    
    7,061
    
    
    
    750
    
    
    
    10,935Income (loss) before income taxes and
noncontrolling interest
    
    
    8,202
    
    
    
    11,172
    
    
    
    11,945
    
    
    
    (19,107
    )
    
    
    12,212Provision (benefit) for income taxes
    
    
    2,531
    
    
    
    3,427
    
    
    
    4,188
    
    
    
    (10,661
    )
    
    
    (515
    )Noncontrolling interest
    
    
    5,757
    
    
    
    7,518
    
    
    
    8,259
    
    
    
    (8,112
    )
    
    
    13,422(Loss) income from continuing operations
    
    
    (86
    )
    
    
    227
    
    
    
    (502
    )
    
    
    (334
    )
    
    
    (695
    )Discontinued operations, net of tax
    
    
    (213
    )
    
    
    (306
    )
    
    
    (641
    )
    
    
    (366
    )
    
    
    (1,526
    )Net loss
    
    
    (299
    )
    
    
    (79
    )
    
    
    (1,143
    )
    
    
    (700
    )
    
    
    (2,221
    )5% Preferred Stock dividends
    
    
    (188
    )
    
    
    (188
    )
    
    
    (187
    )
    
    
    (187
    )
    
    
    (750
    )Net loss allocable to common shareholders
    
    $
    (487
    )
    
    
    (267
    )
    
    
    (1,330
    )
    
    
    (887
    )
    
    
    (2,971
    )Basic loss per share from continuing operations
    
    $
    (0.01
    )
    
    
    0.00
    
    
    
    (0.02
    )
    
    
    (0.02
    )
    
    
    (0.04
    )Basic loss per share from discontinued operations
    
    
    0.00
    
    
    
    (0.01
    )
    
    
    (0.02
    )
    
    
    (0.01
    )
    
    
    (0.05
    )Basic loss per share
    
    $
    (0.01
    )
    
    
    (0.01
    )
    
    
    (0.04
    )
    
    
    (0.03
    )
    
    
    (0.09
    )Diluted loss per share from continuing operations
    
    $
    (0.01
    )
    
    
    0.00
    
    
    
    (0.02
    )
    
    
    (0.02
    )
    
    
    (0.05
    )Diluted loss per share from discontinued
operations
    
    
    (0.01
    )
    
    
    (0.01
    )
    
    
    (0.02
    )
    
    
    (0.01
    )
    
    
    (0.05
    )Diluted loss per share
    
    $
    (0.02
    )
    
    
    (0.01
    )
    
    
    (0.04
    )
    
    
    (0.03
    )
    
    
    (0.10
    )Basic weighted average number of common
Shares outstanding
    
    
    32,692
    
    
    
    33,422
    
    
    
    33,427
    
    
    
    33,436
    
    
    
    33,249Diluted weighted average number of common
Shares outstanding
    
    
    32,692
    
    
    
    33,422
    
    
    
    33,427
    
    
    
    33,436
    
    
    
    33,249
  31. Estimated Fair Values of Financial Instruments
   243




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BFC Financial Corporation
Notes to Consolidated Financial Statements
            244




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  December 31, 2007
    
    December 31, 2006Carrying
    
    Fair
    
    Carrying
    
    FairAmount
    
    Value
    
    Amount
    
    ValueFinancial assets:Cash and cash equivalents and federal funds
sold
and other short-term investments
    
    $
    332,155
    
    
    
    332,155
    
    
    
    201,123
    
    
    
    201,123Securities available for sale
    
    
    926,307
    
    
    
    926,307
    
    
    
    653,659
    
    
    
    653,659Stifel warrants
    
    
    10,661
    
    
    
    10,661
    
    
    
    
    
    
    
    Investment securities
    
    
    60,173
    
    
    
    64,666
    
    
    
    227,208
    
    
    
    229,546Tax Certificates
    
    
    188,401
    
    
    
    188,401
    
    
    
    195,391
    
    
    
    195,391Federal home loan bank stock
    
    
    74,003
    
    
    
    74,003
    
    
    
    80,217
    
    
    
    80,217Loans receivable including loans held for
sale, net
    
    
    4,528,538
    
    
    
    4,614,705
    
    
    
    4,603,505
    
    
    
    4,566,158Financial liabilities:Deposits
    
    $
    3,953,405
    
    
    
    3,967,256
    
    
    
    3,867,036
    
    
    
    3,872,703Federal funds purchased and other
short term borrowings
    
    
    108,975
    
    
    
    108,975
    
    
    
    32,026
    
    
    
    32,026Securities sold under agreements to repurchase
    
    
    50,930
    
    
    
    50,930
    
    
    
    96,385
    
    
    
    96,385Advances from FHLB
    
    
    1,397,044
    
    
    
    1,406,728
    
    
    
    1,517,058
    
    
    
    1,507,264Notes payable associated with assets held for
sale
    
    
    78,970
    
    
    
    77,620
    
    
    
    27,338
    
    
    
    27,338Subordinated debentures, notes and
and junior subordinated debentures
    
    
    595,674
    
    
    
    548,323
    
    
    
    881,604
    
    
    
    882,095
  Derivatives
   Concentration of Credit Risk
  245




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 32. Earnings (Loss) per Share
    246




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
  For the Years Ended December 31,(In thousands, except per share data)
    
    2007
    
    
    2006
    
    
    2005Basic (loss) earnings per shareNumerator:(Loss) income from continuing operations allocable to common
stock
    
    $
    (34,851
    )
    
    
    (1,445
    )
    
    
    6,986Discontinued operations, net of taxes
    
    
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Extraordinary gain, net of taxes
    
    
    2,403
    
    
    
    
    
    
    
    Net (loss) income allocable to common shareholders
    
    $
    (31,209
    )
    
    
    (2,971
    )
    
    
    12,024Denominator:Basic weighted average number of common shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    28,952Basic (loss) earnings per share:(Loss) earnings per share from continuing operations
    
    $
    (0.90
    )
    
    
    (0.04
    )
    
    
    0.24Earnings (loss) per share from discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.18Earnings per share from extraordinary gain
    
    
    0.06
    
    
    
    
    
    
    
    Basic (loss) earnings per share
    
    $
    (0.81
    )
    
    
    (0.09
    )
    
    
    0.42Diluted (loss) earnings per shareNumerator(Loss) income from continuing operations allocable to common
stock
    
    $
    (34,851
    )
    
    
    (1,445
    )
    
    
    6,986Effect of securities issuable by subsidiaries
    
    
    
    
    
    
    (93
    )
    
    
    (142
    )(Loss) income allocable to common stock after assumed dilution
    
    $
    (34,851
    )
    
    
    (1,538
    )
    
    
    6,844Discontinued operations, net of taxes
    
    $
    1,239
    
    
    
    (1,526
    )
    
    
    5,038Effect of securities issuable by subsidiaries
    
    
    
    
    
    
    
    
    
    
    (200
    )Discontinued operations, net of taxes after assumed dilution
    
    $
    1,239
    
    
    
    (1,526
    )
    
    
    4,838Extraordinary gain, net of taxes
    
    $
    2,403
    
    
    
    
    
    
    
    Effect of securities issuable by a subsidiary
    
    
    
    
    
    
    
    
    
    
    Extraordinary gain, net of taxes after assumed dilution
    
    $
    2,403
    
    
    
    
    
    
    
    Net (loss) income allocable to common stock after assumed
dilution
    
    $
    (31,209
    )
    
    
    (3,064
    )
    
    
    11,682DenominatorBasic weighted average number of common shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    28,952Common stock equivalents resulting from stock-based compensation
    
    
    
    
    
    
    
    
    
    
    2,267Diluted weighted average shares outstanding
    
    
    38,778
    
    
    
    33,249
    
    
    
    31,219Diluted (loss) earnings per share(Loss) earnings per share from continuing operations
    
    $
    (0.90
    )
    
    
    (0.05
    )
    
    
    0.22Earnings (loss) per share from discontinued operations
    
    
    0.03
    
    
    
    (0.05
    )
    
    
    0.15Earnings per share from extraordinary gain
    
    
    0.06
    
    
    
    
    
    
    
    Diluted (loss) earnings per share
    
    $
    (0.81
    )
    
    
    (0.10
    )
    
    
    0.37
  247




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 33. Certain Relationships and Related Party Transactions
   At December 31, 2007 andFor the Year Ended December 31, 2007(in thousands)
    
    
    
    
    
    BFC
    
    BankAtlantic Bancorp
    
    Levitt
    
    BluegreenShared service receivable (payable)
    
    
    (a
    )
    
    $
    312
    
    
    
    (89
    )
    
    
    (119
    )
    
    
    (104
    )Shared service income (expense)
    
    
    (a
    )
    
    $
    2,855
    
    
    
    (1,406
    )
    
    
    (1,006
    )
    
    
    (443
    )Facilities cost
    
    
    (a
    )
    
    $
    (272
    )
    
    
    220
    
    
    
    
    
    
    
    52Interest income (expense) from cash
balance/securities sold under agreements
to repurchase
    
    
    (b
    )
    
    $
    38
    
    
    
    (185
    )
    
    
    147
    
    
    
    Cash and cash equivalents and (securities sold
under agreements to repurchase)
    
    
    (b
    )
    
    $
    1,217
    
    
    
    (7,335
    )
    
    
    6,118
    
    
    
    
 At December 31, 2006 andFor the Year Ended December 31, 2006(in thousands)
    
    
    
    
    
    BFC
    
    BankAtlantic Bancorp
    
    Levitt
    
    BluegreenShared service receivable (payable)
    
    
    (a
    )
    
    $
    312
    
    
    
    (142
    )
    
    
    (107
    )
    
    
    (63
    )Shared service income (expense)
    
    
    (a
    )
    
    $
    2,495
    
    
    
    (1,053
    )
    
    
    (1,134
    )
    
    
    (308
    )Office facilities cost
    
    
    (a
    )
    
    $
    (460
    )
    
    
    406
    
    
    
    
    
    
    
    54Interest income (expense) from cash
balance/securities sold under agreements to
repurchase
    
    
    (b
    )
    
    $
    43
    
    
    
    (479
    )
    
    
    436
    
    
    
    Cash and cash equivalents and (securities sold
under agreements to repurchase)
    
    
    (b
    )
    
    $
    996
    
    
    
    (5,547
    )
    
    
    4,551
    
    
    
    
 At December 31, 2005 andFor the Year Ended December 31, 2005(in thousands)
    
    
    
    
    
    BFC
    
    BankAtlantic Bancorp
    
    Levitt
    
    BluegreenShared service income (expense)
    
    
    (c
    )
    
    $
    (368
    )
    
    
    1,329
    
    
    
    (883
    )
    
    
    (78
    )Consulting service income (expense)
    
    
    (f
    )
    
    $
    127
    
    
    
    (218
    )
    
    
    (127
    )
    
    
    218Property development reimbursement (cost
incurred)
    
    
    (d
    )
    
    $
    
    
    
    
    (438
    )
    
    
    438
    
    
    
    Interest income (expense) from notes
receivable/payable
    
    
    (h
    )
    
    $
    
    
    
    
    892
    
    
    
    (892
    )
    
    
    Interest income (expense) from cash
balance/securities sold under agreements to
repurchase
    
    
    (b
    )
    
    $
    32
    
    
    
    (348
    )
    
    
    316
    
    
    
    Fees received (paid) relating to the issuance of
BFC Class A Common Stock
    
    
    (e
    )
    
    $
    (1,950
    )
    
    
    1,950
    
    
    
    
    
    
    
    Cash and cash equivalents and (securities sold
under agreements to repurchase)
    
    
    (b
    )
    
    $
    1,115
    
    
    
    (6,238
    )
    
    
    5,123
    
    
    
    Notes receivable (payable)
    
    
    (g
    )
    
    $
    
    
    
    
    223
    
    
    
    (223
    )
    
    
    
 
 (a)
    
    Effective January 1, 2006, BFC maintained arrangements with BankAtlantic Bancorp and Levitt
Corporation to provide shared service operations in the areas of human resources, risk
management, investor relations and executive office administration. Pursuant to these
arrangements, certain employees from BankAtlantic were transferred to BFC to staff BFCs
shared service operations. Additionally, BFC provides certain risk management and
administrative services to Bluegreen. The costs of shared services are allocated based upon
the estimated usage of the respective services. Also, as part of the shared services
arrangement, the Company reimburses BankAtlantic Bancorp and Bluegreen for office facilities
costs relating to the Company and its shared service operations. 248




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 
 (b)
    
    BFC and Levitt entered into securities sold under agreements to repurchase (Repurchase
Agreements) with BankAtlantic and the balance in those accounts in the aggregate was
approximately $7.3 million, $5.5 million and $6.2 million at December 31, 2007, 2006 and 2005,
respectively. Interest in connection with the Repurchase Agreements was approximately
$185,000, $479,000 and $348,000 for the years ended December 31, 2007, 2006 and 2005,
respectively. These transactions have similar general terms as BankAtlantic repurchase
agreements with unaffiliated third parties.(c)
    
    In 2005, BankAtlantic Bancorp maintained service arrangements with BFC and Levitt, pursuant
to which BankAtlantic Bancorp provided certain human resources, risk management, project
planning, system support and investor and public relations services. BankAtlantic Bancorp was
compensated on a cost plus 5% basis for such services. Additionally, in 2005, Levitt
reimbursed BankAtlantic for office facilities costs.(d)
    
    During the year ended December 31, 2005, actions were taken by Levitt with respect to the
development of certain property owned by BankAtlantic. Levitts efforts included the
successful rezoning of the property and obtaining the permits necessary to develop the
property for residential and commercial use. At December 31, 2006, BankAtlantic reimbursed
Levitt $438,000 for the costs incurred by it in connection with the development of this
project. Levitt has no further involvement in the project.(e)
    
    During the year ended December 31, 2005, BFC sold 5,957,555 shares of its Class A Common
Stock in an underwritten public offering at a price of $8.50 per share. The $1.95 million
represents Ryan Becks participation as lead underwriter in this offering.(f)
    
    In 2005, a subsidiary of BFC received $127,000 in consulting fees for assisting a subsidiary
of Levitt in obtaining financing of certain properties. Also during 2005, BankAtlantic Bancorp
paid Bluegreen approximately $218,000 for risk management services.(g)
    
    Represents construction loans due from Levitt to BankAtlantic. There were no such loans as of
December 31, 2007 and 2006.(h)
    
    The interest income (expense) relates to the loans due from Levitt to BankAtlantic and
BankAtlantic Bancorp. In 2007 and 2006, there were no such loans and interest.   Class A
    
    WeightedCommon
    
    AverageStock
    
    PriceOptions outstanding
    
    
    268,943
    
    
    $
    9.90Options nonvested
    
    
    154,587
    
    
    $
    12.32
    249




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
     34. Noncontrolling Interest
  December 31,2007
    
    
    2006BankAtlantic Bancorp
    
    $
    351,148
    
    
    
    411,396Levitt
    
    
    207,138
    
    
    
    286,230Joint Venture Partnership
    
    
    664
    
    
    
    697$
    558,950
    
    
    
    698,323
 35. Common Stock, 5% Cumulative Convertible Preferred Stock and Dividends
 Common Stock
  250




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
    Amended Articles of the Companys By-Laws
   5% Cumulative Convertible Preferred Stock
  251




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
   Dividends
  252




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 36. Financial Information of Levitt and Sons
   November 9,2007Cash
    
    $
    6,387Inventory
    
    
    356,294Property and equipment
    
    
    1,681Other assets
    
    
    8,974Assets deconsolidated
    
    
    373,336Accounts payable and other accrued liabilities
    
    
    50,709Customer deposits
    
    
    18,007Due to
Levitt Corporation
    
    
    67,831Notes and mortgage payable
    
    
    344,052Liabilities deconsolidated
    
    $
    480,599Net equity/negative investment
    
    $
    (107,263
    )The loss in excess of investment in Levitts subsidiary is comprised of:Net equity/negative investment
    
    
    (107,263
    )Due to Levitt Corporation
    
    
    67,831Deferred revenue
    
    
    (15,780
    )$
    (55,212
    )
  Financial Reporting by Entities in
Reorganization Under the Bankruptcy Code
 253




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt and Sons
Condensed Consolidated Statements of Financial Condition
As of December 31, 2007 and 2006
(In thousands)
 2007
    
    
    2006AssetsCash
    
    $
    5,365
    
    
    
    13,333Inventory
    
    
    208,686
    
    
    
    664,572Property and equipment
    
    
    55
    
    
    
    2,190Other assets
    
    
    23,810
    
    
    
    26,417Total assets
    
    $
    237,916
    
    
    
    706,512Liabilities and Shareholders EquityAccounts
payable and other accrued liabilities
    
    $
    469
    
    
    
    43,411Customer deposits
    
    
    
    
    
    
    41,738Current income tax payable
    
    
    
    
    
    
    8,467Notes and mortgage notes payable
    
    
    
    
    
    
    417,907Due to Levitt Corporation
    
    
    748
    
    
    
    59,414Due to Core Communities
    
    
    
    
    
    
    14,063Liabilities subject to compromise (A)
    
    
    354,748
    
    
    
    Shareholders (deficit) equity
    
    $
    (118,049
    )
    
    
    121,512Total liabilities and shareholders equity
    
    $
    237,916
    
    
    
    706,512
 (A) Liabilities Subject to Compromise
   December 31, 2007Accounts payable and accrued liabilities
    
    $
    54,619Customer deposits other
    
    
    17,451Due to Core Communities
    
    
    38,552Deficiency
claim associated with secured debt
    
    
    38,552Notes and mortgage payable
    
    
    156,944Total liabilities subject to compromise
    
    $
    354,748
 254




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##### Table of Contents



BFC Financial Corporation
Notes to Consolidated Financial Statements
 Levitt and Sons
Condensed Consolidated Statements of Operations
For the Years Ended December 31, 2007, 2006 and 2005
(In thousands)
 2007
    
    
    2006
    
    
    2005Revenues
Sales of real estate
    
    $
    397,561
    
    
    
    500,719
    
    
    
    438,367Other revenues
    
    
    2,245
    
    
    
    4,070
    
    
    
    3,750Total revenues
    
    
    399,806
    
    
    
    504,789
    
    
    
    442,117Costs and expensesCost of sales of real estate
    
    
    562,763
    
    
    
    440,059
    
    
    
    347,008Selling, general and administrative expenses
    
    
    70,848
    
    
    
    77,858
    
    
    
    57,403Total costs and expenses
    
    
    633,611
    
    
    
    517,917
    
    
    
    404,411Reorganization items, net
    
    
    (3,525
    
    
    
    
    
    
    
    Other
income, net of interest and other expense
    
    
    (1,928
    )
    
    
    (560
    )
    
    
    (2,779
    )(Loss) income before income taxes
    
    
    (239,258
    )
    
    
    (13,688
    )
    
    
    34,927(Provision) benefit for income taxes
    
    
    (303
    )
    
    
    4,749
    
    
    
    (12,691
    )Net (loss) income
    
    $
    (239,561
    )
    
    
    (8,939
    )
    
    
    22,236
 37. Subsequent Event
 Acquisition of Common Stock by Levitt
  255




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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   Managements Report on Internal Control over Financial Reporting
 Internal Control  Integrated Framework
 256




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##### Table of Contents



Changes in Internal Control Over Financial Reporting
  /s/ Alan B. LevanAlan B. LevanChief Executive OfficerMarch 17, 2008/s/ John K. GrelleJohn K. GrelleActing Chief Financial OfficerMarch 17, 2008/s/ Maria R. SchekerMaria R. SchekerChief Accounting OfficerMarch 17, 2008 257




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##### Table of Contents



ITEM 9B. OTHER INFORMATION
  
 PART III
  258




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##### Table of Contents



PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 (a)
    
    Documents Filed as Part of this Report:
 (1)
    
    Financial StatementsThe following consolidated financial statements of BFC Financial Corporation and its
subsidiaries are included herein under Part II, Item 8 of this Report.
 Report of Independent Registered Certified Public Accounting Firm of
PricewaterhouseCoopers LLP dated March 17, 2008.Consolidated Statements of Financial Condition as of December 31,
2007 and 2006.Consolidated Statements of Operations for each of the years in the
three year period ended December 31, 2007.Consolidated Statements of Comprehensive Income (Loss) for each of
the years in the three year period ended December 31, 2007.Consolidated Statements of Shareholders Equity for each of the years
in the three year period ended December 31, 2007.Consolidated Statements of Cash Flows for each of the years in the
three year period ended December 31, 2007.Notes to Consolidated Financial Statements
 (2)
    
    Financial Statement SchedulesAll schedules are omitted as the required information is either not applicable or
presented in the financial statements or related notes.
 259




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##### Table of Contents



(3)
    
    ExhibitsThe following exhibits are either filed as a part of or furnished with this report or are
incorporated herein by reference to documents previously filed as indicated below:
 Exhibit Number
    
    Description
    
    Reference3.1
    
    Articles of Incorporation, as amended and restated
    
    Exhibit 3.1 of
Registrants Registration
Statement on Form 8-A
filed October 16, 19973.2
    
    Amendment to Articles of Incorporation, as
amended and restated
    
    Exhibit 4 of Registrants
Current Report on Form
8-K filed June 27, 2002
and Appendix A of
Registrants Schedule 14C
filed January 18, 20053.3
    
    Amended and Restated By-laws, as Amended
    
    Filed with this Report10.1
    
    BFC Financial Corporation
2005 Stock Incentive Plan
    
    Appendix A to the
Registrants Definitive
Proxy Statement filed
April 18, 200510.2
    
    Executive Services Agreement by and among BFC
Financial Corporation and Tatum, LLC, dated as of
December 5, 2007, relating to the employment of
John K. Grelle
    
    Filed with this Report12.1
    
    Ratio of earnings to fixed charges
    
    Filed with this Report14.1
    
    Code of Business Conduct and Ethics
    
    Filed with this Report21.1
    
    Subsidiaries of the registrant
    
    Filed with this Report23.1
    
    Consent of PricewaterhouseCoopers LLP
    
    Filed with this Report23.2
    
    Consent of Ernst & Young LLP
    
    Filed with this Report31.1
    
    Certification of Chief Executive Officer pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002
    
    Filed with this Report31.2
    
    Certification of Acting Chief Financial Officer
pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002
    
    Filed with this Report31.3
    
    Certification of Chief Accounting Officer
pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002
    
    Filed with this Report32.1
    
    Certification of Chief Executive Officer pursuant
to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
    
    Furnished with this Report32.2
    
    Certification of Acting Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002
    
    Furnished with this Report32.3
    
    Certification of Chief Accounting Officer
pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002
    
    Furnished with this Report99.1
    
    Audited financial statements of Bluegreen
Corporation for the three years ended December
31, 2007
    
    Filed with this Report
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##### Table of Contents



SIGNATURES
  BFC FINANCIAL CORPORATIONMarch 17, 2008
    By:
    /s/ Alan B. LevanAlan B. Levan, Chairman of the Board,President and Chief Executive Officer  Signature
    
    Title
    
    Date/s/ Alan B. Levan
    
    Chairman of the Board, President and
Chief Executive
Officer
    
    March 17, 2008Alan B. Levan/s/ John E. Abdo
    
    Vice Chairman of the Board
    
    March 17, 2008John E. Abdo/s/ John K. Grelle
    
    Acting Chief Financial Officer
    
    March 17, 2008John K. Grelle/s/ Maria R. Scheker
    
    Chief Accounting Officer
    
    March 17, 2008Maria R. Scheker/s/ D. Keith Cobb
    
    Director
    
    March 17, 2008D. Keith Cobb/s/ Earl Pertnoy
    
    Director
    
    March 17, 2008Earl Pertnoy/s/ Oscar J. Holzmann
    
    Director
    
    March 17, 2008Oscar J. Holzmann/s/ Neil A. Sterling
    
    Director
    
    March 17, 2008Neil A. Sterling
 261