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SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-K

[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Year Ended December 31, 2003

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission File Number34-027228

BankAtlantic Bancorp, Inc.

(Exact name of registrant as specified in its Charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Florida                                                        |  | 65-0507804                          
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer
Identification No.)
|                                                               |  |                                     
|1750 East Sunrise Boulevard                                    |  |                                     
|Ft. Lauderdale, Florida                                        |  | 33304                               
|(Address of principal executive offices)                       |  | (Zip Code)                          

(954) 760-5000
(Registrants telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

Name of Each Exchange on Which Registered




New York Stock Exchange


Title of Each Class




Class A Common Stock, Par Value $0.01 Per Share


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

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

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). YES [X] NO [  ]

The aggregate market value of the voting common equity held by
non-affiliates was $530 million computed by reference to the closing price of
the Registrants Class A Common Stock on June 30, 2003.

The number of shares of Registrants Class A Common Stock outstanding on
February 5, 2004 was 54,416,523. The number of shares of Registrants Class B
Common Stock outstanding on February 5, 2004 was 4,876,124.

Portions of the 2003 Annual Report to Stockholders of the Registrant are
incorporated in Parts I, II and IV of this report. Portions of the Proxy
Statement of the Registrant relating to the Annual Meeting of shareholders are
incorporated in Part III of this report.





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TABLE OF CONTENTS



|                                                   |                                                                                               |                                                                          |  |  |  |  |  | 
|-------------------------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------ |  |  |  |  |  | 
|PART I                                            
|                                                   | ITEM I. BUSINESS                                                                             
|                                                   | ITEM 2. PROPERTIES                                                                           
|                                                   | ITEM 3. LEGAL PROCEEDINGS                                                                    
|                                                   | ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                  
|PART II                                           
|                                                   | ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS                
|                                                   | ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA                                                 
|                                                   | ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
|                                                   | ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                          
|                                                   | ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                          
|                                                   |                                                                                               | CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION                          
|                                                   |                                                                                               | CONSOLIDATED STATEMENTS OF OPERATIONS                                   
|                                                   |                                                                                               | CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
|                                                   |                                                                                               | CONSOLIDATED STATEMENTS OF CASH FLOWS                                   
|                                                   |                                                                                               | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                              
|                                                   | ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 
|                                                   | ITEM 9A. CONTROLS AND PROCEDURES                                                             
|PART III                                          
|PART IV                                           
|                                                   | ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K                     
|SIGNATURES                                        
|Amended and Restated Bylaws                       
|First Modification of Loan Agreement dated 2/23/04
|Ratio of Earnings to Fixed Charges                
|Subsidiaries of the Registrant                    
|Consent of PricewaterhouseCoopers LLP             
|Consent of KPMG LLP                               
|Sec. 302 Certification of Chief Financial Officer 
|Sec. 302 Certification of Chief Executive Officer 
|Sec. 906 Certification of Chief Executive Officer 
|Sec. 906 Certification of Chief Financial Officer 



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PART I




ITEM I. BUSINESS

Except for historical information contained herein, the matters discussed
in this document contain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the Securities Act),
and Section 21E of the Securities Exchange Act of 1934, as amended (the
Exchange Act), that involve substantial risks and uncertainties. When used
in this document and in any documents incorporated by reference herein, the
words anticipate, believe, estimate, may, intend, expect and
similar expressions identify certain of such forward-looking statements.
Actual results, performance, or achievements could differ materially from
those contemplated, expressed, or implied by the forward-looking statements
contained herein. These forward-looking statements are based largely on the
expectations of BankAtlantic Bancorp, Inc. (the Company) and are subject to
a number of risks and uncertainties that are subject to change based on
factors which are, in many instances, beyond the Companys control. These
include, but are not limited to, risks and uncertainties associated with: the
impact of economic, competitive and other factors affecting the Company and
its operations, markets, products and services; credit risks and loan losses,
and the related sufficiency of the allowance for loan losses; changes in
interest rates and the effects of, and changes in, trade, monetary and fiscal
policies and laws; adverse conditions in the stock market, the public debt
market and other capital markets and the impact of such conditions on our
activities and the value of our assets; BankAtlantics seven-day banking
initiative and other growth initiatives not being successful or producing
results which do not justify their costs; the impact of periodic testing of
goodwill and other intangible assets for impairment; and achieving the
benefits of the prepayment of the Federal Home Loan Bank advances. Further,
this document contains forward-looking statements with respect to Ryan Beck &
Co., which are subject to a number of risks and uncertainties including but
not limited to the risks and uncertainties associated with its operations,
products and services, changes in economic or regulatory policies, the
volatility of the stock market and fixed income markets, as well as its
revenue mix, the success of new lines of business, uncertainties associated
with the Gruntal litigation, and additional risks and uncertainties that are
subject to change and may be outside of Ryan Becks control. In addition to
the risks and factors identified above, reference is also made to other risks
and factors detailed in reports filed by the Company with the Securities and
Exchange Commission. The Company cautions that the foregoing factors are not
exclusive.

The Company

We are a Florida-based financial services holding company and own
BankAtlantic, a federal savings bank, and RB Holdings, Inc., the parent
company of Ryan Beck & Co. Through these subsidiaries, we provide a full line
of products and services encompassing consumer and commercial banking,
brokerage services and investment banking. The Companys Internet website
address is www.bankatlantic.com. The Companys annual report on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments
to those reports are available free of charge through its website, as soon as
reasonably practicable after such material is electronically filed with, or
furnished to, the SEC. The Companys Internet website and the information
contained therein or connected thereto are not incorporated into this Annual
Report on Form 10-K.

As of December 31, 2003, we had total consolidated assets of
approximately $4.8 billion, deposits of approximately $3.1 billion and
stockholders equity of approximately $413 million. On December 31, 2003, the
Company completed the spin-off of its wholly owned real estate development
subsidiary, Levitt Corporation. At the date of the spin-off, Levitt
Corporation had approximately $393 million in assets and $126 million in
consolidated stockholders equity.

BankAtlantic, a federally-chartered, federally-insured savings bank
organized in 1952, is one of the largest financial institutions headquartered
in Florida and provides traditional retail banking services and a wide range
of commercial banking products and related financial services through 73
branch offices located primarily in Miami-Dade, Broward, Palm Beach and
Hillsborough Counties, in the State of Florida. BankAtlantic currently has
over 225,000 customers and 500,000 accounts. BankAtlantics primary
activities include:



| |  |  | attracting checking and savings deposits from individuals and business customers,             
| | - |  | ----------------------------------------------------------------------------------------------
|
| |  |  | originating commercial real estate and business loans, and consumer and small business loans, 
|
| |  |  | purchasing wholesale residential loans from third parties, and                                
|
| |  |  | making other investments in mortgage-backed securities, tax certificates and other securities.

BankAtlantic is a community-oriented bank which is engaged in commercial
and consumer banking. Its operations

2



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are focused primarily on retail
deposit-taking, commercial lending and commercial real estate lending.
BankAtlantics
primary source of revenue is interest income from its lending activities. It
also receives revenue from interest and dividends on its investment
securities. BankAtlantics primary sources of funds are deposits, principal
and interest payments and principal prepayments on loans and investment
securities, interest and dividends from its investment securities and
borrowings in the form of FHLB Advances. BankAtlantic is regulated and
examined by the Office of Thrift Supervision and the Federal Deposit Insurance
Corporation.

Ryan Beck, headquartered in Livingston, New Jersey, is a full-service
broker dealer engaged in underwriting, market making, and distribution and
trading of equity and fixed income securities. The firm also provides general
securities brokerage services, including financial planning for the individual
investor and consulting and financial advisory services to financial
institutions and middle market companies. Ryan Beck also provides equity
research in the financial institutions, healthcare, and consumer products
sectors. Currently, Ryan Beck has approximately 500 financial consultants
located in 34 offices nationwide.

Description of Business

Through our direct and indirect subsidiaries, we provide a full line of
products and services encompassing consumer and commercial banking, brokerage
and investment banking. We report our results of operations through five (5)
business segments. Our banking operations are conducted by BankAtlantic
through our Commercial Banking, Community Banking and Bank Investments
segments. Our brokerage and investment banking operations are conducted
through Ryan Beck and reported as our Ryan Beck segment. Our results from
capital financing and equity investments are conducted directly by us and
reported as the Parent Company segment.

Banking Operations

BankAtlantics business is primarily focused in southeast Florida and the
Tampa Bay area. Our banking operations are concentrated in a network of 73
branches located primarily in Miami-Dade, Broward, Palm Beach and Hillsborough
Counties, which include the cities of Miami, Ft. Lauderdale, West Palm Beach
and Tampa, respectively. These counties are the four most populous counties
in Florida, with a combined population of more than 6.0 million in 2000.



| |  | The Bank intends to focus on the following key areas:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Continuing the Floridas Most Convenient Bank initiative. BankAtlantic
began its Floridas Most Convenient Bank initiative in 2002. This
initiative, which includes offering free checking, seven-day branch
banking, extended lobby hours, a 24-hour customer service center and new
products and customer service initiatives is an integral part of
BankAtlantics strategy to position itself as a customer-oriented bank
and increase its low cost deposit accounts. We have instituted marketing
programs in the branches which include sales training programs, outbound
telemarketing requirements and incentive compensation programs enabling
our branch banking personnel to earn additional income for production of
profitable business.
|
| |  | Increasing low cost deposits. From December 31, 2001 to December 31,
2003, our low cost deposits, comprised of our demand deposit, NOW
checking accounts and savings accounts, increased 130% percent from
approximately $600 million to approximately $1.4 billion. These low cost
deposits represented 45% of our total deposits at December 31, 2003,
compared to 26% of our total deposits at December 31, 2001. We intend to
continue to increase our low cost deposits through our strong sales and
marketing efforts, new products, our commitment to customer service and
our Floridas Most Convenient Bank initiative.                                                                                                                       
|
| |  | Growing our loan portfolio and concentrating on our core competencies.
We intend to grow our core commercial and retail banking business with an
emphasis on commercial real estate loans, conforming one to four family
residential loans, and small business and consumer loans. We attribute
our success in these lending areas to several key factors, including
disciplined underwriting and significant expertise in our markets.
Further, we intend to limit activities in non-core lending areas, such as
credit card, international, syndication and indirect lending.                                                                                                                                                                          
|
| |  | Expanding our branch network.We intend to grow our branch network both
internally through de novo expansion and, to the extent available,
externally through acquisitions. We intend to acquire branches through
acquisition where attractive opportunities are presented which are
consistent with our growth strategy. We generally seek to expand into
relatively faster growing and higher deposit level markets within our
market area. For the most                                                                                                                                                                                                                                                                                                

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| |  | part, we intend to emphasize our existing
market area for both de novo expansion and growth through acquisitions,
but we may also evaluate expansion into new markets in Florida, including
Orlando, Jacksonville, Naples and Sarasota.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Maintaining our strong credit culture. We believe that continued growth
and profitability will depend on maintaining a strong credit culture. We
have put in place stringent underwriting standards and have developed and
instituted credit training programs for our banking officers which
emphasize underwriting and credit analysis. We have also developed
systems and programs which we believe enable us to offer sophisticated
products and services without exposing the Bank to unnecessary credit
risks. Non-performing assets, net of reserves, declined to $12.8 million at December 31,
2003 from $28.6 million at December 31, 2002, and the ratio of
non-performing assets to total loans, tax certificates and real estate
owned improved from 0.79% at December 31, 2002 to 0.33% at December 31,
2003.

Commercial Banking

Our Commercial Banking segment offers a wide range of commercial lending
products. These products include commercial real estate construction,
residential development and land acquisition loans and commercial business
loans. This segment also provides letters of credit and standby letters of
credit to corporate customers.

Commercial Real Estate Lending:We provide commercial real estate loans
for the acquisition, development and construction of various property types,
as well as the refinancing and acquisition of existing income-producing
properties. These loans are generally secured by property primarily located
within Florida. Commercial real estate loans typically are based on a maximum
of 80% of the collaterals appraised value and, for term loans, in most cases,
require the borrower to maintain escrow accounts for real estate taxes and
insurance. Prior to making a loan, we consider the value of the collateral,
the equity being contributed, the quality of the loan, the credit worthiness
of the borrowers and guarantors, the location of the real estate, the
projected income stream of the property, the reputation and quality of
management constructing or administering the property and the interest rate
and fees. We generally require that one or more of the principals of the
borrowing entity guarantee these loans. Most of these loans have variable
interest rates and are indexed to either the prime or LIBOR rates.

Additionally, we purchase participations in commercial real estate loans
that are originated by another financial institution, typically known as a
lead bank. These transactions are underwritten as if we were originating
the loan, applying all normal underwriting standards. Typically, the lead
bank receives a servicing fee for administering the loan, which reduces the
prorated fee given to the participants. In most cases, the full rate on the
loan is passed through to the participants. The lead bank is responsible for
the administration of the loan; however, we receive periodic reports on the
progress of the project for which the loan was made. Major decisions
regarding the loan are made by the participants on either a majority or
unanimous basis. As a result, the lead bank can not significantly modify the
loan without either majority or unanimous consent of the participants.

We also often sell participations in loans that we originate to other
banks. This reduces our exposure on the project and may be required in order
to stay within the regulatory loans to one borrower limitations. We sell
participations in the same manner as participations are sold to us. We
generally retain the servicing fee and are responsible for administration of
the loan.

Commercial
Business Lending:We make commercial business loans generally
to medium size companies located throughout Florida, but primarily in
Miami-Dade, Broward, Palm Beach and Hillsborough Counties and the Tampa Bay
area. We make both secured and unsecured loans, although the majority of
these loans are secured. Commercial business loans are typically secured by
the accounts receivable, inventory, equipment, real estate, and/or general
corporate assets of the borrowers. Commercial business loans generally have
variable interest rates that are prime or LIBOR-based. These loans typically
are originated for terms ranging from one to five years.

Standby
Letters of Credit and Commitments:Standby letters of credit are
conditional commitments issued by us to guarantee the performance of a
customer to a third party. The credit risk involved in issuing letters of
credit is the same as extending loans to customers. We may hold certificates
of deposit, liens on corporate assets and liens on residential and commercial
property as collateral for letters of credit. We issue commitments for
commercial real estate and commercial business loans.

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Community Banking

Our Community Banking segment offers a diverse range of loan products for
individuals and small businesses.

These products include home equity lines of credit, automobile loans and
overdraft protection on deposit accounts. Additionally, business bankers and
branch market managers within our Community Banking segment originate small
business loans.

Consumer Lending:Consumer loans are primarily loans to individuals
originated through our branch network and sales force. The majority of our
originations are home equity lines of credit secured by a second mortgage on
the primary residence of the borrower. We do not currently use brokers to
originate loans. In the past, we originated automobile loans through
automobile dealers, but this activity was discontinued during the fourth
quarter of 1998. Home equity lines of credit have prime-based interest rates
and generally mature in 15 years. All other consumer loans generally have
fixed interest rates with terms ranging from one to five years.

Small Business Lending:We make small business loans to companies
located primarily in South Florida, along the Treasure Coast of East Florida
and in the Tampa Bay area. Small business loans are primarily originated on a
secured basis and do not exceed $1.0 million for non-real estate secured loans
and $1.5 million for real estate secured loans. These loans are originated
with maturities primarily ranging from one to three years or upon demand by
us; however, loans collateralized by real estate could have terms of up to
fifteen years. Lines of credit extended to small businesses are due upon
demand by us. Small business loans typically have either fixed or variable
prime-based interest rates.

Small business loans generally have a higher degree of risk than other
loans in our portfolio because they are more likely to be adversely impacted
by unfavorable economic conditions. In addition, these loans typically are
highly dependent on the success of the business and the credit worthiness of
the principals.

ATM Network Operations: Our ATM network operations are located in retail
outlets, cruise ships, Native American reservation gaming facilities and
BankAtlantic branch locations.

Retail Brokerage Services:During 2002, through our wholly-owned
subsidiary, BA Financial Services, LLC, we began offering retail brokerage
services to our customers through our branch network. These products and
services include mutual funds, bonds, stocks and variable annuities.

Bank Investments

Our Bank Investments segment includes the management of our securities
portfolio and our investments in tax certificates, as well as our wholesale
and retail residential lending activities and wholesale borrowing activities.

Residential Loans:We purchase residential loans in the secondary
markets, and in 2003, we began a program in which we originate residential
loans to customers that are pre-sold to a correspondent. These loans are
secured by property located throughout the United States. When we purchase
residential loans, we review the sellers underwriting policies and, for
certain individual loans, perform additional credit analysis. Residential
loans are typically purchased in bulk and are generally non-conforming loans
due to the size and characteristics of the individual loans. We set guidelines
for loan purchases relating to loan amount, type of property, state of
residence, loan-to-value ratios, and the borrowers sources of funds,
appraisal, and loan documentation. We also originate certain residential
loans, which are primarily made to low to moderate income borrowers in order
to comply with standards under the Community Reinvestment Act. The
underwriting of these loans generally follows government agency guidelines
with independent appraisers generally performing on-site inspections and
valuations of the collateral.

Securities Available for Sale:Securities available for sale consist
principally of investments in obligations of the U.S. government or its
agencies. These consist of mortgage-backed securities and real estate
mortgage investment conduits, or REMICs. The mortgage-backed securities and
REMICs as of December 31, 2003 consisted of approximately $31 million of fixed
rate securities and approximately $308 million of adjustable rate securities.
Our securities portfolio serves as a source of liquidity while at the same
time providing a means to moderate the effects of interest rate changes. The
decision to purchase and sell securities is based upon a current assessment of
the economy, the interest rate environment and our liquidity requirements.
The total value of our securities available for sale as of December 31, 2003
was approximately $359 million.

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Investment Securities and Tax Certificates:Investment securities held
to maturity consisted of tax certificates at December 31, 2003. Tax
certificates are evidences of tax obligations that are sold through auctions
or bulk sales by various state taxing authorities on an annual basis. The tax
obligation arises when the property owner fails to timely pay the real estate
taxes on the property. Tax certificates represent a priority lien against the
real property for the delinquent real estate taxes. Interest accrues at the
rate established at the auction or by statute. The minimum repayment, in
order to satisfy the lien, is the certificate amount plus the interest accrued
through the redemption date and applicable penalties, fees and costs. Tax
certificates have no payment schedule or stated maturity. If the certificate
holder does not file for the deed within established time frames, the
certificate may become null and void. Our experience with this type of
investment has been favorable as rates earned are generally higher than many
alternative investments and substantial repayments generally occur over a
two-year period.

The composition, yields and maturities of securities available for sale
and investment securities and tax certificates were as follows (dollars in
thousands):

|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|------------------------------------------- |  | -------- | ----- | ------------ |  | ---------- | ------- | --------- |  | ----- | --------- | --------- |  | ------- | ------ | -------- |  | - | --------- | - |  |  | ---- | -
|                                            |  | U.S.     |       |              |  |            |         |           |  |       |           | Corporate |  |         |        |          |  |   |           |  
|                                            |  | Treasury |       |              |  |            |         | Mortgage- |  | Bond  |           |           |  |         |        | Weighted
|                                            |  | and      |       | Tax          |  | Backed     |         | and       |  |       |           |           |  | Average
|                                            |  | Agencies |       | Certificates |  | Securities |         | Other     |  | Total |           | Yield    
|                                            |  |          |       |              |  |            |         |           |  |       |           |          
|December 31, 2003                           |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Maturity: (1)                               |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|One year or less                            |  | $        |      |              |  | $          | 136,514 |           |  | $     | 18        |           |  | $       | 25     |          |  | $ | 136,557   |   |  |  | 9.34 | %
|After one through five years                |  |          |      |              |  |            | 54,392  |           |  |       | 99        |           |  |         | 560    |          |  |   | 55,051    |   |  |  | 9.29 |  
|After five through ten years                |  |          |      |              |  |            |        |           |  |       | 557       |           |  |         |       |          |  |   | 557       |   |  |  | 5.46 |  
|After ten years                             |  |          |      |              |  |            |        |           |  |       | 338,077   |           |  |         |       |          |  |   | 338,077   |   |  |  | 3.96 |  
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Fair values (2)                             |  | $        |      |              |  | $          | 190,906 |           |  | $     | 338,751   |           |  | $       | 585    |          |  | $ | 530,242   |   |  |  | 5.90 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Amortized cost (2)                          |  | $        |      |              |  | $          | 190,906 |           |  | $     | 332,898   |           |  | $       | 585    |          |  | $ | 524,389   |   |  |  | 6.40 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Weighted average yield based
on fair values |  |          |      | %            |  |            | 9.34    | %         |  |       | 3.96      | %         |  |         | 4.99   | %        |  |   | 5.90      | % |  |  |      |  
|Weighted average maturity
(yrs)             |  |          |      |              |  |            | 2.0     |           |  |       | 27.43     |           |  |         | 2.94   |          |  |   | 18.14     |   |  |  |      |  
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|December 31, 2002                           |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Fair values (2)(3)                          |  | $        |      |              |  | $          | 194,074 |           |  | $     | 706,050   |           |  | $       | 15,262 |          |  | $ | 915,386   |   |  |  | 6.26 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Amortized cost (2)(3)                       |  | $        |      |              |  | $          | 194,074 |           |  | $     | 684,085   |           |  | $       | 14,794 |          |  | $ | 892,953   |   |  |  | 6.34 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|December 31, 2001                           |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Fair values (2)                             |  | $        | 5,819 |              |  |            | 144,077 |           |  | $     | 1,084,776 |           |  | $       | 262    |          |  | $ | 1,234,934 |   |  |  | 6.37 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  
|Amortized cost (2)                          |  | $        | 5,819 |              |  | $          | 144,077 |           |  | $     | 1,063,949 |           |  | $       | 250    |          |  | $ | 1,214,095 |   |  |  | 6.59 | %
|                                            |  |          |       |              |  |            |         |           |  |       |           |           |  |         |        |          |  |   |           |   |  |  |      |  



|(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 securities held by the parent company and Ryan Beck with a cost
of $17.6 million, $4.8 million, $33.4 million and a fair value of $20.9
million, $5.2 million, $43.4 million at December 31, 2003, 2002 and
2001, respectively, were excluded from the above table.
|   
|(3) |  | Includes $14.8 million of collateralized mortgage obligations secured by
non-residential real estate associated with the commercial banking
segment at December 31, 2002.                                                                                                 

6



---



##### Table of Contents



A summary of the amortized cost and gross unrealized appreciation or
depreciation of estimated fair value of tax certificates and held to maturity
and available for sale securities follows (in thousands):

|                                               |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |         |         | 
|---------------------------------------------- | ------------------ | ----- | - | ----------------- | ------- | ------------ | - | ------------ | ----- | ---------- | - | --- | --- |  | - | ------- | ------- | 
|                                               |                    |       |   | December 31, 2003
|                                               |                    |       |   |                  
|                                               |                    |       |   |                   |         |              |   | Gross        |       | Gross      |   |     |     | 
|                                               |                    |       |   | Amortized         |         | Unrealized   |   | Unrealized   |       | Estimated 
|                                               |                    |       |   | Cost              |         | Appreciation |   | Depreciation |       | Fair Value
|                                               |                    |       |   |                   |         |              |   |              |       |           
|Tax certificates and investment
securities:    |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |        
|                                               | Cost equals market |       | $ | 192,706           |         |              | $ |             |       |            | $ |    |     |  | $ | 192,706 |        
|Investment securities available for sale:      |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |        
|                                               | Market over cost   |       |   | 16,360            |         |              |   | 3,400        |       |            |   |    |     |  |   | 19,760  |        
|Mortgage-backed securities available for
sale: |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |        
|                                               | Market over cost   |       |   | 257,865           |         |              |   | 6,382        |       |            |   |    |     |  |   | 264,247 |        
|                                               | Cost over market   |       |   | 75,033            |         |              |   |             |       |            |   | 529 |     |  |   | 74,504  |        
|                                               |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |         |        
|                                               |                    | Total |   | $                 | 541,964 |              |   | $            | 9,782 |            |   | $   | 529 |  |   | $       | 551,217 | 
|                                               |                    |       |   |                   |         |              |   |              |       |            |   |     |     |  |   |         |        

Underwriting and Credit Management for Bank Operations Segments

We evaluate a borrowers ability to make principal and interest payments
and the value of any collateral securing the underlying loan. Independent
appraisers generally perform on-site inspections and valuations of the
collateral for commercial real estate loans. All non-residential loans or
leases of $1.0 million to $5.0 million require Officers Loan Committee
approval and ratification by our Major Loan Committee. Residential loans over
$1.0 million require approval by the Officers Loan Committee and ratification
by the Major Loan Committee. Purchased residential loans in pools greater than
$50 million require Investment Committee approval. The Investment Committee
includes the Chief Executive Officer, Chief Financial Officer, Chief
Investment Officer and Chief Credit Officer. All loans over $5.0 million
require the approval of our Major Loan Committee. In addition to Executive and
Senior officers of BankAtlantic, the Major Loan Committee consists of the
Chief Executive Officer and the Vice-Chairman. The Officers Loan Committee
includes members of our executive management and senior officers.

For consumer and small business lending, credit-scoring systems are
utilized to assist in the assessment of the relative risks of new
underwritings and to provide standards for extensions of credit. Consumer and
small business portfolio credit risk is monitored by using statistical models
and regular reviews of actual payment experience in order to predict portfolio
behavior.

An independent credit review group conducts ongoing reviews of credit
activities and portfolios, reexamining, on a regular basis, risk assessments
for credit exposure and overall compliance with policy. This group meets
periodically with the Credit Policy Committee to provide an update on the
status of the various loan portfolios.

A separate Senior Loan Committee meets monthly to discuss problem or
potentially problem credits, to consider the present or alternative courses of
action with respect to such credits and to upgrade or downgrade the risk
grades of specific loans. The Senior Loan Committee includes the Chief Credit
Officer.

The Bank also has a Credit Policy Committee, which meets periodically to
consider possible lending opportunities and changes to the Banks credit
policies. In addition, the Credit Policy Committee reviews trends in the
various lending portfolios and the adequacy of the Banks allowance for loan
losses. The Credit Policy Committee includes the Chief Credit Officer and the
Executive Vice President of Commercial Lending.

Our loans and leases receivable portfolio totaled $3.7 billion, $3.4
billion, and $2.8 billion at December 31, 2003, 2002, and 2001, respectively.
Loans and leases receivable composition at the dates indicated was (in
thousands):

7



---



##### Table of Contents





|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |        | 
|--------------------------------------- | --------------------------- | - | ------------------ | --------- | ---- |  | ------ | ------ | --- |  | --------- | --------- | --- |  | ------ | ------ |  |  | --------- | --------- |  |  | ------ | ------ | 
|                                        |                             |   | As of December 31,
|                                        |                             |   |                   
|                                        |                             |   | 2003               |           | 2002 |  | 2001  
|                                        |                             |   |                    |           |      |  |       
|                                        |                             |   | Amount             |           | Pct  |  | Amount |        | Pct |  | Amount    |           | Pct
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |    
|Loans and Leases receivable:            |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Real estate loans:                      |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Residential real estate                 |                             | $ | 1,343,657          |           |      |  | 36.45  | %      |     |  | 1,378,041 |           |     |  | 40.85  |        |  |  | 1,111,775 |           |  |  | 40.07  |       
|Construction and development            |                             |   | 1,345,449          |           |      |  | 36.50  |        |     |  | 1,218,411 |           |     |  | 36.13  |        |  |  | 1,122,628 |           |  |  | 40.47  |       
|Commercial real estate                  |                             |   | 1,064,043          |           |      |  | 28.87  |        |     |  | 755,492   |           |     |  | 22.40  |        |  |  | 522,006   |           |  |  | 18.82  |       
|Small business - real estate            |                             |   | 110,745            |           |      |  | 3.00   |        |     |  | 98,494    |           |     |  | 2.92   |        |  |  | 43,196    |           |  |  | 1.56   |       
|Loans to Levitt Corporation             |                             |   | 18,118             |           |      |  | 0.49   |        |     |  |          |           |     |  |       |        |  |  |          |           |  |  |       |       
|Other loans:                            |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Loans to Levitt Corporation             |                             |   | 43,500             |           |      |  | 1.18   |        |     |  |          |           |     |  |       |        |  |  |          |           |  |  |       |       
|Second mortgage - direct                |                             |   | 333,655            |           |      |  | 9.05   |        |     |  | 261,579   |           |     |  | 7.75   |        |  |  | 166,531   |           |  |  | 6.00   |       
|Second mortgage - indirect              |                             |   | 1,105              |           |      |  | 0.03   |        |     |  | 1,713     |           |     |  | 0.05   |        |  |  | 2,159     |           |  |  | 0.08   |       
|Commercial business                     |                             |   | 91,491             |           |      |  | 2.48   |        |     |  | 82,174    |           |     |  | 2.44   |        |  |  | 76,146    |           |  |  | 2.74   |       
|Small business - non-mortgage           |                             |   | 58,574             |           |      |  | 1.59   |        |     |  | 62,599    |           |     |  | 1.86   |        |  |  | 59,041    |           |  |  | 2.13   |       
|Lease finance                           |                             |   | 14,442             |           |      |  | 0.39   |        |     |  | 31,279    |           |     |  | 0.93   |        |  |  | 54,969    |           |  |  | 1.98   |       
|Due from foreign banks                  |                             |   |                   |           |      |  |       |        |     |  |          |           |     |  |       |        |  |  | 1,420     |           |  |  | 0.05   |       
|Consumer - other direct                 |                             |   | 21,928             |           |      |  | 0.60   |        |     |  | 24,881    |           |     |  | 0.74   |        |  |  | 25,811    |           |  |  | 0.93   |       
|Consumer - other indirect               |                             |   | 1,297              |           |      |  | 0.04   |        |     |  | 6,392     |           |     |  | 0.19   |        |  |  | 23,241    |           |  |  | 0.84   |       
|Loans held for sale:                    |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Residential real estate                 |                             |   | 2,254              |           |      |  | 0.06   |        |     |  |          |           |     |  |       |        |  |  | 4,757     |           |  |  | 0.17   |       
|Syndication loans                       |                             |   | 9,114              |           |      |  | 0.25   |        |     |  | 14,499    |           |     |  | 0.43   |        |  |  | 40,774    |           |  |  | 1.47   |       
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|                                        | Total                       |   |                    | 4,459,372 |      |  |        | 120.98 |     |  |           | 3,935,554 |     |  |        | 116.69 |  |  |           | 3,254,454 |  |  |        | 117.31 | 
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Adjustments:                            |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Undisbursed portion of loans
in process |                             |   | 728,100            |           |      |  | 19.75  |        |     |  | 511,861   |           |     |  | 15.18  |        |  |  | 434,166   |           |  |  | 15.65  |       
|Unearned discounts(premiums)            |                             |   | (243               | )         |      |  | (0.01  | )      |     |  | 3,041     |           |     |  | 0.09   |        |  |  | 1,470     |           |  |  | 0.05   |       
|Allowance for loan losses               |                             |   | 45,595             |           |      |  | 1.24   |        |     |  | 48,022    |           |     |  | 1.42   |        |  |  | 44,585    |           |  |  | 1.61   |       
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|                                        | Total loans receivable,
net |   | $                  | 3,685,920 |      |  |        | 100.00 | %   |  |           | 3,372,630 |     |  |        | 100.00 |  |  |           | 2,774,233 |  |  |        | 100.00 | 
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       
|Bankers acceptances                    |                             | $ | 233                |           |      |  | 100.00 | %      |     |  |          |           |     |  | 100.00 |        |  |  | 5         |           |  |  | 100.00 |       
|                                        |                             |   |                    |           |      |  |        |        |     |  |           |           |     |  |        |        |  |  |           |           |  |  |        |       

[Additional columns below]

[Continued from above table, first column(s) repeated]

|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |        | 
|--------------------------------------- | --------------------------- |  | ------------------ | --------- | ---- |  | ------ | ------ | --- |  | --------- | --------- |  |  | ------ | ------ | 
|                                        |                             |  | As of December 31,
|                                        |                             |  |                   
|                                        |                             |  | 2000               |           | 1999
|                                        |                             |  |                    |           |     
|                                        |                             |  | Amount             |           | Pct  |  | Amount |        | Pct
|                                        |                             |  |                    |           |      |  |        |        |    
|Loans and Leases receivable:            |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Real estate loans:                      |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Residential real estate                 |                             |  | 1,316,062          |           |      |  | 46.14  |        |     |  | 1,188,092 |           |  |  | 44.39  |       
|Construction and development            |                             |  | 937,881            |           |      |  | 32.88  |        |     |  | 634,382   |           |  |  | 23.71  |       
|Commercial real estate                  |                             |  | 369,282            |           |      |  | 12.95  |        |     |  | 312,014   |           |  |  | 11.66  |       
|Small business - real estate            |                             |  | 28,285             |           |      |  | 0.99   |        |     |  | 22,241    |           |  |  | 0.83   |       
|Loans to Levitt Corporation             |                             |  |                   |           |      |  |       |        |     |  |          |           |  |  |       |       
|Other loans:                            |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Loans to Levitt Corporation             |                             |  |                   |           |      |  |       |        |     |  |          |           |  |  |       |       
|Second mortgage - direct                |                             |  | 124,859            |           |      |  | 4.38   |        |     |  | 85,936    |           |  |  | 3.21   |       
|Second mortgage - indirect              |                             |  | 4,020              |           |      |  | 0.14   |        |     |  | 5,325     |           |  |  | 0.20   |       
|Commercial business                     |                             |  | 86,194             |           |      |  | 3.02   |        |     |  | 188,040   |           |  |  | 7.03   |       
|Small business - non-mortgage           |                             |  | 69,325             |           |      |  | 2.43   |        |     |  | 93,442    |           |  |  | 3.49   |       
|Lease finance                           |                             |  | 75,918             |           |      |  | 2.66   |        |     |  | 43,436    |           |  |  | 1.62   |       
|Due from foreign banks                  |                             |  | 64,207             |           |      |  | 2.25   |        |     |  | 51,894    |           |  |  | 1.94   |       
|Consumer - other direct                 |                             |  | 33,036             |           |      |  | 1.16   |        |     |  | 35,508    |           |  |  | 1.33   |       
|Consumer - other indirect               |                             |  | 58,455             |           |      |  | 2.05   |        |     |  | 120,184   |           |  |  | 4.49   |       
|Loans held for sale:                    |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Residential real estate                 |                             |  |                   |           |      |  |       |        |     |  | 220,236   |           |  |  | 8.23   |       
|Syndication loans                       |                             |  | 80,016             |           |      |  | 2.80   |        |     |  |          |           |  |  |       |       
|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|                                        | Total                       |  |                    | 3,247,540 |      |  |        | 113.85 |     |  |           | 3,000,730 |  |  |        | 112.13 | 
|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Adjustments:                            |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Undisbursed portion of loans
in process |                             |  | 344,390            |           |      |  | 12.07  |        |     |  | 286,608   |           |  |  | 10.71  |       
|Unearned discounts(premiums)            |                             |  | 3,675              |           |      |  | 0.13   |        |     |  | (6,420    | )         |  |  | (0.24  | )     
|Allowance for loan losses               |                             |  | 47,000             |           |      |  | 1.65   |        |     |  | 44,450    |           |  |  | 1.66   |       
|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|                                        | Total loans receivable,
net |  |                    | 2,852,475 |      |  |        | 100.00 |     |  |           | 2,676,092 |  |  |        | 100.00 | 
|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       
|Bankers acceptances                    |                             |  | 1,329              |           |      |  | 100.00 |        |     |  | 13,616    |           |  |  | 100.00 |       
|                                        |                             |  |                    |           |      |  |        |        |     |  |           |           |  |  |        |       

Interest Expense and Overhead Allocations to Bank Operation Segments

Interest expense and overhead for the bank operation segments represents
interest expense and certain revenue and expense items that are allocated to
each such segment by its pro-rata average assets. Items included in interest
expense and overhead include (1) interest expense on all interest-bearing
banking liabilities and (2) an allocation of back office and corporate
headquarters operating expenses, net of deposit account fee income.

Deposits.Our deposits include commercial demand deposit accounts,
retail
demand deposit accounts, savings accounts, money market accounts, certificates
of deposit, various NOW accounts, IRA and Keogh retirement accounts, brokered
certificates of deposit and public funds. We solicit deposits in our market
areas through advertising and relationship banking activities primarily
conducted through our sales force and branch network. During the year ended
December 31, 2003, products such as Totally Free Checking and Totally Free
Savings were the lead programs of our marketing strategy to obtain new
customers.

We have several relationships, including one with Ryan Beck, for the
placement of brokered certificates of deposit. These relationships are
considered an alternative source of funding.

Federal Home Loan Bank (FHLB) Advances.We are a member
of the FHLB and
can obtain secured advances from the FHLB of Atlanta. Our advances are
collateralized by a security lien against our residential loans, certain
commercial loans and our securities. In addition, we must maintain certain
levels of FHLB stock for outstanding advances. We primarily use FHLB advances
to fund our purchased residential loan portfolio.

8



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##### Table of Contents



Securities Sold Under Agreements To Repurchase And Other Short-Term
Borrowings.Short-term borrowings consist of securities sold under agreements
to repurchase and federal funds borrowings. Securities sold under agreements
to repurchase include a sale of a portion of our 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. We issue
repurchase agreements to institutions and to our customers. These transactions
are collateralized by securities in our investment portfolio but are not
insured by the FDIC. Federal funds borrowings occur under established
facilities with various federally-insured banking institutions to purchase
federal funds. We use these facilities on an overnight basis to assist in
managing our cash flow requirements. These federal fund lines are subject to
periodic review, may be terminated at any time by the issuer institution and
are unsecured. We also have a facility with the Federal Reserve Bank of
Atlanta for secured advances. These advances are collateralized by a security
lien against our consumer loans.

Banking Industry Risk

Banking is a business that depends on interest rate differentials. In
general, the net interest income, which is the difference between the interest
paid by a bank on its deposits and its other borrowings and the interest
received by a bank on its loan and securities holdings, constitutes a major
portion of its earnings.

Changes in interest rates can have differing effects on BankAtlantics net
interest income and the cost of purchasing residential mortgage loans in the
secondary market. In particular, changes in market interest rates, changes in
the relationships between short-term and long-term market interest rates or
changes in the relationships between different interest rate indices can affect
the interest rates received on interest-earning assets differently than the
interest rates paid on interest-bearing liabilities. This difference could
result in an increase in interest expense relative to interest income and
therefore reduce BankAtlantics net interest income.

Loan prepayment decisions are also affected by interest rates. Loan
prepayments generally accelerate as interest rates fall. Prepayments in a
declining interest rate environment reduce BankAtlantics net interest income
and adversely affect its earnings because:



| |  |  | BankAtlantic often pays premiums to acquire loans and
mortgage-backed securities, which it amortizes over the life of
the asset. If loans or securities are prepaid, the unamortized
premium is charged off; and
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The yield BankAtlantic earns on the reinvestment of funds
that it receives on the prepayment of loans and securities is
generally less than the yield that it earned on the prepaid
assets.                     

Thus, the earnings and growth of BankAtlantic are affected by interest
rates, which are subject to the influence of economic conditions generally,
both domestic and foreign, and also to the monetary and fiscal policies of the
United States and its agencies, particularly the Federal Reserve Board. The
nature and timing of any changes in such policies or general economic
conditions and their effect on BankAtlantic cannot be controlled and are
extremely difficult to predict.

Additionally, we are exposed to the risk that borrowers or counter-parties
may default on their obligations to us. Credit risk arises through the
extension of loans and leases, certain securities, letters of credit, financial
guarantees and through counter-party exposure on trading and wholesale loan
transactions. In an attempt to manage this risk, we establish policies and
procedures to manage both on and off-balance sheet (primarily loan commitments)
credit risk and we monitor the application of these policies and procedures
throughout the Company. Further, the real estate collateralizing our
commercial real estate and construction and development loans is concentrated
in Broward, Miami-Dade, Palm Beach and Hillsborough Counties in Florida and, as
such, the credit quality of these loans could be impacted by declines in the
economy generally or in the real estate markets in these areas.

We attempt to manage credit exposure to individual borrowers and
counter-parties on an aggregate basis including loans, securities, letters of
credit, derivatives and unfunded commitments. Credit personnel analyze the
creditworthiness of individual borrowers or counter-parties, and limits are
established for the total credit exposure to any one borrower or counter-party.
Credit limits are subject to varying levels of approval by senior line and
credit risk management.

The aftermath of the events of September 11, 2001, the war with Iraq and
the United States continued war on terrorism and other factors may have an
unpredictable effect on economic conditions in general and in our primary
market areas. Depending upon the condition of the local and national economy,
we could experience a decline in credit quality that may result in loan losses
and a material adverse effect on our earnings.

9



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##### Table of Contents



Ryan Beck

Ryan Beck, founded in 1946 and acquired by us in 1998, is a full service
broker-dealer headquartered in Livingston, New Jersey. Ryan Beck operates on
a nationwide basis through a network of 34 offices, with approximately 500
financial consultants and over $17 billion of customer assets gathered. Ryan
Beck is primarily engaged in underwriting, merger advisory assistance, market
making, distribution and trading of equity and fixed income securities,
securities brokerage and equity research. Ryan Beck has primarily focused its
efforts on three industries: financial institutions, healthcare, and consumer
products. Unlike many of its peers, Ryan Beck does not offer any proprietary
fund or investment products, but instead recommends third parties products
that are highly rated in their respective sectors, an approach which Ryan Beck
believes provides a more positive, less biased approach to investment
counseling.

Ryan Beck intends to focus on the following key areas:



| |  |  | Continuing growth and diversification. Ryan Becks strategy
has been to diversify its operations through the addition of
research coverage and market making in the technology, consumer
products and health care industries.                                                                                                                                                                                                                                                                        
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Increasing the productivity of new employees.The Gruntal
transaction, in April, 2002 enabled Ryan Beck to significantly
increase its distribution capabilities by adding over 400 financial
consultants to Ryan Becks then existing 80 financial consultants
and by increasing the number of customer accounts from 27,000
accounts with $4 billion of customer assets gathered at December 31,
2001 to over 150,000 accounts with over $17 billion of customer
assets gathered at December 31, 2003

As a registered broker-dealer with the SEC, Ryan Beck operates on a
fully-disclosed basis through its clearing firm, Pershing LLC. Clients consist
primarily of:



| |  |  | high net worth individuals,                                                                                                                                                              
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |  | financial institutions,                                                                                                                                                                  
| |  |  | institutional clients (including mutual funds, pension funds,
trust companies, insurance companies, LBO funds, private equity
sponsors, merchant banks and other long-term investors) and
| |  |  | to a lesser extent, insurance companies and specialty finance
companies.                                                                                                                 

Ryan Becks Investment Banking Group operates in three markets, Financial
Institutions, Middle Market and Municipal Finance. Ryan Becks Investment
Banking Group primarily focuses on financial institutions, managing
underwritten public offerings, serving as placement agent on institutional
private financings and as an advisor on merger and acquisitions.

Ryan Becks operations also include trading, institutional sales and
research. Trading makes markets in over 500 securities. The Trading
Department has continued to grow and gain expertise to support Ryan Becks
industry diversification. The Research Department consists of 11 publishing
analysts covering 138 companies in 4 industry sectors. Additionally, the
Research Department employs a Chief Market Strategist providing economic and
global market commentary. The Institutional Equity Sales Department brings
investment ideas and proprietary investment banking product to over 500
accounts across the United States.

Over the last several years, Ryan Beck has expanded significantly through
both acquisitions and internal growth. Ryan Beck is focused on enhancing both
the product offerings and services provided to all clients, whether
individual, institutional or corporate.

In April 2002, Ryan Beck acquired certain of the assets and assumed
certain of the liabilities of Gruntal & Co., LLC which significantly increased
the size of Ryan Beck. The long term success of this transaction will depend
upon Ryan Becks ability to integrate the acquired Gruntal operations and
retain its new employees. Although Ryan Beck assumed a $21 million deferred
compensation plan obligation for participating financial consultants, and Ryan
Beck put in place a length of service award and a retention award in forgivable
notes in the aggregate amounts of $900,000 and $11.0 million, respectively, for
certain financial consultants and key employees, the financial consultants and
other employees may choose not to remain with Ryan Beck.

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While Ryan Beck has been named as a defendant in a number of arbitration
claims based on allegations that it is a successor in interest to Gruntal,
Ryan Beck has to date been successful in defending these actions. While no
individual action is material, an adverse result in a number of actions in the
aggregate could be material. In October 2002, Gruntal,
which had agreed to indemnify Ryan Beck against certain types of
liabilities, filed for bankruptcy protection and accordingly indemnification
for these claims may not be available.

Brokerage Industry Risk

The securities business is, by its nature, subject to various risks,
particularly in volatile or illiquid markets, including the risk of losses
resulting from the underwriting or ownership of securities, customer fraud,
employee errors and misconduct, failures in connection with the processing of
securities transactions and litigation. Ryan Becks business and its
profitability are affected by many factors including:



| |  |  | The volatility and price levels of the securities markets,     
| | - |  | ---------------------------------------------------------------
|
| |  |  | The volume, size and timing of securities transactions,        
|
| |  |  | The demand for investment banking services,                    
|
| |  |  | The level and volatility of interest rates,                    
|
| |  |  | The availability of credit,                                    
|
| |  |  | Legislation affecting the business and financial communities,  
|
| |  |  | The economy in general and                                     
|
| |  |  | The volatility of equity and debt securities held in inventory.

Markets characterized by low trading volumes and depressed prices
generally result in reduced commissions and investment banking revenues as well
as losses from declines in the market value of securities positions. Moreover,
Ryan Beck is likely to be adversely affected by negative economic developments
in the mid-Atlantic region or the financial services industry in general.

The majority of Ryan Becks assets and liabilities are securities owned or
securities sold but not yet purchased. Securities owned and securities sold
but not yet purchased are associated with trading activities conducted both as
principal and as agent on behalf of individual and institutional investor
clients of Ryan Beck and are accounted for at fair value in our financial
statements. The fair value of these trading positions is generally based on
listed market prices. If listed market prices are not available or if
liquidating the positions would reasonably be expected to impact market prices,
fair value is determined based on other relevant factors, including dealer
price quotations, price quotations for similar instruments traded in different
markets or managements estimates of amounts to be realized on settlement. As
a consequence, volatility in either the stock or fixed-income markets could
result in adverse changes in our financial results. Trading transactions as
principal involve making markets in securities, which are held in inventory to
facilitate sales to and purchases from customers. As a result of this
activity, Ryan Beck may be required to hold securities during declining
markets.

Parent Company

The Parent Company operations include the financing of the capital needs
of its subsidiaries. We obtain our funds from dividends from BankAtlantic and
from issuances of equity and debt securities, as well as borrowings from
unrelated financial institutions. We provide these funds to our subsidiaries
for the financing of acquisitions and for other general corporate purposes.
The largest expense of the Company is interest expense on debt, and depending
on interest rates, this expense could increase or decrease significantly as
much of our debt is indexed to floating rates.

The Parent Company also owns and manages a portfolio of equity
investments. As of December 31, 2003, we owned publicly traded equity
securities and mutual funds with a fair value of $19.1 million and privately
held equity securities with a cost basis of $1.8 million. Volatility or a
decline in the financial markets can negatively impact the Companys net
income as a result of devaluation of these investments. Certain of our
affiliates, including certain of our executive officers and directors, have
independently made investments with their own funds in both public and private
entities in which we hold investments.

As of December 31, 2003, we had approximately $263.4 million of
indebtedness outstanding at the holding company level, including $262.3 million
of junior subordinated debentures with maturities ranging from 2032 to 2033.
The degree to which we are leveraged poses risks to our operations, including
the risk that our cash flow will not be sufficient to service our outstanding
debt and that we may not be able to obtain additional financing or refinancing.
If we are forced to utilize all or

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most of our cash flow for the purpose of
servicing debt, we will not be able to use those funds for other purposes. Our
ability to meet these obligations is largely dependent on BankAtlantics
ability to pay dividends to us. BankAtlantics ability to pay dividends is
limited and is primarily determined based on BankAtlantics net income. See
Regulations and Supervision and Managements Discussion and Analysis -
Liquidity and Capital Resources.

Employees

Management believes that its relations with its employees are
satisfactory. The Company currently maintains comprehensive employee benefit
programs that are considered by management to be generally competitive with
programs provided by other major employers in its markets.

The Companys number of employees at the indicated dates was:

|             |  |                   |       |                   |  |       |     |       |  |  |       |  |  |  |     | 
|------------ |  | ----------------- | ----- | ----------------- |  | ----- | --- | ----- |  |  | ----- |  |  |  | --- | 
|             |  | December 31, 2003 |       | December 31, 2002
|             |  |                   |       |                  
|             |  | Full-             |       | Part-             |  | Full- |     | Part-
|             |  | Time              |       | time              |  | time  |     | time 
|             |  |                   |       |                   |  |       |     |      
|BankAtlantic |  |                   | 1,301 |                   |  |       | 204 |       |  |  | 1,134 |  |  |  | 219 | 
|Ryan Beck    |  |                   | 1,011 |                   |  |       | 31  |       |  |  | 1,215 |  |  |  | 40  | 
|             |  |                   |       |                   |  |       |     |       |  |  |       |  |  |  |     | 
|Total        |  |                   | 2,312 |                   |  |       | 235 |       |  |  | 2,349 |  |  |  | 259 | 
|             |  |                   |       |                   |  |       |     |       |  |  |       |  |  |  |     | 

Competition

The banking and financial services industry is very competitive. Legal
and regulatory developments have made it easier for new and sometimes
unregulated entities to compete with us. Consolidation among financial service
providers has resulted in fewer very large national and regional banking and
financial institutions holding a large accumulation of assets. These
institutions may have significantly greater resources, a wider geographic
presence or greater accessibility. As consolidation continues among large
banks, we expect additional smaller institutions to try to exploit our market.
We face substantial competition for both loans and deposits. Competition for
loans comes principally from other banks, savings institutions and other
lenders. This competition could decrease the number and size of loans that we
make and the interest rates and fees that we receive on these loans.

We compete for deposits with banks, savings institutions and credit
unions, as well as institutions offering uninsured investment alternatives,
including money market funds and mutual funds. These competitors may offer
higher interest rates than we do, which could decrease the deposits that we
attract or require us to increase our rates to attract new deposits. Increased
competition for deposits could increase our cost of funds and adversely affect
our ability to generate the funds necessary for our lending operations.

Ryan Beck is engaged in investment banking, securities brokerage and
asset management activities all of which are extremely competitive businesses.
Competitors include all of the member organizations of the New York Stock
Exchange and NASD, banks, insurance companies, investment companies and
financial consultants.

Regulation and Supervision

Holding Company

We are a unitary savings and loan holding company within the meaning of
the Home Owners Loan Act, as amended (HOLA). As such, we are registered
with the Office of Thrift Supervision (OTS) and are subject to OTS
regulations, examinations, supervision and reporting requirements. In
addition, the OTS has enforcement authority over us, and our non-bank
subsidiary, Ryan Beck & Co., Inc. Among other things, this authority permits
the OTS to restrict or prohibit activities that are determined to be a serious
risk to the financial safety, soundness or stability of a subsidiary savings
bank.

HOLA prohibits a savings bank holding company, directly or indirectly, or
through one or more subsidiaries, from acquiring another savings institution
or holding company thereof 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. In evaluating an application by a holding company to
acquire a savings

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institution, the OTS must consider the financial and
managerial resources and future prospects of the company and savings
institution involved, the effect of the acquisition on the risk to the
insurance funds, the convenience and needs of the community and competitive
factors.

As a unitary savings and loan holding company, we generally are not
restricted under existing laws as to the types of business activities in which
we may engage, provided that the Bank continues to satisfy the Qualified
Thrift Lending (QTL) test. See Regulation of
Federal Savings Banks - QTL
Test for a discussion of the QTL requirements. If we were to make a
non-supervisory acquisition of another savings institution or of a savings
institution that meets the QTL test and is deemed to be a savings institution
by the OTS and that will be held as a separate subsidiary, we would become a
multiple savings bank holding company and would be subject to limitations on
the types of business activities in which we can engage. HOLA limits the
activities of a multiple savings institution holding company and its
non-insured institution subsidiaries primarily to activities permissible for
bank holding companies under Section 4(c)(8) of the Bank Holding Company
(BHC) Act, subject to the prior approval of the OTS, and to other activities
authorized by OTS regulation.

Transactions between the Bank, including any of the Banks subsidiaries,
and us or any of the Banks affiliates, are subject to various conditions and
limitations. See ''Regulation of Federal Savings Banks - Transactions with
Related Parties. The Bank must file a notice with the OTS prior to any
declaration of the payment of any dividends or other capital distributions to
us. See Regulation of Federal Savings Banks - Limitation on Capital
Distributions.

BankAtlantic

General

The Bank is subject to extensive regulation, examination, and supervision
by the OTS, as its chartering agency, and the FDIC, as its deposit insurer.
The Banks deposit accounts are insured up to applicable limits by the Bank
Insurance Fund (BIF) and the Savings Association Insurance Fund (SAIF),
which are administered by the FDIC. The Bank must file reports with the OTS
and the FDIC concerning its activities and financial condition, and it must
obtain regulatory approvals prior to entering into certain transactions, such
as mergers with, or acquisitions of, other depository institutions or forming
subsidiaries. The OTS and the FDIC conduct periodic examinations to assess the
Banks safety and soundness and compliance with various regulatory
requirements. This regulation and supervision establishes a comprehensive
framework of activities in which a savings bank can engage and is intended
primarily for the protection of the insurance fund and depositors.

The OTS and the FDIC have significant discretion in connection with their
supervisory and enforcement activities and examination policies, including
policies with respect to the classification of assets and the establishment of
adequate loan loss reserves for regulatory purposes. Any change in such
policies, whether by the OTS, the FDIC or the Congress, could have a material
adverse impact on us, the Bank, and the operations of both.

The following discussion is intended to be a summary of the material
statutes and regulations applicable to savings banks, and it does not purport
to be a comprehensive description of all such statutes and regulations.

Regulation of Federal Savings Banks

Business Activities.The Bank derives its lending and investment powers
from the HOLA and the regulations of the OTS there under. Under these laws and
regulations, the Bank may invest in mortgage loans secured by residential and
commercial real estate, commercial and consumer loans, certain types of debt
securities, and certain other assets. The Bank may also establish service
corporations that may engage in activities not otherwise permissible for the
Bank, including certain real estate equity investments and securities and
insurance brokerage. These investment powers are subject to various
limitations, including (a) a prohibition against the acquisition of any
corporate debt security that is not rated in one of the four highest rating
categories; (b) a limit of 400% of capital on the aggregate amount of loans
secured by non-residential real estate property; (c) a limit of 20% of assets
on commercial loans, with the amount of commercial loans in excess of 10% of
assets being limited to small business loans; (d) a limit of 35% of assets on
the aggregate amount of consumer loans and acquisitions of certain debt
securities; (e) a limit of 5% of assets on non-conforming loans (loans in
excess of the specific limitations of HOLA); and (f) a limit of the greater of
5% of assets or total capital on certain construction loans made for the
purpose of financing what is or is expected to become residential property.

Loans to One Borrower.Under HOLA, savings banks are generally subject to
the same limits on loans to one borrower as are imposed on national banks.
Generally, under these limits, a savings bank may not make a loan or extend
credit to a single or related group of borrowers in excess of 15% of the
banks unimpaired capital and surplus. Additional loans or extensions of
credit are permitted of up to 10% of unimpaired capital and surplus if they
are fully secured by readily-

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marketable collateral. Such collateral includes
certain debt and equity securities and bullion, but generally does not include
real estate. At December 31, 2003, the Banks limit on loans to one borrower
was $71.1 million. At December 31, 2003, the Banks largest aggregate amount
of loans to one borrower was $55.3 million and the second largest borrower had
an aggregate balance of $47.1 million.

QTL Test.HOLA requires a savings bank to meet a Qualified Thrift Lending
(QTL) test by maintaining at least 65% of its portfolio assets in
certain qualified thrift investments in at least nine months of the most
recent twelve-month period. A savings bank that fails the QTL test must either
operate under certain restrictions on its activities or convert to a bank
charter. At December 31, 2003, the Bank maintained 73.3% of its portfolio
assets in qualified thrift investments. The Bank had also satisfied the QTL
test in each of the prior 12 months and, therefore, was a qualified thrift
lender.

Capital Requirements.The OTS regulations require savings banks to meet
three minimum capital standards: a tangible capital ratio requirement of 1.5%
of total assets as adjusted under the OTS regulations, a risk-based capital
ratio requirement of 8% of core and supplementary capital to total risk-based
assets and a core capital ratio (as defined under OTS regulations). For a
depository institution that has been assigned the highest composite rating of
1 under the Uniform Financial Institutions Rating, the minimum core capital
ratio is 3%, and the minimum core capital ratio for any other depository
institution is 4%, unless a higher capital ratio is warranted by the
particular circumstances or risk profile of the depository institution. In
determining the amount of risk-weighted assets for purposes of the risk-based
capital requirement, a savings bank must compute its risk-based assets by
multiplying its assets and certain off-balance sheet items by risk-weights,
which range from 0% for cash and obligations issued by the United States
Government or its agencies, to 100% for consumer and commercial loans, as
assigned by the OTS capital regulations based on the risks OTS believes are
inherent in the type of asset. On May 10, 2002, the OTS adopted amendments to
its capital regulations which, among other matters, eliminated the interest
rate risk component of the risk-based capital requirement. Pursuant to the
amendment, the OTS will continue to monitor the interest rate risk management
of individual institutions through the OTS requirements for interest rate risk
management, the ability of the OTS to impose an individual minimum capital
requirement on institutions that exhibit a high degree of interest rate risk,
and the requirements of Thrift Bulletin 13a, which provides guidance regarding
the management of interest rate risk and the responsibility of boards of
directors in that area.

The table below presents the Banks regulatory capital as compared to the
OTS regulatory capital requirements at December 31, 2003 (dollars in
thousands):

|                                |  |                 |         |             |  |             |       |       |  |        |         |       |  |  |      |   |  |   |         |  |  |  |       |  
|------------------------------- |  | --------------- | ------- | ----------- |  | ----------- | ----- | ----- |  | ------ | ------- | ----- |  |  | ---- | - |  | - | ------- |  |  |  | ----- | -
|                                |  | Minimum Capital |         |            
|                                |  |                 |         | Well       
|                                |  | Actual          |         | Requirement |  | Capitalized
|                                |  |                 |         |             |  |            
|                                |  | Amount          |         | Ratio       |  | Amount      |       | Ratio |  | Amount |         | Ratio
|                                |  |                 |         |             |  |             |       |       |  |        |         |      
|Tangible capital                |  | $               | 379,505 |             |  |             | 8.52  | %     |  | $      | 66,802  |       |  |  | 1.50 | % |  | $ | 66,802  |  |  |  | 1.50  | %
|Core capital                    |  |                 | 379,505 |             |  |             | 8.52  |       |  |        | 178,138 |       |  |  | 4.00 |   |  |   | 222,673 |  |  |  | 5.00  |  
|Total tier 1 risk-based capital |  |                 | 379,505 |             |  |             | 10.22 |       |  |        | 148,604 |       |  |  | 4.00 |   |  |   | 222,906 |  |  |  | 6.00  |  
|Total risk-based capital        |  |                 | 447,967 |             |  |             | 12.06 |       |  |        | 297,208 |       |  |  | 8.00 |   |  |   | 371,509 |  |  |  | 10.00 |  

BankAtlantic Bancorp is a unitary savings and loan holding company and is
not currently subject to regulatory capital requirements, and it is not
anticipated that BankAtlantic Bancorp will be required to meet holding company
capital requirements in the foreseeable future. However, BankAtlantic
Bancorps regulatory capital amounts and ratios calculated based on
methodology used in the Federal Reserve Boards calculation of capital
requirements for bank holding companies are presented in the table below
(dollars in thousands):

|                          |  |        |         |       |  |  |       |  
|------------------------- |  | ------ | ------- | ----- |  |  | ----- | -
|                          |  | Actual
|                          |  |       
|                          |  | Amount |         | Ratio
|                          |  |        |         |      
|As of December 31, 2003:  |  |        |         |       |  |  |       |  
|Core capital              |  | $      | 425,115 |       |  |  | 8.97  | %
|Tier I risk-based capital |  | $      | 425,115 |       |  |  | 10.69 | %
|Total risk-based capital  |  | $      | 652,488 |       |  |  | 16.41 | %

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Limitation on Capital Distributions.OTS regulations currently impose
limitations upon capital distributions by savings institutions, such as cash
dividends, payments to repurchase or otherwise acquire its shares, payments to
shareholders of another institution in a cash-out merger, and other
distributions charged against capital.

As the subsidiary of a savings and loan holding company, the Bank is
required to file a notice with the OTS at least 30 days prior to each capital
distribution. However, if the total amount of all capital distributions
(including each proposed capital distribution) for the applicable calendar
year exceeds net income for that year plus the retained net income for the
preceding two years, then the Bank must file an application for OTS
approval of a proposed capital distribution. In addition, the OTS can prohibit
a proposed capital distribution otherwise permissible under the regulation, if
it has determined that the institution is in need of more than customary
supervision or that a proposed distribution by an institution would constitute
an unsafe or unsound practice. Furthermore, under the OTS Prompt Corrective
Action Regulations, the Bank would be prohibited from making any capital
distribution if, after the distribution, the Bank failed to satisfy its
minimum capital requirements, as described above. See Regulation -
Regulation of Federal Savings Institutions - Prompt Corrective Regulatory
Action.

Liquidity. The Bank is required to maintain sufficient liquidity to
ensure its safe and sound operation. The Banks liquidity ratio at December
31, 2003 was 10.77%.

Assessments.Savings institutions are required by OTS regulation to pay
semi-annual assessments to the OTS to fund OTS operations. The regulations
base the assessment for individual savings institutions on three components:
the size of the institution on which the basic assessment is based; the
institutions supervisory condition; and the complexity of the institutions
operations. The Banks assessment expense during the year ended December 31,
2003 was approximately $791,000.

Branching.Subject to certain limitations, HOLA and the OTS regulations
permit federally chartered savings banks to establish branches in any state of
the United States.

Community Reinvestment.Under the Community Reinvestment Act
(CRA), as
implemented by OTS regulations, a savings bank has a continuing and
affirmative obligation consistent with its safe and sound operation to help
meet the credit needs of its entire community, including low and moderate
income neighborhoods. The CRA requires the OTS, in connection with its
examination of a savings bank, to assess the banks record of meeting the
credit needs of its community and to take such record into account in its
evaluation of certain applications by such bank. The CRA also requires all
institutions to make public disclosure of their CRA ratings. The Bank received
a satisfactory CRA performance evaluation in its most recent evaluation.
Insured depository institutions also must publicly disclose certain agreements
that are in fulfillment of CRA. We have no such agreements in place at this
time.

Transactions with Related Parties.The Banks authority to engage in
transactions with its affiliates is limited by OTS regulations and by
Sections 23A and 23B of the Federal Reserve Act (FRA). In general, an
affiliate of the Bank is any company that controls the Bank or any other
company that is controlled by a company that controls the Bank, excluding the
Banks subsidiaries other than those that are non-bank insured depository
institutions and financial subsidiaries. The OTS regulations prohibit a
savings bank (a) from lending to any of its affiliates that is engaged in
activities that are not permissible for bank holding companies under Section
4(c) of the Bank Holding Company Act (BHC Act) and (b) from purchasing the
securities of any affiliate other than a subsidiary. Section 23A limits the
aggregate amount of transactions with any individual affiliate to 10% of the
capital and surplus of the savings bank and also limits the aggregate amount
of transactions with all affiliates to 20% of the savings banks capital and
surplus. Extensions of credit to affiliates are required to be secured by
collateral in an amount and of a type described in Section 23A, and the
purchase of low quality assets from affiliates is generally prohibited.
Section 23B provides that certain transactions with affiliates, including
loans and asset purchases, must be on terms and under circumstances, including
credit standards, that are substantially the same or at least as favorable to
the Bank as those prevailing at the time for comparable transactions with
nonaffiliated companies. In the absence of comparable transactions, such
transactions may only occur under terms and circumstances, including credit
standards that in good faith would be offered to or would apply to
nonaffiliated companies. On October 1, 2001, the Bank made a special dividend
to the Company of all the outstanding stock of Levitt Corporation, and Levitt
Corporation thereupon became a subsidiary of the Company instead of the Bank.
The Company spun-off Levitt Corporation to its stockholders on December 31.
2003; however, Levitt remains an affiliate of the Bank subject to the above
regulations. Transactions between the Bank and Levitt Corporation became
subject to the regulations and statutes described above. In connection with
the October 1, 2001 transaction the OTS issued a no action letter which
effectively grandfathered all then-outstanding loans, commitments and letters
of credit (Levitt Loans) from the Bank to Levitt and the Bank agreed that it
would not engage in any covered

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transactions with any affiliates until the
aggregate amount of all covered transactions, including the Levitt Loans,
falls below twenty percent of the Banks capital stock and surplus.

Effective April 1, 2003, the Federal Reserve Board replaced the
interpretations it has issued under Sections 23A and 23B of the FRA and
replaced these interpretations with Regulation W. In addition, Regulation W
expands the definition of what constitutes an affiliate subject to Sections
23A and 23B.

Under Regulation W, all transactions entered into on or before December
12, 2002, which either became subject to Sections 23A and 23B solely because
of Regulation W, and all transactions covered by Sections 23A and 23B, the
treatment of which changed solely because of Regulation W, became subject to
Regulation W on July 1, 2003. All other covered affiliate transactions became
subject to Regulation W on April 1, 2003. The Federal Reserve Board expects
each depository institution that is subject to Sections 23A and 23B to
implement policies and procedures to ensure compliance with Regulation W. We
do not expect that the changes made by Regulation W will have a material
adverse effect on our business.

Section 402 of Sarbanes-Oxley prohibits the extension of personal loans
to directors and executive officers of issuers (as defined in Sarbanes-Oxley).
The prohibition, however, does not apply to mortgages advanced by an insured
depository institution, such as the Bank, which are subject to the insider
lending restrictions of Section 22(h) of the FRA.

The Banks authority to extend credit to its directors, executive
officers, and 10% stockholders, as well as to entities controlled by such
persons, is currently governed by the requirements of Sections 22(g) and 22(h)
of the FRA and Regulation O of the Federal Reserve Board
(FRB) there
under. Among other things, these provisions require that extensions of credit
to insiders (a) be made on terms that are substantially the same as and follow
credit underwriting procedures that are not less stringent than those
prevailing for comparable transactions with unaffiliated persons and that do
not involve more than the normal risk of repayment or present other
unfavorable features and (b) not exceed certain limitations on the amount of
credit extended to such persons, individually and in the aggregate, which
limits are based, in part, on the amount of the banks capital. In addition,
extensions of credit in excess of certain limits must be approved by the
Banks board of directors.

Enforcement.Under the Federal Deposit Insurance Act (FDI
Act), the
OTS has primary enforcement responsibility over savings banks and has the
authority to bring enforcement action against all institution-affiliated
parties, including any controlling stockholder or any shareholder, attorney,
appraiser and accountant who knowingly or recklessly participates in any
violation of applicable law or regulation or breach of fiduciary duty or
certain other wrongful actions that cause or are likely to cause a more than a
minimal loss or other significant adverse effect on an insured savings bank.
In addition, the FDIC has back-up authority to take enforcement action for
unsafe and unsound practices.

Standards for Safety and Soundness.Pursuant to the requirements of the
FDI Act, as amended by FDICIA and the Riegle Community Development and
Regulatory Improvement Act of 1994 (Community Development
Act), the OTS,
together with the other federal bank regulatory agencies, have adopted a set
of guidelines prescribing safety and soundness standards relating to internal
controls and information systems, internal audit systems, loan documentation,
credit underwriting, interest rate exposure, asset growth, asset quality,
earnings and compensation, fees and benefits. In general, the guidelines
require, among other things, appropriate systems and practices to identify and
manage the risks and exposures specified in the guidelines.

Real Estate Lending Standards.The OTS and the other federal banking
agencies adopted regulations to prescribe standards for extensions of credit
that (a) are secured by real estate or (b) are made for the purpose of
financing the construction of improvements on real estate. The OTS regulations
require each savings bank to establish and maintain written internal real
estate lending standards that are consistent with OTS guidelines and with safe
and sound banking practices and which are appropriate to the size of the bank
and the nature and scope of its real estate lending activities.

Prompt Corrective Regulatory Action.Under the OTS Prompt Corrective
Action Regulations, the OTS is required to take certain, and is authorized to
take other, supervisory actions against undercapitalized savings institutions.
For this purpose, a savings institution would be placed in one of five
categories based on its capital. Generally, a savings institution is treated
as well capitalized if its ratio of total capital to risk-weighted assets
is at least 10.0%, its ratio of core capital to risk-weighted assets is at
least 6.0%, its ratio of core capital to total assets is at least 5.0%, and it
is not subject to any order or directive by the OTS to meet a specific capital
level. The most recent notification from the Office of Thrift Supervision
categorized the Bank as well capitalized under the regulatory framework for
prompt corrective action. There are no conditions or events since that
notification that management believes have changed the institutions category.
See - Capital Requirements.

The severity of the action authorized or required to be taken under the
Prompt Corrective Action Regulations increases as a banks capital
deteriorates within the three undercapitalized categories. All institutions
are prohibited from

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paying dividends or other capital distributions or paying
management fees to any controlling person if, following such distribution, the
institution would be undercapitalized. An undercapitalized institution is
required to file a capital restoration plan within 45 days of the date the
institution receives notice that it is within any of the three
undercapitalized categories. The OTS is required to monitor closely the
condition of an undercapitalized institution and to restrict the asset growth,
acquisitions, branching, and new lines of business of such an institution. If
one or more grounds exist for appointing a conservator or receiver for an
institution, the OTS may require the institution to issue additional debt or
stock, sell assets, be acquired by a depository bank holding company or
combine with another depository bank. The OTS and the FDIC have a broad range
of grounds under which they may appoint a receiver or conservator for an
insured depository bank. When
appropriate, the OTS can require corrective action by a savings bank
holding company under the Prompt Corrective Action provisions of FDICIA.

Insurance of Deposit Accounts.Savings banks are subject to a risk-based
assessment system for determining the deposit insurance assessments to be paid
by each bank. Under the risk-based assessment system, which began in 1993, the
FDIC assigns an institution to one of three capital categories based on the
institutions financial information as of the reporting period. The
supervisory subgroup to which an institution is assigned is based upon a
supervisory evaluation provided to the FDIC by the institutions primary
federal regulator and information that the FDIC determines to be relevant to
the institutions financial condition and the risk posed to the deposit
insurance funds. An institutions assessment rate depends on the capital
category and supervisory category to which it is assigned. Assessment rates
currently range from 0.0% of deposits for an institution in the highest
category (i.e., well-capitalized and financially sound, with no more than a
few minor weaknesses) to 0.27% of deposits for an institution in the lowest
category (i.e., undercapitalized and substantial supervisory concern). The
FDIC is authorized to raise the assessment rates as necessary to maintain the
required reserve ratio of 1.25%. Both the BIF and SAIF currently satisfy the
reserve ratio requirement. If the FDIC determines that assessment rates should
be increased, institutions in all risk categories could be affected. The FDIC
has exercised this authority several times in the past and could raise
insurance assessment rates in the future. Increases in deposit insurance
premiums could have an adverse effect on the Companys earnings.

The Deposit Insurance Funds Act of 1996 amended the FDIA to recapitalize
the SAIF and expand the assessment base for the payments of Financing
Corporation (FICO) bonds. FICO bonds were sold by the federal government in
order to finance the recapitalization of SAIF and BIF insurance funds. The
recapitalization of the SAIF and BIF insurance funds was necessitated
following payments made from these insurance funds to compensate depositors of
federally-insured depository institutions that experienced bankruptcy and
dissolution during the 1980s and 1990s. The quarterly adjusted rate of
assessment for FICO bonds is 0.0152% for both BIF-and SAIF-insured
institutions.

Privacy and Security Protection.The OTS has adopted regulations
implementing the privacy protection provisions of the Gramm-Leach-Bliley Act
(Gramm-Leach). The regulations, which require each financial institution to
adopt procedures to protect customers and customers non-public personal
information, became effective November 13, 2000. The Bank has a privacy
protection policy which we believe complies with applicable regulations. In
February 2001, the OTS and other federal banking agencies finalized guidelines
establishing standards for safeguarding customer information to implement
certain provisions of Gramm-Leach. The guidelines describe the agencies
expectations for the creation, implementation and maintenance of an
information security program. The regulation became effective on July 1, 2001.
These regulations have not had a material impact upon our operations.

Internet Banking.Technological developments are dramatically altering
the methods by which most companies, including financial institutions, conduct
their business. The growth of the Internet is prompting banks to reconsider
business strategies and adopt alternative distribution and marketing systems.
The federal bank regulatory agencies have conducted seminars and published
materials targeted at various aspects of Internet Banking and have indicated
their intention to re-evaluate their regulations to ensure they encourage bank
efficiency and competitiveness consistent with safe and sound banking
practices. The Company cannot assure that federal bank regulatory agencies
will not adopt new regulations that will not materially affect or restrict the
Banks Internet operations.

Insurance Activities.As a federal savings bank, we are generally
permitted to engage in certain insurance activities through subsidiaries. OTS
regulations promulgated pursuant to Gramm-Leach prohibit depository
institutions from conditioning the extension of credit to individuals upon
either the purchase of an insurance product or annuity or an agreement by the
consumer not to purchase an insurance product or annuity from an entity that
is not affiliated with the depository institution. The regulation also
requires prior disclosure of this prohibition to potential insurance product
or annuity customers.

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Federal Home Loan Bank System.The Bank is a member of the FHLB of
Atlanta, which is one of the regional FHLBs composing the FHLB System. Each
FHLB provides a central credit facility primarily for its member institutions.
The Bank, as a member of the FHLB of Atlanta, is required to acquire and hold
shares of capital stock in the FHLB. The Bank was in compliance with this
requirement with an investment in FHLB stock at December 31, 2003 of $40.3
million. Any advances from a FHLB must be secured by specified types of
collateral, and all long-term advances may be obtained only for the purpose of
providing funds for residential housing finance. The FHLB of Atlanta paid
dividends on the capital stock of $2.3 million during the year ended December
31, 2003. If dividends were reduced or interest on future FHLB advances
increased, the Banks net interest income would likely also be reduced.

Federal Reserve System.The Bank is subject to provisions of the FRA and
the FRBs regulations, pursuant to which depository institutions may be
required to maintain non-interest-earning reserves against their deposit
accounts and certain other liabilities. Currently, reserves must be maintained
against transaction accounts (primarily NOW and regular checking accounts).
The FRB regulations generally require that reserves be maintained in the
amount of 3% of the aggregate of transaction accounts up to $42.8 million and
10% of amounts over $42.8 million, subject to adjustment by the FRB. An
initial reserve of $6.0 million is exempt from the calculation on a portion of
transaction accounts over $42.8 million. The FRB regulations currently exempt
$6.0 million of otherwise reservable balances from the reserve requirements,
which exemption is adjusted by the FRB at the end of each year. The Bank is in
compliance with the foregoing reserve requirements. Because required reserves
must be maintained in the form of either vault cash, a non-interest-bearing
account at a Federal Reserve Bank, or a pass-through account as defined by the
FRB, the effect of this reserve requirement is to reduce the Banks
interest-earning assets. The balances maintained to meet the reserve
requirements imposed by the FRB may be used to satisfy liquidity requirements
imposed by the OTS. FHLB System members are also authorized to borrow from the
Federal Reserve ''discount window, but FRB regulations require such
institutions to exhaust all FHLB sources before borrowing from a Federal
Reserve Bank.

Anti-Terrorism Regulation.The Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001 (USA Patriot Act) was signed into law on October 26, 2001, providing
the federal government with new powers to address terrorist threats. By way of
amendments to the Bank Secrecy Act, Title III of the USA Patriot Act enacts
measures intended to encourage information-sharing among bank regulatory and
law enforcement agencies. In addition, certain provisions of Title III impose
affirmative obligations on a broad range of financial institutions, including
the obligation to establish anti-money laundering programs that include, at a
minimum, (i) internal policies, procedures and controls, (ii) a designated
compliance officer, and employee training program and an independent audit
function to test the program and (iii) implement procedures to verify
customer identification upon the opening of new accounts and (iv) undertake
heightened due diligence measures with respect to certain foreign accounts and
relationships. Implementation of the USA Patriot Act did not have a material
impact upon the financial condition or results of operations of the Company.

Ryan Beck

The securities industry in the United States is subject to extensive
regulation under both federal and state laws. The SEC is the federal agency
charged with administration of the federal securities laws. Much of the
regulation of broker-dealers has been delegated to self-regulatory
authorities, principally the NASD and, in the case of broker-dealers that are
members of a securities exchange, the particular securities exchange. These
self-regulatory organizations conduct periodic examinations of member
broker-dealers in accordance with rules they have adopted and amended from
time to time, subject to approval by the SEC.

Securities firms are also subject to regulation by state securities
commissions in those states in which they do business. As of December 31,
2003, Ryan Beck was registered as a broker-dealer in 50 states and the
District of Columbia. The principal purpose of regulation and discipline of
broker-dealers is the protection of clients and the securities markets, rather
than protection of creditors and stockholders of broker-dealers. The
regulations to which broker-dealers are subject cover all aspects of the
securities business, including sales methods, trading practices among
broker-dealers, uses and safekeeping of clients funds and securities, capital
structure of securities firms, record-keeping and reporting, fee arrangements,
disclosure to clients and the conduct of directors, officers and employees.

Additionally, legislation, changes in rules promulgated by the SEC and
self-regulatory authorities or changes in the interpretation or enforcement of
existing laws and rules may directly affect the operations and profitability
of broker-dealers. The SEC, self-regulatory authorities and state securities
commissions may conduct administrative proceedings which can result in
censure, fine, suspension or expulsion of a broker-dealer, its officers or
employees. Such administrative proceedings, whether or not resulting in
adverse findings, can require substantial expenditures. The profitability of
broker-

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dealers could also be affected by rules and regulations that impact the
business and financial communities in general, including changes to the laws
governing taxation, antitrust regulation and electronic commerce.

Securities held in custody by Pershing for Ryan Becks customer accounts
are protected to an unlimited amount. The Securities Investors Protection
Corporation (SIPC) provides $500,000 of coverage, including $100,000 for
claims for cash. Pershing provides the remaining coverage through a commercial
insurer. The account protection applies when a SIPC member firm fails
financially and is unable to meet obligations to securities customers, but it
does not protect against losses from the rise and fall in the market value of
investments.

Ryan Beck is subject to the net capital provision of Rule 15c3-1 under
the Securities Exchange Act of 1934. The Net Capital Rule specifies minimum
net capital requirements that are intended to ensure the general financial
soundness and liquidity of broker-dealers. Failure to maintain the required
net capital may subject a firm to suspension or expulsion by the NASD, certain
punitive actions by the SEC and other regulatory bodies, and ultimately may
require a firms liquidation. At December 31, 2003, Ryan Beck was in
compliance with all applicable capital requirements.

Ryan Beck operates under the provisions of paragraph (k)(2)(ii) of Rule
15c3-3 of the SEC as a fully disclosed broker and, accordingly, customer
accounts are carried on the books of the clearing broker. However, Ryan Beck
safe keeps and redeems municipal bond coupons for the benefit of its
customers. Accordingly, Ryan Beck is subject to the provisions of SEC Rule
15c3-3 relating to possession or control and customer reserve requirements and
was in compliance with such provisions at December 31, 2003.

NEW ACCOUNTING PRONOUNCEMENTS

In November 2002, the FASB issued Interpretation No. 45,
Guarantors
Accounting and Disclosure Requirements for Guarantees Including Indirect
Guarantees of Indebtedness of Others. This interpretation elaborates on the
disclosures to be made by a guarantor in its interim and annual financial
statements about its obligations under certain guarantees that it has issued.
It also clarifies that a guarantor is required to recognize, at the inception
of a guarantee, a liability for the fair value of the obligation undertaken in
issuing the guarantee. This interpretation does not prescribe a specific
approach for subsequently measuring the guarantors recognized liability over
the term of the related guarantee. This interpretation also incorporates,
without change, the guidance in FASB Interpretation No. 34, Disclosure of
Indirect Guarantees of Indebtedness of Others, which is being superseded. The
Company implemented the disclosure requirements of this interpretation as of
December 31, 2002 and the liability recognition provisions of the
interpretation as of January 1, 2003. This interpretation has not had a
significant impact on the Companys consolidated financial statements.

In January 2003, the Financial Accounting Standards Board (FASB)
issued
FIN No. 46. The interpretation was revised by the FASB in December 2003. The
interpretation changes the accounting model for consolidation of variable
interest entities from one based on consideration of control through voting
interests. The consolidation of an entity is now based on other considerations
such as: sufficient equity at risk to enable it to operate without additional
financial support, whether the equity owners in that entity lack the obligation
to absorb expected losses or the right to receive residual returns of the
entity, whether voting rights in the entity are not proportional to the equity
interest and substantially all the entitys activities are conducted for an
investor with few voting rights. The interpretation also requires disclosures
about variable interest entities that the company is not required to
consolidate but in which it has a significant variable interest. On July 1,
2003, all of the Companys subsidiaries, except for Levitt and its subsidiaries
implemented the interpretation effective January 1, 2003. As a consequence of
the implementation, the Companys wholly-owned statutory business trusts formed
to issue trust preferred securities were deconsolidated and a real estate joint
venture was consolidated.

In May 2003, the FASB issued Statement No. 150 (Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity).
This Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. The Statement requires that an issuer classify a financial instrument
that is within its scope as a liability. Many of those instruments were
previously classified as equity. This Statement was effective for financial
instruments entered into or modified after May 31, 2003, and otherwise was
effective at the beginning of the first interim period beginning after June 15,
2003. Upon adoption, this Statement did not have a significant impact on the
Companys financial statements.

The Statement also required that mandatorily redeemable minority interests
in finite-lived entities be classified as liabilities and reported at
settlement value. The FASB deferred those requirements related to mandatorily
redeemable

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minority interests in finite-lived entities indefinitely pending
further FASB action. The Companys minority interest in finite-lived entities
is not significant.

In December 2003, the FASB issued Statement No. 132, revised
(Employers
Disclosures about Pensions and Other Postretirement Benefits). This revised
Statement requires additional disclosures about the assets, obligations, cash
flows and net periodic benefit cost of defined benefit pension and
postretirement plans, as well as the expense recorded for such plans. This
Statement is effective for financial statements with fiscal years ending after
December 15, 2003. The Company has implemented the disclosure requirements of
this statement as of December 31, 2003.

In December 2003, the American Institute of Certified Public Accountants
(AICPA) Accounting Standards Executive Committee (AcSEC) issued Statement
of Position 03-3 (SOP). The SOP addresses accounting for loans and debt
securities acquired in purchase business combinations or purchased subsequent
to origination. The SOP prohibits the
creation of valuation allowances in the initial accounting of all loans
acquired. The SOP does not apply to originated loans. The SOP limits the
yield that may be accreted to the excess of the purchasers estimate of
undiscounted expected principal, interest and other cash flows over the
purchasers initial investment. The SOP requires excess contractual cash flows
over cash flows expected to be collected to not be recognized as an adjustment
of yield, loss accrual or valuation allowance. Subsequent increases in cash
flows expected to be collected generally should be recognized prospectively
through adjustment of the loans yield over its remaining life. Decreases in
cash flows expected to be collected should be recognized as impairments. The
SOP is effective for loans and securities acquired in fiscal years beginning
after December 15, 2004 with early adoption encouraged. Management is
currently evaluating the requirements of the SOP concerning future loan
acquisitions that are within the scope of the SOP.

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ITEM 2. PROPERTIES

The Companys and BankAtlantics principal and executive offices are
located at 1750 East Sunrise Boulevard, Fort Lauderdale, Florida, 33304. In
addition to its branches, BankAtlantic owns three buildings and leases four
locations, which house its back office operations. The following table sets
forth owned and leased branch offices at December 31, 2003:

|                             |                        |                             |   |           |    |         |    |            |    |           |    |           |    |  |   |           |   | 
|---------------------------- | ---------------------- | --------------------------- | - | --------- | -- | ------- | -- | ---------- | -- | --------- | -- | --------- | -- |  | - | --------- | - | 
|                             |                        |                             |   | Miami-    |    |         |    |            |    |           |    |           |    |  |   |          
|                             |                        |                             |   | Dade      |    | Broward |    | Palm Beach |    | Tampa Bay
|                             |                        |                             |   |           |    |         |    |            |    |          
|Owned full-service branches  |                        |                             | 4 |           |    |         | 10 |            |    |           | 26 |           |    |  | 3 |          
|Leased full-service branches |                        |                             | 8 |           |    |         | 12 |            |    |           | 5  |           |    |  | 5 |          
|                             |                        |                             |   |           |    |         |    |            |    |           |    |           |    |  |   |          
|                             |                        | Total full-service branches |   |           | 12 |         |    |            | 22 |           |    |           | 31 |  |   |           | 8 | 
|                             |                        |                             |   |           |    |         |    |            |    |           |    |           |    |  |   |          
|                             | Lease expiration dates |                             |   | 2004-2012 |    |         |    | 2004-2009  |    |           |    | 2005-2009 |    |  |   | 2004-2008 |  
|                             |                        |                             |   |           |    |         |    |            |    |           |    |           |    |  |   |          

BankAtlantic also maintains two ground leases in Broward County expiring
between 2006 - 2072, with one expiring in 2006 and the other expiring in 2072.

Ryan Becks office space includes leased facilities in the following
states with year of lease expiration:

|              |  |            |           |           |  |  |    | 
|------------- |  | ---------- | --------- | --------- |  |  | -- | 
|              |  | Lease      |           | Number of
|Locations     |  | Expiration |           | Offices  
|              |  |            |           |          
|California    |  |            | 2009      |           |  |  | 1  | 
|Connecticut   |  |            | 2004-2005 |           |  |  | 3  | 
|Florida       |  |            | 2004-2005 |           |  |  | 3  | 
|Georgia       |  |            | 2004      |           |  |  | 1  | 
|Illinois      |  |            | 2008      |           |  |  | 1  | 
|Maryland      |  |            | 2009      |           |  |  | 1  | 
|Massachusetts |  |            | 2004-2006 |           |  |  | 3  | 
|Nevada        |  |            | 2004      |           |  |  | 1  | 
|New Jersey    |  |            | 2004-2012 |           |  |  | 5  | 
|New York      |  |            | 2004-2010 |           |  |  | 9  | 
|Ohio          |  |            | 2010      |           |  |  | 1  | 
|Pennsylvania  |  |            | 2004-2011 |           |  |  | 4  | 
|Virginia      |  |            | 2007      |           |  |  | 1  | 
|              |  |            |           |           |  |  |    | 
|              |  |            |           |           |  |  | 34 | 
|              |  |            |           |           |  |  |    | 

During 2002, BankAtlantic purchased a $14.3 million office facility to
consolidate its headquarters and back office operations into a centralized
facility. As of December 31, 2003 BankAtlantic had incurred approximately $3
million in renovation costs. The total estimated cost to renovate the
facility is approximately $24.5 million, and the facility is expected to be
completed in October 2004.

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ITEM 3. LEGAL PROCEEDINGS

The following is a description of certain lawsuits other than ordinary
routine litigation incidental to our business to which the Company or a
subsidiary is a party:

Commerce Bancorp, Inc. v. BankAtlantic, Civil Action No. 02CV 4774
(JBS)(D.N.J.)(Camden)On October 3, 2002, Commerce Bancorp., Inc. (Commerce)
filed a complaint against BankAtlantic in the United States District Court for
the District of New Jersey. The complaint, which seeks unspecified money
damages and injunctive relief, asserts that BankAtlantic is infringing certain
trademark rights allegedly owned by Commerce in the slogan AMERICAS MOST
CONVENIENT BANK by virtue of BankAtlantics use of the slogan FLORIDAS MOST
CONVENIENT BANK. Commerce also filed an amended complaint, which asserts
additional claims for trademark infringement based on Commerces allegation
that BankAtlantics use of the word WOW! infringes trademark rights
purportedly owned by Commerce in the phases WOW ANSWER GUIDE, COMMERCE WOW
ZONE COMMERCEWOW!ZONE COMMERCEWOW!ZONE, and WOW! THE CUSTOMER. In
order to amicably resolve the litigation the parties entered into a Settlement
Agreement dated January 20, 2004 settling the case in its entirety. Pursuant
to the settlement, the action will be dismissed with prejudice. No monetary
payments were made by either party in connection with the settlement.

Scott Teich v. Ryan Beck & Co., Inc.,Case
No. 03-80138-CIV-MIDDLEBROOKS/
JOHNSON, United States District Court for the Southern District of Florida,
West Palm Beach, Division. On January 30, 2003, a one-count purported class
action complaint was filed in the Circuit Court of the Fifteenth Judicial
Circuit in and for Palm Beach County, Florida (Case No. CA-1114AF) by a former
Gruntal employee seeking a declaratory judgment that Ryan Beck is liable for
all pre-April 26, 2002 claims against Gruntal by former Gruntal retail
customers and retail brokers, whether pending or to be filed in the future, not
expressly assumed by Ryan Beck in its acquisition of certain of the assets of
Gruntal. The complaint does not specify the amount of such claims. The
complaint seeks to impose liability under the theory that either (1) Ryan Beck
engaged in a de factomerger with Gruntal, or (2) Ryan Becks brokerage
business is a mere continuation of Gruntals brokerage business, or (3) Ryan
Beck is the beneficiary of a fraudulent transfer. Ryan Beck removed the case
to federal court and subsequently filed a motion to dismiss the complaint on
various grounds. The court issued an order staying this action until the
resolution of the Gruntal bankruptcy proceedings.

Other Gruntal Proceedings, In April 2002, Ryan Beck acquired certain of
the assets and assumed certain of the liabilities of Gruntal. Ryan Beck has
been named as a defendant in a number of arbitration claims filed by former
Gruntal clients whose claims arose prior to the transaction date. In these
actions Ryan Beck is alleged to be successor in interest to Gruntal, which
allegations Ryan Beck denies. In some instances the former Gruntal brokers
against whom the claims relate are now employed by Ryan Beck and in other
instances the brokers are not employed by Ryan Beck. Ryan Beck did not assume
any of the liabilities associated with these actions in the Gruntal
transaction. While Ryan Beck does not consider any individual action to be
material, an adverse result in a number of these actions in the aggregate could
adversely affect the Companys financial statements. In October 2002, Gruntal
filed for bankruptcy protection under Chapter 11 of the Federal Bankruptcy
Laws.

In the ordinary course of business, the Company and its subsidiaries are
parties to other lawsuits as plaintiff or defendant involving its bank
operations lending, tax certificates, securities sales, brokerage and
underwriting and acquisitions. Although the Company believes it has
meritorious defenses in all current legal actions, the outcome of the various
legal actions is uncertain.

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

None.

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PART II




ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS

The Companys Class A common stock is traded on the New York Stock
Exchange under the symbol BBX. BFC Financial Corporation (BFC) is the
sole holder of the Companys Class B common stock and there is no trading
market for the Companys Class B common stock. The Class B common stock may
only be owned by BFC or its affiliates and is convertible into Class A common
stock on a share for share basis.

On February 5, 2004, there were approximately 969 record holders and
54,416,523 shares of the Class A common stock issued and outstanding. In
addition, there were 4,876,124 shares of Class B common stock outstanding at
February 5, 2004.

The following table sets forth, for the periods indicated, the high and
low sale prices of the Class A common stock as reported by the New York Stock
Exchange:

|                                     |                |   |                |       |     |   |      |       | 
|------------------------------------ | -------------- | - | -------------- | ----- | --- | - | ---- | ----- | 
|                                     |                |   | Class A Common
|                                     |                |   | Stock Price   
|                                     |                |   |               
|                                     |                |   | High           |       | Low
|                                     |                |   |                |       |    
|For the year ended December 31, 2003 |                | $ | 19.75          |       |     | $ | 8.76 |      
|                                     | Fourth quarter |   |                | 19.75 |     |   |      | 14.15 | 
|                                     | Third quarter  |   |                | 15.77 |     |   |      | 11.76 | 
|                                     | Second quarter |   |                | 12.49 |     |   |      | 9.60  | 
|                                     | First quarter  |   |                | 10.12 |     |   |      | 8.76  | 
|For the year ended December 31, 2002 |                | $ | 13.01          |       |     | $ | 7.00 |      
|                                     | Fourth quarter |   |                | 9.76  |     |   |      | 7.30  | 
|                                     | Third quarter  |   |                | 12.15 |     |   |      | 7.00  | 
|                                     | Second quarter |   |                | 13.01 |     |   |      | 10.05 | 
|                                     | First quarter  |   |                | 13.00 |     |   |      | 8.90  | 

On December 31, 2003, the Company completed the spin-off of its wholly
owned real estate development subsidiary, Levitt Corporation (Levitt), by
means of a distribution to its stockholders of all of the outstanding capital
stock of Levitt. As a result of the spin-off, the Company no longer owns any
shares of capital stock of Levitt. On December 31, 2003, the last trading day
before consummation of the Levitt spin-off, the closing price of the Class A
common stock was $19.00. On January 2, 2004, the first trading day after
consummation of the Levitt spin-off, the closing price of the Class A common
stock was $14.81.

See
Regulation and Supervision - Limitation on Capital
Distributions
and Managements Discussion and Analysis - Liquidity and Capital Resources
for a description of certain limitations on the payment of dividends by our
subsidiaries. Subject to the results of operations and regulatory capital
requirements, the Company has indicated that it will seek to declare regular
quarterly cash dividends on its common stock. The declaration and payment of
dividends will depend upon, among other things, indenture restrictions, loan
covenants, the results of operations, financial condition and cash
requirements of the Company and on the ability of BankAtlantic to pay
dividends or otherwise advance funds to the Company, which payments and
distributions are subject to OTS approval and regulations and based upon
BankAtlantics regulatory capital levels and net income. Ryan Beck has not
paid dividends to the Company in the past; however, Ryan Beck, subject to its
results of operations and regulatory capital requirements, may pay dividends
to the Company during 2004.

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The cash dividends paid by the Company were as follows:

|                                    |  |                    |       |                    |  |   |       | 
|----------------------------------- |  | ------------------ | ----- | ------------------ |  | - | ----- | 
|                                    |  | Cash Dividends Per |       | Cash Dividends Per
|                                    |  | Share of Class B   |       | Share of Class A  
|                                    |  | Common Stock       |       | Common Stock      
|                                    |  |                    |       |                   
|Fiscal year ended December 31, 2003 |  | $                  | 0.128 |                    |  | $ | 0.128 | 
|Fourth quarter                      |  |                    | 0.033 |                    |  |   | 0.033 | 
|Third quarter                       |  |                    | 0.033 |                    |  |   | 0.033 | 
|Second quarter                      |  |                    | 0.031 |                    |  |   | 0.031 | 
|First quarter                       |  |                    | 0.031 |                    |  |   | 0.031 | 
|Fiscal year ended December 31, 2002 |  | $                  | 0.120 |                    |  | $ | 0.120 | 
|Fourth quarter                      |  |                    | 0.031 |                    |  |   | 0.031 | 
|Third quarter                       |  |                    | 0.031 |                    |  |   | 0.031 | 
|Second quarter                      |  |                    | 0.029 |                    |  |   | 0.029 | 
|First quarter                       |  |                    | 0.029 |                    |  |   | 0.029 | 

The following table lists all securities authorized for issuance and
outstanding under the Companys equity compensation plans at December 31,
2003.

|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  |                         |           | 
|---------------------------------------------------------- | ----- | ---------------------- | ----------------------- | ------------------- | ----------------- | ------- | ------------------------- | ---- |  |  | ----------------------- | --------- | 
|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  | Number of securities   
|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  | remaining available for
|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  | future issuance under  
|                                                           |       |                        | Number of securities to |                     | Weighted-average  |         | equity compensation plans
|                                                           |       |                        | be issued upon exercise |                     | exercise price of |         | excluding outstanding    
|Plan category                                              |       | of outstanding options |                         | outstanding options |                   | options
|                                                           |       |                        |                         |                     |                   |        
|Equity compensation plans
approved by security holders     |       |                        | 5,181,912               |                     |                   | $       | 6.03                      |      |  |  | 1,007,282               |          
|Equity compensation plans
not approved by security
holders |       |                        | 129,453                 | (1)                 |                   |         | 6.40                      |      |  |  | 10,500                  | (2)      
|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  |                         |          
|                                                           | Total |                        |                         | 5,311,365           |                   |         | $                         | 6.04 |  |  |                         | 1,017,782 | 
|                                                           |       |                        |                         |                     |                   |         |                           |      |  |  |                         |          



| | (1) |  | During 1999, nonqualifying options
for 575 shares of Class A Common Stock were granted to
each employee of BankAtlantic except executive officers.
| | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) |  | 1,500 shares of restricted stock vest and are issued each year through
2011 under a compensation agreement with an employee.                      

During the year ended December 31, 2003, the Company issued 11,000 shares
of restricted Class A common stock to a BankAtlantic employee, who is not an
officer of the Company, under a written individual compensation arrangement.
The shares vest on December 31, 2008.

During the year ended December 31, 2001, the Company issued 195,000
shares of restricted Class A common stock to an executive officer of
BankAtlantic, who is not an officer of the Company, under a written individual
compensation arrangement. The shares vest 10% per year for ten years.

In January 2004, the Compensation Committee adjusted all outstanding
options to acquire Class A common stock that were outstanding prior to the
Levitt spin-off to reflect the change in intrinsic value of the options that
resulted from the spin-off. As a consequence of the adjustments the number of
shares of Class A common stock issuable upon exercise of outstanding options
increased from 5,311,365 to 6,938,247 and the number of shares of Class A
common stock underlying options available for grant under equity compensation
plans was increased from 1,007,282 to 1,315,809.

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##### Table of Contents






ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA

|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|------------------------------------------------------------------------------------------- |  | -------------------------------- | ------- | ---- |  | ---- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | - |  | - | ------- | -
|                                                                                            |  | For the Years Ended December 31,
|                                                                                            |  |                                 
|(In thousands except share and per share data)                                              |  | 2003                             |         | 2002 |  | 2001 |         | 2000 |  | 1999
|                                                                                            |  |                                  |         |      |  |      |         |      |  |     
|Income Statement                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Total interest income                                                                       |  | $                                | 261,849 |      |  | $    | 303,387 |      |  | $    | 324,026 |   |  | $ | 326,574 |   |  | $ | 284,711 |  
|Total interest expense                                                                      |  |                                  | 113,217 |      |  |      | 148,891 |      |  |      | 186,912 |   |  |   | 206,082 |   |  |   | 167,732 |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Net interest income                                                                         |  |                                  | 148,632 |      |  |      | 154,496 |      |  |      | 137,114 |   |  |   | 120,492 |   |  |   | 116,979 |  
|Provision for (recovery from) loan losses                                                   |  |                                  | (547    | )    |  |      | 14,077  |      |  |      | 16,905  |   |  |   | 29,132  |   |  |   | 30,658  |  
|Securities activity, net                                                                    |  |                                  | (1,553  | )    |  |      | (10,223 | )    |  |      | 3,597   |   |  |   | 2,226   |   |  |   | 1,928   |  
|Other non-interest income                                                                   |  |                                  | 283,267 |      |  |      | 181,972 |      |  |      | 81,338  |   |  |   | 84,827  |   |  |   | 87,329  |  
|Impairment of goodwill                                                                      |  |                                  |        |      |  |      |        |      |  |      | 6,624   |   |  |   |        |   |  |   |        |  
|Other non-interest expense                                                                  |  |                                  | 368,872 |      |  |      | 283,967 |      |  |      | 158,030 |   |  |   | 146,253 |   |  |   | 133,695 |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Income from continuing operations before income taxes                                       |  |                                  | 62,021  |      |  |      | 28,201  |      |  |      | 40,490  |   |  |   | 32,160  |   |  |   | 41,883  |  
|Provision for income taxes                                                                  |  |                                  | 23,424  |      |  |      | 9,051   |      |  |      | 17,960  |   |  |   | 13,516  |   |  |   | 17,080  |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Income from continuing operations                                                           |  |                                  | 38,597  |      |  |      | 19,150  |      |  |      | 22,530  |   |  |   | 18,644  |   |  |   | 24,803  |  
|Discontinued operations, net of tax                                                         |  |                                  | 29,120  |      |  |      | 22,543  |      |  |      | 8,492   |   |  |   | 6,070   |   |  |   | 6,066   |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Income before extraordinary items and cumulative
Effect of a change in accounting principle |  |                                  | 67,717  |      |  |      | 41,693  |      |  |      | 31,022  |   |  |   | 24,714  |   |  |   | 30,869  |  
|Extraordinary item, net of tax                                                              |  |                                  |        |      |  |      | 23,749  |      |  |      |        |   |  |   |        |   |  |   |        |  
|Cumulative effect of a change in accounting principle                                       |  |                                  |        |      |  |      | (15,107 | )    |  |      | 1,138   |   |  |   |        |   |  |   |        |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Net income                                                                                  |  |                                  | 67,717  |      |  |      | 50,335  |      |  |      | 32,160  |   |  |   | 24,714  |   |  |   | 30,869  |  
|Amortization of goodwill, net of tax                                                        |  |                                  |        |      |  |      |        |      |  |      | 3,903   |   |  |   | 3,887   |   |  |   | 3,893   |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Net income adjusted to exclude goodwill amortization                                        |  | $                                | 67,717  |      |  | $    | 50,335  |      |  | $    | 36,063  |   |  | $ | 28,601  |   |  | $ | 34,762  |  
|                                                                                            |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Performance ratios                                                                          |  |                                  |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Return on average assets (1)                                                                |  |                                  | 0.70    | %    |  |      | 0.35    | %    |  |      | 0.48    | % |  |   | 0.42    | % |  |   | 0.62    | %
|Return on average equity (1)                                                                |  |                                  | 7.84    |      |  |      | 4.41    |      |  |      | 7.40    |   |  |   | 7.31    |   |  |   | 10.06   |  
|Average equity to average assets                                                            |  |                                  | 8.92    |      |  |      | 8.03    |      |  |      | 6.48    |   |  |   | 5.81    |   |  |   | 6.14    |  
|Dividend payout ratio (2)                                                                   |  |                                  | 19.50   |      |  |      | 36.51   |      |  |      | 23.44   |   |  |   | 20.82   |   |  |   | 16.10   |  

26



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##### Table of Contents



|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|----------------------------------------------------------------------------------------------------------- |  | -------------------------------- | --------- | ---- |  | ---- | --------- | ---- |  | ---- | --------- | - |  | - | --------- | - |  | - | --------- | -
|                                                                                                            |  | For the Years Ended December 31,
|                                                                                                            |  |                                 
|(In thousands except share and per share data)                                                              |  | 2003                             |           | 2002 |  | 2001 |           | 2000 |  | 1999
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |     
|Per Class A common share data (3)                                                                           |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Diluted earnings from continuing operations                                                                 |  | $                                | N/A       |      |  | $    | N/A       |      |  | $    | N/A       |   |  | $ | 0.43      |   |  | $ | 0.52      |  
|Diluted earnings from discontinued operations                                                               |  |                                  | N/A       |      |  |      | N/A       |      |  |      | N/A       |   |  |   | 0.11      |   |  |   | 0.10      |  
|Diluted earnings from extraordinary items                                                                   |  |                                  | N/A       |      |  |      | N/A       |      |  |      | N/A       |   |  |   |          |   |  |   |          |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Diluted earnings per share                                                                                  |  |                                  | N/A       |      |  |      | N/A       |      |  |      | N/A       |   |  |   | 0.54      |   |  |   | 0.62      |  
|Diluted earnings per share from amortization of
goodwill                                                    |  |                                  | N/A       |      |  |      | N/A       |      |  |      | N/A       |   |  |   | 0.07      |   |  |   | 0.07      |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Diluted earnings per share adjusted for amortization
of goodwill                                            |  | $                                | N/A       |      |  | $    | N/A       |      |  | $    | N/A       |   |  | $ | 0.61      |   |  | $ | 0.69      |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Per common share data (3)                                                                                   |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |          
|Diluted earnings from continuing operations                                                                 |  | $                                | 0.62      |      |  | $    | 0.32      |      |  | $    | 0.47      |   |  | $ | N/A       |   |  | $ | N/A       |  
|Diluted earnings per share from discontinued
operations                                                     |  |                                  | 0.46      |      |  |      | 0.35      |      |  |      | 0.16      |   |  |   | N/A       |   |  |   | N/A       |  
|Diluted earnings per share from extraordinary items                                                         |  |                                  |          |      |  |      | 0.37      |      |  |      |          |   |  |   | N/A       |   |  |   | N/A       |  
|Diluted earnings (loss) per share from cumulative effect of
a change in accounting principle                |  |                                  |          |      |  |      | (0.23     | )    |  |      | 0.02      |   |  |   | N/A       |   |  |   | N/A       |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Diluted earnings per share                                                                                  |  |                                  | 1.08      |      |  |      | 0.81      |      |  |      | 0.65      |   |  |   | N/A       |   |  |   | N/A       |  
|Diluted earnings per share from amortization of
goodwill                                                    |  |                                  |          |      |  |      |          |      |  |      | 0.08      |   |  |   | N/A       |   |  |   | N/A       |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Diluted earnings per share adjusted for goodwill
amortization                                               |  | $                                | 1.08      |      |  | $    | 0.81      |      |  | $    | 0.73      |   |  | $ | N/A       |   |  | $ | N/A       |  
|                                                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Cash dividends declared per common share Class A                                                            |  | $                                | 0.128     |      |  | $    | 0.120     |      |  | $    | 0.112     |   |  | $ | 0.101     |   |  | $ | 0.097     |  
|Cash dividends declared per common share Class B                                                            |  |                                  | 0.128     |      |  |      | 0.120     |      |  |      | 0.110     |   |  |   | 0.092     |   |  |   | 0.088     |  
|Book value per share                                                                                        |  |                                  | 6.98      |      |  |      | 8.05      |      |  |      | 7.50      |   |  |   | 6.80      |   |  |   | 5.53      |  
|Tangible book value per share                                                                               |  |                                  | 5.48      |      |  |      | 6.46      |      |  |      | 6.82      |   |  |   | 5.44      |   |  |   | 4.27      |  
|Balance Sheet (at year end)                                                                                 |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Loans and leases, net (4)                                                                                   |  | $                                | 3,686,153 |      |  | $    | 3,372,630 |      |  | $    | 2,774,238 |   |  | $ | 2,853,804 |   |  | $ | 2,689,708 |  
|Securities                                                                                                  |  |                                  | 675,782   |      |  |      | 1,106,552 |      |  |      | 1,340,881 |   |  |   | 1,266,186 |   |  |   | 954,932   |  
|Total assets                                                                                                |  |                                  | 4,831,549 |      |  |      | 5,421,011 |      |  |      | 4,654,486 |   |  |   | 4,617,300 |   |  |   | 4,159,901 |  
|Deposits                                                                                                    |  |                                  | 3,058,142 |      |  |      | 2,920,555 |      |  |      | 2,276,567 |   |  |   | 2,234,485 |   |  |   | 2,027,892 |  
|Securities sold under agreements to repurchase and
other short term borrowings                              |  |                                  | 138,809   |      |  |      | 116,279   |      |  |      | 467,070   |   |  |   | 669,202   |   |  |   | 429,123   |  
|Other borrowings (5)                                                                                        |  |                                  | 1,082,066 |      |  |      | 1,671,361 |      |  |      | 1,312,208 |   |  |   | 1,337,909 |   |  |   | 1,401,709 |  
|Stockholders equity                                                                                        |  |                                  | 413,452   |      |  |      | 469,334   |      |  |      | 435,673   |   |  |   | 248,821   |   |  |   | 235,886   |  
|Asset quality ratios                                                                                        |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Non-performing assets, net of reserves, as a percent
of total loans, tax certificates and real estate owned |  |                                  | 0.33      | %    |  |      | 0.79      | %    |  |      | 1.11      | % |  |   | 0.89      | % |  |   | 1.40      | %
|Loan loss allowance as a percent of non-performing
loans                                                    |  |                                  | 479.19    |      |  |      | 253.84    |      |  |      | 119.67    |   |  |   | 248.35    |   |  |   | 136.17    |  
|Loan loss allowance as a percent of total loans                                                             |  |                                  | 1.22      |      |  |      | 1.40      |      |  |      | 1.58      |   |  |   | 1.62      |   |  |   | 1.63      |  
|Capital ratios for BankAtlantic:                                                                            |  |                                  |           |      |  |      |           |      |  |      |           |   |  |   |           |   |  |   |           |  
|Total risk based capital                                                                                    |  |                                  | 12.06     | %    |  |      | 11.89     | %    |  |      | 12.90     | % |  |   | 11.00     | % |  |   | 13.30     | %
|Tier I risk based capital                                                                                   |  |                                  | 10.22     |      |  |      | 10.01     |      |  |      | 11.65     |   |  |   | 9.74      |   |  |   | 12.04     |  
|Leverage                                                                                                    |  |                                  | 8.52      |      |  |      | 7.26      |      |  |      | 8.02      |   |  |   | 6.66      |   |  |   | 7.71      |  



|(1) |  | Prior period return on average equity and assets were restated to
reflect returns from continuing operations. Returns from continuing
operations exclude the results of operations of Levitt Corporation, The
GMS Group, and Cumberland Advisors, Inc.                                                                                                                                                                                                                                    
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Cash dividends declared on common shares divided by income from
continuing operations.                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|(3) |  | In periods prior to December 31, 2001, our capital structure
included a dividend premium for our Class A common stockholders. As a
consequence of the dividend structure, we used the two-class method to
calculate our earnings per share. During the 2001 second quarter, our
stockholders voted to equalize the dividend payable on the Class A and
Class B common stock. As a result, as of January 1, 2001 we no longer
use the two-class method to calculate our earnings per share.
|   
|(4) |  | Includes $233,000, $0, $5,000, $1.3 million and $13.6 million of
bankers acceptances in 2003, 2002, 2001, 2000 and 1999, respectively.                                                                                                                                                                                                                                                                                                                                                   
|   
|(5) |  | Other borrowings consist of FHLB advances, subordinated debentures,
notes and bonds payable, guaranteed preferred beneficial interests in
Companys junior subordinated debentures and junior subordinated
debentures.                                                                                                                                                                                                                                                                    

27



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##### Table of Contents






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

Introduction

BankAtlantic Bancorp, Inc. is a Florida-based financial services holding
company offering a full range of products and services through BankAtlantic,
our wholly-owned banking subsidiary, and RB Holdings, Inc., our wholly-owned
parent company of our broker-dealer subsidiary, Ryan Beck. As of December
31, 2003, we had total consolidated assets of approximately $4.8 billion,
deposits of approximately $3.1 billion and shareholders equity of
approximately $413 million.

The following events have occurred during the past three years that have
had a significant impact on the Company and upon its past and future results
of operations:



| |  |  | In March of 2002, BankAtlantic acquired Community Savings
Bancshares, Inc., the parent company of Community Savings, F.A.
(Community) and immediately merged Community into BankAtlantic.
Community had its headquarters and branches in our South Florida
market. Community had approximately $909 million in assets and $637
million in deposits on the date of acquisition.                                                                                                                                                                                                                                  
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | In April of 2002, BankAtlantic embarked upon its Floridas Most
Convenient Bankinitiative to attract retail customers. This
campaign includes seven-day branch banking and extended weekday hours,
along with a 24/7 live customer service center, Totally Free Checking,
free online banking, Totally Free Change Exchange coin counters, and
dozens of additional product and service initiatives. While the
initiatives have resulted in increased expenses, we believe this
marketing campaign has contributed to significant new deposit account
openings and growth in low cost deposits at the Bank.     
|
| |  |  | Also, in April of 2002, Ryan Beck acquired certain of the assets
and assumed certain liabilities of the former broker-dealer known as
Gruntal & Co., LLC. Before this acquisition, Ryan Beck had 130
account executives located in 9 offices, principally in the New
Jersey/New York metropolitan area and southeast Florida. This
transaction added over 400 additional consultants and 25 new offices
to Ryan Becks operations. Ryan Beck currently has approximately 500
financial consultants in 34 offices and now has a substantial east
coast presence, along with offices in the mid-west and west coast.
|
| |  |  | Effective December 31, 2003 we spun-off our wholly-owned real
estate development subsidiary, Levitt Corporation (Levitt), which is
now traded on the New York Stock Exchange under the symbol LEV.
Levitt has approximately $394 million in total assets and $126
million in shareholders equity. This transaction was effected by
means of a distribution to our stockholders of all of the outstanding
capital stock of Levitt.                                                                                                                                                                            

BankAtlantic Bancorp, Inc. Consolidated Results of Operations

Net income increased to $67.7 million in 2003 from $50.3 million in 2002
and $32.2 million in 2001. Included in these totals is income from
discontinued operations (primarily relating to Levitt) of $29.1 million, $22.5
million and $8.5 million, respectively. Additionally, in 2002, the Company
realized an extraordinary gain of $23.7 million associated with the Gruntal
transaction because the fair value of the assets acquired exceeded the
purchase price. Also in 2002, the Company realized a loss of $15.1 million
due to the initial implementation of FAS 142 concerning goodwill impairment.
The Company performed the required goodwill impairment test and determined
that the goodwill assigned to the Ryan Beck subsidiary was impaired. The
Company performed its annual goodwill impairment test again in 2003 and
concluded that no further goodwill impairment existed. In 2001, the Company
realized a gain of $1.1 million due to the initial implementation of FAS 133
concerning derivative instruments and hedging activities. The Company had
interest rate swap contracts for which it recorded a cumulative effect
adjustment gain.

Income from continuing operations increased to $38.6 million in 2003 from
$19.1 million in 2002 and $22.5 million in 2001. A reconciliation of the
results of operations from each of the Companys primary business segments
follows (in thousands):

28



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##### Table of Contents



Income from Continuing Operations

|               |       |   |                     |        |      |   |         |        |  |   |         |        | 
|-------------- | ----- | - | ------------------- | ------ | ---- | - | ------- | ------ |  | - | ------- | ------ | 
|               |       |   | For the Years Ended
|               |       |   | December 31,       
|               |       |   |                    
|               |       |   | 2003                |        | 2002 |   | 2001   
|               |       |   |                     |        |      |   |        
|BankAtlantic   |       | $ | 42,129              |        |      | $ | 45,109  |        |  | $ | 44,629  |       
|Ryan Beck      |       |   | 9,645               |        |      |   | (2,448  | )      |  |   | (1,317  | )     
|Parent Company |       |   | (13,177             | )      |      |   | (23,511 | )      |  |   | (20,782 | )     
|               |       |   |                     |        |      |   |         |        |  |   |         |       
|               | Total |   | $                   | 38,597 |      |   | $       | 19,150 |  |   | $       | 22,530 | 
|               |       |   |                     |        |      |   |         |        |  |   |         |       

A detailed discussion of the result of operations of each of these
business segments follows.

BankAtlantic Results of Operations

Summary

Since the beginning of 2002, BankAtlantic has opened 244,000 new checking
and savings accounts, including over 34,000 in the fourth quarter of 2003.
The fourth quarter of 2003 marked the eighth consecutive quarter of
double-digit growth in new low cost checking and savings account openings. In
2003, new checking (DDA/NOW) and savings account openings were approximately
145,000, compared to 99,000 in 2002, an increase of 46%. Since January 1,
2002, total low cost deposits have increased from approximately $600 million
to approximately $1.4 billion, an increase of 133%. Non-interest bearing
demand deposits now constitute 21% of deposit funding, up from 16% last year.
We expect these trends to continue as we increase our advertising
expenditures, create other marketing programs and maintain our commitment to
superior customer service.

Subject to changes in the interest rate environment, we expect our net
interest income to improve in 2004. During 2003, the net interest margin was
negatively impacted by lower interest rates, creating prepayments and rapid
premium amortization on mortgage related assets. We were also burdened with
fixed rate FHLB advances that prevented our cost of funds from decreasing as
rapidly as our yield on assets. Late in 2003, we prepaid a portion of these
fixed rate FHLB advances and incurred a prepayment penalty. Although this
penalty decreased earnings in 2003, we prepaid these fixed rate advances with
the expectation that it will lower our funding costs and improve our net
interest margin in future years.

Our credit quality has been improving. The ratio of non-performing loans
to total loans declined to 0.25% at year-end. Net charge-offs for 2003 were
only $1.1 million vs. $19.8 million for 2002, and the associated ratio of net
charge-offs to average outstanding loans declined to 0.03% versus 0.57% for
these respective years. In addition to lower loan charge-offs, in 2003 we were
successful in recovering and collecting upon past charge-offs in our
syndication loan and leasing portfolios. We cannot assure that we will have
similar success in future years and expect to experience a higher net
charge-off ratio.

Also, because of our recent emphasis on the origination and purchase of
loans collateralized by real estate, we believe we have lower losses inherent
in our loan portfolio; therefore the ratio of the allowance for loan losses to
total loans outstanding at December 31, 2003 decreased to 1.22% from 1.40% at
the 2002 year-end. This, combined with low net charge offs, necessitated a
negative provision for loan losses of $547,000 in 2003. We believe that our
credit ratios reflect the improving credit quality of our loans. Although we
do not foresee significant changes in the quality of our loan portfolio, we
caution that changes in the local or national economy, or within certain
industries, could have a dramatic impact on the performance of our loans.

Our non-interest income improved substantially during 2003, due in part
to increased fees associated with the additional new deposit accounts opened
during the year. Additionally, we generated fee income on $637 million of
deposits acquired as part of the March 2002 acquisition of Community. This
was a locally headquartered savings and loan that had branches within and
adjacent to our primary South Florida market. We believe that we will
continue to experience an increase in non-interest income during 2004 as we
continue our Floridas Most Convenient Bankinitiatives and expand and
renovate our branch network.

Our non-interest expenses increased significantly during 2003 due
primarily to the costs linked to our marketing initiatives, including the
hiring of new employees to service customers and advertising expenditures to
promote the campaign. We believe that these expenses will continue to
increase during 2004 as we continue to implement the Floridas Most

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Convenient Bank initiatives. Additionally, we have plans for branch expansion
and renovation. We believe that the potential
future contribution to our profitability from our branch network
expansion and deposit strategies will justify these additional costs.
Additionally, as discussed earlier, our non-interest expense increased because
we incurred $10.9 million in expenses associated with the prepayment of FHLB
Advances.

The following table is a condensed income statement summarizing the Banks
results of operations (in thousands):

|                                                      |  |                     |          |          |  |          |          |      |  |      |          |   |  |   |         |   |  |   |         |  
|----------------------------------------------------- |  | ------------------- | -------- | -------- |  | -------- | -------- | ---- |  | ---- | -------- | - |  | - | ------- | - |  | - | ------- | -
|                                                      |  | For the Years Ended |          |          |  |          |          |      |  |     
|                                                      |  | December 31,        |          | Change   |  | Change  
|                                                      |  |                     |          | 2003 vs. |  | 2002 vs.
|                                                      |  | 2003                |          | 2002     |  | 2001     |          | 2002 |  | 2001
|                                                      |  |                     |          |          |  |          |          |      |  |     
|Net interest income                                   |  | $                   | 154,100  |          |  | $        | 164,122  |      |  | $    | 153,722  |   |  | $ | (10,022 | ) |  | $ | 10,400  |  
|(Provision for) recovery from
loan losses             |  |                     | 547      |          |  |          | (14,077  | )    |  |      | (16,905  | ) |  |   | 14,624  |   |  |   | 2,828   |  
|                                                      |  |                     |          |          |  |          |          |      |  |      |          |   |  |   |         |   |  |   |         |  
|Net interest income after
provision for loan losses   |  |                     | 154,647  |          |  |          | 150,045  |      |  |      | 136,817  |   |  |   | 4,602   |   |  |   | 13,228  |  
|Non-interest income                                   |  |                     | 70,686   |          |  |          | 53,317   |      |  |      | 37,457   |   |  |   | 17,369  |   |  |   | 15,860  |  
|Non-interest expense                                  |  |                     | (161,615 | )        |  |          | (134,408 | )    |  |      | (103,353 | ) |  |   | (27,207 | ) |  |   | (31,055 | )
|                                                      |  |                     |          |          |  |          |          |      |  |      |          |   |  |   |         |   |  |   |         |  
|Income from continuing operations
before income taxes |  |                     | 63,718   |          |  |          | 68,954   |      |  |      | 70,921   |   |  |   | (5,236  | ) |  |   | (1,967  | )
|Income taxes                                          |  |                     | (21,589  | )        |  |          | (23,845  | )    |  |      | (26,292  | ) |  |   | 2,256   |   |  |   | 2,447   |  
|                                                      |  |                     |          |          |  |          |          |      |  |      |          |   |  |   |         |   |  |   |         |  
|Income from continuing operations                     |  | $                   | 42,129   |          |  | $        | 45,109   |      |  | $    | 44,629   |   |  | $ | (2,980  | ) |  | $ | 480     |  
|                                                      |  |                     |          |          |  |          |          |      |  |      |          |   |  |   |         |   |  |   |         |  

A complete discussion of each component of income and expense follows:

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BankAtlantics Net Interest Income

The following table summarizes net interest income:

|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |      | 
|------------------------------------------------ | ----------------------------------------- | ------- | ------------------- | ------- | ----------------- | ---- | ----------------- | ------- | ------- | ------- | -------- | ---- | ------ | ------- | --------- | ------- | -------- | ---- | ------- | ----- |  |  | ----- | ---- |  | - | --------- | ------- |  | - | ------- | ------ |  |  | ----- | ---- | 
|                                                 |                                           |         | For the Years Ended
|                                                 |                                           |         |                    
|                                                 |                                           |         | December 31, 2003   |         | December 31, 2002 |      | December 31, 2001
|                                                 |                                           |         |                     |         |                   |      |                  
|                                                 |                                           |         | Average             |         | Revenue/          |      | Yield/            |         | Average |         | Revenue/ |      | Yield/ |         | Average   |         | Revenue/ |      | Yield/ 
|(Dollars in thousands)                           |                                           | Balance |                     | Expense |                   | Rate |                   | Balance |         | Expense |          | Rate |        | Balance |           | Expense |          | Rate
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |     
|Interest earning assets                          |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Loans: (a)                                       |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Residential real estate                          |                                           | $       | 1,639,504           |         |                   | $    | 78,535            |         |         |         | 4.79     | %    |        | $       | 1,429,022 |         |          | $    | 88,808  |       |  |  | 6.21  | %    |  | $ | 1,327,455 |         |  | $ | 94,199  |        |  |  | 7.10  | %   
|Commercial real estate                           |                                           |         | 1,610,707           |         |                   |      | 94,193            |         |         |         | 5.85     |      |        |         | 1,500,744 |         |          |      | 96,836  |       |  |  | 6.45  |      |  |   | 1,112,026 |         |  |   | 95,114  |        |  |  | 8.55  |     
|Consumer                                         |                                           |         | 316,113             |         |                   |      | 14,177            |         |         |         | 4.48     |      |        |         | 253,044   |         |          |      | 14,165  |       |  |  | 5.60  |      |  |   | 211,939   |         |  |   | 17,296  |        |  |  | 8.16  |     
|Lease financing                                  |                                           |         | 21,930              |         |                   |      | 2,490             |         |         |         | 11.35    |      |        |         | 43,496    |         |          |      | 5,307   |       |  |  | 12.20 |      |  |   | 70,113    |         |  |   | 8,835   |        |  |  | 12.60 |     
|Commercial business                              |                                           |         | 107,371             |         |                   |      | 6,126             |         |         |         | 5.71     |      |        |         | 99,852    |         |          |      | 5,935   |       |  |  | 5.94  |      |  |   | 187,131   |         |  |   | 14,482  |        |  |  | 7.74  |     
|Small business                                   |                                           |         | 161,245             |         |                   |      | 11,973            |         |         |         | 7.43     |      |        |         | 146,468   |         |          |      | 11,565  |       |  |  | 7.90  |      |  |   | 98,405    |         |  |   | 9,811   |        |  |  | 9.97  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total loans                                      |                                           |         | 3,856,870           |         |                   |      | 207,494           |         |         |         | 5.38     |      |        |         | 3,472,626 |         |          |      | 222,616 |       |  |  | 6.41  |      |  |   | 3,007,069 |         |  |   | 239,737 |        |  |  | 7.97  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Securities available for sale (b)                |                                           |         | 559,562             |         |                   |      | 27,265            |         |         |         | 4.87     |      |        |         | 727,347   |         |          |      | 42,406  |       |  |  | 5.83  |      |  |   | 858,145   |         |  |   | 52,813  |        |  |  | 6.15  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Investment securities (c)                        |                                           |         | 229,889             |         |                   |      | 16,476            |         |         |         | 7.17     |      |        |         | 452,753   |         |          |      | 32,013  |       |  |  | 7.07  |      |  |   | 389,197   |         |  |   | 32,161  |        |  |  | 8.26  |     
|Federal funds sold                               |                                           |         | 16,499              |         |                   |      | 166               |         |         |         | 1.01     |      |        |         | 3,929     |         |          |      | 57      |       |  |  | 1.45  |      |  |   | 564       |         |  |   | 21      |        |  |  | 3.72  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total investment securities                      |                                           |         | 246,388             |         |                   |      | 16,642            |         |         |         | 5.54     |      |        |         | 456,682   |         |          |      | 32,070  |       |  |  | 7.02  |      |  |   | 389,761   |         |  |   | 32,182  |        |  |  | 8.26  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total interest earning assets                    |                                           |         | 4,662,820           |         |                   | $    | 251,401           |         |         |         | 5.39     | %    |        |         | 4,656,655 |         |          | $    | 297,092 |       |  |  | 6.38  | %    |  |   | 4,254,975 |         |  | $ | 324,732 |        |  |  | 7.63  | %   
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Non-interest earning assets                      |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total non-interest earning assets                |                                           |         | 324,598             |         |                   |      |                   |         |         |         |          |      |        |         | 316,085   |         |          |      |         |       |  |  |       |      |  |   | 164,255   |         |  |   |         |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total assets                                     |                                           | $       | 4,987,418           |         |                   |      |                   |         |         |         |          |      |        | $       | 4,972,740 |         |          |      |         |       |  |  |       |      |  | $ | 4,419,230 |         |  |   |         |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Interest bearing liabilities                     |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Deposits:                                        |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Savings                                          |                                           | $       | 190,506             |         |                   | $    | 856               |         |         |         | 0.45     | %    |        | $       | 140,961   |         |          | $    | 1,362   |       |  |  | 0.97  | %    |  | $ | 102,996   |         |  | $ | 1,451   |        |  |  | 1.41  | %   
|NOW, money funds and checking                    |                                           |         | 1,315,747           |         |                   |      | 11,142            |         |         |         | 0.85     |      |        |         | 1,078,298 |         |          |      | 15,338  |       |  |  | 1.42  |      |  |   | 757,922   |         |  |   | 20,241  |        |  |  | 2.67  |     
|Certificate accounts                             |                                           |         | 882,736             |         |                   |      | 24,191            |         |         |         | 2.74     |      |        |         | 1,230,013 |         |          |      | 46,077  |       |  |  | 3.75  |      |  |   | 1,182,094 |         |  |   | 63,976  |        |  |  | 5.41  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total interest bearing deposits                  |                                           |         | 2,388,989           |         |                   |      | 36,189            |         |         |         | 1.51     |      |        |         | 2,449,272 |         |          |      | 62,777  |       |  |  | 2.56  |      |  |   | 2,043,012 |         |  |   | 85,668  |        |  |  | 4.19  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Securities sold under agreements                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|                                                 | To repurchase and federal funds
Purchased |         |                     | 285,284 |                   |      |                   | 3,089   |         |         |          | 1.08 |        |         |           | 400,376 |          |      |         | 6,845 |  |  |       | 1.71 |  |   |           | 604,311 |  |   |         | 24,870 |  |  |       | 4.12 | 
|Advances from FHLB                               |                                           |         | 1,195,653           |         |                   |      | 57,299            |         |         |         | 4.79     |      |        |         | 1,198,463 |         |          |      | 62,412  |       |  |  | 5.21  |      |  |   | 1,077,876 |         |  |   | 60,472  |        |  |  | 5.61  |     
|Subordinated debentures and notes payable        |                                           |         | 35,457              |         |                   |      | 1,917             |         |         |         | 5.41     |      |        |         | 14,805    |         |          |      | 936     |       |  |  | 6.32  |      |  |   |          |         |  |   |        |        |  |  |      |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total interest bearing liabilities               |                                           |         | 3,905,383           |         |                   |      | 98,494            |         |         |         | 2.52     |      |        |         | 4,062,916 |         |          |      | 132,970 |       |  |  | 3.27  |      |  |   | 3,725,199 |         |  |   | 171,010 |        |  |  | 4.59  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Non-interest bearing liabilities                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Demand deposit and escrow accounts               |                                           |         | 551,866             |         |                   |      |                   |         |         |         |          |      |        |         | 405,599   |         |          |      |         |       |  |  |       |      |  |   | 285,760   |         |  |   |         |        |  |  |       |     
|                                                 | Other liabilities                         |         |                     | 55,261  |                   |      |                   |         |         |         |          |      |        |         |           | 70,187  |          |      |         |       |  |  |       |      |  |   |           | 55,383  |  |   |         |        |  |  |       |      | 
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|                                                 | Total non-interest bearing liabilities    |         |                     | 607,127 |                   |      |                   |         |         |         |          |      |        |         |           | 475,786 |          |      |         |       |  |  |       |      |  |   |           | 341,143 |  |   |         |        |  |  |       |      | 
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Stockholders equity                             |                                           |         | 474,908             |         |                   |      |                   |         |         |         |          |      |        |         | 434,038   |         |          |      |         |       |  |  |       |      |  |   | 352,888   |         |  |   |         |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Total liabilities and stockholders
Equity       |                                           | $       | 4,987,418           |         |                   |      |                   |         |         |         |          |      |        | $       | 4,972,740 |         |          |      |         |       |  |  |       |      |  | $ | 4,419,230 |         |  |   |         |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Net interest income/net
interest spread          |                                           |         |                     |         |                   |      | 152,907           |         |         |         | 2.87     | %    |        |         |           |         |          |      | 164,122 |       |  |  | 3.11  | %    |  |   |           |         |  |   | 153,722 |        |  |  | 3.04  | %   
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Capitalized interest from real estate
operations |                                           |         |                     |         |                   |      | 1,193             |         |         |         |          |      |        |         |           |         |          |      |        |       |  |  |       |      |  |   |           |         |  |   |        |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Net interest income                              |                                           |         |                     |         |                   | $    | 154,100           |         |         |         |          |      |        |         |           |         |          | $    | 164,122 |       |  |  |       |      |  |   |           |         |  | $ | 153,722 |        |  |  |       |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Margin                                           |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Interest income/interest earning assets          |                                           |         |                     |         |                   |      |                   |         |         |         | 5.39     | %    |        |         |           |         |          |      |         |       |  |  | 6.38  | %    |  |   |           |         |  |   |         |        |  |  | 7.63  | %   
|Interest expense/interest earning assets         |                                           |         |                     |         |                   |      |                   |         |         |         | 2.11     |      |        |         |           |         |          |      |         |       |  |  | 2.86  |      |  |   |           |         |  |   |         |        |  |  | 4.02  |     
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     
|Net interest margin                              |                                           |         |                     |         |                   |      |                   |         |         |         | 3.28     | %    |        |         |           |         |          |      |         |       |  |  | 3.52  | %    |  |   |           |         |  |   |         |        |  |  | 3.61  | %   
|                                                 |                                           |         |                     |         |                   |      |                   |         |         |         |          |      |        |         |           |         |          |      |         |       |  |  |       |      |  |   |           |         |  |   |         |        |  |  |       |     

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##### Table of Contents





| | a) |  | Includes non-accruing loans                                                                                                                                                  
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | Average balances were based on amortized cost.                                                                                                                               
|
| | c) |  | Includes securities purchased under agreements to resell, tax
certificates, mortgage-backed securities held to maturity and
interest bearing deposits and trading securities.

The following table summarizes the changes in net interest income (in
thousands):

|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |         |  
|--------------------------------------------------------- | ------------------------------ | - | ---------------------- | ------ | ---------------------- | - | ------- | ------- | ---------- | - | ------- | ------- | ----- | - | ------ | ----- |  | - | ------- | ------- | - | - | ------- | ------- | -
|                                                          |                                |   | Year Ended             |        | Year Ended            
|                                                          |                                |   | December 31, 2003      |        | December 31, 2002     
|                                                          |                                |   | Compared to Year Ended |        | Compared to Year Ended
|                                                          |                                |   | December 31, 2002      |        | December 31, 2001     
|                                                          |                                |   |                        |        |                       
|                                                          |                                |   | Volume (a)             |        | Rate                   |   | Total   |         | Volume (a) |   | Rate    |         | Total
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |      
|Increase (decrease) due to:                               |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Loans                                                     |                                | $ | 20,672                 |        |                        | $ | (35,793 | )       |            | $ | (15,121 | )       |       | $ | 29,845 |       |  | $ | (46,966 | )       |   | $ | (17,121 | )      
|Securities available for sale                             |                                |   | (8,175                 | )      |                        |   | (6,966  | )       |            |   | (15,141 | )       |       |   | (7,626 | )     |  |   | (2,781  | )       |   |   | (10,407 | )      
|Investment securities (b)                                 |                                |   | (15,973                | )      |                        |   | 436     |         |            |   | (15,537 | )       |       |   | 4,494  |       |  |   | (4,642  | )       |   |   | (148    | )      
|Federal funds sold                                        |                                |   | 126                    |        |                        |   | (17     | )       |            |   | 109     |         |       |   | 49     |       |  |   | (13     | )       |   |   | 36      |        
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Total earning assets                                      |                                |   | (3,350                 | )      |                        |   | (42,340 | )       |            |   | (45,690 | )       |       |   | 26,762 |       |  |   | (54,402 | )       |   |   | (27,640 | )      
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Deposits:                                                 |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|                                                          | Savings                        |   |                        | 223    |                        |   |         | (729    | )          |   |         | (506    | )     |   |        | 367   |  |   |         | (456    | ) |   |         | (89     | )
|                                                          | NOW, money funds, and checking |   |                        | 2,011  |                        |   |         | (6,207  | )          |   |         | (4,196  | )     |   |        | 4,557 |  |   |         | (9,460  | ) |   |         | (4,903  | )
|                                                          | Certificate accounts           |   |                        | (9,517 | )                      |   |         | (12,369 | )          |   |         | (21,886 | )     |   |        | 1,795 |  |   |         | (19,694 | ) |   |         | (17,899 | )
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Total deposits                                            |                                |   | (7,283                 | )      |                        |   | (19,305 | )       |            |   | (26,588 | )       |       |   | 6,719  |       |  |   | (29,610 | )       |   |   | (22,891 | )      
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Securities sold under agreements
to repurchase            |                                |   | (1,247                 | )      |                        |   | (2,508  | )       |            |   | (3,755  | )       |       |   | (3,487 | )     |  |   | (14,538 | )       |   |   | (18,025 | )      
|Advances from FHLB                                        |                                |   | (135                   | )      |                        |   | (4,978  | )       |            |   | (5,113  | )       |       |   | 6,280  |       |  |   | (4,340  | )       |   |   | 1,940   |        
|Subordinated debentures                                   |                                |   | 1,117                  |        |                        |   | (136    | )       |            |   | 981     |         |       |   | 936    |       |  |   |        |         |   |   | 936     |        
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|                                                          |                                |   | (265                   | )      |                        |   | (7,622  | )       |            |   | (7,887  | )       |       |   | 3,729  |       |  |   | (18,878 | )       |   |   | (15,149 | )      
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Total interest bearing liabilities                        |                                |   | (7,548                 | )      |                        |   | (26,927 | )       |            |   | (34,475 | )       |       |   | 10,448 |       |  |   | (48,488 | )       |   |   | (38,040 | )      
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        
|Change in net interest income
before capitalized interest |                                | $ | 4,198                  |        |                        | $ | (15,413 | )       |            | $ | (11,215 | )       |       | $ | 16,314 |       |  | $ | (5,914  | )       |   | $ | 10,400  |        
|                                                          |                                |   |                        |        |                        |   |         |         |            |   |         |         |       |   |        |       |  |   |         |         |   |   |         |        



|(a) |  | Changes attributable to rate/volume have been allocated to volume.
|--- |  | ------------------------------------------------------------------
|   
|(b) |  | Average balances were based on amortized cost.                    

For the Year Ended December 31, 2003 Compared to the Same 2002 Period

Net interest income decreased by $11.2 million, or 6%, from 2002. The
decline reflects a substantial decrease in yields on earning assets partially
offset by lower rates on interest bearing liabilities resulting in a 24 basis
point decline in our net interest margin. The net interest margin was
negatively impacted by the historically low interest rates during 2003 and
high rates associated with our advances from the FHLB. The yield on the
10-year Treasury bond declined from approximately 5.5% in early 2002 to almost
3.0% in mid-2003. For most of 2002, the prime rate stood at 4.75%. The prime
rate declined to 4.25% in November, 2002 and declined again to 4.00% in June,
2003. Short-term Libor and Treasury based indices also declined during this
period, leading to less interest income earned on adjustable rate loans and
investments. Additionally, this low interest rate environment resulted in
accelerated prepayments of mortgage loans and mortgage-backed securities as
homeowners took advantage of the refinancing opportunities. We experienced
accelerated amortization of premiums associated with some of these assets, and
we were faced with investing the proceeds from these repayments primarily in
residential and commercial loans at lower yields.

Interest income on average loans declined as the significant decline in
average loan yields was partially offset by an increase in average loan
balances. The growth in balances resulted from the purchase and origination
of commercial real estate, residential and home equity loans. During 2003,
the Bank purchased $1.1 billion of residential loans and originated over $1.0
billion of commercial loans and $317 million of home equity loans. The net
loan growth was funded primarily by the reduction in the average balances of
our securities portfolios.

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Interest income on investment securities, short term investments and
securities available for sale declined primarily due to the accelerated
repayment of high yielding securities due to the historically low interest
rate environment.

As a consequence of lower average yields on earning assets and a slight
increase in average earning asset balances, interest income decreased by $45.7
million.

Rates on interest bearing liabilities did not decline as rapidly as rates
on interest earning assets as 30% of average interest bearing liabilities
consisted of long term advances from the FHLB that, either directly or
indirectly via interest rate swaps, bear fixed interest rates. These advances
were originated in order to fund the purchase of fixed rate residential loans.
However, in September 2003 we repaid $185 million of high rate advances and
in December 2003 we repaid $140 million of high rate advances. The advances
repaid had an average rate of 5.57%. We recognized expenses of $10.9 million
in connection with these prepayments and recognized a $1.9 million loss on the
termination of interest rate swap contracts.

The lower deposit rates reflect the historically low interest rate
environment during 2003 plus a change in our deposit mix from higher rate
certificate of deposit accounts to low cost deposits and insured money fund
accounts. Low cost deposits are comprised of checking and savings accounts.
In 2003, new checking (DDA/NOW) and savings account openings were
approximately 145,000, compared to 99,000 in 2002, an increase of 46%.
Balances in low cost deposits increased 35% for the year ended December 31,
2003, to $1.4 billion. Non-interest bearing demand deposits now constitute
21% of deposit funding, up from 16% last year. We believe that our growth in
low cost deposits resulted primarily from our Floridas Most Convenient Bank
initiatives.

Interest expense on short-term borrowings was substantially lower during
2003 due to lower average balances and average rates.

Interest expense on FHLB advances declined resulting from maturities and
repayments of advances at higher rates than the advances outstanding.

Interest expense on long-term debt represents interest expense associated
with mortgage-backed bonds acquired in connection with the Community
acquisition and interest expense associated with $22 million of subordinated
debentures issued in October 2002.

Capitalized interest during 2003 represents interest capitalized on
qualifying assets associated with the Riverclub real estate joint venture.
Upon the implementation of Financial Interpretation No.46 (FIN 46), the
Riverclub joint venture was consolidated effective January 1, 2003. During
2002, the Riverclub joint venture was accounted for on the equity method of
accounting.

In total, the Banks interest expense declined by $34.5 million primarily
due to declining average rates and, secondarily, due to lower average
balances on interest bearing liabilities.

For the Year Ended December 31, 2002 Compared to the Same 2001 Period

Net interest income increased by $10.4 million, or 7%, from 2001. The
improvement reflects earning asset growth associated with the Community
acquisition and the origination and purchase of real estate loans partially
offset by a decline in the net interest margin. The net interest margin was
negatively impacted by a substantial increase in non-earning assets primarily
due to an increase in goodwill and branch-related assets as a result of the
Community acquisition. The unfavorable impact on net interest income of the
increase in non-earning assets was partially offset by a slight improvement in
our net interest spread as interest-bearing liabilities re-priced downward more
rapidly than interest-earning assets.

The growth in earning assets resulted from the addition of $709 million of
earning assets from the Community acquisition, and a significant increase in
fundings of commercial real estate, small business mortgage and home equity
consumer loans. The above increases in earning assets were partially offset by
lower average balances related to several discontinued or curtailed lines of
business, including our lease finance business, indirect consumer loans,
syndication commercial business loans, international loans to correspondent
banks and certain small business loans.

The decline in securities available for sale average balances primarily
resulted from accelerated repayments and the sale of mortgage-backed
securities. The increase in investment securities average balances reflects
increased tax certificate acquisitions during the period.

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The increase in interest-bearing deposits was primarily attributed to the
Community acquisition. The substantial growth in non-interest bearing demand
deposits primarily resulted from our Floridas Most Convenient Bank
initiatives.

Average short-term borrowings were substantially lower during 2002. The
decline was linked to an increase in deposits, FHLB advances, and subordinated
debenture average balances. During October 2002, BankAtlantic issued $22
million of subordinated debentures. The proceeds of the debentures were used
for general corporate purposes.

The net interest spread improved by 7 basis points from 2001, because the
rates on our interest-bearing liabilities declined faster than the yields on
our earning assets. The significant decline in the yields on our
interest-earning assets and the rate associated with our interest bearing
liabilities was a direct result of the historically low interest rate
environment during 2002. Contributing to the decline in our deposit rates
was a change in our deposit mix from time deposits to low cost savings, NOW,
money funds and checking accounts. Contributing to the decline in average
yields on interest-bearing assets was the refinancing of residential loans and
mortgage-backed securities and the subsequent purchases of replacement assets
at lower yields than the existing portfolio. Additionally, the rapid decline
in interest rates caused a downward adjustment of yields on our floating rate
loans and securities.

As a consequence of the growth in average earning assets and
interest-bearing liabilities, interest income increased by $26.8 million and
interest expense increased by $10.4 million. The lower rates paid on average
interest-bearing liabilities decreased interest expense by $48.5 million
while the lower yields on interest-earning assets decreased interest income
by $54.4 million.

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BankAtlantics Allowance for Loan Losses

Changes in the allowance for loan losses were as follows (in thousands):

|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|---------------------------------- |  | ------------------------------- | ------- | ---- |  | ---- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | - |  | - | ------- | -
|                                   |  | For the Year Ended December 31,
|                                   |  |                                
|                                   |  | 2003                            |         | 2002 |  | 2001 |         | 2000 |  | 1999
|                                   |  |                                 |         |      |  |      |         |      |  |     
|Balance, beginning of period       |  | $                               | 48,022  |      |  | $    | 44,585  |      |  | $    | 47,000  |   |  | $ | 44,450  |   |  | $ | 37,950  |  
|Charge-offs:                       |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Syndication loans                  |  |                                 |        |      |  |      | (8,013  | )    |  |      | (7,235  | ) |  |   | (3,659  | ) |  |   |        |  
|Commercial business loans          |  |                                 | (2,394  | )    |  |      |        |      |  |      |        |   |  |   | (24     | ) |  |   | (87     | )
|Commercial real estate loans       |  |                                 |        |      |  |      | (6,998  | )    |  |      |        |   |  |   |        |   |  |   | (211    | )
|Small business                     |  |                                 | (2,708  | )    |  |      | (3,655  | )    |  |      | (4,487  | ) |  |   | (14,114 | ) |  |   | (12,531 | )
|Lease financing                    |  |                                 | (3,700  | )    |  |      | (7,069  | )    |  |      | (10,340 | ) |  |   | (3,930  | ) |  |   | (1,217  | )
|Consumer loans - direct            |  |                                 | (1,563  | )    |  |      | (1,006  | )    |  |      | (2,629  | ) |  |   | (2,233  | ) |  |   | (2,443  | )
|Consumer loan - indirect           |  |                                 | (677    | )    |  |      | (1,095  | )    |  |      | (2,981  | ) |  |   | (7,546  | ) |  |   | (11,052 | )
|Residential real estate loans      |  |                                 | (681    | )    |  |      | (827    | )    |  |      | (244    | ) |  |   | (715    | ) |  |   | (150    | )
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Total charge-offs                  |  |                                 | (11,723 | )    |  |      | (28,663 | )    |  |      | (27,916 | ) |  |   | (32,221 | ) |  |   | (27,691 | )
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Recoveries:                        |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Syndication loans                  |  |                                 | 3,133   |      |  |      | 1,274   |      |  |      |        |   |  |   |        |   |  |   |        |  
|Commercial business loans          |  |                                 | 95      |      |  |      | 76      |      |  |      | 331     |   |  |   | 94      |   |  |   | 185     |  
|Commercial real estate loans       |  |                                 | 3       |      |  |      | 20      |      |  |      | 10      |   |  |   | 8       |   |  |   | 205     |  
|Small business                     |  |                                 | 2,637   |      |  |      | 2,268   |      |  |      | 2,623   |   |  |   | 1,240   |   |  |   | 188     |  
|Lease financing                    |  |                                 | 2,224   |      |  |      | 3,014   |      |  |      | 2,388   |   |  |   | 335     |   |  |   | 285     |  
|Consumer loans - direct            |  |                                 | 622     |      |  |      | 477     |      |  |      | 769     |   |  |   | 645     |   |  |   | 739     |  
|Consumer loans - indirect          |  |                                 | 1,137   |      |  |      | 1,419   |      |  |      | 2,252   |   |  |   | 3,211   |   |  |   | 1,931   |  
|Residential real estate loans      |  |                                 | 726     |      |  |      | 331     |      |  |      | 223     |   |  |   | 106     |   |  |   |        |  
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Total recoveries                   |  |                                 | 10,577  |      |  |      | 8,879   |      |  |      | 8,596   |   |  |   | 5,639   |   |  |   | 3,533   |  
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Net charge-offs                    |  |                                 | (1,146  | )    |  |      | (19,784 | )    |  |      | (19,320 | ) |  |   | (26,582 | ) |  |   | (24,158 | )
|Provision for loan losses          |  |                                 | (547    | )    |  |      | 14,077  |      |  |      | 16,905  |   |  |   | 29,132  |   |  |   | 30,658  |  
|Allowance for loan losses acquired |  |                                 | (734    | )    |  |      | 9,144   |      |  |      |        |   |  |   |        |   |  |   |        |  
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|Balance, end of period             |  | $                               | 45,595  |      |  | $    | 48,022  |      |  | $    | 44,585  |   |  | $ | 47,000  |   |  | $ | 44,450  |  
|                                   |  |                                 |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  

The outstanding loan balances related to our discontinued lines of
business and the amount of allowance for loan losses (ALL) assigned to each
line of business was as follows (in thousands):

|                    |  |                    |        |        |  |            |       |        |  |        |        |            |  |   |        |  |  |            |         |  |  |   |        | 
|------------------- |  | ------------------ | ------ | ------ |  | ---------- | ----- | ------ |  | ------ | ------ | ---------- |  | - | ------ |  |  | ---------- | ------- |  |  | - | ------ | 
|                    |  | As of December 31,
|                    |  |                   
|                    |  | 2003               |        | 2002   |  | 2001      
|                    |  |                    |        |        |  |           
|                    |  |                    |        |        |  | Allocation |       |        |  |        |        | Allocation |  |   |        |  |  | Allocation
|                    |  | Amount             |        | of ALL |  | Amount     |       | of ALL |  | Amount |        | of ALL    
|                    |  |                    |        |        |  |            |       |        |  |        |        |           
|Lease finance       |  | $                  | 14,442 |        |  | $          | 3,425 |        |  | $      | 31,279 |            |  | $ | 7,396  |  |  | $          | 54,969  |  |  | $ | 8,639  | 
|Syndication loans   |  |                    | 9,114  |        |  |            | 185   |        |  |        | 14,499 |            |  |   | 294    |  |  |            | 40,774  |  |  |   | 8,602  | 
|Small business (1)  |  |                    | 9,569  |        |  |            | 873   |        |  |        | 17,297 |            |  |   | 2,143  |  |  |            | 32,123  |  |  |   | 4,105  | 
|Consumer - indirect |  |                    | 2,402  |        |  |            | 70    |        |  |        | 8,105  |            |  |   | 457    |  |  |            | 25,400  |  |  |   | 1,247  | 
|                    |  |                    |        |        |  |            |       |        |  |        |        |            |  |   |        |  |  |            |         |  |  |   |        | 
|                    |  | $                  | 35,527 |        |  | $          | 4,553 |        |  | $      | 71,180 |            |  | $ | 10,290 |  |  | $          | 153,266 |  |  | $ | 22,593 | 
|                    |  |                    |        |        |  |            |       |        |  |        |        |            |  |   |        |  |  |            |         |  |  |   |        | 

(1) Small business loans originated before January 1, 2000.

During prior periods we discontinued the origination of syndication, lease
financings and indirect consumer loans and made major modifications to the
underwriting process for small business loans (collectively, discontinued
lines of business). The loans associated with the discontinued lines of
business gave rise to a significant portion of our net charge-offs in prior
periods. As the portfolios of these discontinued lines of business declined,
our provision for loan losses and the related allowance for loan losses also
declined.

The provision for loan losses declined in each of the years in the three
year period ended December 31, 2003. During 1999 and 2000, we significantly
increased our allowance for loan losses and provision for loan losses to
reflect losses

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experienced in our indirect consumer and small business lending activities.
During 2001, we significantly increased our allowance and provision associated
with losses experienced in our lease financing and syndication lending
activities. During 2002 and 2003, our allowance and provision were reduced due
to a change in our underwriting and credit management polices that began in
2000. We discontinued the origination of loans with high historical loss
experiences and focused our loan production on collateral based loans that have
historically had lower loss experiences than our discontinued lines of
business. Additionally, during 2003, our loan provision was favorably impacted
by significant recoveries from our discontinued lines of business. The
majority of these recoveries were from bankruptcy settlements associated with
syndication loans charged-off in prior periods.

The Bank experienced a significant improvement in net charge-offs during
2003 compared to the net charge-offs experienced during 2002 and 2001. This
improvement resulted from lower discontinued lines of business net charge-offs
during 2003 compared to prior periods. Additionally, included in commercial
real estate charge-offs during 2002 was a $3.5 million partial charge-off of a
commercial real estate construction loan and a $3.4 million partial charge-off
of a commercial loan in the hospitality industry. The commercial real estate
construction loan was transferred to real estate owned during 2002 and was sold
in 2003. The commercial loan collateralized by real estate in the hospitality
industry was sold at book value to an unrelated third party. During 2003 there
were no commercial real estate loan charge-offs; however, the Bank recognized a
$2.4 million partial charge-off of a commercial business loan.

Allowance for loan losses acquired and adjustments to the allowance for
loan losses acquired represent the loan loss allowance acquired in connection
with the Community acquisition.

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The table below presents the allocation of the allowance for loan losses
by various loan classifications (ALL by category), the percent of allowance
to each loan category (ALL to gross loans in each category) and sets forth
the percentage of loans in each category to gross loans excluding bankers
acceptances (Loans by category to gross loans). The allowance shown in the
table should not be interpreted as an indication that charge-offs in future
periods will occur in these amounts or percentages or that the allowance
indicates future charge-off amounts or trends (dollars in thousands):

|                        |  |                   |        |                   |  |                   |       |          |  |          |        |          |  |          |        |          |  |          |       |   |  |          |        |       |  |   |        |  |  |  |       |   |  |  |        |  
|----------------------- |  | ----------------- | ------ | ----------------- |  | ----------------- | ----- | -------- |  | -------- | ------ | -------- |  | -------- | ------ | -------- |  | -------- | ----- | - |  | -------- | ------ | ----- |  | - | ------ |  |  |  | ----- | - |  |  | ------ | -
|                        |  | December 31, 2003 |        | December 31, 2002 |  | December 31, 2001
|                        |  |                   |        |                   |  |                  
|                        |  |                   |        |                   |  | ALL               |       | Loans    |  |          |        |          |  | ALL      |        | Loans    |  |          |       |   |  | ALL      |        | Loans
|                        |  |                   |        |                   |  | to gross          |       | by       |  |          |        |          |  | to gross |        | by       |  |          |       |   |  | to gross |        | by   
|                        |  | ALL               |        | loans             |  | category          |       | ALL      |  | loans    |        | category |  | ALL      |        | loans    |  | category
|                        |  | by                |        | in each           |  | to gross          |       | by       |  | in each  |        | to gross |  | by       |        | in each  |  | to gross
|                        |  | category          |        | category          |  | loans             |       | category |  | category |        | loans    |  | category |        | category |  | loans   
|                        |  |                   |        |                   |  |                   |       |          |  |          |        |          |  |          |        |          |  |         
|Commercial business     |  | $                 | 1,715  |                   |  |                   | 1.87  | %        |  |          | 2.08   | %        |  | $        | 1,437  |          |  |          | 1.75  | % |  |          | 2.09   | %     |  | $ | 1,563  |  |  |  | 2.02  | % |  |  | 2.38   | %
|Syndications            |  |                   | 185    |                   |  |                   | 2.03  |          |  |          | 0.21   |          |  |          | 294    |          |  |          | 2.03  |   |  |          | 0.37   |       |  |   | 8,602  |  |  |  | 21.10 |   |  |  | 1.25   |  
|Commercial real estate  |  |                   | 24,005 |                   |  |                   | 0.99  |          |  |          | 54.97  |          |  |          | 21,124 |          |  |          | 1.07  |   |  |          | 50.16  |       |  |   | 13,682 |  |  |  | 0.83  |   |  |  | 50.54  |  
|Small business          |  |                   | 3,173  |                   |  |                   | 1.87  |          |  |          | 3.83   |          |  |          | 5,006  |          |  |          | 3.11  |   |  |          | 4.09   |       |  |   | 5,178  |  |  |  | 5.06  |   |  |  | 3.14   |  
|Lease financing         |  |                   | 3,425  |                   |  |                   | 23.72 |          |  |          | 0.33   |          |  |          | 7,396  |          |  |          | 23.65 |   |  |          | 0.79   |       |  |   | 8,639  |  |  |  | 15.72 |   |  |  | 1.69   |  
|Residential real estate |  |                   | 2,111  |                   |  |                   | 0.16  |          |  |          | 30.48  |          |  |          | 2,512  |          |  |          | 0.18  |   |  |          | 35.01  |       |  |   | 1,304  |  |  |  | 0.12  |   |  |  | 34.31  |  
|Consumer - direct       |  |                   | 3,900  |                   |  |                   | 1.10  |          |  |          | 8.05   |          |  |          | 3,239  |          |  |          | 1.13  |   |  |          | 7.28   |       |  |   | 2,064  |  |  |  | 1.07  |   |  |  | 5.91   |  
|Consumer - indirect     |  |                   | 70     |                   |  |                   | 2.91  |          |  |          | 0.05   |          |  |          | 457    |          |  |          | 5.64  |   |  |          | 0.21   |       |  |   | 1,247  |  |  |  | 4.91  |   |  |  | 0.78   |  
|                        |  |                   |        |                   |  |                   |       |          |  |          |        |          |  |          |        |          |  |          |       |   |  |          |        |       |  |   |        |  |  |  |       |   |  |  |        |  
|Total assigned          |  |                   | 38,584 |                   |  |                   |       |          |  |          |        |          |  |          | 41,465 |          |  |          |       |   |  |          |        |       |  |   | 42,279 |  |  |  |       |   |  |  |        |  
|Unassigned              |  |                   | 7,011  |                   |  |                   | N/A   |          |  |          | N/A    |          |  |          | 6,557  |          |  |          | N/A   |   |  |          | N/A    |       |  |   | 2,306  |  |  |  | N/A   |   |  |  | N/A    |  
|                        |  |                   |        |                   |  |                   |       |          |  |          |        |          |  |          |        |          |  |          |       |   |  |          |        |       |  |   |        |  |  |  |       |   |  |  |        |  
|                        |  | $                 | 45,595 |                   |  |                   | 1.03  | %        |  |          | 100.00 | %        |  | $        | 48,022 |          |  |          | 1.22  | % |  |          | 100.00 | %     |  | $ | 44,585 |  |  |  | 1.37  | % |  |  | 100.00 | %
|                        |  |                   |        |                   |  |                   |       |          |  |          |        |          |  |          |        |          |  |          |       |   |  |          |        |       |  |   |        |  |  |  |       |   |  |  |        |  

|                        |  |                   |        |                   |  |          |       |          |  |          |        |          |  |          |        |       |  |  |       |   |  |  |        |  
|----------------------- |  | ----------------- | ------ | ----------------- |  | -------- | ----- | -------- |  | -------- | ------ | -------- |  | -------- | ------ | ----- |  |  | ----- | - |  |  | ------ | -
|                        |  | December 31, 2000 |        | December 31, 1999
|                        |  |                   |        |                  
|                        |  |                   |        |                   |  | ALL      |       | Loans    |  |          |        |          |  | ALL      |        | Loans
|                        |  |                   |        |                   |  | to gross |       | by       |  |          |        |          |  | to gross |        | by   
|                        |  | ALL               |        | loans             |  | category |       | ALL      |  | loans    |        | category
|                        |  | by                |        | in each           |  | to gross |       | by       |  | in each  |        | to gross
|                        |  | category          |        | category          |  | loans    |       | category |  | category |        | loans   
|                        |  |                   |        |                   |  |          |       |          |  |          |        |         
|Commercial business     |  | $                 | 1,502  |                   |  |          | 1.00  | %        |  |          | 4.64   | %        |  | $        | 2,004  |       |  |  | 1.85  | % |  |  | 3.60   | %
|Syndications            |  |                   | 8,480  |                   |  |          | 10.60 |          |  |          | 2.46   |          |  |          | 2,651  |       |  |  | 2.01  |   |  |  | 4.41   |  
|Commercial real estate  |  |                   | 10,072 |                   |  |          | 0.77  |          |  |          | 40.25  |          |  |          | 8,118  |       |  |  | 0.86  |   |  |  | 31.44  |  
|Small business          |  |                   | 10,750 |                   |  |          | 11.01 |          |  |          | 3.01   |          |  |          | 13,278 |       |  |  | 11.48 |   |  |  | 3.84   |  
|Lease financing         |  |                   | 2,879  |                   |  |          | 3.79  |          |  |          | 2.34   |          |  |          | 2,131  |       |  |  | 4.91  |   |  |  | 1.45   |  
|Residential real estate |  |                   | 1,540  |                   |  |          | 0.12  |          |  |          | 40.52  |          |  |          | 1,912  |       |  |  | 0.14  |   |  |  | 47.00  |  
|Consumer - direct       |  |                   | 2,989  |                   |  |          | 1.89  |          |  |          | 4.86   |          |  |          | 2,294  |       |  |  | 1.89  |   |  |  | 4.05   |  
|Consumer - indirect     |  |                   | 5,388  |                   |  |          | 8.62  |          |  |          | 1.92   |          |  |          | 7,758  |       |  |  | 6.18  |   |  |  | 4.21   |  
|                        |  |                   |        |                   |  |          |       |          |  |          |        |          |  |          |        |       |  |  |       |   |  |  |        |  
|Total assigned          |  |                   | 43,600 |                   |  |          |       |          |  |          |        |          |  |          | 40,146 |       |  |  |       |   |  |  |        |  
|Unassigned              |  |                   | 3,400  |                   |  |          | N/A   |          |  |          | N/A    |          |  |          | 4,304  |       |  |  | N/A   |   |  |  | N/A    |  
|                        |  |                   |        |                   |  |          |       |          |  |          |        |          |  |          |        |       |  |  |       |   |  |  |        |  
|                        |  | $                 | 47,000 |                   |  |          | 1.45  | %        |  |          | 100.00 | %        |  | $        | 44,450 |       |  |  | 1.48  | % |  |  | 100.00 | %
|                        |  |                   |        |                   |  |          |       |          |  |          |        |          |  |          |        |       |  |  |       |   |  |  |        |  

The assigned portion of the allowance for loan losses primarily related to
commercial real estate at December 31, 2003 and 2002 and from discontinued
lines of business in prior periods. The allowance for commercial real estate
loans increased from $8.1 million at December 31, 1999 to $24.0 million at
December 31, 2003. This increase primarily reflects portfolio growth associated
with high balance loans and additional reserves associated with loans to the
hospitality industry. This industry component of our loan portfolio was
significantly affected by the tourism decline in Florida during 2002 and 2003.

At December 31, 2003, our commercial real estate portfolio included large
lending relationships, including 22 relationships with unaffiliated borrowers
involving individual lending commitments in excess of $30 million with an
aggregate outstanding balance of $555 million. The remaining change in our
assigned portion of our allowance for loan losses during the five year period
ended December 31, 2003 resulted from the increase and subsequent decreases in
our

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discontinued lines of business reserves. The decline in our discontinued
line of business reserves primarily reflects lower portfolio balances.

The key factor in the calculation of the assigned portion of the allowance
for loan losses is our historical loss experience obtained through statistical
analysis of charge-off trends and reserves assigned to loans individually
evaluated for impairment.

The unassigned portion of the allowance for loan losses addresses certain
individual industry conditions, general economic conditions and geographic
concentration. In periods prior to December 31, 2002, we established an
unassigned allowance based on our view of near term economic conditions and
their potential effect upon loan losses within select segments of the loan
portfolio. Since December 31, 2002, management has included the entire loan
portfolio in its analysis due to uncertainty surrounding economic conditions
and a higher concentration of lending in new geographical areas in Florida.
The uncertain economic conditions relate to the tourism industry and the luxury
residential housing market and the potential effect of both industries on our
entire loan portfolio. The tourism industry is the largest industry in
Florida. Additionally, we expanded the geographical area in which we originate
commercial real estate loans by hiring experienced lending personnel in these
markets and originating loans in central and northern Florida. The loans
originated outside our primary markets may have substantially different loss
experiences than our loans secured by collateral in South Florida. Loans
originated in commercial lending branch offices outside of South Florida
amounted to $446 million at December 31, 2003.

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Non-performing Assets and Potential Problem Loans(dollars in thousands):

|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |      | 
|------------------------------------------------------- | ------------------------------------------------- | - | ------------ | ---- | ---- | - | --------- | ---- | ---- | - | --------- | ---- |  | - | --------- | ---- |  | - | --------- | ---- | 
|                                                        |                                                   |   | December 31,
|                                                        |                                                   |   |             
|                                                        |                                                   |   | 2003         |      | 2002 |   | 2001      |      | 2000 |   | 1999     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |          
|NONPERFORMING ASSETS                                    |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|NON-ACCRUAL                                             |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Tax certificates                                        |                                                   | $ | 894          |      |      | $ | 1,419     |      |      | $ | 1,727     |      |  | $ | 2,491     |      |  | $ | 2,258     |     
|Residential                                             |                                                   |   | 8,489        |      |      |   | 12,773    |      |      |   | 9,203     |      |  |   | 11,229    |      |  |   | 15,214    |     
|Syndication                                             |                                                   |   |             |      |      |   |          |      |      |   | 10,700    |      |  |   |          |      |  |   |          |     
|Commercial real estate and business                     |                                                   |   | 52           |      |      |   | 1,474     |      |      |   | 13,066    |      |  |   | 1,705     |      |  |   | 6,097     |     
|Small business                                          |                                                   |   | 155          |      |      |   | 239       |      |      |   | 905       |      |  |   | 2,532     |      |  |   | 4,427     |     
|Lease financing                                         |                                                   |   | 25           |      |      |   | 3,900     |      |      |   | 2,585     |      |  |   | 1,515     |      |  |   | 1,201     |     
|Consumer                                                |                                                   |   | 794          |      |      |   | 532       |      |      |   | 796       |      |  |   | 1,944     |      |  |   | 5,705     |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|                                                        |                                                   |   | 10,409       |      |      |   | 20,337    |      |      |   | 38,982    |      |  |   | 21,416    |      |  |   | 34,902    |     
|REPOSSESSED (1)                                         |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Residential real estate owned                           |                                                   |   | 1,474        |      |      |   | 1,304     |      |      |   | 2,033     |      |  |   | 2,562     |      |  |   | 1,929     |     
|Commercial real estate owned                            |                                                   |   | 948          |      |      |   | 8,303     |      |      |   | 1,871     |      |  |   | 1,937     |      |  |   | 2,022     |     
|Consumer                                                |                                                   |   |             |      |      |   | 4         |      |      |   | 17        |      |  |   | 95        |      |  |   | 867       |     
|Lease financing                                         |                                                   |   |             |      |      |   |          |      |      |   |          |      |  |   | 1,647     |      |  |   | 386       |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|                                                        |                                                   |   | 2,422        |      |      |   | 9,611     |      |      |   | 3,921     |      |  |   | 6,241     |      |  |   | 5,204     |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|TOTAL NON-PERFORMING ASSETS                             |                                                   |   | 12,831       |      |      |   | 29,948    |      |      |   | 42,903    |      |  |   | 27,657    |      |  |   | 40,106    |     
|Specific valuation allowances                           |                                                   |   |             |      |      |   | (1,386    | )    |      |   | (9,936    | )    |  |   | (819      | )    |  |   | (350      | )   
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|TOTAL NON-PERFORMING ASSETS, NET                        |                                                   | $ | 12,831       |      |      | $ | 28,562    |      |      | $ | 32,967    |      |  | $ | 26,838    |      |  | $ | 39,756    |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Total nonperforming assets as a percentage of:          |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|                                                        | Total assets                                      |   |              | 0.27 |      |   |           | 0.55 |      |   |           | 0.92 |  |   |           | 0.60 |  |   |           | 0.96 | 
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|                                                        | Loans, tax certificates and net real estate owned |   |              | 0.33 |      |   |           | 0.83 |      |   |           | 1.45 |  |   |           | 0.91 |  |   |           | 1.42 | 
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|TOTAL ASSETS                                            |                                                   | $ | 4,831,549    |      |      | $ | 5,421,011 |      |      | $ | 4,654,486 |      |  | $ | 4,617,300 |      |  | $ | 4,159,901 |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|TOTAL LOANS, TAX CERTIFICATES AND NET
REAL ESTATE OWNED |                                                   | $ | 3,927,946    |      |      | $ | 3,626,210 |      |      | $ | 2,968,341 |      |  | $ | 3,029,592 |      |  | $ | 2,831,189 |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Allowance for loan losses                               |                                                   | $ | 45,595       |      |      | $ | 48,022    |      |      | $ | 44,585    |      |  | $ | 47,000    |      |  | $ | 44,450    |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Total tax certificates                                  |                                                   | $ | 193,776      |      |      | $ | 195,947   |      |      | $ | 145,598   |      |  | $ | 124,289   |      |  | $ | 93,080    |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Allowance for tax certificate losses                    |                                                   | $ | 2,870        |      |      | $ | 1,873     |      |      | $ | 1,521     |      |  | $ | 1,937     |      |  | $ | 1,504     |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|OTHER POTENTIAL PROBLEM LOANS                           |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|CONTRACTUALLY PAST DUE 90
DAYS OR MORE                  |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Commercial real estate and business (2)                 |                                                   | $ | 135          |      |      | $ | 100       |      |      | $ |          |      |  | $ | 7,086     |      |  | $ | 410       |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|                                                        |                                                   |   | 135          |      |      |   | 100       |      |      |   |          |      |  |   | 7,086     |      |  |   | 410       |     
|PERFORMING IMPAIRED LOANS, NET OF
SPECIFIC ALLOWANCES   |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Performing impaired loans                               |                                                   |   | 180          |      |      |   |          |      |      |   |          |      |  |   | 15,001    |      |  |   |          |     
|RESTRUCTURED LOANS                                      |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|Commercial real estate and business                     |                                                   |   | 1,387        |      |      |   | 1,882     |      |      |   | 743       |      |  |   |          |      |  |   |          |     
|DELINQUENT RESIDENTIAL LOANS PURCHASED                  |                                                   |   | 1,288        |      |      |   | 1,464     |      |      |   | 1,705     |      |  |   | 5,389     |      |  |   | 10,447    |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     
|TOTAL POTENTIAL PROBLEM LOANS                           |                                                   | $ | 2,990        |      |      | $ | 3,446     |      |      | $ | 2,448     |      |  | $ | 27,476    |      |  | $ | 10,857    |     
|                                                        |                                                   |   |              |      |      |   |           |      |      |   |           |      |  |   |           |      |  |   |           |     



|(1) |  | Amounts are net of specific allowances for real estate owned.                                                                                                                                   
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | The majority of these loans have matured and the borrower continues to
make payments under the matured loan agreement. The 2000 amount
represents one loan that was repaid during February 2001.

Non-performing assets, net of reserves, decreased by $15.7 million to
$12.8 million at December 31, 2003 compared to $28.6 million at December 31,
2002. Non-accrual assets decreased by $9.95 million and repossessed assets
decreased by $7.2 million. The decrease in repossessed assets primarily
resulted from the sale of a $6.5 million commercial construction property which
was included in repossessed assets in 2002 at a value of $7.3 million. This
property was written down by

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$0.8 million during 2003. The decrease in non-accrual assets resulted from
lower non-performing leases in the lease financing portfolio as a result of a
settlement of a significant non-performing lease in the aviation industry and
lower non-performing residential loans.

Potential problem assets were $3.0 million at December 31, 2003 compared
to $3.4 million at December 31, 2002.

BankAtlantics Non- Interest Income

The following table summarizes the changes in non-interest income (in
thousands):

|                                   |                     |   |                     |        |          |   |          |        |      |   |        |        |  |   |        |        |  |   |        |        | 
|---------------------------------- | ------------------- | - | ------------------- | ------ | -------- | - | -------- | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ |  | - | ------ | ------ | 
|                                   |                     |   | For the Years Ended |        |          |   |          |        |      |   |       
|                                   |                     |   | Ended December 31,  |        | Change   |   | Change  
|                                   |                     |   |                     |        | 2003 vs. |   | 2002 vs.
|                                   |                     |   | 2003                |        | 2002     |   | 2001     |        | 2002 |   | 2001  
|                                   |                     |   |                     |        |          |   |          |        |      |   |       
|Other service charges and fees     |                     | $ | 19,318              |        |          | $ | 14,087   |        |      | $ | 14,731 |        |  | $ | 5,231  |        |  | $ | (644   | )     
|Service charges on deposits        |                     |   | 40,569              |        |          |   | 26,479   |        |      |   | 16,372 |        |  |   | 14,090 |        |  |   | 10,107 |       
|Income from real estate operations |                     |   | 5,642               |        |          |   | 1,293    |        |      |   |       |        |  |   | 4,349  |        |  |   | 1,293  |       
|Gains on sales of loans, net       |                     |   | 122                 |        |          |   | 1,840    |        |      |   | 60     |        |  |   | (1,718 | )      |  |   | 1,780  |       
|Securities activities, net         |                     |   | (1,957              | )      |          |   | 4,741    |        |      |   | 468    |        |  |   | (6,698 | )      |  |   | 4,273  |       
|Other                              |                     |   | 6,992               |        |          |   | 4,877    |        |      |   | 5,826  |        |  |   | 2,115  |        |  |   | (949   | )     
|                                   |                     |   |                     |        |          |   |          |        |      |   |        |        |  |   |        |        |  |   |        |       
|                                   | Non-interest income |   | $                   | 70,686 |          |   | $        | 53,317 |      |   | $      | 37,457 |  |   | $      | 17,369 |  |   | $      | 15,860 | 
|                                   |                     |   |                     |        |          |   |          |        |      |   |        |        |  |   |        |        |  |   |        |       

Other service charges and fees increased 37% during 2003 compared to
2002. The additional fee income reflects the opening of 244,000 new deposit
accounts since January 2002 that are directly associated with our Floridas
Most Convenient Bank campaign and higher loan fees. New ATM and check cards
are linked to the new checking and savings accounts and result in increases in
interchange fees, annual fees and foreign transaction fees. Also in 2003,
check card income was favorably impacted by card conversion fees received from
MasterCard in consideration for converting our customer check cards from Visa.

The increased loan fee income in 2003 primarily resulted from higher
prepayment penalties associated with commercial loans. During 2003, we
experienced a significant increase in prepayment penalties assessed on
borrowers refinancing commercial loans in response to historically low
interest rates

In 2002, compared to 2001, the decline in other service charges and fees
resulted from an 18% decrease in ATM fee income and a decline in late fee
income. The decline in ATM fee income resulted from the removal of our ATM
machines from retail outlets, gas stations and convenience stores. The
decline in late fee income was attributed to lower collections of late fees
assessed in our consumer and leasing portfolios in proportion to declines in
outstanding balances resulting from discontinued product lines. The above
declines in fee income were partially offset by higher fees earned on check
cards which were linked to the significant increase in transaction accounts
since commencing the Floridas Most Convenient Bank initiative.

Revenues from service charges on deposits increased by 53% in 2003 and by
62% in 2002. The increase in service charge revenues primarily resulted from
a higher volume of overdrafts, which increased 74% in 2003 and 116% in 2002.
This substantial increase in overdraft fee income primarily resulted from an
increase in the number of checking accounts attributed to our high performance
checking products and Floridas Most Convenient Bank initiatives. The above
increase in service charge income was partially offset by a 3% decline in
monthly checking account fee income in 2003 as we discontinued the promotion
of fee-based checking products. In 2002, monthly checking account fee income
declined 17%.

Income from real estate operations in 2003 represents revenues from the
Riverclub joint venture. This is a 50% owned real estate joint venture
acquired in connection with the Banks purchase of Community in March 2002.
This development of single family homes, condominium units and duplexes is
located on 117 acres of land in Florida. During the year, the Riverclub joint
venture closed on the sale of twenty-six units. Prior to 2003, this joint
venture was accounted for as an unconsolidated subsidiary, and the income from
real estate operations represented the Banks equity in the undistributed
earnings of Riverclub. During 2002, there were 11 closings on the sale of
units.

During 2002, the Bank had a gain on the sale of a commercial loan of $2.1
million. The gain was partially offset by losses on the sale of CRA loans. In
2003, the Bank had a small gain on the sale of residential loans.

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Losses on securities in 2003 are primarily due to the termination of
interest rate swaps. The swaps had a total notional amount of $75 million and
were settled at a loss of $1.9 million as part of a strategy to prepay FHLB
advances with a view to improving our net interest margin in future periods.
In 2002, gains on securities activities resulted from the sale of $152 million
of mortgage-backed securities and $9.4 million of corporate bonds for gains.
The securities were sold to reposition the portfolio in response to the
significant decline in interest rates.

Other income during 2003 was favorably impacted by the expansion of our
branch brokerage business unit which earned $1.4 million in commissions versus
$342,000 in commissions in 2002. Other income was also favorably impacted by
higher miscellaneous customer fees such as wire fees, research charges and
cash management services associated with the substantial increase in the
number of customer accounts.

The decline in other income during 2002, compared to 2001, was primarily
due to a $1.6 million gain realized on the sale of in-store branches during
2001, compared to a $384,000 gain during 2002. The exiting of in-store
branches was part of a bank-wide program to review all lines of business with
a view towards improving overall earnings. We also sold or disposed of branch
facilities and equipment for a $328,000 loss during 2002 compared to a
$386,000 gain during 2001. Additionally, we recognized a $264,000 loss from
the sale of residential loan servicing acquired in connection with the
Community acquisition.

BankAtlantics Non- Interest Expense

The following table summarizes the changes in non-interest expense (in
thousands):

|                                                 |                      |   |                     |         |          |   |          |         |      |   |        |         |  |   |        |        |  |   |        |        | 
|------------------------------------------------ | -------------------- | - | ------------------- | ------- | -------- | - | -------- | ------- | ---- | - | ------ | ------- |  | - | ------ | ------ |  | - | ------ | ------ | 
|                                                 |                      |   | For the Years Ended |         |          |   |          |         |      |   |       
|                                                 |                      |   | Ended December 31,  |         | Change   |   | Change  
|                                                 |                      |   |                     |         | 2003 vs. |   | 2002 vs.
|                                                 |                      |   | 2003                |         | 2002     |   | 2001     |         | 2002 |   | 2001  
|                                                 |                      |   |                     |         |          |   |          |         |      |   |       
|Employee compensation and benefits               |                      | $ | 79,492              |         |          | $ | 65,130   |         |      | $ | 49,231 |         |  | $ | 14,362 |        |  | $ | 15,899 |       
|Occupancy and equipment                          |                      |   | 27,329              |         |          |   | 29,852   |         |      |   | 25,852 |         |  |   | (2,523 | )      |  |   | 4,000  |       
|Advertising and promotion                        |                      |   | 9,434               |         |          |   | 7,470    |         |      |   | 3,771  |         |  |   | 1,964  |        |  |   | 3,699  |       
|Restructuring charges and impairment write-downs |                      |   | 257                 |         |          |   | 1,007    |         |      |   | 331    |         |  |   | (750   | )      |  |   | 676    |       
|Amortization of intangible assets                |                      |   | 1,772               |         |          |   | 1,360    |         |      |   |       |         |  |   | 412    |        |  |   | 1,360  |       
|Acquisition related charges                      |                      |   |                    |         |          |   | 864      |         |      |   |       |         |  |   | (864   | )      |  |   | 864    |       
|Professional fees                                |                      |   | 4,390               |         |          |   | 2,723    |         |      |   | 4,916  |         |  |   | 1,667  |        |  |   | (2,193 | )     
|Cost associated with debt redemption             |                      |   | 10,895              |         |          |   |         |         |      |   |       |         |  |   | 10,895 |        |  |   |       |       
|Other                                            |                      |   | 28,046              |         |          |   | 26,002   |         |      |   | 19,252 |         |  |   | 2,044  |        |  |   | 6,750  |       
|                                                 |                      |   |                     |         |          |   |          |         |      |   |        |         |  |   |        |        |  |   |        |       
|                                                 | Non-interest expense |   | $                   | 161,615 |          |   | $        | 134,408 |      |   | $      | 103,353 |  |   | $      | 27,207 |  |   | $      | 31,055 | 
|                                                 |                      |   |                     |         |          |   |          |         |      |   |        |         |  |   |        |        |  |   |        |       

Compensation and benefit expenses increased 22% in 2003. In addition to
standard annual employee salary increases, the growth in this expense category
primarily resulted from:



| |  |  | An increase in the number of employees resulting from Floridas
Most Convenient Bank initiatives. The number of full time equivalent
Bank employees increased to 1,403 at year-end 2003 versus 1,244 at
year-end 2002 and 873 at year-end 2001. In 2002, 172 employees were
added as a result of the Community acquisition. The remainder of
personnel growth during the past two years primarily related to the
additional personnel required to implement the Banks commitment to
provide high service levels to the increased number of Bank customers
resulting from the Floridas Most Convenient Bank campaign.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The higher cost of employee benefits.In addition to the increase
in the number of employees in 2003, the cost of our regular benefit
programs also increased. In addition, we experienced higher health
insurance costs and higher pension expenses associated with our
defined benefit plan.                                                                                                                                                                                                                                                                                                                         
|
| |  |  | The implementation of an employee profit sharing plan in 2003.
Approximately $3.6 million in bonuses were paid in 2003 to employees
of the Bank for exceeding targeted performance goals.                                                                                                                                                                                                                                                                                                                                                                                                                             

In 2003, occupancy and equipment expenses decreased 8%. This decline
primarily resulted from lower data processing costs and depreciation expense.
Lower data processing expenses resulted from the renewal of a vendor contract
at

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significantly lower rates than experienced during the prior period. The
decrease in depreciation expense reflects $1.9 million of accelerated
depreciation expense during 2002, most of which was associated with a
reduction in the estimated life of our on-line banking platform as we upgraded
the technology.

The increase in occupancy and equipment expenses during 2002 compared to
2001 reflects the accelerated depreciation expense. The remaining increase
reflects upgrades in the data processing infrastructure and increases in
occupancy costs due to building maintenance, repairs, real estate taxes and
security guard service associated with an expanded branch network resulting
from the Community acquisition and longer branch business hours due to the
Floridas Most Convenient Bank campaign.

Advertising expenses during 2003 and 2002 reflect marketing initiatives
to promote our new high performance account products and our Floridas Most
Convenient Bank initiatives. These promotions included an expanded direct mail
campaign, a check card rewards program and periodic customer gifts and events
associated with seven-day banking.

The 2003 impairment write down resulted from the Bank relocating a
branch, transferring the real estate associated with the closed branch to real
estate held for sale and recognizing a $257,000 impairment loss.
Restructuring charges and impairment write-downs during 2002 were the result
of a plan to discontinue certain ATM relationships. As a consequence, an
$801,000 restructuring charge and a $206,000 impairment write-down were
realized. These relationships were primarily with convenience stores and gas
stations which did not meet our performance expectations and were unlikely to
meet our future profitability goals. The remaining ATM machines are primarily
located in our branch network, cruise ships, Native American reservation
gaming facilities and other retail outlets.

Amortization of intangible assets consisted of the amortization of core
deposit intangible assets acquired in connection with the Community
acquisition. The core deposit intangible assets are being amortized over an
estimated life of eight years.

Acquisition related charges and impairments during 2002 include various
data conversion and system integration expenses as well as facilities
impairment write-downs associated with the Community acquisition. As a
consequence of the acquisition, BankAtlantic closed two of its branches that
competed directly with two of the former Community offices.

The higher expenses for professional fees in 2003 compared to 2002 were
primarily associated with legal fees incurred in connection with a lawsuit
filed against BankAtlantic in October 2002 relating to our Floridas Most
Convenient Bank initiative which has been settled without payments to either
party. (See Item 3 Legal Proceedings for a description of this lawsuit.)

Costs associated with debt redemption resulted from the prepayment
penalties associated with the repayment of $325 million of FHLB advances. We
prepaid these high rate advances with the expectation that it will improve our
net interest margin in future periods.

The increase in other expenses in 2003 primarily resulted from higher ATM
interchange expenses, check loss charges, and higher general operating
expenses. These increases in other expenses relate to a substantial increase
in the number of deposit accounts and the related increase in transaction
volume associated with Floridas Most Convenient Bank initiative. Expenses
of the Riverclub joint venture as well as costs related to converting check
cards from Visa to MasterCard are also reflected in 2003 results and
contributed to higher other expenses.

The increase in other expenses during 2002, compared to 2001, related to
several factors. During 2002, we wrote down REO properties by $1.5 million
compared to $120,000 during 2001. The majority of the 2002 REO write down
related to a residential construction loan that was transferred to real estate
owned. Additionally, REO expenses increased by $700,000 during 2002 due to
the operating costs associated with this REO property. Also, during 2002, we
recognized only $120,000 of gains on the sales of REO property compared to net
gains of $1.2 million during 2001. The remaining increase in other expenses
resulted from increased check losses and higher operating expenses in
connection with the increased size of BankAtlantic.

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Ryan Beck Results of Operations

Summary

The integration of the assets that were acquired from Gruntal has enabled
Ryan Beck to significantly increase its distribution capabilities and revenues
during the latter half of 2003. Most of this improvement should arise as a
result of continued improvement in the economy, further advancement in the
equity markets, and renewed interest in both equity and fixed income products.

The increase to approximately 500 financial consultants enables the
investment banking and trading lines of business to distribute their product
to an increased client base of over 110,000 active clients. There is no
assurance that Ryan Beck will be successful in managing the expanded
operations resulting from Ryan Becks growth.

The following table is a condensed income statement summarizing Ryan
Becks results of operations (in thousands):

|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |        |        | 
|------------------------------------------- | -------------------- | ------------------- | ------- | ------------------ | ------- | -------- | ------- | -------- | ------- | ---- | ------ | ------ | ------ | - | ------ | ------ | ------ | - | ------ | ------ | ------ | 
|                                            |                      |                     |         | For the Years      |         |          |         |          |         |      |        |       
|                                            |                      |                     |         | Ended December 31, |         | Change   |         | Change  
|                                            |                      |                     |         |                    |         | 2003 vs. |         | 2002 vs.
|                                            |                      |                     |         | 2003               |         | 2002     |         | 2001     |         | 2002 |        | 2001  
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |       
|Net interest income:                        |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Interest on trading securities              |                      | $                   | 10,437  |                    |         | $        | 7,512   |          |         | $    | 1,978  |        |        | $ | 2,925  |        |        | $ | 5,534  |       
|Interest expense                            |                      |                     | (1,283  | )                  |         |          | (1,444  | )        |         |      | (517   | )      |        |   | 161    |        |        |   | (927   | )     
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Net interest income                         |                      |                     | 9,154   |                    |         |          | 6,068   |          |         |      | 1,461  |        |        |   | 3,086  |        |        |   | 4,607  |       
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Non-interest income:                        |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Principal transactions                      |                      |                     | 95,519  |                    |         |          | 49,106  |          |         |      | 18,930 |        |        |   | 46,413 |        |        |   | 30,176 |       
|Investment banking                          |                      |                     | 27,728  |                    |         |          | 19,119  |          |         |      | 12,014 |        |        |   | 8,609  |        |        |   | 7,105  |       
|Commissions                                 |                      |                     | 85,176  |                    |         |          | 62,924  |          |         |      | 12,761 |        |        |   | 22,252 |        |        |   | 50,163 |       
|Other                                       |                      |                     | 2,516   |                    |         |          | 2,696   |          |         |      | 978    |        |        |   | (180   | )      |        |   | 1,718  |       
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|                                            |                      | Non-interest income |         |                    | 210,939 |          |         |          | 133,845 |      |        |        | 44,683 |   |        |        | 77,094 |   |        |        | 89,162 | 
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Non-interest expense:                       |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Employee compensation and benefits          |                      |                     | 147,358 |                    |         |          | 100,909 |          |         |      | 33,440 |        |        |   | 46,449 |        |        |   | 67,469 |       
|Occupancy and equipment                     |                      |                     | 12,707  |                    |         |          | 9,344   |          |         |      | 3,287  |        |        |   | 3,363  |        |        |   | 6,057  |       
|Advertising and promotion                   |                      |                     | 3,291   |                    |         |          | 2,977   |          |         |      | 1,515  |        |        |   | 314    |        |        |   | 1,462  |       
|Professional Fees                           |                      |                     | 10,467  |                    |         |          | 3,994   |          |         |      | 1,627  |        |        |   | 6,473  |        |        |   | 2,367  |       
|Communications                              |                      |                     | 13,783  |                    |         |          | 10,152  |          |         |      | 3,291  |        |        |   | 3,631  |        |        |   | 6,861  |       
|Floor broker and clearing fees              |                      |                     | 9,227   |                    |         |          | 8,192   |          |         |      | 2,796  |        |        |   | 1,035  |        |        |   | 5,396  |       
|Amortization of goodwill                    |                      |                     |        |                    |         |          |        |          |         |      | 440    |        |        |   |       |        |        |   | (440   | )     
|Acquisition related charges and impairments |                      |                     |        |                    |         |          | 4,061   |          |         |      |       |        |        |   | (4,061 | )      |        |   | 4,061  |       
|Other                                       |                      |                     | 6,691   |                    |         |          | 4,865   |          |         |      | 1,774  |        |        |   | 1,826  |        |        |   | 3,091  |       
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|                                            | Non-interest expense |                     |         | 203,524            |         |          |         | 144,494  |         |      |        | 48,170 |        |   |        | 59,030 |        |   |        | 96,324 |       
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Income (loss) before income taxes           |                      |                     | 16,569  |                    |         |          | (4,581  | )        |         |      | (2,026 | )      |        |   | 21,150 |        |        |   | (2,555 | )     
|Income taxes                                |                      |                     | 6,924   |                    |         |          | (2,133  | )        |         |      | (709   | )      |        |   | 9,057  |        |        |   | (1,424 | )     
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       
|Income from continuing operations           |                      | $                   | 9,645   |                    |         | $        | (2,448  | )        |         | $    | (1,317 | )      |        | $ | 12,093 |        |        | $ | (1,131 | )     
|                                            |                      |                     |         |                    |         |          |         |          |         |      |        |        |        |   |        |        |        |   |        |       

For the Year Ended December 31, 2003 Compared to the Same 2002 Period:

The improvement in income from continuing operations was primarily the
result of the full year impact of increased revenue from Ryan Becks
additional financial consultants, as well as the improvement in investment
banking revenue.

Investment banking revenue increased 45% from 2002. The improvement was
largely attributable to the increased distribution capabilities discussed
above along with an increase in merger and acquisition and advisory business
in 2003.

Net interest income increased 51% from 2002. The improvement in net
interest income primarily resulted from the expansion of municipal bond
trading and the associated spread between the interest on the municipal bonds
and the financing costs incurred. Also included in interest income was Ryan
Becks participation in interest income associated with

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approximately $259 million of customer margin debit balances and fees
earned in connection with approximately $1.3 billion in customer money market
account balances. This improvement in net interest income was partially
offset by the interest expense associated with a $5.0 million subordinated
borrowing from the Company, which was repaid in full on September 3, 2003, as
well as an increased level of borrowings from Ryan Becks clearing agent as a
result of a higher volume of trading activity.

Principal transactions revenue increased 95% from 2002. The improvement
in principal transaction revenue was primarily the result of additional
financial consultants and trading personnel hired in connection with the
Gruntal transaction on April 26, 2002. This increase was aided by the
improved operating environment of the U.S. securities industry in the second
half of fiscal 2003.

Commission revenue increased 35% in 2003. The improvement is largely due
to the additional financial consultants, as well as the improvement in equity
and fixed income markets.

The increase in employee compensation and benefits of 46% from 2002 is
primarily due to the additional personnel. Also, the increase in Ryan Becks
revenue correlates to an increase in compensation in the form of commission
expense and discretionary bonuses.

Occupancy and rent expenses have increased 36% from 2002. This increase
is primarily due to the additional offices operated as a result of the Gruntal
transaction.

Professional fees increased by 162% in 2003. The increase is primarily
due to additional legal expense associated with the ongoing successor
liability issues relating to the Gruntal transaction, as well as an NASD
ruling against Ryan Beck in the amount of $2.7 million which resulted in a
$1.7 million increase in professional fees. Additionally, broker registration
fees were higher associated with the additional financial consultants added as
a result of the Gruntal transaction.

Acquisition-related charges during 2002 included branch closures,
professional fees, and regulatory costs incurred in connection with the
Gruntal transaction.

The increase in communications, floor broker and clearing fees and other
expenses from 2002 related primarily to increased commission revenue and
principal transactions revenue associated with the additional financial
consultants.

For the Year Ended December 31, 2002 Compared to the Same 2001 Period:

The increased losses primarily resulted from the Gruntal transaction.
Included in the 2002 loss was $4.1 million of acquisition-related charges and
impairments associated with the Gruntal transaction. This transaction resulted
in significant differences between 2002 and 2001 revenue and expense line
items. In addition, this transaction resulted in the addition of 32 branch
offices, 125,000 customer accounts and $14.4 billion in customer assets.

Net interest income increased 315% from 2001. The improvement resulted
from Ryan Becks participation in interest income associated with approximately
$255 million of customer margin debit balances and fees earned in connection
with approximately $1.5 billion in customer money market account balances.
This improvement in net interest income was partially offset by the interest
expense associated with a $5.0 million subordinated borrowing from the Company,
as well as an increased level of borrowings from Ryan Becks clearing agent as
a result of a higher volume of trading activity.

Principal transactions revenue increased 159% from 2001. The improvement
in principal transaction revenue was primarily the result of additional
financial consultants and trading personnel. This increase was offset by
losses on the sales of mutual funds as well as mark to market losses on those
funds, which were associated with a deferred compensation plan acquired in
connection with the Gruntal transaction.

Investment banking revenue increased 59% from 2001. The improvement was
largely attributable to the increased distribution capabilities discussed above
which allows for an increased participation in underwritings and initial public
offerings.

Commission revenue increased 393% from 2001. The improvement is largely
due to the additional financial consultants.

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The increase in employee compensation and benefits of 202% from 2001 is
primarily due to the additional personnel.

Occupancy and rent expenses have increased 184% from 2001. This increase
is primarily due to the additional offices.

Advertising and promotion expenses have increased 97% from 2001. This
increase relates to marketing to a larger geographic region as a result of
additional offices discussed above.

Acquisition-related charges during 2002 included branch closures,
professional fees, and regulatory costs incurred in connection with the Gruntal
transaction.

Professional
fees increased from 2001, primarily as a result of the
ongoing successor liability issues associated with the Gruntal transaction.

The increase in communications, floor broker and clearing fees and other
expenses from 2001 related primarily to increased commission revenue and
principal transactions revenue associated with the additional financial
consultants.

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Parent Company Results of Operations

The following table is a condensed income statement summarizing the
parent companys results of operations (in thousands):

|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |        |         |  
|-------------------------------------------------- | -------------------- | ------------------- | ------- | ------------------ | --- | -------- | ------- | -------- | ------- | ---- | ------- | ------ | ----- | - | ------ | ------ | ------ | - | ------- | ------ | ------- | -
|                                                   |                      |                     |         | For the Years      |     |          |         |          |         |      |         |       
|                                                   |                      |                     |         | Ended December 31, |     | Change   |         | Change  
|                                                   |                      |                     |         |                    |     | 2003 vs. |         | 2002 vs.
|                                                   |                      |                     |         | 2003               |     | 2002     |         | 2001     |         | 2002 |         | 2001  
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |       
|Net interest income:                               |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Interest and fees on loans                         |                      | $                   | 1,488   |                    |     | $        | 1,416   |          |         | $    | 21      |        |       | $ | 72     |        |        | $ | 1,395   |       
|Interest on short term investments                 |                      |                     | 234     |                    |     |          | 329     |          |         |      | 208     |        |       |   | (95    | )      |        |   | 121     |       
|Interest expense on junior subordinated debentures |                      |                     | (16,344 | )                  |     |          | (17,439 | )        |         |      | (18,297 | )      |       |   | 1,095  |        |        |   | 858     |       
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Net interest income                                |                      |                     | (14,622 | )                  |     |          | (15,694 | )        |         |      | (18,068 | )      |       |   | 1,072  |        |        |   | 2,374   |       
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Non-interest income:                               |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Income from unconsolidated subsidiaries            |                      |                     | 425     |                    |     |          |        |          |         |      |        |        |       |   | 425    |        |        |   |        |       
|Gains on securities activities                     |                      |                     | 404     |                    |     |          | 3,837   |          |         |      | 6,656   |        |       |   | (3,433 | )      |        |   | (2,819  | )     
|Impairment of securities                           |                      |                     |        |                    |     |          | (18,801 | )        |         |      | (3,527  | )      |       |   | 18,801 |        |        |   | (15,274 | )     
|Other                                              |                      |                     | (635    | )                  |     |          | (359    | )        |         |      |        |        |       |   | (276   | )      |        |   | (359    | )     
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|                                                   |                      | Non-interest income |         |                    | 194 |          |         |          | (15,323 | )    |         |        | 3,129 |   |        |        | 15,517 |   |         |        | (18,452 | )
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Non-interest expense:                              |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Employee compensation and benefits                 |                      |                     | 90      |                    |     |          | 940     |          |         |      | 2,049   |        |       |   | (850   | )      |        |   | (1,109  | )     
|Professional fees                                  |                      |                     | 1,500   |                    |     |          | 810     |          |         |      | 186     |        |       |   | 690    |        |        |   | 624     |       
|Cost associated with debt redemption               |                      |                     | 1,648   |                    |     |          | 3,125   |          |         |      | 389     |        |       |   | (1,477 | )      |        |   | 2,736   |       
|Impairment of goodwill                             |                      |                     |        |                    |     |          |        |          |         |      | 6,624   |        |       |   |       |        |        |   | (6,624  | )     
|Amortization of goodwill                           |                      |                     |        |                    |     |          |        |          |         |      | 3,633   |        |       |   |       |        |        |   | (3,633  | )     
|Other                                              |                      |                     | 600     |                    |     |          | 280     |          |         |      | 585     |        |       |   | 320    |        |        |   | (305    | )     
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|                                                   | Non-interest expense |                     |         | 3,838              |     |          |         | 5,155    |         |      |         | 13,466 |       |   |        | (1,317 | )      |   |         | (8,311 | )      
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Loss before income taxes                           |                      |                     | (18,266 | )                  |     |          | (36,172 | )        |         |      | (28,405 | )      |       |   | 17,906 |        |        |   | (7,767  | )     
|Income
tax benefit                                 |                      |                     | 5,089   |                    |     |          | 12,661  |          |         |      | 7,623   |        |       |   | (7,572 | )      |        |   | 5,038   |       
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       
|Loss from continuing operations                    |                      | $                   | (13,177 | )                  |     | $        | (23,511 | )        |         | $    | (20,782 | )      |       | $ | 10,334 |        |        | $ | (2,729  | )     
|                                                   |                      |                     |         |                    |     |          |         |          |         |      |         |        |       |   |        |        |        |   |         |       

Interest and fees on loans for each of the years in the two year period
ended December 31, 2003 represent interest income associated with a $5 million
loan to Ryan Beck and a $30 million loan to Levitt. The $30 million loan to
Levitt was originated in April 2002. The $5 million Ryan Beck loan was fully
repaid in September 2003.

The decrease in interest expense during 2003, compared to 2002, resulted
from lower rates on borrowings partially offset by higher average balances.
During 2002 and 2003, we redeemed higher rate trust preferred securities and
subordinated debentures with the proceeds associated with the issuance of
lower rate trust preferred securities. During the years ended December 31,
2003 and 2002, we issued $77.3 million and $186.0 million, respectively, of
junior subordinated debentures, all of which were issued in connection with
the issuance of trust preferred securities. The average rate of these
debentures was 5.94%. A portion of the proceeds from the issuance of those
debentures were used to retire $74.8 million of 9.50% fixed rate trust
preferred securities and $21.0 million of 9.00% subordinated debentures.

The decrease in interest expense on debentures and notes payable for 2002
compared to 2001 resulted from a substantial decrease in average rates. In
part because of the lower interest rate environment in 2002, we issued $186
million of junior subordinated debentures and used the proceeds to redeem
higher cost trust preferred securities and subordinated debentures. As a
result of the above debt restructuring and the significant decline in interest
rates, our average rate on borrowings declined from 8.55% during 2001 to 7.83%
during 2002. The decline in interest expense was partially offset by an
increase in average balances. Parent company average borrowings increased
from $214.1 million during 2001 to $222.7 million during 2002.

In 2003, income from unconsolidated subsidiaries represents the equity
earnings from trusts formed to issue trust preferred securities. In prior
periods, the trusts were consolidated for financial reporting. This change in
accounting methodology was required due to a change in the accounting rules.

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Gains on securities activities during 2003 represent a gain realized on a
liquidating dividend from an equity security. Securities activities during
2002 and 2001 include the sale of equity securities.

During 2002, the Company recognized a $15 million impairment charge
associated with its investment in a privately held technology company. Both
Alan B. Levan and John E. Abdo became directors of the technology company in
connection with the Companys investment and individually invested in the
technology company. Additionally, during 2002 and 2001, the Company recognized
impairment charges of $3.8 million and $3.5 million, respectively, on
publicly traded equity securities resulting from significant declines in value
that were other than temporary. As a result of these losses, we revised our
policy for holding company equity investments so that any future equity
investments will generally be more liquid and subject to concentration
restrictions. The Company did not recognize impairments on securities during
2003.

Compensation expense during 2003 primarily related to the Ryan Beck
retention pool established upon the acquisition of Ryan Beck in June 1998.
During 2002 and 2001, we accrued $1.0 million and $2.0 million, respectively,
of compensation expense related to the Ryan Beck retention pool. The
participants accounts in the Ryan Beck retention pool vested on June 28,
2002, and no further expenses will be incurred in connection with this
retention pool.

The increase in professional fees during 2003 consisted of higher fees
associated with litigation relating to the Companys investments in the
privately held technology company and legal, accounting and tax advice
associated with the Levitt spin-off. For a more detailed discussion of the
technology company litigation see Related Party Transactions.

Loss on debt redemption during 2003 resulted from the Company redeeming
its 5.625% convertible debentures at a redemption price of 102% of the
principal amount. The loss on the redemption reflects a $732,000 write-off of
deferred offering costs and a $916,000 call premium. During 2002, we used the
proceeds from the issuance of junior subordinated debentures to retire $21
million of 9% subordinated debentures and $74.8 million of 9.5% trust
preferred securities. We recognized a $3.1 million loss associated with these
redemptions. During 2001, we redeemed our subordinated investment notes and
recognized a $389,000 loss.

The impairment of goodwill in 2001 related to the Companys 1998
acquisition of LTI. During the third quarter of 2001, we concluded that LTI
would not meet our performance expectations. As a consequence, we closed the
offices of LTI and ceased the origination of leases.

Goodwill amortization during 2001 represented the amortization of
goodwill associated with all acquisitions. Upon the implementation of FASB
Statement Number 142 on January 1, 2002, we discontinued the amortization of
goodwill. We evaluate goodwill for impairment in accordance with FASB
Statement Number 142.

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BankAtlantic Bancorp Financial Condition

Our total assets at December 31, 2003 were $4.8 billion compared to $5.4
billion at December 31, 2002. The decrease in total assets primarily resulted
from:



| |  |  | decreases in real estate held for development and sale due to the
Levitt spin-off.                                                                       
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | accelerated loan and mortgage-backed securities repayments due to
the historically low interest rate environment.                                        
|
| |  |  | a decline in securities owned associated with the sale by Ryan
Beck of its subsidiary, GMS.                                                              
|
| |  |  | lower accrued interest receivable resulting from a substantial
decline in interest rates and lower investment and securities
available for sale balances.
|
| |  |  | decreases in investment in and advances to unconsolidated
subsidiaries associated with the Levitt spin-off.                                              
|
| |  |  | declines in cash and due from depository institutions resulting
from lower cash letter and Federal Reserve balances.                                     
|
| |  |  | declines in investment in FHLB stock related to repayments of FHLB advances.                                                                             

The above decreases in total assets were partially offset by:



| |  |  | the purchase of approximately $1.1 billion of hybrid adjustable rate residential loans.                                                                                                
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | the origination of and participation in commercial real estate loans.                                                                                                                  
|
| |  |  | the origination of home equity loans.                                                                                                                                                  
|
| |  |  | the increase in investments in and advances to unconsolidated
subsidiaries of $7.9 million as a result of the deconsolidation of the
trusts formed to issue trust preferred securities.

The Companys total liabilities at December 31, 2003 were $4.4 billion
compared to $5.0 billion at December 31, 2002. The decreases in total
liabilities primarily resulted from:



| |  |  | reduction in notes payable related to the Levitt spin-off.                                                                                  
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | the prepayment and maturity of over $500 million of FHLB advances.                                                                          
|
| |  |  | redemption of the Companys 5.625% Convertible Subordinated Debentures.                                                                     
|
| |  |  | reduction in certificate of deposit account balances associated
with marketing initiatives focusing on the origination of low cost
deposits.
|
| |  |  | decreases in other liabilities related to customer deposits at Levitt.                                                                      
|
| |  |  | lower due to clearing agent balances associated with the sale of Ryan Becks subsidiary, GMS.                                               

The above decreases in total liabilities were partially offset by:



| |  |  | the issuance in the aggregate of $77.3 million of junior subordinated debentures.                                                           
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | higher transaction and savings account balances resulting from
Floridas Most Convenient Bank and totally free checking account
initiatives.
|
| |  |  | higher short term borrowings to fund certificate account outflows,
loan originations and loan purchases.                                    

Stockholders equity at December 31, 2003 was $413.5 million compared to
$469.3 million at December 31, 2002. The decrease was primarily attributable
to the payment of $7.5 million of dividends and a $126 million reduction of
stockholders equity associated with the Levitt spin-off transaction. This
decrease in the Companys stockholders equity was partially offset by the
earnings of the Company and the issuance of common stock upon the exercise of
stock options. As a result of the Levitt spin-off the Companys debt to
equity ratio increased at December 31, 2003 from 226% to 295% and its equity
to assets decreased from 10.44% to 8.56%.

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Liquidity and Capital Resources

BankAtlantic Bancorp, Inc.

The Companys principal source of liquidity is dividends from
BankAtlantic. The Company also obtains funds through the issuance of equity
and debt securities, borrowings from financial institutions, repayment of
subsidiary loans and liquidation of equity securities it holds. The Company
uses these funds to contribute capital to its subsidiaries, pay debt service,
repay borrowings, purchase equity securities and for administrative expenses.
The Companys annual debt service associated with its junior subordinated
debentures and financial institution borrowings is approximately $15.6
million. The Companys estimated current annual dividends to common
shareholders are approximately $7.8 million. The declaration and payment of
dividends and the ability of the Company to meet its debt service obligations
will depend upon the results of operations, financial condition and cash
requirements of the Company as well as indenture restrictions and loan
covenants and on the ability of BankAtlantic to pay dividends to the Company.
These payments are subject to regulations and OTS approval and are based upon
BankAtlantics regulatory capital levels and net income. During 2003, the
Company received $20.0 million of dividends from BankAtlantic.

In connection with the Levitt spin-off, the $30.0 million demand note
owed to us by Levitt was converted to a five year term note with interest only
payable monthly initially at the prime rate and thereafter at the prime rate
plus increments of an additional 0.25% every six months. Prior to the
spin-off, we also transferred our 4.9% ownership interest in Bluegreen
Corporation to Levitt in exchange for a $5.5 million note and additional
shares of Levitts stock (which additional shares were included in the
spin-off). This $5.5 million note is due in one year, with principal and
interest payable monthly and interest payable at the prime rate.
Additionally, prior to the spin-off, Levitt declared an $8.0 million dividend
to us payable in the form of a note due in five years bearing interest on the
same basis as the $30.0 million note described above.

Management believes that the Levitt spin-off transaction will not have a
significant effect on the Companys liquidity due to the fact that; in prior
periods, Levitt did not declare any cash dividends, the Company invested in
Levitt to expand its operations, and the Company will receive cash payments
from Levitt in subsequent periods from interest and principal payments
associated with the notes payable mentioned above.

During 2003, the Company participated in three pooled trust preferred
securities offerings in which an aggregate of $77.3 million of junior
subordinated debentures were issued. The junior subordinated debentures pay
interest quarterly at a fixed rate ranging from 6.40% to 6.65% per annum until
2008, and thereafter at a floating rate equal to 3-month LIBOR plus 315-325
basis points. The debentures are callable in five years and mature in 2033.
The net proceeds to the Company from the issuance of junior subordinated
debentures, after the Companys investment in the related trust, placement
fees and expenses were approximately $74 million.

The Company used the net proceeds from the above trust preferred
securities offerings to redeem $45.8 million of 5.625% Convertible
Subordinated Debentures due 2007, repay $16 million of outstanding borrowings
under a credit facility from an unrelated financial institution, repay $3.7
million of Ryan Beck retention pool notes payable and for general corporate
purposes.

The Company maintains a revolving credit facility of $30 million with an
independent financial institution. The credit facility contains customary
covenants, including financial covenants relating to BankAtlantics regulatory
capital and maintenance of certain loan loss reserves and is secured by the
common stock of BankAtlantic. The Company has used this credit facility to
temporarily fund acquisitions and asset purchases as well as for general
corporate purposes. The credit facility had an outstanding balance of
$100,000 at December 31, 2003, and we were in compliance with all loan
covenants. Amounts outstanding accrue interest at the prime rate minus 50
basis points, and the facility matures in March 2005.

To date, Ryan Beck has not paid dividends to the Company, although,
subject to regulatory and capital requirements, it may do so in the future.

BankAtlantic

BankAtlantics liquidity will depend on its ability to generate
sufficient cash to support loan demand, to meet deposit withdrawals, and to
pay operating expenses. BankAtlantics securities portfolio provides an
internal source of liquidity through its short-term investments as well as
scheduled maturities and interest payments. Loan repayments and sales also
provide an internal source of liquidity.

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BankAtlantics primary sources of funds are deposits; principal
repayments of loans and tax certificates and securities available for sale;
proceeds from the sale of loans and securities available for sale; proceeds
from securities sold under agreements to repurchase; advances from FHLB; and
operations. These funds were primarily utilized to fund loan disbursements and
purchases, deposit outflows, repayments of securities sold under agreements to
repurchase, repayments of advances from FHLB, purchases of tax certificates,
payments of maturing certificates of deposit, to pay operating expenses and to
pay dividends to the Company. The FHLB has granted BankAtlantic a $1.4
billion line of credit subject to available collateral, with a maximum term of
ten years. BankAtlantic borrowed $782.2 million of FHLB advances and the FHLB
issued a $92 million letter of credit to secure public deposits under this
line at December 31, 2003 The line of credit is secured by a blanket lien on
BankAtlantics residential mortgage loans and certain commercial real estate
loans. BankAtlantics available borrowings under this line of credit were
approximately $525.8 million at December 31, 2003. BankAtlantic has
established lines of credit for up to $245 million with other banks to
purchase federal funds and has established a $10.0 million potential advance
with the Federal Reserve Bank of Atlanta. BankAtlantic has various
relationships to acquire brokered deposits. These relationships may be
utilized as an alternative source of borrowings, if needed.

BankAtlantics commitments to originate and purchase loans at December
31, 2003 were $428.1 million and $43.7 million, respectively, compared to
$397.3 million and $300.6 million, respectively, at December 31, 2002.
Additionally, BankAtlantic had commitments to purchase mortgage-backed
securities of $8.6 million and $39.1 million at December 31, 2003 and 2002,
respectively. At December 31, 2003, total loan commitments represented
approximately 11.6% of net loans receivable.

At year-end 2003, BankAtlantic had approximately $144.9 million in
investments and mortgage-backed securities pledged against securities sold
under agreements to repurchase.

During 2002, BankAtlantic purchased a $14.3 million office facility to
consolidate its headquarters and back office operations into a centralized
facility. As of December 31, 2003, the Company had incurred approximately $3
million in renovation costs. The total estimated cost to renovate is
approximately $24.5 million, and the facility is expected to be completed in
October 2004. The estimated cost to renovate the building will be funded
through cash flow from operations.

A significant source of our liquidity is repayments and maturities of
loans and securities. The table below presents the contractual principal
repayments and maturity dates of our loan portfolio and securities available
for sale at December 31, 2003. The total amount of principal repayments on
loans and securities contractually due after December 31, 2004 was $3.6
billion, of which $791.7 million have fixed interest rates and $2.8 billion
have floating or adjustable interest rates. Actual principal repayments may
differ from information shown below (in thousands):

|                                        |  |             |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |   |           | 
|--------------------------------------- |  | ----------- | --------- | -------------------------------------- |  | --------- | --------- | --------- |  | --------- | --------- | --------- |  | ----- | ------- |  |  | - | ------- |  |  | - | ------- |  |  | - | --------- | 
|                                        |  | Outstanding |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |  
|                                        |  | on          |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |  
|                                        |  | December    |           | For the Period Ending December 31, (1)
|                                        |  | 31,         |           |                                       
|                                        |  | 2003        |           | 2004                                   |  | 2005-2006 |           | 2007-2011 |  | 2012-2016 |           | 2017-2021 |  | >2022
|                                        |  |             |           |                                        |  |           |           |           |  |           |           |           |  |      
|Commercial real estate                  |  | $           | 2,568,355 |                                        |  | $         | 1,065,233 |           |  | $         | 998,191   |           |  | $     | 353,972 |  |  | $ | 80,105  |  |  | $ | 65,858  |  |  | $ | 4,996     | 
|Residential real estate                 |  |             | 1,345,911 |                                        |  |           | 13,979    |           |  |           | 16,157    |           |  |       | 22,774  |  |  |   | 114,547 |  |  |   | 115,179 |  |  |   | 1,063,275 | 
|Consumer (2)                            |  |             | 357,985   |                                        |  |           | 4,012     |           |  |           | 5,328     |           |  |       | 11,341  |  |  |   | 117,907 |  |  |   | 219,397 |  |  |   |          | 
|Commercial business (4)                 |  |             | 187,354   |                                        |  |           | 105,278   |           |  |           | 35,443    |           |  |       | 41,885  |  |  |   | 4,748   |  |  |   |        |  |  |   |          | 
|                                        |  |             |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |   |           | 
|Total loans (4)                         |  | $           | 4,459,605 |                                        |  | $         | 1,188,502 |           |  | $         | 1,055,119 |           |  | $     | 429,972 |  |  | $ | 317,307 |  |  | $ | 400,434 |  |  | $ | 1,068,271 | 
|                                        |  |             |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |   |           | 
|Total securities available for
sale (3) |  | $           | 358,485   |                                        |  | $         | 19,192    |           |  | $         | 352       |           |  | $     | 841     |  |  | $ | 1,659   |  |  | $ | 20,922  |  |  | $ | 315,519   | 
|                                        |  |             |           |                                        |  |           |           |           |  |           |           |           |  |       |         |  |  |   |         |  |  |   |         |  |  |   |           | 

|    |  |                                                                                                                                                    
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------
|(1) |  | Does not include deductions for the undisbursed portion of loans in process,
deferred loan fees, unearned discounts and allowances for loan losses.
|    |  |                                                                                                                                                    
|(2) |  | Includes second mortgage loans.                                                                                                                    
|    |  |                                                                                                                                                    
|(3) |  | Includes in 2003 marketable equity securities available for sale of $1.4 million.                                                                  
|    |  |                                                                                                                                                    
|(4) |  | Includes lease financing.                                                                                                                          

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Loan maturities and sensitivity of loans to changes in interest rates for
commercial business and real estate construction loans at December 31, 2003
were (in thousands):

|                                        |  |            |         |              |  |       |           |  |  |   |           | 
|--------------------------------------- |  | ---------- | ------- | ------------ |  | ----- | --------- |  |  | - | --------- | 
|                                        |  | Commercial |         | Real Estate  |  |       |           | 
|                                        |  | Business   |         | Construction |  | Total
|                                        |  |            |         |              |  |      
|One year or less                        |  | $          | 163,590 |              |  | $     | 658,066   |  |  | $ | 821,656   | 
|Over one year, but less than five years |  |            | 6,910   |              |  |       | 698,383   |  |  |   | 705,293   | 
|Over five years                         |  |            | 3,354   |              |  |       | 7,118     |  |  |   | 10,472    | 
|                                        |  |            |         |              |  |       |           |  |  |   |           | 
|                                        |  | $          | 173,854 |              |  | $     | 1,363,567 |  |  | $ | 1,537,421 | 
|                                        |  |            |         |              |  |       |           |  |  |   |           | 
|Due After One Year:                     |  |            |         |              |  |       |           |  |  |   |           | 
|Pre-determined interest rate            |  | $          | 10,264  |              |  | $     | 120,157   |  |  | $ | 130,421   | 
|Floating or adjustable interest rate    |  |            |        |              |  |       | 585,344   |  |  |   | 585,344   | 
|                                        |  |            |         |              |  |       |           |  |  |   |           | 
|                                        |  | $          | 10,264  |              |  | $     | 705,501   |  |  | $ | 715,765   | 
|                                        |  |            |         |              |  |       |           |  |  |   |           | 

BankAtlantics geographic loan concentration at December 31, 2003 was:

|           |       |  |    |     |  
|---------- | ----- |  | -- | --- | -
|Florida    |       |  | 65 | %  
|California |       |  | 9  | %  
|Northeast  |       |  | 7  | %  
|Other      |       |  | 19 | %  
|           |       |  |    |    
|           | Total |  |    | 100 | %
|           |       |  |    |    

The loan concentration for BankAtlantics originated portfolio is
primarily in Florida. The concentration in California, the Northeast, and other
locations primarily relates to purchased wholesale residential real estate
loans.

At December 31, 2003, BankAtlantic met all applicable liquidity and
regulatory capital requirements. At the indicated dates, BankAtlantics
capital amounts and ratios were (dollars in thousands):

|                          |  |        |         |             |  |             |       |       |  |                |      |   |  |  |       |  
|------------------------- |  | ------ | ------- | ----------- |  | ----------- | ----- | ----- |  | -------------- | ---- | - |  |  | ----- | -
|                          |  |        |         |             |  |             |       |       |  | Minimum Ratios
|                          |  |        |         |             |  |             |       |       |  |               
|                          |  | Actual |         | Adequately  |  | Well       
|                          |  |        |         | Capitalized |  | Capitalized
|                          |  | Amount |         | Ratio       |  | Ratio       |       | Ratio
|                          |  |        |         |             |  |             |       |      
|At December 31, 2003:     |  |        |         |             |  |             |       |       |  |                |      |   |  |  |       |  
|Total risk-based capital  |  | $      | 447,967 |             |  |             | 12.06 | %     |  |                | 8.00 | % |  |  | 10.00 | %
|Tier 1 risk-based
capital |  | $      | 379,505 |             |  |             | 10.22 | %     |  |                | 4.00 | % |  |  | 6.00  | %
|Tangible capital          |  | $      | 379,505 |             |  |             | 8.52  | %     |  |                | 1.50 | % |  |  | 1.50  | %
|Core capital              |  | $      | 379,505 |             |  |             | 8.52  | %     |  |                | 4.00 | % |  |  | 5.00  | %
|At December 31, 2002:     |  |        |         |             |  |             |       |       |  |                |      |   |  |  |       |  
|Total risk-based capital  |  | $      | 413,469 |             |  |             | 11.89 | %     |  |                | 8.00 | % |  |  | 10.00 | %
|Tier 1 risk-based
capital |  | $      | 347,927 |             |  |             | 10.01 | %     |  |                | 4.00 | % |  |  | 6.00  | %
|Tangible capital          |  | $      | 347,927 |             |  |             | 7.26  | %     |  |                | 1.50 | % |  |  | 1.50  | %
|Core capital              |  | $      | 347,927 |             |  |             | 7.26  | %     |  |                | 4.00 | % |  |  | 5.00  | %

Savings institutions are also subject to the provisions of the Federal
Deposit Insurance Corporation Improvement Act of 1991 (FDICIA). Regulations
implementing the prompt corrective action provisions of FDICIA define specific
capital categories based on FDICIAs defined capital ratios, as discussed more
fully in Part I under Regulations of Federal Savings Banks.

Ryan Beck

Ryan Becks primary sources of funds during the year ended December 31,
2003 were clearing broker borrowings, proceeds from the sale of securities
owned, proceeds from securities sold but not yet purchased, and fees from
customers.

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These funds were primarily utilized to pay operating expenses and fund
capital expenditures. As part of the Gruntal transaction, Ryan Beck acquired
all of the membership interests in The GMS Group, LLC (GMS). During 2003,
Ryan Beck sold GMS for $22.6 million, receiving cash proceeds of $9.0 million
and a $13.6 million promissory note. The note is secured by the membership
interests in GMS and requires GMS to maintain certain capital and financial
ratios. During 2003, the buyer made a $1.6 million repayment of principal of
the promissory note which reduced the balance to $12.0 million.

In the ordinary course of business, Ryan Beck borrows, under an agreement
with its Clearing Broker, by pledging securities owned as collateral primarily
to finance its trading inventories. The amount and terms of the borrowings
are subject to the lending policies of the Clearing Broker and can be changed
at the Clearing Brokers discretion. Additionally, the amount financed is
also impacted by the market value of the securities owned.

Also as part of the Gruntal transaction, Ryan Beck assumed responsibility
for repayment of a $3.4 million note payable secured by leasehold improvements
and equipment. At December 31, 2003, the total outstanding amount was $0.8
million and the note matures on May 1, 2004. At December 31, 2003, Ryan Beck
had a line of credit facility with an unrelated financial institution in the
amount of $10 million with an interest rate of LIBOR plus 1.50%. The line
expires on April 1, 2004, and it is secured by certificates of deposit which
Ryan Beck holds in inventory in its certificate of deposit wholesale business.

There were no amounts outstanding under this facility at December 31, 2003.

Ryan Beck is subject to the net capital provision of Rule 15c3-1 under
the Securities Exchange Act of 1934, which requires the maintenance of minimum
net capital and requires the ratio of aggregate indebtedness to net capital,
both as defined, not to exceed 15 to 1. Additionally, Ryan Beck, as a market
maker, is subject to supplemental requirements of Rule 15c3-1(a)4, which
provides for the computation of net capital to be based on the number of and
price of issues in which markets are made by Ryan Beck, not to exceed $1.0
million. Ryan Becks regulatory net capital was $26.2 million, which was
$25.2 million in excess of its required net capital of $1.0 million.

Ryan Beck operates under the provisions of paragraph (k)(2)(ii) of Rule
15c3-3 of the Securities and Exchange Commission as a fully disclosed
introducing broker and, accordingly, customer accounts are carried on the
books of the clearing broker. However, Ryan Beck safe keeps and redeems
municipal bond coupons for the benefit of its customers. Accordingly, Ryan
Beck is subject to the provisions of SEC Rule 15c3-3 relating to possession or
control and customer reserve requirements and was in compliance with such
provisions at December 31, 2003.

Consolidated Cash Flows

A summary of our consolidated cash flows follows (in thousands):

|                                                 |                      |   |                                  |          |      |   |         |          |   |   |        |         |  
|------------------------------------------------ | -------------------- | - | -------------------------------- | -------- | ---- | - | ------- | -------- | - | - | ------ | ------- | -
|                                                 |                      |   | For the Years Ended December 31,
|                                                 |                      |   |                                 
|                                                 |                      |   | 2003                             |          | 2002 |   | 2001   
|                                                 |                      |   |                                  |          |      |   |        
|Net cash provided (used) by:                     |                      |   |                                  |          |      |   |         |          |   |   |        |        
|                                                 | Operating activities |   | $                                | 100,282  |      |   | $       | 1,485    |   |   | $      | 82,082  |  
|                                                 | Investing activities |   |                                  | 147,818  |      |   |         | 279,746  |   |   |        | (6,879  | )
|                                                 | Financing activities |   |                                  | (378,963 | )    |   |         | (150,691 | ) |   |        | (41,691 | )
|                                                 |                      |   |                                  |          |      |   |         |          |   |   |        |        
|Increase (decrease) in cash and cash
equivalents |                      | $ | (130,863                         | )        |      | $ | 130,540 |          |   | $ | 33,512 |        
|                                                 |                      |   |                                  |          |      |   |         |          |   |   |        |        

Cash flows from operating activities increased during 2003 compared to
2002 due primarily to increases in other liabilities and amounts due to
clearing agent. The above increases in cash flows were partially offset by a
substantial decrease in securities owned activities.

Cash flows from operating activities decreased during 2002 compared to
2001 due to increases in real estate inventory and loans held for sale along
with decreases in other liabilities and amounts due to clearing agent. These
declines in operating cash flows were partially offset by a decline in
securities owned as well as a significant increase in impairments and
write-downs.

Cash flows from investing activities decreased during 2003 compared to
2002 resulting primarily from greater purchases and originations of loans, net
of repayments, and lower proceeds from the sale and maturity of securities.
These decreases in cash flows from investing activities were partially offset
by lower investments in unconsolidated subsidiaries and reduced purchases of
investments.

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Cash flows provided by investing activities increased during 2002
compared to 2001 primarily due to increased proceeds from sales and maturities
of securities available for sale and investment securities.

Cash flows from financing activities declined during 2003 compared to
2002 primarily as a result of increases in FHLB maturities and repayments.
The decreases were partially offset by a net increase in deposits and a net
increase in securities sold under agreements to repurchase.

Cash flows from financing activities declined during 2002 compared to
2001 primarily as a result of a decline in FHLB advances and short-term
borrowings, the retirement of certain trust preferred securities and
debentures and a decline in the increase in deposits. The above cash outflows
were partially offset by the issuance of trust preferred securities and
additional borrowings.

Off Balance Sheet Arrangements, Contractual Obligations and Commercial Commitments

The tables below summarize the Companys commercial commitments at
December 31, 2003 (in thousands):

|                             |  |                                            |         |           |  |           |         |           |  |       |        |  |  |         |   |  |  |   |         | 
|---------------------------- |  | ------------------------------------------ | ------- | --------- |  | --------- | ------- | --------- |  | ----- | ------ |  |  | ------- | - |  |  | - | ------- | 
|                             |  | Amount of Commitment Expiration Per Period
|                             |  |                                           
|                             |  | Total                                      |         |           |  |           |         |           |  |       |        |  |  |         |   |  |  |  
|                             |  | Amounts                                    |         | Less than |  |           |         |           |  |       |        |  |  | After 5
|Commercial Commitments       |  | Committed                                  |         | 1 year    |  | 1-3 years |         | 4-5 years |  | Years
|                             |  |                                            |         |           |  |           |         |           |  |      
|Lines of credit              |  | $                                          | 468,991 |           |  | $         | 152,669 |           |  | $     | 9,954  |  |  | $       |  |  |  | $ | 306,368 | 
|Standby letters of credit    |  |                                            | 32,292  |           |  |           | 32,292  |           |  |       |       |  |  |         |  |  |  |   |        | 
|Other commercial commitments |  |                                            | 428,084 |           |  |           | 428,084 |           |  |       |       |  |  |         |  |  |  |   |        | 
|Other commitments            |  |                                            | 8,611   |           |  |           |        |           |  |       | 8,611  |  |  |         |  |  |  |   |         | 
|                             |  |                                            |         |           |  |           |         |           |  |       |        |  |  |         |   |  |  |   |         | 
|Total commercial commitments |  | $                                          | 937,978 |           |  | $         | 613,045 |           |  | $     | 18,565 |  |  | $       |  |  |  | $ | 306,368 | 
|                             |  |                                            |         |           |  |           |         |           |  |       |        |  |  |         |   |  |  |   |         | 

Lines of credit are primarily revolving lines to home equity loan and
business loan customers. The business loans to customers usually expire in
less than one year and the home equity lines generally expire in 15 years.

Standby letters of credit are conditional commitments issued by
BankAtlantic to guarantee the performance of a customer to a third party.
BankAtlantic standby letters of credit are generally issued to customers in the
construction industry guaranteeing project performance. These types of standby
letters of credit had a maximum exposure of $26.1 million at December 31, 2003.
BankAtlantic also issues standby letters of credit to commercial lending
customers guaranteeing the payment of goods and services. These types of
standby letters of credit had a maximum exposure of $5.6 million at December
31, 2003. Those guarantees are primarily issued to support public and private
borrowing arrangements and have maturities of one year or less. The credit
risk involved in issuing letters of credit is essentially the same as that
involved in extending loan facilities to customers. BankAtlantic may hold
certificates of deposit and residential and commercial liens as collateral for
such commitments which are collateralized similar to other types of borrowings.

Other commercial commitments are agreements to lend funds to a customer as
long as there is no violation of any condition established in the commitment.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since many of the commitments are expected to
expire without being drawn upon, the total commitment amounts do not
necessarily represent future cash requirements. BankAtlantic evaluates each
customers creditworthiness on a case-by-case basis. The amount of collateral
required by BankAtlantic in connection with an extension of credit is based on
managements credit evaluation of the counter-party.

The other commitments consist of a 5-year forward commitment to purchase
the underlying collateral from a government agency pool in March 2005.

Ryan Beck, in its capacity as a market-maker and dealer in corporate and
municipal fixed-income and equity securities, may enter into transactions in a
variety of cash and derivative financial instruments in order to facilitate
customer order flow and to hedge market risk exposures. Accordingly, these
transactions result in off-balance-sheet risk as Ryan Becks ultimate
obligation may exceed the amount recognized in the Consolidated Statement of
Financial Condition.

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As a securities broker and dealer, Ryan Beck is engaged in various
securities trading and brokerage activities servicing a diverse group of
domestic corporations, governments, institutional, and individual investors.
Ryan Beck has exposure to risk associated with the nonperformance of these
counter parties in fulfilling their contractual obligations.

At December 31, 2003, the Company did not have off balance sheet
arrangements that would have a material effect on the Companys consolidated
financial statements.

The tables below summarize the Companys contractual obligations at
December 31, 2003 (in thousands).

|                                      |  |                        |           |        |  |           |         |           |  |       |         |  |  |   |         |         |  |   |         | 
|------------------------------------- |  | ---------------------- | --------- | ------ |  | --------- | ------- | --------- |  | ----- | ------- |  |  | - | ------- | ------- |  | - | ------- | 
|                                      |  | Payments Due by Period
|                                      |  |                       
|                                      |  |                        |           |        |  | Less than |         |           |  |       |         |  |  |   |         | After 5
|Contractual Obligations               |  | Total                  |           | 1 year |  | 1-3 years |         | 4-5 years |  | Years
|                                      |  |                        |           |        |  |           |         |           |  |      
|Time deposits                         |  | $                      | 802,462   |        |  | $         | 474,063 |           |  | $     | 292,497 |  |  | $ | 35,489  |         |  | $ | 413     | 
|Long-term debt                        |  |                        | 299,861   |        |  |           | 2,785   |           |  |       | 856     |  |  |   |        |         |  |   | 296,220 | 
|Advances from FHLB (1)                |  |                        | 782,205   |        |  |           | 56,250  |           |  |       | 61,250  |  |  |   | 542,000 |         |  |   | 122,705 | 
|Capital lease obligations             |  |                        |          |        |  |           |        |           |  |       |        |  |  |   |        |         |  |   |        | 
|Operating lease obligations           |  |                        | 54,547    |        |  |           | 12,476  |           |  |       | 20,106  |  |  |   | 11,603  |         |  |   | 10,362  | 
|Pension obligation                    |  |                        | 11,536    |        |  |           |        |           |  |       | 2,595   |  |  |   | 1,918   |         |  |   | 7,023   | 
|Other obligations                     |  |                        | 7,229     |        |  |           | 7,229   |           |  |       |        |  |  |   |        |         |  |   |        | 
|Securities sold but not
yet purchased |  |                        | 37,813    |        |  |           | 37,813  |           |  |       |        |  |  |   |        |         |  |   |        | 
|                                      |  |                        |           |        |  |           |         |           |  |       |         |  |  |   |         |         |  |   |         | 
|Total contractual cash
obligations    |  | $                      | 1,995,653 |        |  | $         | 590,616 |           |  | $     | 377,304 |  |  | $ | 591,010 |         |  | $ | 436,723 | 
|                                      |  |                        |           |        |  |           |         |           |  |       |         |  |  |   |         |         |  |   |         | 

(1)  Payments due by period are based on contractual maturities

Long-term debt primarily consists of the junior subordinated debentures
issued by the Company as well as BankAtlantics subordinated debentures and
mortgage backed bonds. Operating lease obligations represent minimum future
lease payments in which the Company is the lessee for real estate and equipment
leases.

Securities sold but not yet purchased represent obligations of Ryan Beck
to deliver specified financial instruments at contracted prices, thereby
creating a liability to purchase the financial instrument in the market at
prevailing prices.

The pension obligation represents the accumulated benefit obligation of
the Companys defined benefit plan at December 31, 2003. The payments
represent the estimated benefit payments through 2013, of which the majority of
the payments will be funded through plan assets. The table does not include
estimated benefit payments after 2013. The actuarial present value of
projected accumulated benefit obligation was $23.1 million at December 31,
2003.

The other obligations are legally binding agreements with vendors for the
purchase of services and materials associated with the construction of
BankAtlantics corporate headquarters. The facility is expected to be
completed in October 2004.

Related Party Transactions

The Abdo Companies, a company in which John E. Abdo, Vice Chairman of the
Company, is the principal shareholder and CEO, receives monthly management fees
from Levitt, which was a subsidiary of the Company until it was spun off to the
Companys stockholders on December 31, 2003. BFC received management fees in
connection with providing accounting, general and administrative services to
Levitt. The amounts paid may not be representative of the amounts that would be
paid in an arms-length transaction. Management fees paid to related parties by
Levitt for the year ended December 31, 2003 consisted of $291,240 to the Abdo
Companies and $213,000 to BFC.

During the year ended December 31, 2003, BankAtlantic paid a subsidiary of
Levitt Corporation a $540,000 management fee to operate and sell a residential
construction property acquired through foreclosure. The property was sold to
an unrelated developer during the fourth quarter of 2003.

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The Company is an investor in a privately held technology company located
in Boca Raton, Florida which owns 748,000 shares of the Companys Class A
Stock. The Company has a $15 million investment in 3,033,386 shares of the
technology companys common stock, which shares were acquired in October 1999
at an average price per share of $4.95. Both Alan B. Levan and John E. Abdo
became directors of the technology company in connection with the Companys
investment and individually invested in the technology company. Alan B. Levan
owns or controls direct and indirect interests in an aggregate of 286,709
shares of the technology companys common stock purchased at an average price
of $8.14 and Mr. Abdo owns or controls direct and indirect interests in an
aggregate of 368,408 shares of the technology companys common stock purchased
at an average price of $7.69. Jarett Levan has an indirect ownership interest
in an aggregate of 350 shares of such common stock, and director Bruno
DiGiulian has an indirect ownership interest in 1,754 shares of such common
stock. The Company and its affiliates collectively own approximately 7% of the
technology companys outstanding common stock. During 2001, Mr. Levan and Mr.
Abdo resigned from the technology companys Board of Directors and initiated a
lawsuit on behalf of the Company and others against the founder of the
technology company, personally, regarding his role. The Company and the other
owners of the shares of the technology company who are parties to the lawsuit
are sharing in the legal fees incurred in connection with the litigation in
proportion to their respective interests. In early 2003 the technology company
initiated a lawsuit against the Company seeking to have a restrictive legend on
its Company Class A Stock removed.

The Company and its subsidiaries utilized certain services of Ruden,
McClosky, Smith, Schuster & Russell, P.A. (Ruden, McClosky), a law firm to
which Bruno DiGiulian is of counsel. Fees aggregating $110,000 were paid by
BankAtlantic and $30,000 were paid by Ryan Beck to Ruden, McClosky in 2003. In
addition, fees aggregating $845,000 were paid to Ruden, McClosky by Levitt in
2003 prior to the spin off of Levitt from the Company. Ruden, McClosky also
represents Alan B. Levan and John E. Abdo with respect to certain other
business interests.

Alan B. Levan, Jarett Levan and John E. Abdo have investments or are
partners in real estate joint ventures with developers, which developers, in
connection with other ventures, have loans from BankAtlantic or are joint
venture partners with Levitt.

Certain of the Companys affiliates, including its executive officers,
have independently made investments with their own funds in both public and
private entities in which the Company holds investments.

BFC paid BankAtlantic $67,000 during 2003 for office space used by BFC in
BankAtlantics headquarters and for miscellaneous administrative and other
related expenses. BankAtlantic provided certain administrative services to
Bluegreen in 2003 without receipt of payment for such services.

The BankAtlantic Foundation is a non-profit foundation established by
BankAtlantic. During 2003, the Foundation made donations aggregating $364,530,
including $25,000 to the Broward Community College Foundation (as the first
installment of a 4-year commitment of $100,000 to the Will and Jo Holcombe
Institute for Teaching and Learning), $15,000 to the Florida Grand Opera,
$7,500 to the Leadership Broward Foundation, $7,500 to Nova Southeastern
University (including $5,000 as the first installment of a 5-year, $25,000
commitment to the Wayne Huizenga School of Business and $2,500 to Nova
Southeastern University Libraries); $4,250 to ArtServe, $3,000 to the Broward
Performing Arts Foundation and $2,000 to the Museum of Art of Ft. Lauderdale.
In addition to the contributions made by the BankAtlantic Foundation,
BankAtlantic made certain direct contributions. In 2003 BankAtlantic made
donations of $11,500 to the Broward Community College Foundation, $10,963 to
the Urban League of Broward County, $6,000 to ArtServe, $1,160 to United Way of
Broward County and $900 to the Leadership Broward Foundation. Alan B. Levan
sits on the Boards of the Broward Community College Foundation, the Florida
Grand Opera and Nova Southeastern University, Jarett Levan sits on the Boards
of the Leadership Broward Foundation and ArtServe and the Board of Governors of
the Museum of Art of Ft. Lauderdale, John E. Abdo is President of the Broward
Performing Arts Foundation, Dr. Willis Holcombe sits on the Boards of the
Broward Community College Foundation and the Urban League of Broward County. In
addition, both D. Keith Cobb and Lloyd DeVaux sit on the Board of the United
Way of Broward County.

During fiscal 2003, Jarett Levan, a director and son of director,
president and CEO Alan B. Levan, was employed by BankAtlantic as Chief
Marketing Officer and was paid approximately $211,000 for his services. Alan B.
Levans daughter, Shelley Levan Margolis, served as executive director of the
BankAtlantic Foundation and received approximately $43,000 for the year.

In connection with the Levitt spin-off, the Company entered into a
transitional services agreement with Levitt whereby the Company will provide
human resources, risk management and investor and public relations services and
receive

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compensation for such services on a percentage of cost basis.
Additionally, the Company entered into an employment matters agreement
providing for the allocation of responsibility and liability between the
Company and Levitt with respect to the welfare and benefit plans for Levitt
employees after the spin-off.

Also in connection with the spin-off of Levitt, the Company converted a
currently outstanding $30.0 million demand note owned by Levitt to the Company
to a five year term note with interest only payable monthly initially at the
prime rate and thereafter at a prime rate plus increments of an additional .25%
every six months. Prior to the spin-off, the Company transferred its 4.9%
ownership interest in Bluegreen Corporation to Levitt in exchange for a $5.5
million note and additional shares of Levitt common stock (which additional
shares were distributed as part of the spin-off transaction.) This note is due
in one year, with principal and interest payable monthly at the prime rate.
Additionally, prior to the spin-off, Levitt declared an $8.0 million dividend
to the Company payable in the form of a five year note with the same payment
terms as the $30.0 million note described above. BankAtlantic also has $18.1
million of construction loans to Levitt secured by land and improvements.

Critical Accounting Policies

Management views critical accounting policies as accounting policies that
are important to the understanding of our financial statements and also
involve estimates and judgments about inherently uncertain matters. In
preparing the financial statements, management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities as of the date of the
consolidated statements of financial condition and assumptions that affect the
recognition of income and expenses on the statement of operations for the
periods presented. Actual results could differ significantly from those
estimates. Material estimates that are particularly susceptible to significant
change in subsequent periods relate to the determination of the allowance for
loan losses, evaluation of goodwill for impairment, the valuation of real
estate acquired in connection with foreclosure or in satisfaction of loans,
the valuation of the fair value of assets and liabilities in the application
of the purchase method of accounting, the amount of the deferred tax asset
valuation allowance, and accounting for contingencies. The six accounting
policies that we have identified as critical accounting policies are: (i)
allowance for loan losses; (ii) valuation of securities; (iii) impairment of
goodwill and other intangible assets; (iv) impairment of long-lived assets;
(v) accounting for business combinations and (vi) accounting for
contingencies. We have discussed the critical accounting estimates outlined
below with our audit committee of our board of directors, and the audit
committee has reviewed our disclosure. See note 1, Summary of Significant
Accounting Policies to the Notes to Consolidated Financial Statements, for a
detailed discussion of our significant accounting policies.

Allowance for loan losses

The allowance for loan losses consists of three components. The first
component requires us to identify impaired loans based on management
classification and, if necessary, assign a valuation allowance to the impaired
loans. A loan is deemed impaired when collection of principal and interest
based on the contractual terms of the loan is not likely to occur. Most of
our loans do not have an observable market price and an estimate of the
collection of contractual cash flows is based on the judgment of management.
Valuation allowances are established on loans that are collateral-dependent
based on managements estimated fair value of the collateral less the cost to
dispose of the collateral. Valuation allowances are established on unsecured
loans based on the present value of expected future cash flows, discounted at
the notes effective rate. These valuations are based on available
information and require estimates and subjective judgments about fair values
of the collateral or expected future cash flows. It is likely that we would
obtain materially different results if different assumptions or conditions
were to prevail. This would include updated information that came to
managements attention about the loans or a change in the current economic
environment. As a consequence of the estimates and assumptions required to
calculate the first component of our allowance for loan losses, a change in
these highly uncertain estimates could have a materially favorable or
unfavorable impact on our financial position and results of operations.

The second component of the allowance requires us to group loans and
leases that have similar credit risk characteristics so as to form a basis for
predicting losses based on historical data and delinquency trends as it
relates to the group. Management assigns an allowance to these groups of
loans by utilizing observable data such as historical loss experiences, trends
in the industry, static pool analysis, delinquency trends and credit scores.
These loss experiences assigned to loan groups are primarily based on
historical data and current delinquency trends. As a consequence, there may
be a lag in the adjustment to historical loss experiences when there is a
significant change in observable data in subsequent periods. A subsequent
change in observable data trends may result in material changes in this
component of the allowance from period to period.

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The third component of the allowance is the unassigned portion of the
allowance. This component addresses certain industry and geographic
concentrations, the view of regulators, and changes in the composition of the
loan portfolio. This component requires substantial management judgment in
adjusting the allowance for the changes in the current economic climate
compared to the economic environment that existed historically. Due to the
subjectivity involved in the determination of the unassigned portion of the
allowance, the relationship of the unassigned component to the total allowance
may fluctuate substantially from period to period.

Management believes that the allowance for loan losses reflects
managements best estimate of incurred credit losses as of the balance sheet
date. As of December 31, 2003, our allowance for loan losses was $45.6
million. See Provision for Loan Losses for a discussion on the amounts of
our allowance assigned to each loan product and the amount of our unassigned
allowance. The estimated allowance derived from the above methodology may be
significantly different from actual realized losses. Actual losses incurred
in the future are highly dependent upon future events, including the economies
of geographic areas in which we hold loans. These uncertainties are beyond
managements control. In addition, various regulatory agencies, as an integral
part of their examination process, periodically review our allowance for loan
losses. Such agencies may require us to recognize additions to the allowance
based on their judgments and information available to them at the time of
their examination.

On an on-going basis, we analyze our loan portfolio by monitoring the
loan mix, credit quality, historical trends and economic conditions. As a
consequence, our allowance for loan losses estimates will change from period
to period. A measure of this change is our ratio of the allowance for loan
losses to total loans. This ratio has declined from 1.62% at December 31,
2000 to 1.22% at December 31, 2003. If we were to increase or decrease our
historical loss experience in the assigned portion of the allowance for loan
losses by 25 basis points at December 31, 2003, we estimate that our pre-tax
earnings would increase or decrease by approximately $9 million.

Valuation of securities and trading activities

We record our securities available for sale, securities owned and
derivative instruments in our statement of financial condition at fair value.
We use the following three methods for valuation: obtaining market price
quotes, using a price matrix, and applying a management valuation model.

The following table provides the sources of fair value for our securities
available for sale, securities owned and derivative instruments at December
31, 2003 (in thousands):

|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |         |  
|----------------------------------- | --------------------------------- | - | ------------ | ------- | ------ | - | --------- | ------- | ----- | - | --- | --- |  | - | ------- | ------- | -
|                                    |                                   |   | National     |         |        |   |           |         |       |   |     |     |  |   |        
|                                    |                                   |   | Market price |         | Price  |   | Valuation |         |       |   |    
|                                    |                                   |   | Quotes       |         | Matrix |   | Model     |         | Total
|                                    |                                   |   |              |         |        |   |           |         |      
|Securities available for sale       |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|                                    | Mortgage-backed securities        |   | $            |        |        |   | $         | 338,751 |       |   | $   |    |  |   | $       | 338,751 |  
|                                    | Other securities                  |   |              |         |        |   |           |        |       |   |     | 585 |  |   |         | 585     |  
|                                    | Equity securities                 |   |              | 19,175  |        |   |           |        |       |   |     |    |  |   |         | 19,175  |  
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|Total securities available for sale |                                   |   | 19,175       |         |        |   | 338,751   |         |       |   | 585 |     |  |   | 358,511 |        
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|Brokerage industry securities       |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|                                    | Securities owned                  |   |              | 124,565 |        |   |           |        |       |   |     |    |  |   |         | 124,565 |  
|                                    | Securities sold not yet purchased |   |              | (37,813 | )      |   |           |        |       |   |     |    |  |   |         | (37,813 | )
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|Total Brokerage industry securities |                                   |   | 86,752       |         |        |   |          |         |       |   |    |     |  |   | 86,752  |        
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|Interest rate swap contracts        |                                   |   |             |         |        |   |          |         |       |   | 13  |     |  |   | 13      |        
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        
|Total                               |                                   | $ | 105,927      |         |        | $ | 338,751   |         |       | $ | 598 |     |  | $ | 445,276 |        
|                                    |                                   |   |              |         |        |   |           |         |       |   |     |     |  |   |         |        

Equity securities available for sale trade daily on various stock
exchanges and are primarily exchange-traded mutual funds. The fair value of
these securities in our statement of financial condition was based on the
closing price quotations at period end. The closing quotation represents
inter-dealer quotations without retail markups, markdowns or commissions and
do not necessarily represent actual transactions. We adjust our equity
securities available for sale to fair value monthly with a corresponding
increase or decrease, net of income taxes, to other comprehensive income.
Declines in the fair value of individual securities available for sale below
their cost that are other than temporary result in write-downs of the
individual securities to their fair value.

We subscribe to a third-party service to obtain a price matrix fair value
of our debt securities available for sale. The pricing matrix computes a
fair value of debt securities based on inputting the securities coupon rate,
maturity date and

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estimates of future prepayment rates. The valuations obtained from the
pricing matrix are not actual transactions and will not be the actual amount
realized upon sale. It is likely that we would obtain materially different
results if different interest rate and prepayment assumptions were used in the
valuation. We adjust our debt securities available for sale to fair value
monthly with a corresponding increase or decrease, net of income taxes, to
other comprehensive income.

Securities and future contracts to purchase residential loans that are
not listed on an exchange and that we cannot obtain broker quotes are valued
based on a valuation model. Management estimates the valuation of these
securities and contracts based on market information available, principally
reviewing the issuers financial statements and obtaining recent trades of
similar securities. This evaluation requires a significant amount of judgment
in assessing the estimated fair value. These estimates would be significantly
different if the assumptions concerning credit quality and projected cash
flows were changed.

At December 31, 2003, the fair value and unrealized gain associated with
our securities available for sale was $358.5 million and $9.3 million,
respectively. If interest rates were to decline by 200 basis points, we
estimate that the fair value of our securities available for sale portfolio
would increase by $.8 million. In contrast, if interest rates were to
increase by 200 basis points, we estimate that the fair value of our
securities would decline by $9.1 million. The above changes in value are
based on various assumptions concerning prepayment rates and shifts in the
interest rate yield curve. We are likely to obtain significantly different
results if these assumptions were changed. At December 31, 2002 and 2001, our
securities available for sale had a fair value of $707.9 million and $843.9
million, respectively, and unrealized gains were $22.3 million and $25.0
million, respectively.

Securities owned and securities sold but not yet purchased are accounted
for at fair value with changes in fair value included in earnings. The fair
value of these securities is determined by obtaining security values from
various sources, including dealer price quotations and price quotations for
similar instruments traded and management estimates. The majority of our
securities owned are listed on national markets or market quotes can be
obtained from brokers. The fair values of securities owned and securities
sold but not yet purchased are highly volatile and are largely driven by
general market conditions and changes in the market environment. The most
significant factors affecting the valuation of securities owned and securities
sold but not yet purchased is the lack of liquidity and credit quality of the
issuer. Lack of liquidity results when trading in a position or a market
sector has slowed significantly or ceased and quotes may not be available.

Goodwill and Other Intangible Assets

We test goodwill and other intangible assets for impairment annually.
The test requires us to determine the fair value of our reporting units and
compare the reporting units fair value to its carrying value. The fair
values of the reporting units are estimated using discounted cash flow present
value techniques and management valuation models. While management believes
the sources utilized to arrive at the fair value estimates are reliable,
different sources or methods could have yielded different fair value
estimates. These fair value estimates require a significant amount of
judgment. Changes in managements valuation of its reporting units may affect
future earnings through the recognition of a goodwill impairment charge. At
September 30, 2003 (our goodwill impairment testing date) the fair value of
our reporting units was greater than their carrying value; therefore, goodwill
was not impaired. If the fair value of our reporting units declines below the
carrying amount we would have to perform the second step of the impairment
test. This step requires us to fair value all assets (recognized and
unrecognized) and liabilities in a manner similar to a purchase price
allocation. This allocation will include core deposit intangible assets that
are currently not recognized on our financial statements. These unrecognized
assets may result in a significant impairment of goodwill. At December 31,
2003, total goodwill and other intangible assets were $88.7 million. The fair
value of our reportable segments assigned goodwill exceeds the carrying value
by $261 million, $69 million, $36 million and $8.4 million for commercial
banking, bank investments, community banking, and Ryan Beck, respectively.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. When testing a long-lived asset for recoverability, it may be
necessary to review estimated lives and adjust the depreciation period.
Changes in circumstances and the estimates of future cash flows as well as
evaluating estimated lives of long-lived assets are subjective and involve a
significant amount of judgment. A change in the estimated life of a
long-lived asset may substantially increase depreciation expense in subsequent
periods. For purposes of recognition and measurement of an impairment loss,
we are required to group long-lived assets at the lowest level for which
identifiable cash flows are independent of other assets. These cash flows are
based on projections from management reports which are based on subjective
interdepartmental allocations. Fair values are not available for many of our
long-lived assets, and estimates must be based on available information,
including prices of similar assets and present value valuation techniques. At
December 31, 2003, total property and equipment was
$93.6 million.

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Near the end of 2004, we expect to relocate our new corporate
headquarters. It is the intention of management to sell the land and building
that comprise its current headquarters, and the facility is considered held
and used with a book value of $3.9 million at December 31, 2003. Based upon
property values indicated from this propertys latest tax assessments,
management believes the carrying value of the facility to be recoverable.

Accounting for Business Combinations

The Company accounts for its business combinations, such as the Community
acquisition and the Gruntal transaction, based on the purchase method of
accounting. The purchase method of accounting requires us to fair value the
tangible net assets and identifiable intangible assets acquired. The fair
values are based on available information and current economic conditions at
the date of acquisition. The fair values may be obtained from independent
appraisers, discounted cash flow present value techniques, management
valuation models, quoted prices on national markets or quoted market prices
from brokers. These fair values estimates will affect future earnings through
the disposition or amortization of the underlying assets and liabilities.
While management believes the sources utilized to arrive at the fair value
estimates are reliable, different sources or methods could have yielded
different fair value estimates. Such different fair value estimates could
affect future earnings through different values being utilized for the
disposition or amortization of the underlying assets and liabilities acquired.

In connection with the acquisition of Community, we recorded net fair
value adjustments excluding goodwill and other intangible assets of $21.9
million. This amount will affect future earnings through the disposition and
amortization of the underlying assets and liabilities.

Contingent Liabilities

Contingent liabilities consist of Ryan Beck arbitration proceedings,
litigation and tax reserves and other claims arising from the conduct of our
business activities. We have established reserves for legal and other claims
when it becomes probable that we will incur a loss and the loss is reasonably
estimated. We have attorneys, consultants and other professionals assessing
the probability of the estimated amounts. Changes in these assessments can
lead to changes in the recorded reserves and the actual costs of resolving the
claims may be substantially higher or lower than the amounts reserved for the
claim. The reserving for contingencies is based on managements judgment on
uncertain events in which changes in circumstances could significantly affect
the amounts recorded in the Companys financial statements. At December 31,
2003, total reserves for contingent liabilities included in other liabilities
were $4.2 million.

Dividends

The availability of funds for dividend payments depends upon
BankAtlantics ability to pay dividends to the Company. Current regulations
applicable to the payment of cash dividends by savings institutions impose
limits on capital distributions based on an institutions regulatory capital
levels, retained net income and net income. See Regulation and Supervision 
Limitation on Capital Distributions.

Subject to the results of operations and regulatory capital requirements
for BankAtlantic and indenture restrictions, we will seek to declare regular
quarterly cash dividends on our common stock.

Impact of Inflation

The financial statements and related financial data and notes presented
herein have been prepared in accordance with generally accepted accounting
principles, which require the measurement of financial position and operating
results in terms of historical dollars without considering changes in the
relative purchasing power of money over time due to inflation.

Unlike most industrial companies, virtually all of our assets and
liabilities are monetary in nature. As a result, interest rates have a more
significant impact on our performance than the effects of general price
levels. Although interest rates generally move in the same direction as
inflation, the magnitude of such changes varies. The possible effect of
fluctuating interest rates is discussed more fully under the section entitled
Consolidated Interest Rate Risk In Item 7A below.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Consolidated Market Risk

Market risk is defined as the risk of loss arising from adverse changes
in market valuations which arise from interest rate risk, foreign currency
exchange rate risk, commodity price risk and equity price risk. Our primary
market risk is interest rate risk and our secondary market risk is equity
price risk.

Consolidated Interest Rate Risk

The majority of our assets and liabilities are monetary in nature
subjecting us to significant interest rate risk which would arise if the
relative values of each of our assets and liabilities change in conjunction
with a general rise or decline in interest rates. We have developed a model
using standard industry software to quantify our interest rate risk. A
sensitivity analysis was performed measuring our potential gains and losses in
net portfolio fair values of interest rate sensitive instruments at December
31, 2003 resulting from a change in interest rates. Interest rate sensitive
instruments included in the model are:



| |  |  | Loans,                                         
| | - |  | -----------------------------------------------
|
| |  |  | Debt securities available for sale,            
|
| |  |  | Investment securities,                         
|
| |  |  | FHLB stock,                                    
|
| |  |  | Federal funds sold,                            
|
| |  |  | Deposits,                                      
|
| |  |  | Advances from FHLB,                            
|
| |  |  | Securities sold under agreements to repurchase,
|
| |  |  | Federal funds purchased,                       
|
| |  |  | Subordinated debentures,                       
|
| |  |  | Notes and bonds payable,                       
|
| |  |  | Interest rate swaps,                           
|
| |  |  | Forward contracts,                             
|
| |  |  | Junior subordinated debentures, and            
|
| |  |  | Off-balance sheet loan commitments.            

The model calculates the net potential gains and losses in net portfolio
fair value by:



| | i.   |  | discounting anticipated cash flows from existing assets, liabilities
and off-balance sheet contracts and derivatives at market rates to
determine fair values at December 31, 2003,
| | ---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | ii.  |  | discounting the above expected cash flows based on instantaneous and
parallel shifts in the yield curve to determine fair values; and                                              
|
| | iii. |  | calculating the difference between the fair value calculated in (i)
and (ii).                                                                                                      

Management has made estimates of fair value discount rates that it
believes to be reasonable. However, because there is no quoted market for
many of these financial instruments, management has no basis to determine
whether the fair value presented would be indicative of the value negotiated
in an actual sale. Our fair value estimates do not consider the tax effect
that would be associated with the disposition of the assets or liabilities at
their fair value estimates.

Subordinated debentures, notes and bonds payable and junior subordinated
debentures were valued for this purpose based on their contractual maturities
or redemption date. The Companys interest rate risk policy has been approved
by the Board of Directors and establishes guidelines for tolerance levels for
net portfolio value changes based on interest rate volatility. Management has
maintained the portfolio within these established tolerances.

Certain assumptions by the Company in assessing the interest rate risk
were utilized in preparing the following table. These assumptions related to:



| | § |  | Interest rates,       
| | - |  | ----------------------
|
| | § |  | Loan prepayment rates,
|
| | § |  | Deposit decay rates,  

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| | § |  | Market values of certain assets under various interest rate scenarios, and
| | - |  | --------------------------------------------------------------------------
|
| | § |  | Re-pricing of certain borrowings.                                         

The prepayment assumptions used in the model are:

|  |  |                            |  |  |    |   |  | 
|- |  | -------------------------- |  |  | -- | - |  | 
| |  | Fixed rate mortgages       |  |  | 60 | %
| |  | Fixed rate securities      |  |  | 35 | %
| |  | Tax certificates           |  |  | 10 | %
| |  | Adjustable rate mortgages  |  |  | 62 | %
| |  | Adjustable rate securities |  |  | 65 | %

Deposit runoff assumptions used in the model are as follows:

|                                        |  |        |    |       |  |       |    |        |  |  |    |   |  |  |    |  
|--------------------------------------- |  | ------ | -- | ----- |  | ----- | -- | ------ |  |  | -- | - |  |  | -- | -
|                                        |  | Within |    | 1-3   |  | 3-5   |    | Over 5
|                                        |  | 1 Year |    | Years |  | Years |    | Years 
|                                        |  |        |    |       |  |       |    |       
|Money fund savings accounts decay rates |  |        | 17 | %     |  |       | 17 | %      |  |  | 16 | % |  |  | 14 | %
|NOW and savings accounts decay rates    |  |        | 37 | %     |  |       | 32 | %      |  |  | 17 | % |  |  | 17 | %

The tables below measure changes in net portfolio value for instantaneous
and parallel shifts in the yield curve in 100 basis point increments up or
down. It was also assumed that delinquency rates would not change as a result
of changes in interest rates, although there can be no assurance that this
would be the case. Even if interest rates change in the designated
increments, there can be no assurance that our assets and liabilities would
perform as indicated in the table above. In addition, a change in U.S.
Treasury rates in the designated amounts accompanied by a change in the shape
of the yield curve could cause significantly different changes to the fair
values than indicated above. Furthermore, the results of the calculations in
the preceding table are subject to significant deviations based upon actual
future events, including anticipatory and reactive measures which we may take
in the future.

Presented below is an analysis of the impact of changes in interest rates
on the Companys net portfolio value at December 31, 2003 (dollars in
thousands):

|        |   |        |               |         |  |   |         |   | 
|------- | - | ------ | ------------- | ------- |  | - | ------- | - | 
|        |   |        | Net Portfolio |         |  |   |        
|Changes |   | Value  |               | Dollar 
|in Rate |   | Amount |               | Change 
|        |   |        |               |        
|+200 bp |   | $      | 470,869       |         |  | $ | 17,666  |  
|+100 bp |   | $      | 482,543       |         |  | $ | 29,340  |  
|        | 0 |        | $             | 453,203 |  |   | $       |  | 
|-100 bp |   | $      | 408,921       |         |  | $ | (44,282 | )
|-200 bp |   | $      | 391,156       |         |  | $ | (62,047 | )

Presented below is an analysis of the impact of changes in interest rates
on the Companys net portfolio value at December 31, 2002 (dollars in
thousands):

|        |   |        |               |         |  |   |          |   | 
|------- | - | ------ | ------------- | ------- |  | - | -------- | - | 
|        |   |        | Net Portfolio |         |  |   |         
|Changes |   | Value  |               | Dollar 
|in Rate |   | Amount |               | Change 
|        |   |        |               |        
|+200 bp |   | $      | 531,932       |         |  | $ | 66,530   |  
|+100 bp |   | $      | 512,530       |         |  | $ | 47,128   |  
|        | 0 |        | $             | 465,402 |  |   | $        |  | 
|-100 bp |   | $      | 404,404       |         |  | $ | (60,998  | )
|-200 bp |   | $      | 341,066       |         |  | $ | (124,336 | )

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Interest Rate Sensitivity

Changes in interest rates can impact our net interest income as well as
the valuation of our assets and liabilities, as the relative spreads between
our assets and our liabilities can widen or narrow due to changes in the
overall levels of and changes in market interest rates.

Our profitability is dependent to a large extent on net interest income.
Net interest income is the difference between interest income on
interest-earning assets, such as loans, and interest expense on
interest-bearing liabilities, such as deposits and borrowings. Changes in
market interest rates, changes in the relationships between short-term and
long-term market interest rates, or changes in the relationships between
different interest rate indices can affect the interest rates charged on
interest-earning assets differently than the interest rates paid on
interest-bearing liabilities. This difference could result in an increase in
interest expense relative to interest income. While we have attempted to
structure our asset and liability management strategies to mitigate the impact
on net interest income of changes in market interest rates, we cannot assure
you that we will be successful.

Generally, as interest rates fall, loan prepayments accelerate.
Prepayments in a declining interest rate environment reduce our net interest
income and adversely impact our earnings due to accelerated amortization of
loan premiums and the reinvestment of proceeds from these loan payoffs at
lower rates. Significant loan prepayments in our purchased residential loan
portfolio in the future could have an adverse effect on future earnings.

Equity Price Risk

We also maintain a portfolio of equity securities and exchange traded
mutual funds that subject us to equity pricing risks which would arise as the
relative values of our equity investments change in conjunction with market or
economic conditions. The change in fair values of equity investments
represents instantaneous changes in all equity prices. The following are
hypothetical changes in the fair value of our available for sale securities at
December 31, 2003 based on percentage changes in fair value. Actual future
price appreciation or depreciation may be different from the changes
identified in the table below (dollars in thousands).

|           |   |            |           |        |  |  |   |        |  
|---------- | - | ---------- | --------- | ------ |  |  | - | ------ | -
|           |   |            | Available |        |  |  |  
|Percent    |   | For Sale   |           |        |  | 
|Change in  |   | Securities |           | Dollar
|Fair Value |   | Fair Value |           | Change
|           |   |            |           |       
|20         | % |            | $         | 23,010 |  |  | $ | 3,835  |  
|10         | % |            | $         | 21,093 |  |  | $ | 1,918  |  
|0          | % |            | $         | 19,175 |  |  | $ |       |  
|-10        | % |            | $         | 17,257 |  |  | $ | (1,918 | )
|-20        | % |            | $         | 15,340 |  |  | $ | (3,835 | )

Excluded from the above table is $1.8 million of investments in private
companies for which no current market exists. The ability to realize on or
liquidate these investments will depend on future market conditions and is
subject to significant risk.

Ryan Beck Market Risk

Ryan Becks market risk is the potential change in value of financial
instruments caused by fluctuations in interest rates, equity prices, credit
spreads or other market forces. The Company, through its broker/dealer
subsidiary Ryan Beck, is exposed to market risk arising from trading and market
making activities.

Ryan Becks management monitors risk in its trading activities by
establishing limits and reviewing daily trading results, inventory aging,
pricing, concentration and securities ratings. Ryan Beck uses a variety of
tools, including aggregate and statistical methods. Value at Risk, (VaR) is
the principal statistical method and measures the potential loss in the fair
value of a portfolio due to adverse movements in underlying risk factors. Ryan
Beck began using VaR on January 31, 2003. Substantially all the trading
inventory is subject to measurement using VaR.

Ryan Beck uses an historical simulation approach to measuring VaR using a
99% confidence level, a one day holding period and the most recent three months
average volatility. The 99% VaR means that, on average, one would not

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expect to exceed such loss amount more than one time every one hundred
trading days if the portfolio were held constant for a one-day period.

Modeling and statistical methods rely on approximations and assumptions
that could be significant under certain circumstances. As such, the risk
management process also employs other methods such as sensitivity to interest
rates and stress testing.

The following table sets forth the high, low and average VaR for Ryan Beck
during the period January 31, 2003 to December 31, 2003, and adjusted for
discontinued operations.

|                      |  |                        |        |     |  |         |        |  |  |  |        | 
|--------------------- |  | ---------------------- | ------ | --- |  | ------- | ------ |  |  |  | ------ | 
|                      |  | (dollars in thousands)
|                      |  | High                   |        | Low |  | Average
|                      |  |                        |        |     |  |        
|VaR                   |  |                        | 1,285  |     |  |         | 16     |  |  |  | 531    | 
|Aggregate Long Value  |  |                        | 68,995 |     |  |         | 42,364 |  |  |  | 66,809 | 
|Aggregate Short Value |  |                        | 19,570 |     |  |         | 60,602 |  |  |  | 36,495 | 

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

|                                                                                                                                                |  |      |      | 
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ---- | 
|                                                                                                                                                |  | Page
|Independent Certified Public Accountants Report of PricewaterhouseCoopers LLP                                                                  |  |      | F-2  | 
|Independent Auditors Report of KPMG LLP                                                                                                        |  |      | F-3  | 
|Consolidated Statements of Financial Condition as of December 31, 2003 and 2002                                                                 |  |      | F-4  | 
|Consolidated Statements of Operations for each of the years in the three year period ended
December 31, 2003                                    |  |      | F-5  | 
|Consolidated Statements of Stockholders Equity and Comprehensive Income for each of the
years in the three year period ended December 31, 2003 |  |      | F-7  | 
|Consolidated Statements of Cash Flows for each of the years in the three year period ended
December 31, 2003                                    |  |      | F-10 | 
|Notes to Consolidated Financial Statements                                                                                                      |  |      | F-13 | 





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##### Table of Contents



Report of Independent Certified Public Accountants

To the Board of Directors and Stockholders:

In our opinion, the accompanying consolidated statements of financial condition
and the related consolidated statements of operations, stockholders equity and
comprehensive income and cash flows present fairly, in all material respects,
the financial position of BankAtlantic Bancorp, Inc. and its subsidiaries at
December 31, 2003, and the results of their operations and their cash flows for
the year then ended in conformity with accounting principles generally accepted
in the United States of America. These financial statements are the
responsibility of the Companys management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our
audit of these statements in accordance with auditing standards generally
accepted in the United States of America, which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

PricewaterhouseCoopers LLP
Fort Lauderdale, Florida
February 13, 2004





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##### Table of Contents



INDEPENDENT AUDITORS REPORT

The Board of Directors
BankAtlantic Bancorp, Inc.:

We have audited the accompanying consolidated statement of financial
condition of BankAtlantic Bancorp, Inc. and subsidiaries as of December 31,
2002, and the related consolidated statements of operations, stockholders
equity and comprehensive income and cash flows for each of the years in the
two-year period ended December 31, 2002. These consolidated financial
statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
BankAtlantic Bancorp, Inc. and subsidiaries as of December 31, 2002, and the
results of their operations and their cash flows for each of the years in the
two-year period ended December 31, 2002, in conformity with accounting
principles generally accepted in the United States of America.

As discussed in Note 1 to the consolidated financial statements, the
Company changed its method of accounting for goodwill and intangible
assets in 2002 and for derivative
instruments and hedging activities in 2001.

KPMG LLP

Fort Lauderdale, Florida
February 3, 2003





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##### Table of Contents






BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

|                                                                                                                            |                             |                                            |           |              |           |   |           |           |           | 
|--------------------------------------------------------------------------------------------------------------------------- | --------------------------- | ------------------------------------------ | --------- | ------------ | --------- | - | --------- | --------- | --------- | 
|                                                                                                                            |                             |                                            |           | December 31,
|                                                                                                                            |                             |                                            |           |             
|(In thousands, except share data)                                                                                           |                             | 2003                                       |           | 2002        
|                                                                                                                            |                             |                                            |           |             
|ASSETS                                                                                                                      |                             |                                            |           |              |           |   |           |          
|Cash and due from depository institutions (See Note 14)                                                                     |                             | $                                          | 119,882   |              |           | $ | 200,600   |          
|Federal funds sold and securities purchased under resell agreements (See Note 3)                                            |                             |                                            |          |              |           |   | 50,145    |          
|Securities owned (at fair value) (See Note 3)                                                                               |                             |                                            | 124,565   |              |           |   | 186,454   |          
|Securities available for sale (at fair value) (See Note 3)                                                                  |                             |                                            | 358,511   |              |           |   | 707,858   |          
|Investment securities and tax certificates (approximate fair value: $192,706
and $212,698) (See Note 3)                     |                             |                                            | 192,706   |              |           |   | 212,240   |          
|Federal Home Loan Bank stock, at cost which approximates fair value (See Note 8)                                            |                             |                                            | 40,325    |              |           |   | 64,943    |          
|Loans receivable, net of allowance for loan losses of $45,595 and $48,022 (See Note 4)                                      |                             |                                            | 3,686,153 |              |           |   | 3,372,630 |          
|Accrued interest receivable (See Note 5)                                                                                    |                             |                                            | 27,866    |              |           |   | 33,984    |          
|Real estate held for development and sale (See Note 21)                                                                     |                             |                                            | 21,803    |              |           |   | 200,183   |          
|Investment and advances to unconsolidated subsidiaries (See Notes 2, 22)                                                    |                             |                                            | 7,910     |              |           |   | 112,599   |          
|Office properties and equipment, net (See Note 6)                                                                           |                             |                                            | 93,577    |              |           |   | 92,699    |          
|Deferred tax asset, net (See Note 12)                                                                                       |                             |                                            | 22,999    |              |           |   | 35,316    |          
|Goodwill, net (See Notes 1,2)                                                                                               |                             |                                            | 76,674    |              |           |   | 78,612    |          
|Core deposit intangible asset (See Note 2)                                                                                  |                             |                                            | 11,985    |              |           |   | 13,757    |          
|Other assets (See Notes 4, 10, 13)                                                                                          |                             |                                            | 46,593    |              |           |   | 58,991    |          
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|                                                                                                                            |                             | Total assets                               |           | $            | 4,831,549 |   |           | $         | 5,421,011 | 
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                        |                             |                                            |           |              |           |   |           |          
|Liabilities:                                                                                                                |                             |                                            |           |              |           |   |           |          
|Interest bearing deposits                                                                                                   |                             | $                                          | 2,413,106 |              |           | $ | 2,457,837 |          
|Non-interest bearing deposits                                                                                               |                             |                                            | 645,036   |              |           |   | 462,718   |          
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|                                                                                                                            | Total deposits (See Note 7) |                                            |           | 3,058,142    |           |   |           | 2,920,555 |          
|Advances from FHLB (See Note 8)                                                                                             |                             |                                            | 782,205   |              |           |   | 1,297,170 |          
|Securities sold under agreements to repurchase (See Note 9)                                                                 |                             |                                            | 138,809   |              |           |   | 116,279   |          
|Subordinated debentures, notes and bonds payable (See Note 10)                                                              |                             |                                            | 36,595    |              |           |   | 193,816   |          
|Guaranteed preferred beneficial interests in Companys Junior Subordinated
Debentures (See Note 10)                         |                             |                                            |          |              |           |   | 180,375   |          
|Junior subordinated debentures (See Note 10)                                                                                |                             |                                            | 263,266   |              |           |   |          |          
|Securities sold but not yet purchased (Note 3)                                                                              |                             |                                            | 37,813    |              |           |   | 38,003    |          
|Due to clearing agent (Note 3)                                                                                              |                             |                                            | 8,583     |              |           |   | 78,791    |          
|Other liabilities (See Notes 13)                                                                                            |                             |                                            | 92,684    |              |           |   | 126,688   |          
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|                                                                                                                            |                             | Total liabilities                          |           |              | 4,418,097 |   |           |           | 4,951,677 | 
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|Commitments and contingencies (See Note 14)                                                                                 |                             |                                            |           |              |           |   |           |          
|Stockholders equity: (See Notes 11, 12)                                                                                    |                             |                                            |           |              |           |   |           |          
|Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued and outstanding                                  |                             |                                            |          |              |           |   |          |          
|Class A common stock, $.01 par value, authorized 80,000,000 shares;
issued and outstanding 54,396,824 and 53,441,847 shares |                             |                                            | 544       |              |           |   | 534       |          
|Class B common stock, $.01 par value, authorized 45,000,000 shares;
issued and outstanding 4,876,124 and 4,876,124 shares   |                             |                                            | 49        |              |           |   | 49        |          
|Additional paid-in capital                                                                                                  |                             |                                            | 259,770   |              |           |   | 252,699   |          
|Unearned compensation - restricted stock grants                                                                             |                             |                                            | (1,178    | )            |           |   | (1,209    | )        
|Retained earnings                                                                                                           |                             |                                            | 148,311   |              |           |   | 213,692   |          
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|Total stockholders equity before accumulated other comprehensive income                                                    |                             |                                            | 407,496   |              |           |   | 465,765   |          
|Accumulated other comprehensive income                                                                                      |                             |                                            | 5,956     |              |           |   | 3,569     |          
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|                                                                                                                            |                             | Total stockholders equity                 |           |              | 413,452   |   |           |           | 469,334   | 
|                                                                                                                            |                             |                                            |           |              |           |   |           |          
|                                                                                                                            |                             | Total liabilities and stockholders equity |           | $            | 4,831,549 |   |           | $         | 5,421,011 | 
|                                                                                                                            |                             |                                            |           |              |           |   |           |          

See Notes to Consolidated Financial Statements

F- 4



---



##### Table of Contents






BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |         | 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ---- | -------------------------------- | ------- |  | ---- | ------- | ------- |  | - | ------- | ------- | 
|                                                                                                                                                                                       |                            |      | For the Years Ended December 31,
|                                                                                                                                                                                       |                            |      |                                 
|(In thousands, except share and per share data)                                                                                                                                        |                            | 2003 |                                  | 2002    |  | 2001
|                                                                                                                                                                                       |                            |      |                                  |         |  |     
|Interest income:                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Interest and fees on loans and leases (See Note 4)                                                                                                                                     |                            | $    | 207,446                          |         |  | $    | 221,370 |         |  | $ | 237,064 |        
|Interest and dividends on securities available for sale                                                                                                                                |                            |      | 24,313                           |         |  |      | 42,406  |         |  |   | 52,813  |        
|Interest and dividends on other investment securities                                                                                                                                  |                            |      | 19,653                           |         |  |      | 32,100  |         |  |   | 32,171  |        
|Interest and dividends on securities owned                                                                                                                                             |                            |      | 10,437                           |         |  |      | 7,511   |         |  |   | 1,978   |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|                                                                                                                                                                                       | Total interest income      |      |                                  | 261,849 |  |      |         | 303,387 |  |   |         | 324,026 | 
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Interest expense:                                                                                                                                                                      |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Interest on deposits (See Note 7)                                                                                                                                                      |                            |      | 36,189                           |         |  |      | 62,777  |         |  |   | 85,668  |        
|Interest on advances from FHLB                                                                                                                                                         |                            |      | 57,299                           |         |  |      | 62,412  |         |  |   | 60,472  |        
|Interest on securities sold under agreements to repurchase                                                                                                                             |                            |      | 2,914                            |         |  |      | 6,546   |         |  |   | 24,667  |        
|Interest on subordinated debentures, notes and bonds payable,
guaranteed preferred beneficial interests in Companys Junior
Subordinated Debentures and junior subordinated debentures |                            |      | 18,008                           |         |  |      | 17,156  |         |  |   | 16,105  |        
|Capitalized interest on real estate development                                                                                                                                        |                            |      | (1,193                           | )       |  |      |        |         |  |   |        |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|                                                                                                                                                                                       | Total interest expense     |      |                                  | 113,217 |  |      |         | 148,891 |  |   |         | 186,912 | 
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Net interest income                                                                                                                                                                    |                            |      | 148,632                          |         |  |      | 154,496 |         |  |   | 137,114 |        
|Provision for (recovery from) loan losses (See Note 4)                                                                                                                                 |                            |      | (547                             | )       |  |      | 14,077  |         |  |   | 16,905  |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Net interest income after provision for (recovery from) loan losses                                                                                                                    |                            |      | 149,179                          |         |  |      | 140,419 |         |  |   | 120,209 |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Non-interest income:                                                                                                                                                                   |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Investment banking income (See Note 3)                                                                                                                                                 |                            |      | 207,788                          |         |  |      | 130,738 |         |  |   | 43,436  |        
|Service charges on deposits                                                                                                                                                            |                            |      | 40,569                           |         |  |      | 26,479  |         |  |   | 16,372  |        
|Other service charges and fees                                                                                                                                                         |                            |      | 19,318                           |         |  |      | 14,087  |         |  |   | 14,731  |        
|Income from real estate operations (See Note 21)                                                                                                                                       |                            |      | 5,642                            |         |  |      |        |         |  |   |        |        
|Income from unconsolidated subsidiaries (See Note 22)                                                                                                                                  |                            |      | 425                              |         |  |      | 1,293   |         |  |   |        |        
|Securities activities, net (See Note 3)                                                                                                                                                |                            |      | (1,553                           | )       |  |      | 8,578   |         |  |   | 7,124   |        
|Impairment of securities (See Note 23)                                                                                                                                                 |                            |      |                                 |         |  |      | (18,801 | )       |  |   | (3,527  | )      
|Gains on sales of loans, net                                                                                                                                                           |                            |      | 122                              |         |  |      | 1,840   |         |  |   | 60      |        
|Other                                                                                                                                                                                  |                            |      | 9,403                            |         |  |      | 7,535   |         |  |   | 6,739   |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|                                                                                                                                                                                       | Total non-interest income  |      |                                  | 281,714 |  |      |         | 171,749 |  |   |         | 84,935  | 
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Non-interest expense:                                                                                                                                                                  |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Employee compensation and benefits (See Notes 11,13)                                                                                                                                   |                            |      | 226,940                          |         |  |      | 166,979 |         |  |   | 84,720  |        
|Occupancy and equipment                                                                                                                                                                |                            |      | 40,036                           |         |  |      | 39,196  |         |  |   | 29,139  |        
|Advertising and promotion                                                                                                                                                              |                            |      | 12,724                           |         |  |      | 10,447  |         |  |   | 5,286   |        
|Amortization of goodwill and other intangible assets                                                                                                                                   |                            |      | 1,772                            |         |  |      | 1,360   |         |  |   | 4,073   |        
|Impairment of goodwill (See Note 2)                                                                                                                                                    |                            |      |                                 |         |  |      |        |         |  |   | 6,624   |        
|Restructuring charge and impairment write-downs (See Note 6)                                                                                                                           |                            |      | 257                              |         |  |      | 1,007   |         |  |   | 331     |        
|Cost associated with debt redemption (See Note 8,10)                                                                                                                                   |                            |      | 12,543                           |         |  |      | 3,125   |         |  |   | 389     |        
|Acquisition-related charges and impairments (Note 2)                                                                                                                                   |                            |      |                                 |         |  |      | 4,925   |         |  |   |        |        
|Professional fees                                                                                                                                                                      |                            |      | 16,311                           |         |  |      | 7,527   |         |  |   | 6,729   |        
|Communications                                                                                                                                                                         |                            |      | 13,783                           |         |  |      | 10,152  |         |  |   | 3,291   |        
|Floor broker and clearing fees                                                                                                                                                         |                            |      | 9,227                            |         |  |      | 8,192   |         |  |   | 2,796   |        
|Other                                                                                                                                                                                  |                            |      | 35,279                           |         |  |      | 31,057  |         |  |   | 21,276  |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|                                                                                                                                                                                       | Total non-interest expense |      |                                  | 368,872 |  |      |         | 283,967 |  |   |         | 164,654 | 
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Income from continuing operations before income taxes                                                                                                                                  |                            |      | 62,021                           |         |  |      | 28,201  |         |  |   | 40,490  |        
|Provision for income taxes (See Note 12)                                                                                                                                               |                            |      | 23,424                           |         |  |      | 9,051   |         |  |   | 17,960  |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Income from continuing operations                                                                                                                                                      |                            |      | 38,597                           |         |  |      | 19,150  |         |  |   | 22,530  |        
|Discontinued operations, (less applicable income taxes of $16,512,
$6,825 and $4,640)                                                                                                  |                            |      | 29,120                           |         |  |      | 22,543  |         |  |   | 8,492   |        
|Extraordinary items (less applicable provision for income taxes of
$2,771) (See Note 2)                                                                                                |                            |      |                                 |         |  |      | 23,749  |         |  |   |        |        
|Cumulative effect of a change in accounting principle (less applicable
income taxes of ($1,246) and $683) (See Note 1)                                                                 |                            |      |                                 |         |  |      | (15,107 | )       |  |   | 1,138   |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Net income                                                                                                                                                                             |                            |      | 67,717                           |         |  |      | 50,335  |         |  |   | 32,160  |        
|Amortization of goodwill, net of tax                                                                                                                                                   |                            |      |                                 |         |  |      |        |         |  |   | 3,903   |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        
|Net income adjusted to exclude goodwill amortization                                                                                                                                   |                            | $    | 67,717                           |         |  | $    | 50,335  |         |  | $ | 36,063  |        
|                                                                                                                                                                                       |                            |      |                                  |         |  |      |         |         |  |   |         |        

(Continued)

See Notes to Consolidated Financial Statements

F- 5



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|-------------------------------------------------------------------------------------------- |  | -------------------------------- | ---------- | ---- |  | ---- | ---------- | - |  | - | ---------- | 
|                                                                                             |  | For the Years Ended December 31,
|                                                                                             |  |                                 
|                                                                                             |  | 2003                             |            | 2002 |  | 2001
|                                                                                             |  |                                  |            |      |  |     
|Earnings per share (See Note 20)                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share from continuing operations                                          |  | $                                | 0.66       |      |  | $    | 0.33       |   |  | $ | 0.53       | 
|Basic earnings per share from discontinued operations                                        |  |                                  | 0.50       |      |  |      | 0.39       |   |  |   | 0.20       | 
|Basic earnings per share from extraordinary items                                            |  |                                  |           |      |  |      | 0.41       |   |  |   |           | 
|Basic (loss) earnings per share from cumulative effect of a
change in accounting principle   |  |                                  |           |      |  |      | (0.26      | ) |  |   | 0.03       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share                                                                     |  |                                  | 1.16       |      |  |      | 0.87       |   |  |   | 0.76       | 
|Basic earnings per share from amortization of goodwill                                       |  |                                  |           |      |  |      |           |   |  |   | 0.10       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share adjusted to exclude goodwill amortization                           |  | $                                | 1.16       |      |  | $    | 0.87       |   |  | $ | 0.86       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Diluted earnings per share from continuing operations                                        |  | $                                | 0.62       |      |  | $    | 0.32       |   |  | $ | 0.47       | 
|Diluted earnings per share from discontinued operations                                      |  |                                  | 0.46       |      |  |      | 0.35       |   |  |   | 0.16       | 
|Diluted earnings per share from extraordinary items                                          |  |                                  |           |      |  |      | 0.37       |   |  |   |           | 
|Diluted (loss) earnings per share from cumulative effect of a
change in accounting principle |  |                                  |           |      |  |      | (0.23      | ) |  |   | 0.02       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Diluted earnings per share                                                                   |  |                                  | 1.08       |      |  |      | 0.81       |   |  |   | 0.65       | 
|Diluted earnings per share from amortization of goodwill                                     |  |                                  |           |      |  |      |           |   |  |   | 0.08       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Diluted earnings per share adjusted to exclude goodwill amortization                         |  | $                                | 1.08       |      |  | $    | 0.81       |   |  | $ | 0.73       | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Cash dividends per Class A share                                                             |  |                                  | 0.128      |      |  |      | 0.120      |   |  |   | 0.120      | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Cash dividends per Class B share                                                             |  |                                  | 0.128      |      |  |      | 0.120      |   |  |   | 0.120      | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic weighted average number of common shares outstanding                                   |  |                                  | 58,509,894 |      |  |      | 57,997,556 |   |  |   | 42,091,961 | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Diluted weighted average number of common and common
equivalent shares outstanding           |  |                                  | 62,354,430 |      |  |      | 64,400,725 |   |  |   | 54,313,104 | 
|                                                                                             |  |                                  |            |      |  |      |            |   |  |   |            | 

See Notes to Consolidated Financial Statements

F- 6



---



##### Table of Contents






BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
For Each of the Years in the Three Year Period Ended December 31, 2003

Unearned
    
    Accumul-Compen-
    
    atedAddi-
    
    
    
    
    
    sation
    
    OtherCompre-
    
    
    
    
    
    tional
    
    
    
    
    
    Restricted
    
    Compre-hensive
    
    Common
    
    Paid-in
    
    Retained
    
    Stock
    
    hensive(In thousands)
    
    Income
    
    Stock
    
    Capital
    
    Earnings
    
    Grants
    
    Income
    
    TotalBALANCE, DECEMBER 31, 2000
    
    
    
    
    
    $
    366
    
    
    $
    103,745
    
    
    $
    143,471
    
    
    $
    (391
    )
    
    $
    1,630
    
    
    $
    248,821Net income
    
    $
    32,160
    
    
    
    
    
    
    
    
    
    
    
    32,160
    
    
    
    
    
    
    
    
    
    
    
    32,160Other comprehensive income, net of tax:Unrealized gains on securities available for
sale (less income tax provision of $9,904)
    
    
    17,798Accumulated losses associated with cash flow hedges
(less income tax benefit of $594)
    
    
    (2,288
    )Reclassification adjustment for cash flow hedges
    
    
    924Reclassification adjustment for net gain
included in net income (less income tax
benefit of $1,780)
    
    
    (3,164
    )Other comprehensive income
    
    
    13,270Comprehensive income
    
    $
    45,430Dividends on Class A common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,747
    )
    
    
    
    
    
    
    
    
    
    
    (4,747
    )Dividends on Class B common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (535
    )
    
    
    
    
    
    
    
    
    
    
    (535
    )Tax effect relating to the exercise of stock options
    
    
    
    
    
    
    
    
    
    
    598
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    598Issuance of Class A common stock upon conversion of subordinated
debentures
    
    
    
    
    
    
    89
    
    
    
    49,846
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    49,935Issuance of Class A common stock
    
    
    
    
    
    
    126
    
    
    
    97,013
    
    
    
    
    
    
    
    (1,209
    )
    
    
    
    
    
    
    95,930Amortization of unearned compensation  restricted stock grants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    241
    
    
    
    
    
    
    
    241Net change in accumulated other comprehensive income, net of income
taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,270
    
    
    
    13,270BALANCE, DECEMBER 31, 2001
    
    
    
    
    
    $
    581
    
    
    $
    251,202
    
    
    $
    170,349
    
    
    $
    (1,359
    )
    
    $
    14,900
    
    
    $
    435,673


(Continued)

See Notes to Consolidated Financial Statements

F- 7



---



##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
For Each of the Years in the Three Year Period Ended December 31, 2003

|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  |  | 
|--------------------------------------------------------------------------- | --------------------------------------- | --------------------------------------------------------------------------------------------------- | ---------------------------------------- | ------- | ------- | ------- | ------ | -------- | ------- | ------ | -------- | ------ | ----- | ----- | ------- | ------ | ---------- | - | ------- | - | -------- | - | -------- | - |  | - | ------- | ------ |  |  | 
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   | Unearned |   | Accumul- |   |  |   |        
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   | Compen-  |   | ated     |   |  |   |        
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        | Addi- |       |         |        |            |   | sation  |   | Other    |   |          |   | 
|                                                                            |                                         |                                                                                                     |                                          |         | Compre- |         |        |          |         |        | tional   |        |       |       |         |        | Restricted |   | Compre- |   |          |   |         
|                                                                            |                                         |                                                                                                     |                                          |         | hensive |         | Common |          | Paid-in |        | Retained |        | Stock |       | hensive |        |            |   |        
|(In thousands)                                                              |                                         | Income                                                                                              |                                          | Stock   |         | Capital |        | Earnings |         | Grants |          | Income |       | Total
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |      
|BALANCE, DECEMBER 31, 2001                                                  |                                         |                                                                                                     |                                          |         |         | $       | 581    |          |         | $      | 251,202  |        |       | $     | 170,349 |        |            | $ | (1,359  | ) |          | $ | 14,900   |   |  | $ | 435,673 |       
|                                                                            | Net income                              |                                                                                                     | $                                        | 50,335  |         |         |        |          |         |        |          |        |       |       |         | 50,335 |            |   |         |   |          |   |          |   |  |   |         | 50,335 | 
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|                                                                            | Other comprehensive income, net of tax: |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        | 
|                                                                            |                                         | Unrealized gains on securities available for sale
(less income tax provision of $2,142)             |                                          |         | 3,514   |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         | Increase in minimum pension liability
(less income tax benefit of $4,194)                           |                                          |         | (7,456  | )       |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         | Unrealized losses associated with investment in                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         |                                                                                                     | unconsolidated subsidiaries (less income |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  |  | 
|                                                                            |                                         |                                                                                                     | tax benefit of $454)                     |         |         | (448    | )      |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  |  | 
|                                                                            |                                         | Accumulated losses associated with cash flow
hedges (less income tax benefit of $517)               |                                          |         | (917    | )       |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         | Reclassification adjustment for cash flow hedges                                                    |                                          |         | (534    | )       |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         | Reclassification adjustment for net gain
included in net income (less income tax benefit
of $3,254) |                                          |         | (5,490  | )       |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        |  | 
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|                                                                            | Other comprehensive loss                |                                                                                                     |                                          | (11,331 | )       |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |        | 
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|Comprehensive income                                                        |                                         | $                                                                                                   | 39,004                                   |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|Dividends on Class A common stock                                           |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        |         |        |       |       | (6,408  | )      |            |   |        |   |          |   |         |   |  |   | (6,408  | )     
|Dividends on Class B common stock                                           |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        |         |        |       |       | (584    | )      |            |   |        |   |          |   |         |   |  |   | (584    | )     
|Issuance of Class A common stock                                            |                                         |                                                                                                     |                                          |         |         |         | 2      |          |         |        | 1,202    |        |       |       |        |        |            |   |        |   |          |   |         |   |  |   | 1,204   |       
|Tax effect relating to the exercise of stock options                        |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        | 440      |        |       |       |        |        |            |   |        |   |          |   |         |   |  |   | 440     |       
|Issuance of Class A common stock upon
conversion of subordinated debentures |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        | 25       |        |       |       |        |        |            |   |        |   |          |   |         |   |  |   | 25      |       
|Issuance of subsidiary stock options                                        |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        | (170     | )      |       |       |        |        |            |   |        |   |          |   |         |   |  |   | (170    | )     
|Amortization of unearned compensation -
restricted stock grants             |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        |         |        |       |       |        |        |            |   | 150     |   |          |   |         |   |  |   | 150     |       
|Net change in accumulated other comprehensive
income, net of income taxes   |                                         |                                                                                                     |                                          |         |         |         |       |          |         |        |         |        |       |       |        |        |            |   |        |   |          |   | (11,331  | ) |  |   | (11,331 | )     
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       
|BALANCE, DECEMBER 31, 2002                                                  |                                         |                                                                                                     |                                          |         |         | $       | 583    |          |         | $      | 252,699  |        |       | $     | 213,692 |        |            | $ | (1,209  | ) |          | $ | 3,569    |   |  | $ | 469,334 |       
|                                                                            |                                         |                                                                                                     |                                          |         |         |         |        |          |         |        |          |        |       |       |         |        |            |   |         |   |          |   |          |   |  |   |         |       

(Continued)

See Notes to Consolidated Financial Statements

F- 8



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY AND COMPREHENSIVE INCOME
For Each of the Years in the Three Year Period Ended December 31, 2003

Unearned
    
    Accumul-Compen-
    
    atedAddi-
    
    
    
    
    
    sation
    
    OtherCompre-
    
    
    
    
    
    tional
    
    
    
    
    
    Restricted
    
    Compre-hensive
    
    Common
    
    Paid-in
    
    Retained
    
    Stock
    
    hensive(In thousands)
    
    Income
    
    Stock
    
    Capital
    
    Earnings
    
    Grants
    
    Income
    
    TotalBALANCE, DECEMBER 31, 2002
    
    
    
    
    
    $
    583
    
    
    $
    252,699
    
    
    $
    213,692
    
    
    $
    (1,209
    )
    
    $
    3,569
    
    
    $
    469,334Net income
    
    $
    67,717
    
    
    
    
    
    
    
    
    
    
    
    67,717
    
    
    
    
    
    
    
    
    
    
    
    67,717Other comprehensive income, net of tax:Unrealized losses on securities available for sale (less income tax
benefit of $5,296)
    
    
    (9,330
    )Decrease in minimum pension liability (less income tax
provision of $4,194)
    
    
    7,456Unrealized gains associated with investment in unconsolidated real
estate subsidiary (less income tax provision of $454)
    
    
    448Accumulated gains associated with cash flow hedges
(less income tax provision of $1,108)
    
    
    2,306Reclassification adjustment for cash flow hedges
    
    
    513Reclassification adjustment for net losses included in net income
(less income tax provision of $559)
    
    
    994Other comprehensive income
    
    
    2,387Comprehensive income
    
    $
    70,104Levitt Corporation spin-off transaction
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (125,573
    )
    
    
    
    
    
    
    
    
    
    
    (125,573
    )Dividends on Class A common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,903
    )
    
    
    
    
    
    
    
    
    
    
    (6,903
    )Dividends on Class B common stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (622
    )
    
    
    
    
    
    
    
    
    
    
    (622
    )Issuance of Class A common stock
    
    
    
    
    
    
    10
    
    
    
    4,672
    
    
    
    
    
    
    
    (134
    )
    
    
    
    
    
    
    4,548Tax effect relating to the exercise of stock options
    
    
    
    
    
    
    
    
    
    
    2,264
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,264Purchase and retirement of Class A common stock
    
    
    
    
    
    
    
    
    
    
    (25
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (25
    )Issuance of Class A common stock upon conversion
of subordinated debentures
    
    
    
    
    
    
    
    
    
    
    211
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    211Issuance of subsidiary stock options
    
    
    
    
    
    
    
    
    
    
    (51
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (51
    )Amortization of unearned compensation  restricted stock grants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    165
    
    
    
    
    
    
    
    165Net change in accumulated other comprehensive
income, net of income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,387
    
    
    
    2,387BALANCE, DECEMBER 31, 2003
    
    
    
    
    
    $
    593
    
    
    $
    259,770
    
    
    $
    148,311
    
    
    $
    (1,178
    )
    
    $
    5,956
    
    
    $
    413,452


See Notes to Consolidated Financial Statements

F- 9



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##### Table of Contents






BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                 |  |                                  |         |      |  |      |         |   |  |   |         |  
|-------------------------------------------------------------------------------- |  | -------------------------------- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | -
|                                                                                 |  | For the Years Ended December 31,
|                                                                                 |  |                                 
|(In thousands)                                                                   |  | 2003                             |         | 2002 |  | 2001
|                                                                                 |  |                                  |         |      |  |     
|Operating activities:                                                            |  |                                  |         |      |  |      |         |   |  |   |         |  
|Income from continuing operations                                                |  | $                                | 38,597  |      |  | $    | 19,150  |   |  | $ | 22,530  |  
|Income from discontinued operations, net of tax                                  |  |                                  | 29,120  |      |  |      | 22,543  |   |  |   | 8,492   |  
|Income from extraordinary item, net of tax                                       |  |                                  |        |      |  |      | 23,749  |   |  |   |        |  
|Cumulative effect of a change in accounting principle, net of tax                |  |                                  |        |      |  |      | (15,107 | ) |  |   | 1,138   |  
|Adjustment to reconcile net income to net cash provided by operating activities: |  |                                  |         |      |  |      |         |   |  |   |         |  
|Provision for credit losses (1)                                                  |  |                                  | 1,465   |      |  |      | 17,019  |   |  |   | 18,222  |  
|Change in real estate inventory                                                  |  |                                  | (55,090 | )    |  |      | (57,653 | ) |  |   | (28,978 | )
|Loans originated for sale net of repayments                                      |  |                                  | (32,494 | )    |  |      | (21,279 | ) |  |   | 15,203  |  
|Proceeds from sales of loans                                                     |  |                                  | 44,617  |      |  |      | 41,602  |   |  |   | 24,017  |  
|Losses (Gains) from securities activities, net                                   |  |                                  | 1,553   |      |  |      | (8,578  | ) |  |   | (7,124  | )
|Gains on sale of REO                                                             |  |                                  | (1,984  | )    |  |      | (117    | ) |  |   | (1,053  | )
|Loss on debt redemption                                                          |  |                                  | 12,543  |      |  |      | 3,125   |   |  |   | 389     |  
|Depreciation, amortization and accretion, net                                    |  |                                  | 20,457  |      |  |      | 11,998  |   |  |   | 4,654   |  
|Restructuring charges and impairment write-downs, net                            |  |                                  | 257     |      |  |      | 4,852   |   |  |   | 331     |  
|Gain on Gruntal transaction                                                      |  |                                  |        |      |  |      | (26,520 | ) |  |   |        |  
|Impairment of goodwill                                                           |  |                                  |        |      |  |      | 16,353  |   |  |   | 6,624   |  
|Impairment of securities                                                         |  |                                  |        |      |  |      | 18,801  |   |  |   | 3,527   |  
|Provision (benefit) for deferred income taxes                                    |  |                                  | 9,427   |      |  |      | (4,510  | ) |  |   | 597     |  
|Securities owned activities, net                                                 |  |                                  | (43,194 | )    |  |      | 33,751  |   |  |   | (24,739 | )
|Decrease in accrued interest receivable                                          |  |                                  | 6,118   |      |  |      | 2,542   |   |  |   | 10,340  |  
|Issuance of forgivable notes receivable to Ryan Beck employees                   |  |                                  | (16,270 | )    |  |      | (17,140 | ) |  |   |        |  
|Decrease (increase) in other assets                                              |  |                                  | 1,966   |      |  |      | 5,784   |   |  |   | (3,724  | )
|Increase (decrease) in other liabilities                                         |  |                                  | 77,591  |      |  |      | (25,509 | ) |  |   | 8,857   |  
|Increase (decrease) in due to clearing agent                                     |  |                                  | 10,353  |      |  |      | (32,876 | ) |  |   | (739    | )
|Increase (decrease) in securities sold but not yet purchased                     |  |                                  | 3,591   |      |  |      | (1,629  | ) |  |   | 26,406  |  
|Equity in earnings from unconsolidated subsidiaries                              |  |                                  | (8,341  | )    |  |      | (8,866  | ) |  |   | (2,888  | )
|                                                                                 |  |                                  |         |      |  |      |         |   |  |   |         |  
|Net cash provided by operating activities                                        |  |                                  | 100,282 |      |  |      | 1,485   |   |  |   | 82,082  |  
|                                                                                 |  |                                  |         |      |  |      |         |   |  |   |         |  

(Continued)

See Notes to Consolidated Financial Statements

F- 10



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|----------------------------------------------------------------------------------- |  | -------------------------------- | -------- | ---- |  | ---- | -------- | - |  | - | -------- | -
|                                                                                    |  | For the Years Ended December 31,
|                                                                                    |  |                                 
|(In thousands)                                                                      |  | 2003                             |          | 2002 |  | 2001
|                                                                                    |  |                                  |          |      |  |     
|Investing activities:                                                               |  |                                  |          |      |  |      |          |   |  |   |          |  
|Purchase of investment securities and tax certificates                              |  |                                  | (205,209 | )    |  |      | (238,700 | ) |  |   | (267,025 | )
|Proceeds from redemption and maturity of investment securities
and tax certificates |  |                                  | 205,677  |      |  |      | 239,176  |   |  |   | 221,434  |  
|Purchase of securities available for sale                                           |  |                                  | (278,977 | )    |  |      | (356,493 | ) |  |   | (485,732 | )
|Proceeds from sales and maturities of securities available for sale                 |  |                                  | 630,222  |      |  |      | 772,339  |   |  |   | 509,833  |  
|Purchases and net repayments (originations) of loans and leases                     |  |                                  | (235,735 | )    |  |      | (23,776  | ) |  |   | 24,039   |  
|Proceeds from sales of real estate owned                                            |  |                                  | 10,807   |      |  |      | 6,015    |   |  |   | 6,913    |  
|Additions to office properties and equipment                                        |  |                                  | (12,599  | )    |  |      | (23,676  | ) |  |   | (13,390  | )
|Proceeds from sales of office properties and equipment                              |  |                                  |         |      |  |      | 1,986    |   |  |   | 529      |  
|Proceeds from sales of bank facilities real estate held for sale                    |  |                                  |         |      |  |      | 6,012    |   |  |   |         |  
|(Investments) and repayments from unconsolidated subsidiaries, net                  |  |                                  | (941     | )    |  |      | (49,902  | ) |  |   | 1,348    |  
|Redemptions (purchases) of FHLB stock, net                                          |  |                                  | 24,618   |      |  |      | (452     | ) |  |   | (4,488   | )
|Net cash proceeds from the sale of Ryan Becks subsidiaries                         |  |                                  | 9,955    |      |  |      |         |   |  |   |         |  
|Acquisitions, net of cash acquired                                                  |  |                                  |         |      |  |      | (52,783  | ) |  |   | (340     | )
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|Net cash provided (used) by investing activities                                    |  |                                  | 147,818  |      |  |      | 279,746  |   |  |   | (6,879   | )
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|Financing activities:                                                               |  |                                  |          |      |  |      |          |   |  |   |          |  
|Net increase in deposits                                                            |  |                                  | 137,587  |      |  |      | 47,858   |   |  |   | 125,252  |  
|Reduction in deposits from sale of in-store branches, net                           |  |                                  |         |      |  |      | (42,597  | ) |  |   | (81,593  | )
|Proceeds from FHLB advances                                                         |  |                                  | 275,000  |      |  |      | 227,499  |   |  |   | 365,000  |  
|Repayments of FHLB advances                                                         |  |                                  | (799,991 | )    |  |      | (172,736 | ) |  |   | (297,771 | )
|Net increase (decrease) in federal funds purchased                                  |  |                                  |         |      |  |      | (61,000  | ) |  |   | 51,300   |  
|Proceeds from notes and bonds payable                                               |  |                                  | 134,016  |      |  |      | 157,331  |   |  |   | 62,136   |  
|Issuance of trust preferred securities                                              |  |                                  |         |      |  |      | 180,375  |   |  |   |         |  
|Issuance of junior subordinated debentures                                          |  |                                  | 77,320   |      |  |      |         |   |  |   |         |  
|Repayment of notes and bonds payable                                                |  |                                  | (112,341 | )    |  |      | (95,468  | ) |  |   | (67,854  | )
|Retirement of subordinated notes and debentures                                     |  |                                  | (70,855  | )    |  |      | (21,716  | ) |  |   | (35,042  | )
|Retirement of trust preferred securities                                            |  |                                  |         |      |  |      | (74,750  | ) |  |   |         |  
|Net increase (decrease) in securities sold under agreements to repurchase           |  |                                  | 4,767    |      |  |      | (289,791 | ) |  |   | (253,432 | )
|Net cash reduction on Levitt Corporation spin-off                                   |  |                                  | (21,413  | )    |  |      |         |   |  |   |         |  
|Issuance of common stock                                                            |  |                                  | 4,472    |      |  |      | 1,296    |   |  |   | 95,595   |  
|Common stock dividends paid                                                         |  |                                  | (7,525   | )    |  |      | (6,992   | ) |  |   | (5,282   | )
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|Net cash used by financing activities                                               |  |                                  | (378,963 | )    |  |      | (150,691 | ) |  |   | (41,691  | )
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|(Decrease) increase in cash and cash equivalents                                    |  |                                  | (130,863 | )    |  |      | 130,540  |   |  |   | 33,512   |  
|Cash and cash equivalents at the beginning of period                                |  |                                  | 250,745  |      |  |      | 120,205  |   |  |   | 86,693   |  
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  
|Cash and cash equivalents at end of period                                          |  | $                                | 119,882  |      |  | $    | 250,745  |   |  | $ | 120,205  |  
|                                                                                    |  |                                  |          |      |  |      |          |   |  |   |          |  

See Notes to Consolidated Financial Statements

F- 11



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                                                       |  |                                  |         |      |  |      |         |   |  |   |         | 
|-------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | 
|                                                                                                                                       |  | For the Years Ended December 31,
|                                                                                                                                       |  |                                 
|(In thousands)                                                                                                                         |  | 2003                             |         | 2002 |  | 2001
|                                                                                                                                       |  |                                  |         |      |  |     
|Cash paid for                                                                                                                          |  |                                  |         |      |  |      |         |   |  |   |         | 
|Interest on borrowings and deposits                                                                                                    |  | $                                | 120,221 |      |  | $    | 158,914 |   |  | $ | 200,454 | 
|Income taxes                                                                                                                           |  |                                  | 31,115  |      |  |      | 36,790  |   |  |   | 17,884  | 
|Supplementary disclosure of non-cash investing and financing activities:                                                               |  |                                  |         |      |  |      |         |   |  |   |         | 
|Levitt dividend received in the form of a note receivable                                                                              |  |                                  | 8,000   |      |  |      |        |   |  |   |        | 
|Note receivable issued in connection with the GMS sale                                                                                 |  |                                  | 13,681  |      |  |      |        |   |  |   |        | 
|Levitt notes receivable outstanding at date of spin-off                                                                                |  |                                  | 48,118  |      |  |      |        |   |  |   |        | 
|Note receivable issued in connection with Bluegreen stock transfer                                                                     |  |                                  | 5,500   |      |  |      |        |   |  |   |        | 
|Adjustment to goodwill related to the allowance for loan losses                                                                        |  |                                  | 734     |      |  |      | 9,144   |   |  |   |        | 
|Loans transferred to REO                                                                                                               |  |                                  | 2,450   |      |  |      |        |   |  |   |        | 
|Transfer of commercial mortgage-backed securities to available for sale                                                                |  |                                  | 14,505  |      |  |      |        |   |  |   |        | 
|Transfer of fixed assets to real estate held for sale                                                                                  |  |                                  | 1,000   |      |  |      |        |   |  |   |        | 
|Increase in investments in unconsolidated subsidiaries related to
deconsolidation of trusts formed to issue trust preferred securities |  |                                  | 7,910   |      |  |      |        |   |  |   |        | 
|Increase in junior subordinated debentures related to trust deconsolidation                                                            |  |                                  | 7,910   |      |  |      |        |   |  |   |        | 
|Transfer of guaranteed preferred beneficial interest in Companys Junior
Subordinated Debentures to junior subordinated debentures     |  |                                  | 180,375 |      |  |      |        |   |  |   |        | 
|Change in accumulated other comprehensive income                                                                                       |  |                                  | 2,387   |      |  |      | (11,331 | ) |  |   | 13,270  | 
|Change in deferred taxes on other comprehensive income                                                                                 |  |                                  | 1,019   |      |  |      | (6,277  | ) |  |   | 7,530   | 
|Issuance of Class A common stock upon conversion of subordinated
debentures                                                            |  |                                  | 211     |      |  |      | 25      |   |  |   | 49,935  | 
|Issuance of notes payable under the Ryan Beck deferred compensation plan                                                               |  |                                  |        |      |  |      | 3,675   |   |  |   |        | 
|Issuance of Class A common stock upon acquisitions                                                                                     |  |                                  |        |      |  |      |        |   |  |   | 335     | 
|Issuance of Class A restricted stock, net                                                                                              |  |                                  |        |      |  |      |        |   |  |   | 1,209   | 
|Increase in loans receivable from real estate closings                                                                                 |  |                                  |        |      |  |      |        |   |  |   | 1,247   | 
|Increase in development bonds payable from real estate closings                                                                        |  |                                  |        |      |  |      |        |   |  |   | 1,247   | 

(1)  Provision for credit losses represents provision for loan losses, REO and tax certificates.

See Notes to Consolidated Financial Statements

F- 12



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##### Table of Contents






BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

Basis of Financial Statement Presentation BankAtlantic Bancorp, Inc.
(the Company, BBC) is a unitary savings bank holding company organized
under the laws of the State of Florida in 1994. The Companys principal assets
include BankAtlantic and its subsidiaries and RB Holdings, Inc. (Ryan Beck)
and its subsidiaries. On December 31, 2003, the Company completed the spin-off
of its wholly owned real estate development subsidiary, Levitt Corporation
(Levitt), by means of a distribution to its shareholders of all of the
outstanding capital stock of Levitt. On December 22, 2003 the Company
transferred its investment in Bluegreen Corporation (Bluegreen) to Levitt.
In August 2003, Ryan Beck sold its entire membership interest in The GMS Group,
LLC (GMS). As a consequence of the Levitt spin-off and the GMS sale, the
results of operations of Levitt and GMS are presented as Discontinued
Operations in the Consolidated Statements of Operations for all periods
presented. The accounting policies applied by the Company conform with
accounting principles generally accepted in the United States of America.

BankAtlantic was founded in 1952 and is a federally-chartered,
federally-insured savings bank headquartered in Fort Lauderdale, Florida.
BankAtlantic currently operates through a network of 73 branches located in
Florida. BankAtlantic is a community-oriented bank which provides traditional
retail banking services and a wide range of commercial banking products and
related financial services.

Ryan Beck, founded in 1946 and acquired by the Company in 1998, is a full
service broker dealer headquartered in Livingston, New Jersey. Ryan Beck
provides financial advice to individuals, institutions and corporate clients
through 34 offices in 13 states. Ryan Beck is an investment banking firm
engaged in the underwriting, distribution and trading of tax-exempt, equity and
debt securities. Ryan Beck also offers a full service, general securities
brokerage business with investment and insurance products for retail and
institutional clients and provides investment and wealth management advisory
services for its customers. RB Holdings, Inc. was formed in July, 2003 as a
holding company for Ryan Beck & Co., Inc.

The Company has two classes of common stock: Class A common stock and
Class B common stock. Class A shareholders are entitled to one vote per share,
which in the aggregate represents 53% of the combined voting power of the Class
A common stock and the Class B common stock. Class B common stock represents
the remaining 47% of the combined vote. BFC Financial Corporation (BFC)
currently owns 100% of the Companys Class B common stock. The fixed voting
percentages will be eliminated, and shares of Class B common stock will be
entitled to only one vote per share from and after the date that BFC or its
affiliates no longer own in the aggregate at least 2,438,062 shares of Class B
common stock (which is one-half of the number of shares it now owns). Class B
common stock is convertible into Class A common stock on a share for share
basis.

At December 31, 2003, BFC owned 100% of the Companys outstanding Class B
common stock and 22% of the Companys aggregate outstanding common stock.

In preparing the financial statements, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as of the date
of the statements of financial condition and operations for the periods
presented. Actual results could differ significantly from those estimates.
Material estimates that are particularly susceptible to significant change in
the near term relate to the determination of the allowance for loan losses,
evaluation of goodwill for impairment, the valuation of real estate acquired in
connection with foreclosure or in satisfaction of loans, the valuation of the
fair value of assets and liabilities in the application of the purchase method
of accounting, the amount of the deferred tax asset valuation allowance, and
accounting for contingencies. In connection with the determination of the
allowances for loan losses, real estate owned, and real estate held for
development, management obtains independent appraisals for significant
properties when it is deemed prudent.

Certain amounts for prior years have been reclassified to conform with
revised statement presentation for 2003.

Consolidation Policy The consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries, majority-owned joint
ventures and variable interest entities in which the Company is the primary
beneficiary as defined by Financial Accounting Standards Board Interpretation
No. 46 (FIN No. 46). On July 1, 2003, all of the companys subsidiaries,
except for Levitt and its subsidiaries, implemented the interpretation
effective January 1, 2003. .As a consequence of the implementation of FIN No.
46, the Company consolidated a 50% owned joint venture and deconsolidated its
wholly owned statutory business trusts formed to issue trust preferred
securities. The joint venture was

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

acquired in connection with the Community
acquisition and recorded at fair value on the acquisition date, resulting in no
impact to our financial statements upon adoption of FIN No. 46. In periods
ending prior to January 1, 2003, the statutory business trusts were included in
the Companys consolidated financial statements and the 50% owned joint venture
was accounted for under the equity method of accounting. Prior to the
implementation of FIN No. 46, the Company consolidated all entities in which it
owned a majority of the voting securities. Less than majority-owned joint
ventures in which the Company did not have a controlling interest were
accounted for under the equity method of accounting. Levitts non-consolidated
ownership interest in joint ventures range from 40% to 50%, and the Companys
and Levitts non-consolidated ownership interest in subsidiaries consisted of a
40% ownership interest in Bluegreen. All inter-company transactions and
balances have been eliminated.

Cash Equivalents Cash and due from depository institutions include
demand deposits at other financial institutions. Federal funds sold are
generally sold for one-day periods, and securities purchased under resell
agreements are settled in less than 30 days.

Debt and Equity Securities Debt securities are classified based on
managements intention on the date of purchase. Debt securities that
management has both the positive intent and ability to hold to maturity are
classified as securities held-to-maturity and are carried at amortized cost.
Trading account securities consist of securities that are bought and held
principally for the purpose of selling them in the near term and are carried at
fair value with changes in the fair value included in earnings. All other debt
securities are classified as available for sale and carried at fair value with
the net unrealized gains and losses included in stockholders equity on an
after-tax basis as other comprehensive income. The fair value of securities
available for sale was estimated by obtaining prices actively quoted on
national markets using a price matrix or applying management valuation models.
Declines in the fair value of individual held to maturity and available for
sale securities below their cost that are other than temporary result in
write-downs through charges to earnings of the individual securities to their
fair value.

Interest and dividends on securities, including the amortization of
premiums and the accretion of discounts, are reported in interest and dividends
on securities using the interest method over the lives of the securities,
adjusted for actual prepayments. Gains and losses on the sale of securities
are recorded on the trade date and are calculated using the
specific-identification method.

Marketable equity securities and mutual funds which are included in
securities available for sale are carried at fair value with the net unrealized
gains and losses included in stockholders equity on an after-tax basis as
other comprehensive income. Declines in the fair value of individual equity
securities and mutual funds below their cost that are other than temporary
result in write-downs through charges to earnings of the individual securities
to their fair value. The fair value of marketable equity securities and mutual
funds was estimated by obtaining prices actively quoted on national markets.
Equity securities that do not have readily determinable fair values are
classified as investment securities and carried at historical cost. These
securities are evaluated for other than temporary declines in value, and, if
impaired, the historical cost of the securities is written down through charges
to earnings to estimated fair value.

The specific identification method was used in determining cost in
computing realized gains and losses in connection with sales of securities
available for sale.

Tax Certificates Tax certificates represent a priority lien against
real property for which assessed real estate taxes are delinquent. Tax
certificates are classified as investment securities and are carried at cost,
net of an allowance for probable losses, which approximates fair value.

Allowance for Tax Certificate Losses The allowance represents
managements estimate of incurred losses in the portfolio that are probable and
subject to reasonable estimation. In establishing its allowance for tax
certificate losses, management considers past loss experience, present
indicators, such as the length of time the certificate has been outstanding,
economic conditions and collateral values. Tax certificates and resulting deeds
are classified as non-accrual when a tax certificate is 24 to 60 months
delinquent, depending on the municipality, from the acquisition date. At that
time, interest ceases to be accrued. The provision to record the allowance is
included in other expenses.

Loans and Leases- Loans that management has the intent and ability to
hold for the foreseeable future or until
maturity or payoff are reported at their outstanding principal balances net of
any unearned income, unamortized deferred fees or costs, premiums or discounts
and an allowance for loan losses. Interest income on loans, including the
recognition of unearned income, discounts and loan fees, is accrued based on
the outstanding principal amount of loans using the interest

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

method. Equipment
leases are carried at the aggregate of lease payments receivable plus estimated
residual value of the leased property, less unearned income. Unearned income
on equipment leases is amortized over the lease terms by the interest method.

Loans Held for Sale Such loans are reported at the lower of aggregate
cost or estimated fair value based on current market prices for similar loans.
Loan origination fees and related direct loan origination costs on originated
loans held for sale and premiums and discounts on purchased loans held for sale
are deferred until the related loan is sold.

Allowance for Loan Losses- The allowance for loan losses reflects
managements estimate of probable incurred credit losses in the loan
portfolios. Loans are charged off against the allowance when management
believes the uncollectibility of the loan balance is confirmed. Recoveries are
credited to the allowance.

The allowance consists of three components. The first component of the
allowance is for high-balance non-homogenous loans that are individually
evaluated for impairment. A loan is impaired when collection of principal and
interest based on the contractual terms of the loan is not probable. The
process for identifying loans to be evaluated individually for impairment is
based on managements identification of classified loans. Once an individual
loan is found to be impaired, a valuation allowance is assigned to the loan
based on one of the following three methods: (1) present value of expected
future cash flows, (2) fair value of collateral less costs to sell, or (3)
observable market price. Non-homogenous loans that are not impaired are
assigned an allowance based on historical data by product. The second
component of the allowance is for homogenous loans in which groups of loans
with common characteristics are evaluated to estimate the inherent losses in
the portfolio. Homogenous loans have certain characteristics that are common
to the entire portfolio so as to form a basis for predicting losses on
historical data and delinquency trends as it relates to the group. Management
segregates homogenous loans into groups such as residential real estate, small
business mortgage, small business non-mortgage, lease financing, and various
types of consumer loans. The methodology utilized in establishing the
allowance for homogenous loans includes consideration of trends in industries,
analysis of historical losses, static pool analysis, delinquency trends, and
credit scores. The third component of the allowance is determined separately
from the procedures outlined above. This component addresses certain industry
and geographic concentrations, the view of regulators and changes in
composition of the loan portfolio. Management believes the allowance for loan
losses is adequate and that it has a sound basis for estimating the adequacy of
the allowance for loan losses. Actual losses incurred in the future are highly
dependent upon future events, including the economies of the geographic areas
in which BankAtlantic holds loans.

Non-performing Loans A loan or lease is generally placed on non-accrual
status at the earlier of (i) the loan becoming past due 90 days as to either
principal or interest or (ii) when the borrower has entered bankruptcy
proceedings and the loan is delinquent. Exceptions to placing 90-day past due
loans on non-accrual may be made if there exists an abundance of collateral and
the loan is in the process of collection. Loans are placed on non-accrual or
charged-off at an earlier date if collection of principal or interest is
considered doubtful. When a loan is placed on non-accrual status, interest
accrued but not received is reversed against interest income. A non-accrual
loan may be restored to accrual status when delinquent loan payments are
collected and the loan is expected to perform in the future according to its
contractual terms. Interest income on impaired loans is recognized on a cash
basis.

Consumer non-mortgage loans and lease financing contracts that are 120
days past due are charged off. Real estate secured consumer and residential
loans that are 120 days past due are charged down to fair value less cost to
sell.

Real Estate Owned (REO) REO is recorded at the lower of cost or
estimated fair value, less estimated selling costs when acquired, establishing
a new cost basis. Write-downs required at the time of acquisition are charged
to the allowance for loan losses. Expenditures for capital improvements made
thereafter are generally capitalized. Real estate acquired in settlement of
loans is anticipated to be sold and valuation allowance adjustments are made to
reflect any subsequent changes in fair values from the initially recorded
amount. The costs of holding REO are charged to operations as incurred.
Provisions and reversals in the REO valuation allowance are reflected in
operations. Management obtains independent appraisals for significant
properties.

Investment Banking Activities Investment banking revenues include gains,
losses, and fees, net of syndicate expenses, arising from securities offerings
in which Ryan Beck acts as an underwriter or agent. Investment banking revenues
also include fees earned from providing merger and acquisition and financial
restructuring advisory services. Investment banking management fees are
recorded on the offering date, sales concessions on settlement date, and
underwriting fees at
the time the underwriting is completed and the income is reasonably determined.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Securities Owned and Securities Sold, But Not Yet Purchased Securities
owned and securities sold, but not yet purchased are associated with
proprietary transactions entered into by Ryan Beck and are accounted for at
fair value with changes in the fair value included in earnings. The fair value
of these trading positions is generally based on listed market prices. If
listed market prices are not available or if liquidating the positions would
reasonably be expected to impact market prices, fair value is determined based
on other relevant factors, including dealer price quotations, price quotations
for similar instruments traded in different markets, managements estimates of
amounts to be realized on settlement or management valuation model associated
with securities that are not readily marketable. Profits and losses arising
from transactions are recorded on a trade-date basis.

Real Estate Held for Development and Sale This includes land, land
development costs, and other construction costs associated with Levitts real
estate inventory for periods prior to December 31, 2003 and the Companys
investment in a real estate variable interest entity. The real estate
inventory is stated at the lower of accumulated cost or estimated fair value.
The estimated fair value of real estate is evaluated based on disposition of
real estate in the normal course of business under existing and anticipated
market conditions. The evaluation takes into consideration the current status
of property, various restrictions, carrying costs, debt service requirements,
costs of disposition and any other circumstances which may affect fair value,
including managements plans for the property. Due to the large acreage of
certain land holdings, disposition in the normal course of business is expected
to extend over a number of years.

Inventory costs include direct acquisition, development and construction
costs, interest and other indirect construction costs. Land and indirect land
development costs are accumulated by specific area and allocated
proportionately to various parcels or housing units within the respective area
based upon the most practicable methods, including specific identification and
allocation based upon the relative sales value method or acreage methods.
Direct construction costs are assigned to housing units based on specific
identification. All other capitalized costs are accumulated by community and
are allocated to those housing units based upon the most practicable methods.
Other capitalized costs consist of capitalized interest, real estate taxes,
tangible selling costs, local government fees and field overhead incurred
during the development and construction period. Start-up costs and selling
expenses are expensed as incurred.

Interest is capitalized at the effective rates paid on borrowings incurred
for real estate inventory during the preconstruction and planning stage and the
periods that projects are under development. Capitalization of interest is
discontinued if development ceases at a project.

Revenue and all related costs and expenses from house and land sales are
recognized at the time that closing has occurred. This is when title to and
possession of the property and risks and rewards of ownership transfer to the
buyer and other sale and profit recognition criteria are satisfied as required
under generally accepted accounting principles in the United States of America
for real estate transactions.

Investments in Unconsolidated Subsidiaries The Company follows the
equity method of accounting to record its interests in subsidiaries in which it
does not own the majority of the voting stock. Effective January 1, 2003, the
Company implemented FIN No. 46, which required the Company to use the equity
method to account for its investments in variable interest entities in which it
is not the primary beneficiary. As a result of the adoption of this standard
in 2003, the Company began accounting for its interest in statutory business
trusts (utilized in the issuance of trust preferred securities) under the
equity method. Under this method, the Companys initial investment is recorded
at cost and is subsequently adjusted to recognize its share of earnings or
losses. Distributions received reduce the carrying amount of the investment.

Goodwill and Other Intangible Assets The Company adopted SFAS No. 142,
Goodwill and Other Intangible Assets, on January 1, 2002. As of the adoption
date, the Company no longer amortizes goodwill over its useful life. Instead,
goodwill is tested for impairment annually at the reporting unit level, by
comparing the fair value of the reporting unit to its carrying amount. The
Company will recognize a goodwill impairment charge if the carrying amount of
the goodwill assigned to the reporting unit is greater than the implied fair
value of the goodwill.

At the date of adoption the fair values of all reporting units, except for
the Ryan Beck reportable segment, exceeded their respective carrying amounts at
the adoption date. Based on an independent valuation, a $15.1 million
impairment loss (net of a $1.2 million tax benefit) related to Ryan Beck was
recorded effective as of January 1, 2002 as the cumulative effect of a change
in accounting principle.

Other intangible assets consist of core deposit intangible assets which
were initially measured at fair value and are
amortized over their useful life of eight years.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Prior to the adoption of SFAS No. 142, goodwill was being amortized on a
straight-line basis over estimated useful lives, ranging from 7 to 25 years.
The Company periodically reviewed its goodwill for events or changes in
circumstances that indicated that the carrying amount was not recoverable, in
which cases an impairment charge was recorded.

Office Properties and EquipmentLand is carried at cost. Office
properties, equipment and computer software are carried at cost less
accumulated depreciation. Depreciation is computed on the straight-line method
over the estimated useful lives of the assets which generally range up to 40
years for buildings and 3-10 years for equipment and software. The cost of
leasehold improvements is being amortized using the straight-line method over
the terms of the related leases.

Expenditures for new properties and equipment and major renewals and
betterments are capitalized. Expenditures for maintenance and repairs are
charged to expense as incurred, and gains or losses on disposal of assets are
reflected in current operations.

Impairment of long lived assetsLong-lived assets are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. In performing the review
for impairment, the Company compares the expected future cash flows
(undiscounted and without interest charges) to the carrying amount of the
asset and records an impairment loss if the carrying amount exceeds the
expected future cash flows.

Long-lived assets to be abandoned, exchanged for a similar productive
asset, or distributed to owners in a spin-off are considered held and used
until disposed. The depreciable life of a long-lived asset to be abandoned is
revised and the asset is depreciated over its shortened depreciable life when
an entity commits to a plan to abandon the asset before the end of its
previously estimated useful life. An impairment loss is recognized at the date
a long-lived asset is exchanged for a similar productive asset or distributed
to owners in a spin-off if the carrying amount of the asset exceeds its fair
value. Long-lived assets classified as held for sale are reported at the lower
of its carrying amount or fair value less cost to sell and depreciation
(amortization) is ceased.

AdvertisingAdvertising expenditures are expensed as incurred.

Income TaxesThe Company and its subsidiaries, other than Heartwood
Holdings, Inc., a real estate investment trust, file a consolidated federal
income tax return. The Company and its subsidiaries file separate state income
tax returns for each state jurisdiction. The provision for income taxes is
based on income before taxes reported for financial statement purposes after
adjustment for permanent differences. Deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax basis. Deferred tax assets and
liabilities are measured using the enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected
to be recovered or settled. The effect of a change in tax rates on deferred
tax assets and liabilities is recognized in the period that includes the
statutory enactment date. A deferred tax asset valuation allowance is recorded
when it is more likely than not that deferred tax assets will not be realized.

Derivative InstrumentsAll derivatives are recognized on the statement
of financial condition at their fair value. On the date the derivative
contract is entered, the Company evaluates the derivative in order to determine
if it qualifies for hedge accounting. The hedging instrument must be highly
effective in achieving offsetting changes in the hedge instrument and hedged
item attributable to the risk being hedged. Any ineffectiveness which arises
during the hedging relationship is recognized in earnings in the Companys
statements of operations. When it is determined that a derivative is not
highly effective as a hedge or that it has ceased to be a highly effective
hedge, the Company discontinues hedge accounting prospectively.

Changes in the fair value of a derivative that is highly effective and
that is designated and qualifies as a fair-value hedge, along with the loss or
gain on the hedged asset or liability or unrecognized firm commitment of the
hedged item that is attributable to the hedged risk are recorded in earnings.
Changes in the fair value of a derivative that is highly effective and that is
designated and qualifies as a cash-flow hedge are recorded in other
comprehensive income until earnings are affected by the variability in cash
flows of the designated hedged item. Changes in the fair value of undesignated
derivative instruments are reported in current-period earnings.

Commitments to sell residential mortgage loans are accounted for as
derivatives at fair value.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

At January 1, 2001, the Company had outstanding interest rate swap
contracts utilized in the Companys interest rate risk management strategy.
In conjunction with the adoption of SFAS No. 133 (Accounting for Derivative
Instruments and Hedging Activities) on January 1, 2001, the Company accounted
for the interest rate swap contracts in accordance with the transition
provisions of SFAS No. 133 and recorded a cumulative effect adjustment gain of
approximately $1.1 million, net of tax.

Earnings Per Common Share Basic earnings per share excludes dilution
and is computed by dividing net income by the weighted average number of common
shares outstanding for the period. Diluted earnings per share reflect the
potential dilution that could occur if convertible securities or options to
issue common shares of the Company or its subsidiaries were exercised. In
calculating diluted earnings per share, interest expense net of taxes on
convertible securities is added back to net income and equity in earnings of
subsidiaries is adjusted for the effect of subsidiary stock options
outstanding, if dilutive. The resulting net income amount is divided by the
weighted average number of common shares outstanding, when dilutive. The
options and restricted stock are included in the weighted average number of
common shares outstanding based on the treasury stock method, if dilutive.

Stock-Based Compensation Plans During the year ended December 31, 2003,
the Company maintained both qualifying and non-qualifying stock-based
compensation plans for its employees and directors. These are described more
fully in Note 11. The Company accounts for these plans under the recognition
and measurement principles of Accounting Principles Board (APB) Opinion No.
25 and related interpretations. No compensation is recognized in connection
with option grants that had an exercise price equal to the market value of the
underlying common stock on the date of grant.

The following table illustrates the effect on net income and earnings per
share if the Company had applied the fair value recognition provisions of SFAS
No. 123, Accounting for Stock-Based Compensation, to stock-based employee
compensation.

|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|-------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------- | ------ | ---- |  | ---- | ------ | - |  | - | ------ | -
|                                                                                                                                                   |  | For the Years Ended December 31,
|                                                                                                                                                   |  |                                 
|(In thousands, except share data)                                                                                                                  |  | 2003                             |        | 2002 |  | 2001
|                                                                                                                                                   |  |                                  |        |      |  |     
|Pro forma net income                                                                                                                               |  |                                  |        |      |  |      |        |   |  |   |        |  
|Net income, as reported                                                                                                                            |  | $                                | 67,717 |      |  | $    | 50,335 |   |  | $ | 32,160 |  
|Add: Stock-based employee compensation
expense included in reported net income,
net of tax                                                         |  |                                  | 231    |      |  |      | 242    |   |  |   | 241    |  
|Deduct: Total stock-based employee
compensation expense determined under
fair value based method for all awards,
net of related income tax effects |  |                                  | (1,873 | )    |  |      | (1,626 | ) |  |   | (779   | )
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|Pro forma net income                                                                                                                               |  | $                                | 66,075 |      |  | $    | 48,951 |   |  | $ | 31,622 |  
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|Earnings per share:                                                                                                                                |  |                                  |        |      |  |      |        |   |  |   |        |  
|Basic as reported                                                                                                                                  |  | $                                | 1.16   |      |  | $    | 0.87   |   |  | $ | 0.76   |  
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|Basic pro forma                                                                                                                                    |  |                                  | 1.14   |      |  |      | 0.84   |   |  |   | 0.74   |  
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|Diluted as reported                                                                                                                                |  | $                                | 1.08   |      |  | $    | 0.81   |   |  | $ | 0.65   |  
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  
|Diluted pro forma                                                                                                                                  |  |                                  | 1.07   |      |  |      | 0.79   |   |  |   | 0.63   |  
|                                                                                                                                                   |  |                                  |        |      |  |      |        |   |  |   |        |  

New Accounting Pronouncements:

In November 2002, the FASB issued Interpretation No. 45, Guarantors
Accounting and Disclosure Requirements for Guarantees Including Indirect
Guarantees of Indebtedness of Others. This interpretation elaborates on the
disclosures to be made by a guarantor in its interim and annual financial
statements about its obligations under certain guarantees that it has issued.
It also clarifies that a guarantor is required to recognize, at the inception
of a guarantee, a liability for the fair value of the obligation undertaken in
issuing the guarantee. This interpretation does not prescribe a specific
approach for subsequently measuring the guarantors recognized liability over
the term of the related guarantee. This interpretation also incorporates,
without change, the guidance in FASB Interpretation No. 34, Disclosure of
Indirect Guarantees of Indebtedness of Others, which is being superseded. The
Company implemented the disclosure requirements of this interpretation as of
December 31, 2002 and the liability recognition provisions of the
interpretation as of January 1, 2003. This interpretation has not had a

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

significant impact on the Companys consolidated financial statements.

In January 2003, the Financial Accounting Standards Board (FASB) issued
FIN No. 46. The interpretation was revised by the FASB in December 2003. The
interpretation changes the accounting model for consolidation of variable
interest entities from one based on consideration of control through voting
interests. The consolidation of an entity is now based on other considerations
such as: whether there is sufficient equity at risk to enable it to operate
without additional financial support, whether the equity owners in that entity
lack the obligation to absorb expected losses or the right to receive residual
returns of the entity, whether voting rights in the entity are not proportional
to the equity interest and substantially all the entitys activities are
conducted for an investor with few voting rights. The interpretation also
requires disclosures about variable interest entities that the Company is not
required to consolidate but in which it has a significant variable interest.
On July 1, 2003, all of the Companys subsidiaries, except for Levitt and its
subsidiaries, implemented the interpretation effective January 1, 2003. As a
consequence of the implementation, the Companys wholly-owned statutory
business trusts formed to issue trust preferred securities were deconsolidated
and a real estate joint venture was consolidated.

In May 2003, the FASB issued Statement No. 150 (Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity).
This Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. The Statement requires that an issuer classify a financial instrument
that is within its scope as a liability. Many of those instruments were
previously classified as equity. This Statement was effective for financial
instruments entered into or modified after May 31, 2003, and otherwise was
effective at the beginning of the first interim period beginning after June 15,
2003. Upon adoption, this Statement did not have a significant impact on the
Companys financial statements.

The Statement also required that mandatorily redeemable minority interests
in finite-lived entities be classified as liabilities and reported at
settlement value. The FASB deferred those requirements related to mandatorily
redeemable minority interests in finite-lived entities indefinitely pending
further FASB action. The Companys minority interest in finite-lived entities
is not significant.

In December 2003, the FASB issued Statement No. 132, revised (Employers
Disclosures about Pensions and Other Postretirement Benefits). This revised
Statement requires additional disclosures about the assets, obligations, cash
flows and net periodic benefit cost of defined benefit pension and
postretirement plans, as well as the expense recorded for such plans. This
Statement is effective for financial statements with fiscal years ending after
December 15, 2003. The Company has implemented the disclosure requirements of
this statement as of December 31, 2003.

In December 2003, the American Institute of Certified Public Accountants
(AICPA) Accounting Standards Executive Committee (AcSEC) issued Statement
of Position 03-3 (SOP). The SOP addresses accounting for loans and debt
securities acquired in purchase business combinations or purchased subsequent
to origination. The SOP prohibits the creation of valuation allowances in the
initial accounting of all loans acquired. The SOP does not apply to originated
loans. The SOP limits the yield that may be accreted to the excess of the
purchasers estimate of undiscounted expected principal, interest and other
cash flows over the purchasers initial investment. The SOP requires excess
contractual cash flows over cash flows expected to be collected to not be
recognized as an adjustment of yield, loss accrual or valuation allowance.
Subsequent increases in cash flows expected to be collected generally should be
recognized prospectively through adjustment of the loans yield over its
remaining life. Decreases in cash flows expected to be collected should be
recognized as impairments. The SOP is effective for loans and securities
acquired in fiscal years beginning after December 15, 2004 with early adoption
encouraged. Management is currently evaluating the requirements of the SOP
concerning future loan acquisitions that are within the scope of the SOP.

2. Discontinued Operations and Acquisitions

Discontinued Operations

During the year ended December 31, 2003, the Company completed the
spin-off of its wholly-owned subsidiary, Levitt, and transferred its investment
in Bluegreen to Levitt. During the year ended December 31, 2003, Ryan Beck
sold two of its subsidiaries, The GMS Group, LLC (GMS) and Cumberland
Advisors. The above transactions were presented as discontinued operations in
our statements of operations for each of the years in the three year period
ended December 31, 2003.

F- 19



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

On December 31, 2003, the Company completed the spin-off of Levitt, by
means of a distribution to its shareholders of all of the outstanding capital
stock of Levitt. As a result of the spin-off, the Company no longer owns any
shares of capital
stock of Levitt. In connection with the spin-off, the Company converted a
$30.0 million demand note owed to the Company by Levitt to a five year term
note with interest only payable monthly initially at the prime rate and
thereafter at the prime rate plus increments of an additional .25% every six
months. Prior to the spin-off, the Company transferred its 4.9% ownership
interest in Bluegreen Corporation to Levitt in exchange for a $5.5 million note
and additional shares of Levitts stock (which additional shares were included
in the spin-off). This $5.5 million note is due in one year, with principal
payable monthly and interest payable at the prime rate. Additionally, prior to
the spin-off, Levitt declared an $8.0 million dividend to the Company in the
form of a note due in five years bearing interest on the same basis as the
$30.0 million note described above.

As part of Ryan Becks acquisition of certain of the assets and assumption
of certain of the liabilities of Gruntal & Co, LLC, in April 2002, Ryan Beck
acquired all of the membership interests in The GMS Group, L.L.C. (GMS).
Since its acquisition, GMS was operated as an independent business unit. After
a receipt of an offer by GMSs management to purchase GMS from Ryan Beck, Ryan
Beck sold its entire membership interest in GMS to GMS Group Holdings Corp.
(Buyer) in August 2003 for $22.6 million. The Buyer was formed by the
management of GMS along with other investors. Ryan Beck received cash proceeds
from the sale of $9.0 million and a $13.6 million secured promissory note
issued by the Buyer with recourse to the management of GMS. The note is
secured by the membership interest in GMS and contains covenants that require
GMS to maintain certain capital and financial ratios. Ryan Beck did not
recognize any gain or loss associated with the transaction. During 2003, Buyer
made a $1.6 million prepayment of principal of the promissory note which
reduced the outstanding balance to $12.0 million.

During the second quarter of 2003, Ryan Beck sold its entire interest in
Cumberland Advisors, Inc. for $1.5 million and recognized a $228,000 loss.

The components of earnings from discontinued operations are as follows (in
thousands):

|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |        | 
|------------------------------------------------------- | --------------------------- | - | -------------------------------- | ------- | ---- | - | ------ | ------ |  | - | ------ | ------ | 
|                                                        |                             |   | For the Years Ended December 31,
|                                                        |                             |   |                                 
|                                                        |                             |   | 2003                             |         | 2002 |   | 2001  
|                                                        |                             |   |                                  |         |      |   |       
|Net interest income                                     |                             | $ | 5,870                            |         |      | $ | 3,312  |        |  | $ | 905    |       
|Non-interest income:                                    |                             |   |                                  |         |      |   |        |        |  |   |        |       
|Investment banking income                               |                             |   | 17,782                           |         |      |   | 20,418 |        |  |   |       |       
|Income from real estate operations                      |                             |   | 73,547                           |         |      |   | 49,498 |        |  |   | 33,695 |       
|Income from unconsolidated subsidiaries                 |                             |   | 9,564                            |         |      |   | 6,208  |        |  |   | 2,888  |       
|Other                                                   |                             |   | 4,535                            |         |      |   | 4,050  |        |  |   | 2,416  |       
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       
|                                                        | Total non-interest income   |   |                                  | 105,428 |      |   |        | 80,174 |  |   |        | 38,999 | 
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       
|Non-interest expense:                                   |                             |   |                                  |         |      |   |        |        |  |   |        |       
|Employee compensation and benefits                      |                             |   | 37,222                           |         |      |   | 31,969 |        |  |   | 9,730  |       
|Occupancy and equipment                                 |                             |   | 744                              |         |      |   | 763    |        |  |   |       |       
|Advertising and promotion                               |                             |   | 4,546                            |         |      |   | 3,386  |        |  |   | 2,611  |       
|Selling, general and administrative                     |                             |   | 16,504                           |         |      |   | 12,190 |        |  |   | 13,470 |       
|Professional Fees                                       |                             |   | 3,063                            |         |      |   | 2,282  |        |  |   | 961    |       
|Communications                                          |                             |   | 1,148                            |         |      |   | 1,162  |        |  |   |       |       
|Floor broker and clearing fees                          |                             |   | 683                              |         |      |   | 668    |        |  |   |       |       
|Other                                                   |                             |   | 1,756                            |         |      |   | 1,698  |        |  |   |       |       
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       
|                                                        | Total non-interest expenses |   |                                  | 65,666  |      |   |        | 54,118 |  |   |        | 26,772 | 
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       
|Income from discontinued operations before
income taxes |                             |   | 45,632                           |         |      |   | 29,368 |        |  |   | 13,132 |       
|Provision for income taxes                              |                             |   | 16,512                           |         |      |   | 6,825  |        |  |   | 4,640  |       
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       
|Income from discontinued operations, net of tax         |                             | $ | 29,120                           |         |      | $ | 22,543 |        |  | $ | 8,492  |       
|                                                        |                             |   |                                  |         |      |   |        |        |  |   |        |       

F- 20



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The assets and liabilities associated with discontinued operations
included in the Companys statement of financial condition as of December 31,
2002 consisted of the following (in thousands):

|                                          |              |   |         |         | 
|----------------------------------------- | ------------ | - | ------- | ------- | 
|Assets                                    |              |   |         |        
|Cash                                      |              | $ | 19,457  |        
|Securities owned                          |              |   | 114,823 |        
|Loans receivable                          |              |   | 6,082   |        
|Real estate held for development          |              |   | 198,126 |        
|Investment in unconsolidated subsidiaries |              |   | 61,583  |        
|Goodwill                                  |              |   | 1,204   |        
|Other assets                              |              |   | 16,214  |        
|                                          |              |   |         |        
|                                          | Total assets |   | $       | 417,489 | 
|                                          |              |   |         |        
|Liabilities:                              |              |   |         |        
|Notes payable                             |              |   | 89,940  |        
|Securities sold but not yet purchased     |              |   | 2,797   |        
|Due to clearing agent                     |              |   | 92,035  |        
|Other liabilities                         |              |   | 45,102  |        
|                                          |              |   |         |        
|Total liabilities                         |              | $ | 229,874 |        
|                                          |              |   |         |        

The following table summarizes the assets and liabilities sold or
transferred associated with discontinued operations and the cash proceeds
received or transferred (in thousands).

|                                               |  |            |         |          |  |       |          |   |  |   |          |   |  |  |  | 
|---------------------------------------------- |  | ---------- | ------- | -------- |  | ----- | -------- | - |  | - | -------- | - |  |  |  | 
|                                               |  | GMS &      |         | Levitt   |  |       |          |   |  |   |          |  
|                                               |  | Cumberland |         | Spin-off |  | Total |          |   |  |  
|                                               |  |            |         |          |  |       |          |   |  |  
|Cash                                           |  | $          | 815     |          |  | $     | 21,413   |   |  | $ | 22,228   |  
|Securities owned                               |  |            | 105,083 |          |  |       |         |   |  |   | 105,083  |  
|Loans receivable (1)                           |  |            |        |          |  |       | (12,955  | ) |  |   | (12,955  | )
|Real estate held for development               |  |            |        |          |  |       | 257,556  |   |  |   | 257,556  |  
|Investment in unconsolidated subsidiaries      |  |            |        |          |  |       | 73,662   |   |  |   | 73,662   |  
|Property and equipment                         |  |            | 559     |          |  |       |         |   |  |   | 559      |  
|Goodwill                                       |  |            | 1,204   |          |  |       |         |   |  |   | 1,204    |  
|Other assets                                   |  |            | 5,479   |          |  |       | 16,256   |   |  |   | 21,735   |  
|Securities sold under agreements to
repurchase |  |            |        |          |  |       | 17,935   |   |  |   | 17,935   |  
|Subordinated debentures                        |  |            |        |          |  |       | (111,615 | ) |  |   | (111,615 | )
|Securities sold but not yet purchased          |  |            | (3,781  | )        |  |       |         |   |  |   | (3,781   | )
|Due to clearing agent                          |  |            | (80,561 | )        |  |       |         |   |  |   | (80,561  | )
|Other liabilities                              |  |            | (4,347  | )        |  |       | (93,179  | ) |  |   | (97,526  | )
|Stockholders equity                           |  |            |        |          |  |       | (125,573 | ) |  |   | (125,573 | )
|                                               |  |            |         |          |  |       |          |   |  |   |          |  
|Net assets sold or transferred                 |  |            | 24,451  |          |  |       | 43,500   |   |  |   | 67,951   |  
|Notes receivable - GMS Holdings, Inc.          |  |            | (13,681 | )        |  |       |         |   |  |   | (13,681  | )
|Notes receivable - Levitt Corporation          |  |            |        |          |  |       | (43,500  | ) |  |   | (43,500  | )
|Net cash declines due to Levitt spin-off       |  |            |        |          |  |       | (21,413  | ) |  |   | (21,413  | )
|Cash Sold                                      |  |            | (815    | )        |  |       |         |   |  |   | (815     | )
|                                               |  |            |         |          |  |       |          |   |  |   |          |  
|Net cash increase (decrease)                   |  | $          | 9,955   |          |  | $     | (21,413  | ) |  | $ | (11,458  | )
|                                               |  |            |         |          |  |       |          |   |  |   |          |  



|(1) |  | Includes $18.1 million of construction loans from BankAtlantic
to Levitt that were eliminated in the Companys consolidated
financial statements prior to the Levitt spin-off transaction.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Acquisitions

On April 26, 2002 Ryan Beck acquired certain of the assets and assumed
certain of the liabilities of Gruntal & Co., LLC (Gruntal) and acquired all
of the membership interests in GMS (the Gruntal transaction). The assets
acquired from Gruntal include all of Gruntals customer accounts, furniture,
leasehold improvements and equipment owned by Gruntal at the offices where
Gruntals financial consultants are located, assets related to Gruntals
deferred compensation plan and forgivable notes. The consideration provided by
Ryan Beck for this transaction was the assumption of a note payable related to
furniture and equipment in the Gruntal offices, assumption of non-cancelable
leases associated with the Gruntal offices acquired, obligations owed to
financial consultants participating in Gruntals deferred compensation plan
that accepted employment with Ryan Beck, and the payment of $6.0 million in
cash.

The Gruntal transaction was accounted for by the purchase method of
accounting. Under this method the acquired assets and assumed liabilities of
Gruntal were recorded at their estimated fair value, and the amount of
estimated fair value of net assets in excess of the purchase price was used to
write down non-financial assets. The remaining balance was recorded as an
extraordinary income item. The Companys financial statements reflect the
Gruntal transaction as of April 26, 2002.

On March 22, 2002, BankAtlantic acquired Community Savings Bankshares
Inc., the parent company of Community Savings, F.A. (Community), for $170.3
million in cash and immediately merged Community into BankAtlantic. At the
acquisition date, BankAtlantic Bancorp made a $78.5 million capital
contribution to BankAtlantic. BankAtlantic funded the acquisition of Community
using such capital contribution received from BankAtlantic Bancorp and funds
obtained from the liquidation of investments. Communitys results of operations
have been included in the Companys consolidated financial statements since
March 22, 2002. Community was a federally chartered savings and loan
association founded in 1955 and headquartered in North Palm Beach, Florida.
At March 22, 2002, Community had assets of $909 million and deposits of $637
million and 21 branches.

The following table summarizes the fair value of assets acquired and
liabilities assumed in connection with the acquisition of Community and the
Gruntal transaction effective March 22, 2002 and April 26, 2002, respectively
(in thousands):

|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |           | 
|------------------------------------------------------- | --------------------------------- | - | --------- | ------- | ------- | - | ------- | ------- |  | - | -------- | --------- | 
|                                                        |                                   |   | Community |         | Gruntal |   | Total  
|                                                        |                                   |   |           |         |         |   |        
|Cash and interest-earning deposits                      |                                   | $ | 124,977   |         |         | $ | 886     |         |  | $ | 125,863  |          
|Securities available for sale                           |                                   |   | 79,768    |         |         |   |        |         |  |   | 79,768   |          
|Securities owned                                        |                                   |   |          |         |         |   | 151,909 |         |  |   | 151,909  |          
|Loans receivable, net                                   |                                   |   | 623,469   |         |         |   |        |         |  |   | 623,469  |          
|FHLB Stock                                              |                                   |   | 8,063     |         |         |   |        |         |  |   | 8,063    |          
|Investments and advances in unconsolidated subsidiaries |                                   |   | 16,122    |         |         |   |        |         |  |   | 16,122   |          
|Goodwill                                                |                                   |   | 55,068    |         |         |   |        |         |  |   | 55,068   |          
|Core deposit intangible asset                           |                                   |   | 15,117    |         |         |   |        |         |  |   | 15,117   |          
|Other assets                                            |                                   |   | 46,620    |         |         |   | 12,597  |         |  |   | 59,217   |          
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          
|                                                        | Fair value of assets acquired     |   |           | 969,204 |         |   |         | 165,392 |  |   |          | 1,134,596 | 
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          
|Deposits                                                |                                   |   | 639,111   |         |         |   |        |         |  |   | 639,111  |          
|FHLB advances                                           |                                   |   | 138,981   |         |         |   |        |         |  |   | 138,981  |          
|Other borrowings                                        |                                   |   | 14,291    |         |         |   | 3,427   |         |  |   | 17,718   |          
|Securities sold, but not yet purchased                  |                                   |   |          |         |         |   | 1,201   |         |  |   | 1,201    |          
|Due to clearing agent                                   |                                   |   |          |         |         |   | 101,705 |         |  |   | 101,705  |          
|Other liabilities                                       |                                   |   | 6,022     |         |         |   | 27,463  | (1)     |  |   | 33,485   |          
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          
|                                                        | Fair value of liabilities assumed |   |           | 798,405 |         |   |         | 133,796 |  |   |          | 932,201   | 
|Fair value of net assets acquired over cost             |                                   |   |          |         |         |   | (23,749 | ) (2)   |  |   | (23,749  | )        
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          
|Purchase price                                          |                                   |   | 170,799   |         |         |   | 7,847   |         |  |   | 178,646  |          
|Cash acquired                                           |                                   |   | (124,977  | )       |         |   | (886    | )       |  |   | (125,863 | )        
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          
|Purchase price net of cash acquired                     |                                   | $ | 45,822    |         |         | $ | 6,961   |         |  | $ | 52,783   |          
|                                                        |                                   |   |           |         |         |   |         |         |  |   |          |          



|1. |  | Included in Gruntals other liabilities were a $21 million deferred
compensation plan obligation, of which $18.3 million was vested. Also
included in other liabilities was $675,000 of termination costs for
contract obligations related to leased equipment and $654,000 of
contract termination obligations associated with closing certain Gruntal
branches.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



|2. |  | The Company recognized an extraordinary gain of $23.7 million, net of
income taxes of $2.8 million, and reduced the carrying amount of
non-financial assets by $11.2 million as a result of the fair value of
the assets acquired exceeding the cost of the Gruntal transaction. The
Company
did not establish a deferred tax liability for the extraordinary gain
associated with the GMS membership interest acquired because the Company
acquired the GMS membership interest rather than the net assets.
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The purchase price of Community consisted of $170.3 million in cash and
$500,000 of acquisition professional fees. The cost of the Gruntal transaction
consisted of a $6.0 million cash payment, $750,000 of acquisition professional
fees and an estimated $1.05 million of contingent consideration payable to
Gruntal. The $1.05 million contingent consideration to Gruntal relates to
possible deferred compensation plan participant forfeitures and represents the
maximum amount of additional consideration. Pursuant to the terms of the
Acquisition Agreement, during each of the three years beginning October 27,
2002, Ryan Beck is obligated to pay Gruntal & Co. LLC up to $350,000 of
forfeitures each year under the Amended and Restated Gruntal & Co. LLC Deferred
Compensation Plan for each of the years in the three year period ended October
26, 2005. During the year ended December 31, 2003, Ryan Beck paid Gruntal
$350,000 reducing the liability to $700,000.

The following pro forma information for the year ended December 31, 2002
is presented as if the Gruntal and Community transactions had been consummated
on January 1, 2002. The pro forma information is not necessarily indicative of
the combined financial position or results of operations which would have been
realized had the transactions been consummated during the period or as of the
date for which the pro forma financial information is presented.

|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 
|----------------------------------------------------- |  | -------------------------------- | ------- | ---------- |  | --------- | ------- |  |  | - | ------- | 
|                                                      |  | For the Years Ended December 31,
|                                                      |  |                                 
|                                                      |  | 2003                             |         | 2002      
|                                                      |  |                                  |         |           
|(In thousands, except per share data)                 |  | Historical                       |         | Historical |  | Pro Forma
|                                                      |  |                                  |         |            |  |          
|Interest income                                       |  | $                                | 261,849 |            |  | $         | 303,387 |  |  | $ | 319,341 | 
|Interest expense                                      |  |                                  | 113,217 |            |  |           | 148,891 |  |  |   | 155,611 | 
|Provision for loan losses                             |  |                                  | (547    | )          |  |           | 14,077  |  |  |   | 16,121  | 
|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 
|Net interest income after provision for loan losses   |  | $                                | 149,179 |            |  | $         | 140,419 |  |  | $ | 147,609 | 
|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 
|Income from continuing operations                     |  |                                  | 38,597  |            |  |           | 19,150  |  |  |   | 15,461  | 
|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 
|Basic earnings per share from continuing operations   |  | $                                | 0.66    |            |  | $         | 0.33    |  |  | $ | 0.27    | 
|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 
|Diluted earnings per share from continuing
operations |  | $                                | 0.62    |            |  | $         | 0.32    |  |  | $ | 0.26    | 
|                                                      |  |                                  |         |            |  |           |         |  |  |   |         | 

During April 2002, the Companys and Levitts ownership in Bluegreen
Corporation (Bluegreen), a New York Stock Exchange-listed company engaged in
the acquisition, development, marketing and sale of primarily drive-to vacation
interval resorts, golf communities and residential land, increased from
approximately 5% to 40%. This interest in Bluegreen was acquired for an
aggregate purchase price of approximately $56 million. The Company acquired
approximately 5% of Bluegreen common stock during the first quarter of 2001,
and Levitt acquired approximately 35% of Bluegreen common stock in April 2002.
The acquisition of Bluegreen at various acquisition dates was accounted for as
a step acquisition under the purchase method of accounting. In a step
acquisition, the purchase price allocation is performed at each acquisition
date and goodwill is recognized with each step purchase. As a consequence, the
net assets of Bluegreen were recognized at estimated fair value to the extent
of the Companys ownership percentage at each acquisition date. The Companys
carrying amount of the investment was, in the aggregate, $2.1 million lower
than the ownership percentage in the underlying equity in the net assets of
Bluegreen. The $2.1 million was allocated to property and equipment. Prior
period financial statements were not restated to reflect the results of
applying the equity method to the initial acquisition, due to lack of
significance. Under the equity method the investment in Bluegreen was recorded
at cost and the carrying amount of the investment is adjusted to recognize the
Companys interest in the earnings or loss of Bluegreen after the acquisition
date. The equity in earnings from Bluegreen is included in discontinued
operations in the Companys Statement of Operations for the years ended
December 31, 2003 and 2002.

F- 23



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The following table summarizes the estimated fair value of assets acquired
and liabilities assumed in connection with the Bluegreen investment to the
extent of the Companys ownership interest of 40% (in thousands).

|                                                                   |                                   |   |        |         | 
|------------------------------------------------------------------ | --------------------------------- | - | ------ | ------- | 
|                                                                   |                                   |   | Fair  
|                                                                   |                                   |   | Value 
|                                                                   |                                   |   |       
|Cash and cash equivalents                                          |                                   | $ | 19,077 |        
|Contracts receivable, net                                          |                                   |   | 8,544  |        
|Notes receivable, net                                              |                                   |   | 22,449 |        
|Prepaid expenses                                                   |                                   |   | 4,556  |        
|Inventory, net                                                     |                                   |   | 75,260 |        
|Retained interests in notes receivable sold                        |                                   |   | 15,101 |        
|Property and equipment, net                                        |                                   |   | 16,156 |        
|Other assets                                                       |                                   |   | 2,247  |        
|                                                                   |                                   |   |        |        
|                                                                   | Fair value of assets acquired     |   |        | 163,390 | 
|                                                                   |                                   |   |        |        
|Accounts payable, accrued liabilities and other liabilities        |                                   |   | 20,196 |        
|Deferred income taxes                                              |                                   |   | 9,505  |        
|Line-of-credit notes payable and receivable -
backed notes payable |                                   |   | 21,496 |        
|10.50% senior secured notes payable                                |                                   |   | 43,508 |        
|8.00% convertible subordinated debentures to related
parties       |                                   |   | 2,350  |        
|8.25% convertible subordinated debentures                          |                                   |   | 9,826  |        
|                                                                   |                                   |   |        |        
|                                                                   | Fair value of liabilities assumed |   |        | 106,881 | 
|                                                                   |                                   |   |        |        
|Purchase price of Bluegreen Corporation                            |                                   | $ | 56,509 |        
|                                                                   |                                   |   |        |        

In June 2001, pursuant to the February 1998 acquisition agreement under
which Ryan Beck acquired Cumberland Advisors, the Company issued 43,991 shares
of Class A common stock and made a cash payment of $340,000 to the former
Cumberland Advisors partners. Such additional consideration was paid under
earn-out provisions in accordance with the acquisition agreement and was
recorded as an adjustment to the purchase price of Cumberland Advisors.

Effective March 1, 1998, the Company acquired Leasing Technology Inc.
(LTI), a company engaged in the equipment leasing and finance business, in
exchange for 826,175 shares of Class A common stock and $300,000 in cash. This
merger was accounted for under the purchase method of accounting. The Company
was amortizing $7.9 million of goodwill from the transaction over 25 years on a
straight line basis. During the third quarter of 2001, after an extensive
review by the Company of LTIs operations, management concluded that LTI would
not be able to meet performance expectations, and its products did not
complement the Companys product mix. As a consequence, the Company closed the
offices of LTI and ceased new lease originations. The Company determined that
the goodwill associated with the LTI acquisition was impaired, resulting in the
write-off of the remaining unamortized LTI goodwill of $6.6 million.

F- 24



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) 3. Securities and Short-Term Investments The following tables summarize available-for-sale securities, investment
securities and tax certificates (in thousands): Available for SaleDecember 31, 2003
    
    December 31, 2002Gross
    
    Gross
    
    
    
    
    
    
    
    
    
    Gross
    
    GrossAmortized
    
    Unrealized
    
    Unrealized
    
    Estimated
    
    Amortized
    
    Unrealized
    
    Unrealized
    
    EstimatedCost
    
    Appreciation
    
    Depreciation
    
    Fair Value
    
    Cost
    
    Appreciation
    
    Depreciation
    
    Fair ValueMortgage-Backed Securities:Mortgage-backed securities
    
    $
    315,520
    
    
    $
    6,262
    
    
    $
    529
    
    
    $
    321,253
    
    
    $
    581,893
    
    
    $
    20,696
    
    
    $
    
    
    
    $
    602,589Real estate mortgage investment
conduits
    
    
    17,378
    
    
    
    120
    
    
    
    
    
    
    
    17,498
    
    
    
    102,192
    
    
    
    1,299
    
    
    
    30
    
    
    
    103,461Total mortgage-backed securities
    
    
    332,898
    
    
    
    6,382
    
    
    
    529
    
    
    
    338,751
    
    
    
    684,085
    
    
    
    21,995
    
    
    
    30
    
    
    
    706,050Investment Securities:Other bonds
    
    
    585
    
    
    
    
    
    
    
    
    
    
    
    585
    
    
    
    411
    
    
    
    10
    
    
    
    
    
    
    
    421Equity securities
    
    
    15,775
    
    
    
    3,400
    
    
    
    
    
    
    
    19,175
    
    
    
    1,036
    
    
    
    351
    
    
    
    
    
    
    
    1,387Total investment securities
    
    
    16,360
    
    
    
    3,400
    
    
    
    
    
    
    
    19,760
    
    
    
    1,447
    
    
    
    361
    
    
    
    
    
    
    
    1,808Total
    
    $
    349,258
    
    
    $
    9,782
    
    
    $
    529
    
    
    $
    358,511
    
    
    $
    685,532
    
    
    $
    22,356
    
    
    $
    30
    
    
    $
    707,858
 Unrealized losses on mortgage-backed securities at December 31, 2003 have
not been recognized into income as the securities are issued by government
agencies and are of high credit quality. The decline in fair value is
primarily due to increased market interest rates from the securities
acquisition dates. The fair value is expected to recover as the securities
approach their maturity date or as market rates decline. The scheduled
maturities of mortgage-backed securities with unrealized losses is greater than
one year. Investment Securities and Tax CertificatesDecember 31, 2003(1)
    
    December 31, 2002(1)Gross
    
    Gross
    
    Estimated
    
    
    
    
    
    Gross
    
    Gross
    
    EstimatedAmortized
    
    Unrealized
    
    Unrealized
    
    Fair
    
    Amortized
    
    Unrealized
    
    Unrealized
    
    FairCost
    
    Appreciation
    
    Depreciation
    
    Value
    
    Cost
    
    Appreciation
    
    Depreciation
    
    ValueTax certificates Net of allowance of
$2,870
    
    $
    190,906
    
    
    $
    
    
    
    $
    
    
    
    $
    190,906
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Net of allowance of
$1,873
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    194,074
    
    
    
    
    
    
    
    
    
    
    
    194,074Mortgage-backed securities (3)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,383
    
    
    
    458
    
    
    
    
    
    
    
    14,841Equity investment (2)
    
    
    1,800
    
    
    
    
    
    
    
    
    
    
    
    1,800
    
    
    
    3,783
    
    
    
    
    
    
    
    
    
    
    
    3,783$
    192,706
    
    
    $
    
    
    
    $
    
    
    
    $
    192,706
    
    
    $
    212,240
    
    
    $
    458
    
    
    $
    
    
    
    $
    212,698
  (1)
    
    Management considers estimated fair value equivalent to book value for
tax certificates and equity investment securities since these securities
have no readily traded market and are deemed to approximate fair
value.  (2)
    
    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.  (3)
    
    Mortgage-backed securities at December 31, 2002 represented beneficial
interests in a real estate mortgage investment trust secured by commercial
real estate. During the year ended December 31, 2002, the Company
transferred all of its residential mortgage-backed securities held to
maturity ($198.7 million) to securities available for sale. The
securities were transferred in order to respond to the significant decline
in interest rates during the period. The securities transferred were not
sold during the year ended December 31, 2002. The remaining
mortgage-backed securities held to maturity during 2002 were
collateralized by commercial real estate and were transferred to
securities available for sale and sold during the year ended December 31,
2003. The securities were transferred and sold upon F-25




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)  non-compliance with debt covenants by the issuer. The scheduled maturities of debt securities and tax certificates were (in
thousands): Debt SecuritiesAvailable for Sale
    
    Tax CertificatesEstimated
    
    
    
    
    
    EstimatedAmortized
    
    Fair
    
    Amortized
    
    FairDecember 31, 2003 (1)(2)
    
    Cost
    
    Value
    
    Cost
    
    ValueDue within one year
    
    $
    43
    
    
    $
    43
    
    
    $
    136,514
    
    
    $
    136,514Due after one year, but within five years
    
    
    655
    
    
    
    659
    
    
    
    54,392
    
    
    
    54,392Due after five years, but within ten years
    
    
    528
    
    
    
    557
    
    
    
    
    
    
    
    Due after ten years
    
    
    332,257
    
    
    
    338,077
    
    
    
    
    
    
    
    Total
    
    $
    333,483
    
    
    $
    339,336
    
    
    $
    190,906
    
    
    $
    190,906
  (1)
    
    Scheduled maturities in the above table may vary
significantly from actual maturities due to prepayments.(2)
    
    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). Activity in the allowance for tax certificate losses was (in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Balance, beginning of period
    
    $
    1,873
    
    
    $
    1,521
    
    
    $
    1,937Charge-offs
    
    
    (869
    )
    
    
    (1,783
    )
    
    
    (2,162
    )Recoveries
    
    
    666
    
    
    
    660
    
    
    
    546Net charge-offs
    
    
    (203
    )
    
    
    (1,123
    )
    
    
    (1,616
    )Provision charged to
operations
    
    
    1,200
    
    
    
    1,475
    
    
    
    1,200Balance, end of period
    
    $
    2,870
    
    
    $
    1,873
    
    
    $
    1,521
 F-26




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) The components of gains and losses on sales of securities were (in
thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Gross realized gains on securities
activities
    
    $
    457
    
    
    $
    8,711
    
    
    $
    7,130Gross realized losses on
securities activities
    
    
    (1,961
    )
    
    
    (67
    )
    
    
    Unrealized loss on futures contract
    
    
    (49
    )
    
    
    (66
    )
    
    
    (6
    )Securities activities, net
    
    $
    (1,553
    )
    
    $
    8,578
    
    
    $
    7,124
 Proceeds from sales of securities available for sale were $40.1 million,
$197.6 million, and $194.2 million during the years ended December 31, 2003,
2002 and 2001, respectively. Included in gross losses on securities
activities, net during the year ended December 31, 2003 was $1.9 million of
realized losses related to the settlement of interest rate swap contracts. The
interest rate swaps were accounted for as a cash flow hedge and the unrealized
losses were recorded in other comprehensive income during the years ended
December 31, 2002 and 2001. Included in gains on securities activities, net
during the year ended December 31, 2001 was $1.4 million of realized gains
related to the settlement of interest rate swap contracts and unrealized losses
of $1.5 million related to interest rate swap contracts that were subsequently
designated as cash flow hedges. The Companys securities owned consisted of the following (in thousands): December 31,
    
    December 31,2003
    
    2002Debt obligations:States and municipalities (1)
    
    $
    9,903
    
    
    $
    119,417Corporations
    
    
    5,159
    
    
    
    5,344U.S. Government and agencies
    
    
    62,229
    
    
    
    26,004Corporate equity
    
    
    15,072
    
    
    
    19,280Mutual funds
    
    
    24,639
    
    
    
    16,409Certificates of deposits
    
    
    7,563
    
    
    
    Total
    
    $
    124,565
    
    
    $
    186,454
  (1)
    
    Includes $108.3 million of securities owned by GMS
at December 31, 2002, of which approximately $86 million are
non-rated securities and $9.7 million of those securities are
not accruing interest. All the securities owned at December 31, 2003 and 2002 were associated
with trading activities conducted both as principal and as agent on behalf of
individual and institutional investor clients of Ryan Beck. Transactions as
principal involve making markets in securities which are held in inventory to
facilitate sales to and purchases from customers. Ryan Beck realized income
from principal transactions of $95.5 million, $50.4 million and $18.9 million
for the years ended December 31, 2003, 2002 and 2001, respectively. In the ordinary course of business, Ryan Beck borrows under an agreement
with its clearing broker by pledging securities owned as collateral primarily
to finance trading inventories. As of December 31, 2003, the balance due to
the clearing broker was $8.6 million. F-27




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) Securities sold, but not yet purchased consists of the following (in
thousands): December 31,2003
    
    2002Corporate equity
    
    $
    3,544
    
    
    $
    3,691Corporate bonds
    
    
    1,963
    
    
    
    1,159State and municipalities
    
    
    67
    
    
    
    9,566U.S. Government agencies
    
    
    32,231
    
    
    
    23,587Certificates of deposits
    
    
    8
    
    
    
    $
    37,813
    
    
    $
    38,003
 Securities sold, but not yet purchased are a part of Ryan Becks normal
activities as a broker and dealer in securities and are subject to
off-balance-sheet risk should Ryan Beck be unable to acquire the securities for
delivery to the purchaser at prices equal to or less than the current recorded
amounts. The following table provides information on securities purchased under
resell agreements (in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Ending Balance
    
    $
    
    
    
    $
    30,145
    
    
    $
    156Maximum outstanding at any month end
within period
    
    $
    160,000
    
    
    $
    30,145
    
    
    $
    3,651Average amount invested during period
    
    $
    31,589
    
    
    $
    4,558
    
    
    $
    1,152Average yield during period
    
    
    0.60
    %
    
    
    0.73
    %
    
    
    2.80
    %
 The underlying securities associated with the securities purchased under
resell agreements during the years ended December 31, 2003, 2002 and 2001 were
held by the Company. The following table provides information on Federal Funds sold (in
thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Ending Balance
    
    $
    
    
    
    $
    20,000
    
    
    $
    Maximum outstanding at any month end
within period
    
    $
    83,000
    
    
    $
    20,000
    
    
    $
    16,500Average amount invested during period
    
    $
    16,499
    
    
    $
    3,928
    
    
    $
    564Average yield during period
    
    
    1.01
    %
    
    
    1.45
    %
    
    
    3.73
    %
 The estimated fair value of securities and short term investments pledged
for the following obligations were (in thousands): December 31,2003
    
    2002FHLB advances
    
    $
    
    
    
    $
    542,228Treasury tax and loan
    
    
    1,724
    
    
    
    935Repurchase agreements
    
    
    144,984
    
    
    
    124,364Public funds
    
    
    
    
    
    
    139,358Interest rate swap
and forward
contracts
    
    
    174
    
    
    
    7,192$
    146,882
    
    
    $
    814,077
 F-28




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) The change in net unrealized holding gains or losses on available for sale
securities, included as a separate component of stockholders equity, was as
follows (in thousands): For The Years Ended December 31,2003
    
    2002
    
    2001Net change in other comprehensive incomeOn securities available for sale
    
    $
    (13,073
    )
    
    $
    (3,085
    )
    
    $
    22,758Change in deferred taxes (benefits) on net unrealized
appreciation
(depreciation) on securities available for sale
    
    
    (4,737
    )
    
    
    (1,109
    )
    
    
    8,124Change in other comprehensive income component of
stockholders equity from net unrealized appreciation
(depreciation) on securities available for sale
    
    $
    (8,336
    )
    
    $
    (1,976
    )
    
    $
    14,634
 The components of accumulated other comprehensive income included in
stockholders equity was as follows (in thousands): December 31,2003
    
    2002Unrealized gains on securities available
for sale
    
    $
    5,956
    
    
    $
    14,289Unrealized losses associated with
investment
in unconsolidated subsidiaries
    
    
    
    
    
    
    (448
    )Accumulated losses associated with cash
flow hedges
    
    
    
    
    
    
    (2,816
    )Minimum pension liability
    
    
    
    
    
    
    (7,456
    )Accumulated other comprehensive income
    
    $
    5,956
    
    
    $
    3,569
 F-29




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) 4. Loans Receivable The loan portfolio consisted of the following components (in thousands): December 31,2003
    
    2002Real estate loans:Residential
    
    $
    1,343,657
    
    
    $
    1,378,041Construction and development
    
    
    1,345,449
    
    
    
    1,218,411Commercial
    
    
    1,064,043
    
    
    
    755,492Small business
    
    
    110,745
    
    
    
    98,494Loans to Levitt Corporation
    
    
    18,118
    
    
    
    Other loans:Loans to Levitt Corporation
    
    
    43,500
    
    
    
    Second mortgages - direct
    
    
    333,655
    
    
    
    261,579Second mortgages - indirect
    
    
    1,105
    
    
    
    1,713Commercial business
    
    
    91,724
    
    
    
    82,174Lease financing
    
    
    14,442
    
    
    
    31,279Small
business - non-mortgage
    
    
    58,574
    
    
    
    62,599Deposit overdrafts
    
    
    4,036
    
    
    
    2,487Consumer
loans - other direct
    
    
    17,892
    
    
    
    22,394Consumer
loans - other indirect
    
    
    1,297
    
    
    
    6,392Loans held for sale:Residential
    
    
    2,254
    
    
    
    Commercial syndication
    
    
    9,114
    
    
    
    14,499Total gross loans
    
    
    4,459,605
    
    
    
    3,935,554Adjustments:Undisbursed portion of loans
in process
    
    
    (728,100
    )
    
    
    (511,861
    )Net premiums related to
purchased loans
    
    
    6,898
    
    
    
    2,159Deferred fees
    
    
    (6,655
    )
    
    
    (5,200
    )Allowance for loan losses
    
    
    (45,595
    )
    
    
    (48,022
    )Loans
receivable - net
    
    $
    3,686,153
    
    
    $
    3,372,630
 BankAtlantics loan portfolio had the following geographic concentration at
December 31, 2003: Florida
    
    
    65
    %California
    
    
    9
    %Northeast
    
    
    7
    %Other
    
    
    19
    %100
    %
 Loans to Levitt amounting to $43.5 million are unsecured and $18.1 million
of loans are construction loans secured by land and improvements. Loans
receivable from Levitt were eliminated in the consolidated financial statements
at December 31, 2002. Discontinued and Restructured Lending Activity: The Company continuously evaluates its business units for profitability,
growth and overall efficiency. As a consequence of these evaluations the
Company closed the offices of its leasing subsidiary, Leasing Technology, Inc.,
and ceased new lease originations during the third quarter of 2001 During 2003, the Company began originating residential loans that are
pre-sold to correspondents. During 2002, the Company discontinued the
origination of residential loans, except for loans that qualified under the
Community F-30




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) Reinvestment Act (CRA), which were originated for resale through September
2002. During September 2002, the Company discontinued its practice of selling
CRA loans, transferred $7.3 million of CRA loans from loans held for sale to
loans held for investment and realized a $151,000 loss at the transfer date.
The Company now originates CRA loans designated as held for investment and also
originates CRA loans that are pre-sold to correspondents. The Company
continues to purchase residential loans for its portfolio. Allowance for Loan Losses (in thousands): For Years Ended December 31,2003
    
    2002
    
    2001Balance, beginning of period
    
    $
    48,022
    
    
    $
    44,585
    
    
    $
    47,000Loans charged-off
    
    
    (11,723
    )
    
    
    (28,663
    )
    
    
    (27,916
    )Recoveries of loans previously charged-off
    
    
    10,577
    
    
    
    8,879
    
    
    
    8,596Net charge-offs
    
    
    (1,146
    )
    
    
    (19,784
    )
    
    
    (19,320
    )Allowance for loan losses, acquired
    
    
    (734
    )
    
    
    9,144
    
    
    
    Net provision charged (credited) to operations
    
    
    (547
    )
    
    
    14,077
    
    
    
    16,905Balance, end of period
    
    $
    45,595
    
    
    $
    48,022
    
    
    $
    44,585
 The following summarizes impaired loans (in thousands): December 31, 2003
    
    December 31, 2002Gross
    
    
    
    
    
    GrossRecorded
    
    Specific
    
    Recorded
    
    SpecificInvestment
    
    Allowances
    
    Investment
    
    AllowancesImpaired loans
with specific
valuation
allowances
    
    $
    361
    
    
    $
    181
    
    
    $
    4,886
    
    
    $
    1,386Impaired loans
without specific
valuation
allowances
    
    
    12,325
    
    
    
    
    
    
    
    17,478
    
    
    
    Total
    
    $
    12,686
    
    
    $
    181
    
    
    $
    22,364
    
    
    $
    1,386
 The average gross recorded investment in impaired loans was $16.3 million,
$39.3 million and $54.2 million during the years ended December 31, 2003, 2002
and 2001, respectively. Interest income which would have been recorded under the contractual terms
of impaired loans and the interest income actually recognized was (in
thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Contracted interest income
    
    $
    666
    
    
    $
    1,575
    
    
    $
    2,815Interest income recognized
    
    
    (396
    )
    
    
    (768
    )
    
    
    (941
    )Foregone interest income
    
    $
    270
    
    
    $
    807
    
    
    $
    1,874
 Non-performing assets consist of non-accrual loans, non-accrual tax
certificates, REO and repossessed assets. Non-accrual loans are loans on which
interest recognition has been suspended because of doubts as to the borrowers
ability to repay principal or interest. Non-accrual tax certificates are tax
deeds or certificates in which interest recognition has been suspended due to
the aging of the certificate or deed. F-31




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) Non-performing assets (in thousands): At December 31,2003
    
    2002
    
    2001Non-accrual  tax certificates
    
    $
    894
    
    
    $
    1,419
    
    
    $
    1,727Non-accrual  loans
Residential
    
    
    8,489
    
    
    
    12,773
    
    
    
    9,203Syndication
    
    
    
    
    
    
    
    
    
    
    10,700Commercial real estate and business
    
    
    52
    
    
    
    1,474
    
    
    
    13,066Small business
    
    
    155
    
    
    
    239
    
    
    
    905Lease financing
    
    
    25
    
    
    
    3,900
    
    
    
    2,585Consumer
    
    
    794
    
    
    
    532
    
    
    
    796Real estate owned
    
    
    2,422
    
    
    
    9,607
    
    
    
    3,904Other repossessed assets
    
    
    
    
    
    
    4
    
    
    
    17Total non-performing assets
    
    
    12,831
    
    
    
    29,948
    
    
    
    42,903Specific valuation allowance
    
    
    
    
    
    
    (1,386
    )
    
    
    (9,936
    )Total non-performing assets, net
    
    $
    12,831
    
    
    $
    28,562
    
    
    $
    32,967
 Other potential problem loans consist of
the following
(in thousands): At December 31,2003
    
    2002
    
    2001Loans contractually past due 90 days or more
and still accruing
    
    $
    135
    
    
    $
    100
    
    
    $
    Performing impaired loans, net of specific
allowances
    
    
    180
    
    
    
    
    
    
    
    Restructured loans
    
    
    1,387
    
    
    
    1,882
    
    
    
    743Delinquent residential loans purchased
    
    
    1,288
    
    
    
    1,464
    
    
    
    1,705Total potential problem loans
    
    $
    2,990
    
    
    $
    3,446
    
    
    $
    2,448
 Loans contractually past due 90 days or more represent loans that have
matured and the borrower continues to make the payments under the matured loan
agreement. BankAtlantic is in the process of renewing or extending these
matured loans. Restructured loans are loans in which the original terms were
modified granting the borrower loan concessions due to financial difficulties.
Performing impaired loans are still accruing impaired loans, and delinquent
purchased loans were non-performing residential loans purchased at a discount.
There were no commitments to lend additional funds on non-performing loans or
potential problem loans at December 31, 2003. Foreclosed asset activity in non-interest expense includes the following
(in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Real estate acquired in
settlement of loans and
tax certificates:Operating expenses, net
    
    $
    1,122
    
    
    $
    872
    
    
    $
    160Provisions for losses on REO
    
    
    812
    
    
    
    1,467
    
    
    
    117Net (gains) losses on sales
    
    
    (1,984
    )
    
    
    (117
    )
    
    
    (1,053
    )Total (income) loss
    
    $
    (50
    )
    
    $
    2,222
    
    
    $
    (776
    )
 F-32




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) Activity in the allowance for real estate owned consisted of (in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Balance, beginning of period
    
    $
    
    
    
    $
    
    
    
    $
    310Net charge-offs:Commercial real estate
    
    
    (750
    )
    
    
    (1,500
    )
    
    
    (220
    )Residential real estate
    
    
    (62
    )
    
    
    33
    
    
    
    (207
    )Total net charge-offs
    
    
    (812
    )
    
    
    (1,467
    )
    
    
    (427
    )Provision for losses on REO
    
    
    812
    
    
    
    1,467
    
    
    
    117Balance, end of period
    
    $
    
    
    
    $
    
    
    
    $
    
 5. Accrued Interest Receivable Accrued interest receivable consists of (in thousands): December 31,2003
    
    2002Loans receivable
    
    $
    15,700
    
    
    $
    17,555Investment securities and
tax certificates
    
    
    10,269
    
    
    
    11,390Interest rate swaps
    
    
    
    
    
    
    789Securities available for sale
    
    
    1,897
    
    
    
    4,250$
    27,866
    
    
    $
    33,984
 6. Office Properties and Equipment Office properties and equipment was comprised of (in thousands): December 31,2003
    
    2002Land
    
    $
    22,422
    
    
    $
    22,668Buildings and improvements
    
    
    70,446
    
    
    
    68,291Furniture and equipment
    
    
    49,923
    
    
    
    44,907Total
    
    
    142,791
    
    
    
    135,866Less accumulated depreciation
    
    
    49,214
    
    
    
    43,167Office properties and
equipment  net
    
    $
    93,577
    
    
    $
    92,699
 During 2002, BankAtlantic purchased a $14.3 million office facility to
consolidate BankAtlantics headquarters and back office operations into a
centralized facility. As of December 31, 2003 the Company had incurred
approximately $3 million in renovation costs. During 2002, the Company discontinued certain ATM relationships, resulting
in an $801,000 restructuring charge and a $206,000 impairment write-down. During 2001, the Company finalized a plan to exit its in-store branches
resulting in a $550,000 impairment charge on leasehold improvements. The
Company also sold fourteen in-store branches to unrelated financial
institutions and recorded gains of $384,000 and $1.6 million during the years
ended December 31, 2002 and 2001, respectively. F-33




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) 7. Deposits The weighted average nominal interest rate payable on deposit accounts at
December 31, 2003 and 2002 was 0.94% and 1.79%, respectively. The stated rates
and balances on deposits were (dollars in thousands): December 31,2003
    
    2002Amount
    
    Percent
    
    Amount
    
    PercentInterest free checking
    
    $
    645,036
    
    
    
    21.09
    %
    
    $
    462,718
    
    
    
    15.84
    %Insured money fund savings
0.83% at December 31, 2003,
1.20% at December 31, 2002,
    
    
    865,590
    
    
    
    28.31
    
    
    
    775,175
    
    
    
    26.54NOW accounts
0.30% at December 31, 2003,
0.50% at December 31, 2002,
    
    
    533,888
    
    
    
    17.46
    
    
    
    399,985
    
    
    
    13.70Savings accounts
0.28% at December 31, 2003,
0.56% at December 31, 2002,
    
    
    208,966
    
    
    
    6.83
    
    
    
    163,641
    
    
    
    5.60Total non-certificate accounts
    
    
    2,253,480
    
    
    
    73.69
    
    
    
    1,801,519
    
    
    
    61.68Certificate accounts:Less than 2.00%
    
    
    455,709
    
    
    
    14.90
    
    
    
    259,328
    
    
    
    8.882.01% to 3.00%
    
    
    147,446
    
    
    
    4.82
    
    
    
    222,475
    
    
    
    7.623.01% to 4.00%
    
    
    45,546
    
    
    
    1.49
    
    
    
    65,972
    
    
    
    2.264.01% to 5.00%
    
    
    51,379
    
    
    
    1.68
    
    
    
    284,611
    
    
    
    9.755.01% and greater
    
    
    102,382
    
    
    
    3.35
    
    
    
    280,193
    
    
    
    9.59Total certificate accounts
    
    
    802,462
    
    
    
    26.24
    
    
    
    1,112,579
    
    
    
    38.10Total deposit accounts
    
    
    3,055,942
    
    
    
    99.93
    
    
    
    2,914,098
    
    
    
    99.78Fair value adjustment related to hedged
deposits
    
    
    
    
    
    
    
    
    
    
    843
    
    
    
    0.03Premium on brokered deposits
    
    
    (798
    )
    
    
    (0.03
    )
    
    
    
    
    
    
    Fair value adjustment related to acquisitions
    
    
    472
    
    
    
    0.02
    
    
    
    929
    
    
    
    0.03Interest earned not credited to deposit
accounts
    
    
    2,526
    
    
    
    0.08
    
    
    
    4,685
    
    
    
    0.16Total
    
    $
    3,058,142
    
    
    
    100.00
    %
    
    $
    2,920,555
    
    
    
    100.00
    %
 Interest expense by deposit category was (in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Money fund savings and NOW accounts
    
    $
    11,142
    
    
    $
    15,338
    
    
    $
    20,241Savings accounts
    
    
    856
    
    
    
    1,362
    
    
    
    1,451Certificate accounts  below $100,000
    
    
    10,914
    
    
    
    24,177
    
    
    
    30,324Certificate accounts, $100,000 and above
    
    
    13,457
    
    
    
    22,140
    
    
    
    33,960Less early withdrawal penalty
    
    
    (180
    )
    
    
    (240
    )
    
    
    (308
    )Total
    
    $
    36,189
    
    
    $
    62,777
    
    
    $
    85,668
 F-34




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) At December 31, 2003, the amounts of scheduled maturities of certificate
accounts were (in thousands): For the Years Ended December 31,2004
    
    2005
    
    2006
    
    2007
    
    2008
    
    ThereafterLess than 2.00%
    
    $
    341,975
    
    
    $
    104,606
    
    
    $
    8,603
    
    
    $
    159
    
    
    $
    354
    
    
    $
    122.01% to 3.00%
    
    
    19,929
    
    
    
    51,992
    
    
    
    70,235
    
    
    
    1,583
    
    
    
    3,707
    
    
    
    3.01% to 4.00%
    
    
    7,885
    
    
    
    12,491
    
    
    
    1,571
    
    
    
    5,799
    
    
    
    17,399
    
    
    
    4014.01% to 5.00%
    
    
    36,667
    
    
    
    2,924
    
    
    
    7,755
    
    
    
    4,032
    
    
    
    1
    
    
    
    5.01% and greater
    
    
    67,607
    
    
    
    29,263
    
    
    
    3,057
    
    
    
    2,166
    
    
    
    289
    
    
    
    Total
    
    $
    474,063
    
    
    $
    201,276
    
    
    $
    91,221
    
    
    $
    13,739
    
    
    $
    21,750
    
    
    $
    413
 Time deposits of $100,000 and over had the following maturities (in
thousands): December 31,20033 months or less
    
    $
    94,3784 to 6 months
    
    
    45,8857 to 12 months
    
    
    75,049More than 12 months
    
    
    227,798Total
    
    $
    443,110
 Included in certificate accounts at December 31 was (in thousands): 2003
    
    2002Brokered deposits
    
    $
    145,559
    
    
    $
    37,857Public deposits
    
    
    180,241
    
    
    
    286,908Total institutional deposits
    
    $
    325,800
    
    
    $
    324,765
 Ryan Beck acted as principal dealer in obtaining $20.7 million and $22.9
million of the brokered deposits outstanding as of December 31, 2003 and 2002,
respectively. BankAtlantic has various relationships for obtaining brokered
deposits. These relationships are considered as an alternative source of
borrowings, when and if needed. At December 31, 2002, $33 million of ten and
fifteen year callable fixed rate time deposits with an average interest rate of
5.89% were included with brokered deposits. Callable interest rate swap
contracts were written to swap the 5.89% average fixed interest rate to a three
month LIBOR interest rate. The Company elected to account for the interest
rate swaps as fair value hedges (see Note 19). During 2003, BankAtlantic
called the deposits and terminated the interest rate swap contracts. F-35




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) 8. Advances from Federal Home Loan Bank and Federal Funds Purchased Advances from Federal Home Loan Bank (FHLB) (dollars in thousands): Payable During Year
    
    Year
    
    
    
    
    
    December 31,Ending December 31,
    
    Callable
    
    Interest Rate
    
    2003
    
    20022003
    
    
    
    
    
    5.39% to 7.25%
    
    $
    
    
    
    $
    145,6112004
    
    
    
    
    
    2.80% to 5.68%
    
    
    6,250
    
    
    
    128,7502005
    
    
    
    
    
    6.09% to 6.15%
    
    
    
    
    
    
    75,0002005
    
    
    
    
    
    
    1.86
    %
    
    
    17,500
    
    
    
    2006
    
    
    
    
    
    
    1.89
    %
    
    
    18,750
    
    
    
    2007
    
    
    
    
    
    
    5.68
    %
    
    
    25,000
    
    
    
    25,0002008
    
    
    
    
    
    5.32% to 5.67%
    
    
    492,000
    
    
    
    2010
    
    
    
    
    
    5.84% to 6.34%
    
    
    32,000
    
    
    
    32,000Total fixed rate advances
    
    
    
    
    
    
    
    
    
    
    591,500
    
    
    
    406,3612007
    
    
    2003
    
    
    1.69% to 1.93%
    
    
    
    
    
    
    122,5002008
    
    
    2003
    
    
    5.32% to 5.67%
    
    
    
    
    
    
    492,0002008
    
    
    2004
    
    
    
    1.31
    %
    
    
    25,000
    
    
    
    2011
    
    
    2004
    
    
    4.50% to 4.90%
    
    
    50,000
    
    
    
    50,0002011
    
    
    2005
    
    
    
    5.05
    
    
    
    30,000
    
    
    
    30,000Total callable fixed rate
advances - European
    
    
    
    
    
    
    
    
    
    
    105,000
    
    
    
    694,5002004
    
    
    2004
    
    
    
    5.47
    %
    
    
    
    
    
    
    10,0002009
    
    
    2004
    
    
    
    5.06
    %
    
    
    10,000
    
    
    
    10,0002010
    
    
    2003
    
    
    
    5.52
    %
    
    
    
    
    
    
    30,000Total callable fixed rate
advances - Bermuda
    
    
    
    
    
    
    
    
    
    
    10,000
    
    
    
    50,000Adjustable rate advances2003
    
    
    
    
    
    4.15% to 4.90%
    
    
    
    
    
    
    68,0002004
    
    
    
    
    
    1.17% to 1.40%
    
    
    50,000
    
    
    
    50,0002006
    
    
    
    
    
    1.18% to 5.46%
    
    
    25,000
    
    
    
    25,000Total adjustable rate advances
    
    
    
    
    
    
    
    
    
    
    75,000
    
    
    
    143,000Purchase accounting fair
value adjustments
    
    
    
    
    
    
    
    
    
    
    705
    
    
    
    3,309Total FHLB advances
    
    
    
    
    
    
    
    
    
    $
    782,205
    
    
    $
    1,297,170Average cost during period
    
    
    
    
    
    
    
    
    
    
    4.79
    %
    
    
    5.21
    %Average cost end of period
    
    
    
    
    
    
    
    
    
    
    4.67
    %
    
    
    4.83
    %
 European callable advances give the FHLB the option to reprice the advance
at a specific future date. Bermuda callable advances give the FHLB the option
to reprice the advance anytime from the call date until the payable date. Once
the FHLB exercises its call option, the Company has the option to convert to a
three month LIBOR-based floating rate advance, pay off the advance or convert
to another fixed rate advance. At December 31, 2003, $1.4 billion of 1-4 family residential loans, $252.1
million of commercial real estate loans and $328.5 million of consumer loans
were pledged against FHLB advances and an FHLB letter of credit securing public
deposits. In addition, FHLB stock is pledged as collateral for outstanding
FHLB advances. BankAtlantics line of credit with the FHLB is limited to 30% of assets,
subject to available collateral, with a maximum term of 10 years. On December 31, 2003, BankAtlantic pledged $12.4 million of consumer loans
to the Federal Reserve Bank of Atlanta (FRB) as collateral for potential
advances of $10.0 million. The FRB line of credit has not yet been utilized by
the Company. F-36




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) During the year ended December 31, 2003, the Company repaid $325 million
of fixed rate FHLB advances that would have matured within 24 months and
incurred a prepayment penalty of $10.9 million. The weighted average rate of
FHLB advances repaid was 5.57%. Federal Funds Purchased: BankAtlantic established $245.0 million of lines of credit with other
banking institutions for the purchase of federal funds. The following table
provides information on federal funds purchased at December 31, (dollars in
thousands): 2003
    
    2002
    
    2001Ending balance
    
    $
    
    
    
    $
    
    
    
    $
    61,000Maximum outstanding at any month end
within period
    
    $
    180,000
    
    
    $
    85,000
    
    
    $
    107,000Average amount outstanding during period
    
    $
    60,179
    
    
    $
    47,704
    
    
    $
    54,167Average cost during period
    
    
    1.29
    %
    
    
    1.85
    %
    
    
    3.86
    %
 9. Securities Sold Under Agreements to Repurchase Securities sold under agreements to repurchase represent transactions
whereby the Company sells a portion of its current investment portfolio
(usually MBSs and REMICs) at a negotiated rate and agrees to repurchase the
same assets on a specified future date. The Company issues repurchase
agreements to institutions and to its customers. These transactions are
collateralized by investment securities. Customer repurchase agreements are
not insured by the FDIC. At December 31, 2003 and 2002 the outstanding
balances of customer repurchase agreements were $138.8 million and $116.3
million, respectively. There were no repurchase agreements outstanding to
institutions at December 31, 2003 and 2002. The following table provides information on the agreements to repurchase
(dollars in thousands): For the Years Ended December 31,2003
    
    2002
    
    2001Maximum borrowing at any month-end within the period
    
    $
    365,042
    
    
    $
    540,880
    
    
    $
    714,121Average borrowing during the period
    
    $
    193,068
    
    
    $
    327,001
    
    
    $
    542,296Average interest cost during the period
    
    
    1.11
    %
    
    
    1.73
    %
    
    
    4.09
    %Average interest cost at end of the period
    
    
    0.73
    %
    
    
    1.08
    %
    
    
    1.52
    %
 F-37




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) The following table lists the amortized cost and estimated fair value of
securities sold under repurchase agreements, and the repurchase liability
associated with such transactions (dollars in thousands): WeightedEstimated
    
    
    
    
    
    AverageAmortized
    
    Fair
    
    Repurchase
    
    InterestDecember 31, 2003 (1)
    
    Cost
    
    Value
    
    Balance
    
    RateDecember 31, 2002 (1)Mortgage-backed securities
    
    $
    124,759
    
    
    $
    128,118
    
    
    $
    122,661
    
    
    
    0.73
    %REMIC
    
    
    16,846
    
    
    
    16,866
    
    
    
    16,148
    
    
    
    0.73Total
    
    $
    141,605
    
    
    $
    144,984
    
    
    $
    138,809
    
    
    
    0.73
    %December 31, 2002 (1)Mortgage-backed securities
    
    $
    113,494
    
    
    $
    117,317
    
    
    $
    109,690
    
    
    
    1.08
    %REMIC
    
    
    7,024
    
    
    
    7,047
    
    
    
    6,589
    
    
    
    1.08Total
    
    $
    120,518
    
    
    $
    124,364
    
    
    $
    116,279
    
    
    
    1.08
    %
  (1)
    
    At December 31, 2003 and 2002, all securities were
classified as available for sale and were recorded at fair
value in the consolidated statements of financial condition. All repurchase agreements existing at December 31, 2003 matured and were
repaid in January 2004. These securities were held by unrelated broker dealers. F-38




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued) 10. Subordinated Debentures, Other Debt, and Trust Preferred Securities The Company had the following subordinated debentures, notes and bonds
payable outstanding at December 31, 2003 and 2002 (in thousands): Issue
    
    December 31,
    
    Interest
    
    MaturityDate
    
    2003
    
    2002
    
    Rate
    
    DateBBC Borrowings5 5/8% convertible debentures (1)
    
    
    11/25/97
    
    
    $
    
    
    
    $
    46,042
    
    
    
    5.63
    %
    
    
    12/1/2007Bank line of credit
    
    
    8/24/00
    
    
    
    100
    
    
    
    16,100
    
    
    Prime -.50%
    
    
    9/1/2004Notes payable - retention plan
    
    
    6/28/02
    
    
    
    
    
    
    
    3,675
    
    
    
    5.75
    %
    
    
    6/28/2003Total BBC borrowings
    
    
    
    
    
    
    100
    
    
    
    65,817BankAtlantic BorrowingsSubordinated debentures (2)
    
    
    10/29/02
    
    
    
    22,000
    
    
    
    22,000
    
    
    LIBOR + 3.45%
    
    
    11/7/2012Development notes
    
     
   Various
    
    
    
    2,739
    
    
    
    
    
    
    Various%
    
    
    VariousMortgage-Backed Bond
    
    
    3/22/02
    
    
    
    10,954
    
    
    
    13,755
    
    
    
    (3
    )
    
    
    9/30/2013Total BankAtlantic Borrowings
    
    
    
    
    
    
    35,693
    
    
    
    35,755Levitt BorrowingsAcquisition Note
    
    
    9/15/00
    
    
    
    
    
    
    
    10,500
    
    
    Prime +1/2%
    
    
    9/1/2005Working Capital Line
    
    
    9/15/00
    
    
    
    
    
    
    
    3,500
    
    
    Prime +1%
    
    
    9/15/2004Development Bonds
    
    
    Various
    
    
    
    
    
    
    
    4,581
    
    
    Various%
    
    
    VariousWorking capital line of credit
    
    
    9/20/01
    
    
    
    
    
    
    
    112
    
    
    LIBOR +2.75%
    
    
    9/30/2003Acquisition and Development Notes
    
    
    Various
    
    
    
    
    
    
    
    70,802
    
    
    Various%
    
    
    VariousOther loans
    
    
    9/25/01
    
    
    
    
    
    
    
    445
    
    
    Various%
    
    
    VariousTotal Levitt borrowings
    
    
    
    
    
    
    
    
    
    
    89,940RB Holdings, Inc. BorrowingsNotes Payable
    
    
    4/26/02
    
    
    
    802
    
    
    
    2,304
    
    
    LIBOR + 2.65%
    
    
    5/1/2004Total debentures, notes and
bonds
    
    
    
    
    
    $
    36,595
    
    
    $
    193,816
  (1)
    
    Convertible at the option of the holder into shares of Class A common
stock at a conversion price of $11.25 per share.  (2)
    
    LIBOR interest rates are indexed to 3-month LIBOR and adjust
quarterly.  (3)
    
    The bonds adjust semi-annually to the ten year treasury constant
maturity rate minus 23 basis points. The Company had the following junior subordinated debentures outstanding
at December 31, 2003 (in thousands): BeginningOptionalIssue
    
    Outstanding
    
    Interest
    
    Maturity
    
    RedemptionJunior Subordinated Debentures
    
    Date
    
    Amount
    
    Rate
    
    Date
    
    DateSubordinated Debentures Trust II
    
    
    3/5/2002
    
    
    $
    57,088
    
    
    
    8.50
    %
    
    
    3/31/2032
    
    
    
    3/31/2007Subordinated Debentures Trust III
    
    
    6/26/2002
    
    
    
    25,774
    
    
    LIBOR + 3.45%
    
    
    6/26/2032
    
    
    
    6/26/2007Subordinated Debentures Trust IV
    
    
    9/26/2002
    
    
    
    25,774
    
    
    LIBOR + 3.40%
    
    
    9/26/2032
    
    
    
    9/26/2007Subordinated Debentures Trust V
    
    
    9/27/2002
    
    
    
    10,310
    
    
    LIBOR + 3.40%
    
    
    9/27/2032
    
    
    
    9/27/2007Subordinated Debentures Trust VI
    
    
    12/10/2002
    
    
    
    15,450
    
    
    LIBOR + 3.35%
    
    
    12/10/2032
    
    
    
    12/10/2007Subordinated Debentures Trust VII
    
    
    12/19/2002
    
    
    
    25,774
    
    
    LIBOR + 3.25%
    
    
    12/19/2032
    
    
    
    12/19/2007Subordinated Debentures Trust
VIII
    
    
    12/19/2002
    
    
    
    15,464
    
    
    LIBOR + 3.35%
    
    
    12/19/2032
    
    
    
    12/19/2007Subordinated Debentures Trust IX
    
    
    12/19/2002
    
    
    
    10,310
    
    
    LIBOR + 3.35%
    
    
    12/19/2032
    
    
    
    12/19/2007Subordinated Debentures Trust X
    
    
    3/26/2003
    
    
    
    51,548
    
    
    
    6.40 (2)
    %
    
    
    3/26/2033
    
    
    
    3/26/2008Subordinated Debentures Trust XI
    
    
    4/10/2003
    
    
    
    10,310
    
    
    
    6.45(2)
    %
    
    
    4/24/2033
    
    
    
    4/24/2008Subordinated Debentures Trust XII
    
    
    3/27/2003
    
    
    
    15,464
    
    
    
    6.65(2)
    %
    
    
    4/07/2033
    
    
    
    4/07/2008Total Subordinated Debentures
(1)
    
    
    
    
    
    $
    263,266
  (1)
    
    LIBOR interest rates are indexed to 3-month LIBOR and adjust quarterly. F-39




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)  (2)
    
    Adjusts to floating LIBOR rate five years from the issue date. The Company had the following trust preferred securities outstanding at
December 31, 2002 (in thousands): BeginningOptionalIssue
    
    Outstanding
    
    Interest
    
    Maturity
    
    RedemptionDate
    
    Amount
    
    Rate
    
    Date
    
    DateBBC Capital Trust II
    
    
    3/5/2002
    
    
    $
    55,375
    
    
    
    8.50
    %
    
    
    3/31/2032
    
    
    
    3/31/2007BBC Capital Trust III
    
    
    6/26/2002
    
    
    
    25,000
    
    
    LIBOR + 3.45 %
    
    
    6/26/2032
    
    
    
    6/26/2007BBC Capital Trust IV
    
    
    9/26/2002
    
    
    
    25,000
    
    
    LIBOR + 3.40 %
    
    
    9/26/2032
    
    
    
    9/26/2007BBC Capital Trust V
    
    
    9/27/2002
    
    
    
    10,000
    
    
    LIBOR + 3.40 %
    
    
    9/27/2032
    
    
    
    9/27/2007BBC Capital Trust VI
    
    
    12/10/2002
    
    
    
    15,000
    
    
    LIBOR + 3.35 %
    
    
    12/10/2032
    
    
    
    12/10/2007BBC Capital Trust VII
    
    
    12/19/2002
    
    
    
    25,000
    
    
    LIBOR + 3.25 %
    
    
    12/19/2032
    
    
    
    12/19/2007BBC Capital Trust VIII
    
    
    12/19/2002
    
    
    
    15,000
    
    
    LIBOR + 3.35 %
    
    
    12/19/2032
    
    
    
    12/19/2007BBC Capital Trust IX
    
    
    12/19/2002
    
    
    
    10,000
    
    
    LIBOR + 3.35 %
    
    
    12/19/2032
    
    
    
    12/19/2007Total Trust
Preferred Securities
(1)
    
    
    
    
    
    $
    180,375
  (1)
    
    LIBOR interest rates are indexed to 3-month LIBOR and adjust quarterly. Annual Maturities of Junior Subordinated Debentures and Other Debt
outstanding at December 31, 2003 are as follows (in thousands): Year EndingDecember 31,
    
    Amount2004
    
    $
    2,7852005
    
    
    2006
    
    
    8562007
    
    
    2008
    
    
    Thereafter
    
    
    296,220$
    299,861
 At December 31, 2003 and 2002, $7.6 million and $7.3 million,
respectively, of unamortized underwriting discounts and costs associated with
the issuance of subordinated debentures, trust preferred securities and other
debt were included in other assets in the Companys statements of financial
condition. Junior Subordinated Debentures and Trust Preferred Securities: The Company has formed eleven statutory business trusts (Trusts) for the
purpose of issuing Trust Preferred Securities (trust preferred securities)
and investing the proceeds thereof in junior subordinated debentures of the
Company. The trust preferred securities are fully and unconditionally
guaranteed by the Company. The Trusts used the proceeds from issuing trust
preferred securities and the issuance of its common securities to the Company
to purchase junior subordinated debentures from the Company. Interest on the
junior subordinated debentures and distributions on the trust preferred
securities are payable quarterly in arrears. Distributions on the trust
preferred securities are cumulative and are based upon the liquidation value of
the trust preferred security. The Company has the right, at any time, as long
as there are no continuing events of default, to defer payments of interest on
the junior subordinated debentures for a period not exceeding 20 consecutive
quarters; but not beyond the stated maturity of the junior subordinated
debentures. To date no interest has been deferred. The trust preferred
securities are subject to mandatory redemption, in whole or in part, upon
repayment of the junior subordinated debentures at maturity or their earlier
redemption. The Company has the right to redeem the junior subordinated
debentures five years from the issue date and also has the right to redeem the
junior subordinated debentures in whole (but not in part) within 180 days
following certain events, as defined, whether occurring before or after the
redemption date and therefore cause a mandatory redemption of the trust
preferred securities. The exercise of such right is subject to the Company
having received regulatory approval, if required under applicable capital
guidelines or regulatory policies. In addition, the Company has the right, at
any time, to shorten the maturity of the junior subordinated debentures to a
date not F-40




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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

earlier than the redemption date. Exercise of this right is also subject
to the Company having received regulatory approval, if required under
applicable capital guidelines or regulatory policies.

Prior to January 1, 2003, the Trusts were consolidated in the Companys
financial statements, with the trust preferred securities issued by the Trusts
reported as guaranteed preferred beneficial interests in Companys junior
subordinated debentures and the junior subordinated debentures were eliminated
in consolidation. Upon the implementation of FIN No. 46, as revised in
December 2003, the Trusts are no longer consolidated in the Companys financial
statements. As a consequence the Company reports its junior subordinated
debentures issued to the Trusts as liabilities and reports its investment in
the Trusts as investment in unconsolidated subsidiaries. The effect of the
implementation of Fin No. 46 on the Companys consolidated statement of
financial condition was to increase investment in unconsolidated subsidiaries
by $5.5 million, decrease guaranteed preferred beneficial interest in Companys
Junior Subordinated Debentures by $180.4 million and increase junior
subordinated debentures by $185.9 million. The effect of the implementation on
the Companys statement of operations was to increase income from
unconsolidated subsidiaries by $425,000 and increase interest expense by
$425,000.

During the year ended December 31, 2003, the Company participated in three
pooled trust preferred securities offerings in which an aggregate of $77.3
million of junior subordinated debentures were issued. The subordinated
debentures pay interest quarterly at fixed rates ranging from 6.40% to 6.65%
per annum until 2008, and thereafter at a floating rate equal to 3-month LIBOR
plus 315-325 basis points. The net proceeds to the Company from the
subordinated debentures offerings after the Companys investment in the related
Trusts, placement fees and expenses were approximately $74 million.

A portion of the net proceeds from the above junior subordinated debenture
issuance were used to redeem the Companys $45.8 million of 5.625% Convertible
Subordinated Debentures and pay down $16 million of borrowings under the
Companys credit facility with an unrelated financial institution. The Company
wrote off $732,000 of deferred offering costs and incurred a $916,000 call
premium upon retirement of the debentures.

During the year ended December 31, 2002, the Company participated in seven
pooled trust preferred securities offerings in which an aggregate of $125
million of trust preferred securities were issued. The trust preferred
securities pay interest quarterly at a floating rate equal to 3-month LIBOR
plus a spread and are redeemable five years from the issue date. The net
proceeds to the Company from the trust preferred securities offerings after
placement fees and expenses were approximately $121.1 million. Additionally,
in March 2002, the Company completed an underwritten public offering in which
the Companys wholly owned statutory trust (BBC Capital II) issued $55.4
million of trust preferred securities. These trust preferred securities pay
distributions quarterly at an 8.50% fixed rate. The net proceeds to the
Company from the publicly offered trust preferred securities after underwriting
discounts and expenses was approximately $53.3 million.

The Company used the proceeds from the above trust preferred securities
offerings to retire $74.8 million of 9.5% trust preferred securities, $21
million of 9% subordinated debentures, to fund a portion of BankAtlantics
purchase of Community, Levitts investment in Bluegreen and Ryan Becks
acquisition of certain assets and the assumption of certain liabilities of
Gruntal & Co., and for general corporate purposes. The Company wrote off $2.4
million of deferred offering costs associated with the retirement of the
debentures and trust preferred securities and incurred a $716,000 call premium
associated with the retirement of the debentures.

In August 2001, the Company called for redemption approximately $51
million in principal amount of its outstanding 6-3/4% convertible subordinated
debentures due 2006. At the redemption date of September 19, 2001, all but
approximately $251,000 of the 6-3/4% convertible debentures were converted by
holders into an aggregate of 8,919,649 shares of Class A common stock. The
debentures were convertible into Class A common stock at a conversion price of
$5.70.

BBC:

Revolving Credit Facility:

On August 24, 2000, the Company entered into a revolving credit facility
of $20 million from an independent financial institution. The credit facility
contains customary financial covenants relating to regulatory capital and
maintenance of certain loan loss reserves and is secured by the common stock of
BankAtlantic. On September 17, 2001 the maturity date

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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

of the credit facility was extended to September 2004, and the maximum
outstanding balance of the credit facility was increased from $20 million to
$30 million. In January 2004, the maturity date of the note was extended to
March 2005. The Company was in compliance with all loan covenants at December
31, 2003.

Notes Payable Retention Plan:

On June 28, 2002, the participants in the BankAtlantic Bancorp, Inc.
Deferred Compensation Plan relating to the acquisition of Ryan Beck vested in
their compensation awards and the Company elected to issue notes for 50% of the
award. The Company repaid the notes in May 2003.

BankAtlantic:

In connection with the acquisition of Community, BankAtlantic assumed a
$15.9 million mortgage-backed bond, valued at $14.3 million at the acquisition
date. The bond had a $11.0 million outstanding balance at December 31, 2003.
BankAtlantic pledged $20.4 million of residential loans as collateral for this
bond at December 31, 2003.

In October 2002, BankAtlantic issued $22 million of floating rate
subordinated debentures due 2012. The Subordinated Debentures pay interest
quarterly at a floating rate equal to 3-month LIBOR plus 345 basis points and
are redeemable after October 2007 at a price based upon then prevailing market
interest rates. The net proceeds have been used by BankAtlantic for general
corporate purposes. The subordinated debentures were issued by BankAtlantic in
a private transaction as part of a larger pooled securities offering. The
subordinated debentures currently qualify for inclusion in BankAtlantics total
risk based capital.

The development notes are the obligation of a real estate joint venture
that was acquired in connection with the acquisition of Community. The notes
are secured by construction of specific homes. The notes are with unrelated
financial institutions with interest rates ranging from prime plus .75% to
prime plus 1% with interest rate floors ranging from 5.00% to 5.75%. These
notes have maturity dates ranging from 2004 to 2006. BankAtlantics
wholly-owned subsidiary has a 50% interest in the real estate joint venture and
effective January 1, 2003, the joint venture was included in the Companys
consolidated financial statements upon the implementation of FIN No. 46.

Ryan Beck:

At December 31, 2003, Ryan Beck had a line of credit facility with an
unrelated financial institution in the amount of $10 million with an interest
rate of LIBOR plus 1.50%. The line expires on April 1, 2004, and is secured by
certificates of deposit (CDs) from Ryan Becks certificate of deposit
wholesale business. There were no amounts outstanding under this facility at
December 31, 2003.

During the year ended December 31, 2002, Ryan Beck borrowed $5.0 million
from BankAtlantic Bancorp, Inc. for general corporate purposes and repaid the
loan in September 2003. This intercompany loan was eliminated in
consolidation.

As part of the Gruntal transaction, Ryan Beck assumed a $3.4 million note
payable secured by leasehold improvements and equipment in nine branch
locations. The note bears interest at 3-month LIBOR plus 265 basis points and
matures on May 1, 2004. The outstanding balance of this note at December 31,
2003 and 2002 was $802,000 and $2.3 million, respectively.

Indentures

The Indentures relating to all of the Debentures (including those related
to the junior subordinated debentures) contain certain customary covenants
found in Indentures under the Trust Indenture Act, including covenants with
respect to the payment of principal and interest, maintenance of an office or
agency for administering the Debentures, holding of funds for payments on the
Debentures in trust, payment by the Company of taxes and other claims,
maintenance by the Company of its properties and its corporate existence and
delivery of annual certifications to the Trustee.

Levitt Corporation:

F-42



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Levitt acquisition and development loan obligations at December 31, 2002
were secured by land acquisitions, construction and development of various
communities located in Florida. The fixed rate loan totaled $13.0 million and
has an interest rate of 7.50% and a maturity date of May 2012. The variable
rate loans total $57.8 million and are indexed to the prime rate of interest
with maturity dates ranging from February 2003 to August 2007.

At December 31, 2002, Levitt had $4.6 million of development bonds
outstanding with fixed interest rates ranging from 5.88% to 6.50% with maturity
dates ranging from October 2004 to May 2009.

11. Restricted Stock, Common Stock and Common Stock Option Plans

Issuance of Class A Common Stock

In April 2003, the Company called for redemption approximately $45.8
million of 5.625% Convertible Subordinated Debentures due 2007. The
Convertible Subordinated Debentures were redeemed at a redemption price of 102%
of the principal amount plus accrued and unpaid interest through the redemption
date. During the period between the mailing of the notice of redemption and
the redemption, approximately $211,000 of Convertible Subordinated Debentures
were converted by holders into an aggregate of 18,754 shares of Class A Common
Stock.

During December 2001, the Company sold 6.9 million shares of its Class A
common stock in an underwritten public offering at a price of $8.25 per share.
The net proceeds after underwriting discounts and expenses were approximately
$53.5 million. The Company used the proceeds to fund a portion of the purchase
price to acquire Community.

On August 15, 2001, the Company called for redemption approximately $51
million in principal amount of its outstanding 6-3/4% Convertible
Subordinated Debentures due 2006. The 63/4% Convertible Debentures were
convertible into Class A common stock at $5.70 per share. At the redemption
date on September 19, 2001, all but approximately $251,000 of the 63/4%
Convertible Debentures were converted by holders into an aggregate of 8,919,649
shares of Class A common stock.

During July 2001, the Company sold 5.1 million shares of its Class A
common stock in an underwritten public offering at a price of $8.50 per share.
The net proceeds after underwriting discounts and expenses were approximately
$40.3 million and were used to redeem approximately $34.8 million of the
Companys subordinated investment notes and for general corporate purposes.

During the years ended December 31, 2003, 2002 and 2001, the Company
received net proceeds of $4.5 million, $1.2 million and $1.6 million,
respectively, from the exercise of stock options.

Restricted Stock:

During the years ended December 31, 2003, 2002 and 2001, the Company
issued 12,500, 1,500 and 196,500 shares, respectively, of restricted Class A
common stock to certain key employees of BankAtlantic. The restricted stock
vests over designated periods and had a fair market value of $148,000, $17,000
and $1.4 million on the issue dates, respectively. During the years ended
December 31, 2003, 2002 and 2001, 21,000, 21,000 and zero shares, respectively,
of restricted stock vested and 183,287 shares of restricted stock remain
outstanding.

In December 1998, the Company adopted a Restricted Stock Incentive Plan
(BankAtlantic Bancorp-Ryan Beck Restricted Stock Incentive Plan) to provide
additional incentives to officers and key employees of its subsidiary, Ryan
Beck. The Plan provided up to 862,500 shares of restricted Class A common
stock, of which not more than 287,500 shares may be granted to any one person.
The Plan allows the Board of Directors of the Company to impose an annual cap
on awards. The Board granted 16,287 shares of restricted Class A common stock
under this plan to key employees of Ryan Beck in 2001. The fair value of the
award at the grant date is recorded as compensation expense over the vesting
period. The restricted stock vests over designated periods and the shares
granted in 2001 had a fair market value of $100,000 at the grant date. During
the years ended December 31, 2003, 2002 and 2001, 33,760, zero and zero shares,
respectively, of restricted stock vested.

Retention Pool:

F-43



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

In connection with the acquisition of Ryan Beck in June 1998, the Company
established a retention pool covering certain key officers of Ryan Beck, under
which 785,866 shares of restricted Class A common stock (valued at $8.1
million at the acquisition date ) were issued to key employees. The shares
vested four years from the date of acquisition and are treated as compensation
expense. In January 2000, each participant in the retention pool was provided
the opportunity to exchange the restricted shares that were allocated to such
participant for a cash-based deferred compensation award in an amount equal to
the aggregate value at the date of the Ryan Beck acquisition. The deferred
compensation awards were granted under the BankAtlantic Bancorp, Inc. Deferred
Compensation Plan (Plan). On March 1, 2000, 749,533 shares of restricted
Class A common stock out of the 755,474 shares of restricted common stock
outstanding were retired in exchange for the establishment of interests in the
new plan in the aggregate amount of $7.8 million. All participant accounts
under the plan vested on June 28, 2002, and the remaining participants
received, in the aggregate, 5,941 shares of Class A common stock, and $3.8
million in cash and notes payable for an aggregate principal amount of $3.7
million. The notes payable had a 5.75% interest rate and were paid in full in
May 2003. Included in the Companys statement of operations during 2002 and
2001 was $1.0 million and $2.0 million, respectively, of compensation expense
associated with the Plan.

BankAtlantic Bancorp Stock Option Plans:

|                                            |  |                    |  |                |           |          |  |              |   |             |  |             |    |         |  |         |  |  |  | 
|------------------------------------------- |  | ------------------ |  | -------------- | --------- | -------- |  | ------------ | - | ----------- |  | ----------- | -- | ------- |  | ------- |  |  |  | 
|                                            |  | Stock Option Plans
|                                            |  |                   
|                                            |  | Maximum            |  | Shares         |           | Class of |  | Vesting      |   | Type of    
|                                            |  | Term (3)           |  | Authorized (6) |           | Stock    |  | Requirements |   | Options (5)
|                                            |  |                    |  |                |           |          |  |              |   |            
|1996 Stock Option Plan                      |  | 10 years           |  |                | 2,246,094 |          |  |              | A |             |  | 5 Years (1) |    | ISO, NQ
|1998 Ryan Beck Option Plan                  |  | 10 years           |  |                | 362,417   |          |  |              | A |             |  |             | (4 | )       |  | ISO, NQ
|1998 Stock Option Plan                      |  | 10 years           |  |                | 920,000   |          |  |              | A |             |  | 5 Years (1) |    | ISO, NQ
|1999 Non-qualifying Stock Option Plan       |  | 10 years           |  |                | 862,500   |          |  |              | A |             |  |             | (2 | )       |  | NQ     
|1999 Stock Option Plan                      |  | 10 years           |  |                | 862,500   |          |  |              | A |             |  |             | (2 | )       |  | ISO, NQ
|2000 Non-qualifying Stock Option Plan       |  | 10 years           |  |                | 1,704,148 |          |  |              | A |             |  | Immediately |    | NQ     
|2001 Amended and Restated Stock
Option Plan |  | 10 years           |  |                | 3,000,000 |          |  |              | A |             |  | 5 Years (1) |    | ISO, NQ



---

|(1) |  | Vesting is established by the Compensation Committee in
connection with each grant of options. All directors stock
options vest immediately.                                                                                                                                                                                                                                                          
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Options vest at the discretion of the Compensation Committee.                                                                                                                                                                                                                                                                                                                                          
|   
|(3) |  | All outstanding options must be exercised no later than 10
years after their grant date.                                                                                                                                                                                                                                                                                                               
|   
|(4) |  | Upon acquisition of Ryan Beck the Company assumed all options
outstanding under Ryan Becks existing stock option plans at
various exercise prices based upon the exercise prices of the
assumed option. No new options will be issued under the 1998 Ryan
Beck option plan and the plan will terminate when the outstanding
options are exercised or expire. The options vest ratably over
four years.
|   
|(5) |  | ISO - Incentive Stock Option                                                                                                                                                                                                                                                                                                                                                                           
|    |  | NQ - Non-qualifying Stock Option                                                                                                                                                                                                                                                                                                                                                                       
|   
|(6) |  | During 2001 shares underlying options available for grant under
all stock options plans except the 2001 stock option plan were
canceled. The Companys shareholders increased the number of shares
authorized under the 2001 stock option plan to 3,000,000 at the 2002
Annual Meeting.                                                                                                                

In January 2004, in connection with the Levitt spin-off and in accordance
with the terms of all the option plans, the Company adjusted the exercise price
and number of options granted for all options then outstanding in order to
restore the option holders intrinsic value. In addition, the shares
authorized under the 2001 Amended and Restated Stock Option Plan were adjusted
by the same ratio applied to each participant increasing such Plans authorized
shares to 3,918,891. The number of shares authorized under all other plans was
increased in the amount necessary to provide for the increased number of
options outstanding under such plans following the above-referenced adjustment.

Ryan Beck Stock Option Plan:

Ryan Becks Board of Directors adopted the Ryan Beck & Co., Inc. Option
Plan (the Plan) effective March 29, 2002. The Plan provides for the grant of
not more than an aggregate 510,000 options to acquire Ryan Beck common stock.
As of December 31, 2003, 8,125,000 shares of Ryan Beck common stock were
outstanding, all of which is owned by the Company.

In March 2002, Ryan Becks Board of Directors granted to certain
executives, pursuant to the Plan, options to acquire an aggregate of 385,000
shares of Ryan Beck common stock at an exercise price below fair value at the
date of grant ($4.80), all of which vested immediately. The Company recorded
$92,000 of compensation expense associated with the

F-44



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

issuance of these options in 2002. Additionally, in June 2002, 107,500
Ryan Beck options were granted with an exercise price equal to the fair value
at the date of grant ($5.04), all of which vest four years from the grant date.
During 2003, 25,000 Ryan Beck options were granted with an exercise price
equal to the fair value at the date of grant ($10.09), all of which vest four
years from the grant date. During 2003, 7,500 Ryan Beck options issued during
2003 were forfeited.

Upon exercise of the options, the Company or Ryan Beck has the right under

certain defined circumstances, starting six months plus one day after the
exercise date, to repurchase the common stock at fair value as determined by an
independent appraiser. The Company and Ryan Beck also have the right of first
refusal on any sale of Ryan Beck common stock issued as a result of the
exercise of an option, and the Company has the right to require any common
stockholder to sell its shares in the event that the Company sells its interest
in Ryan Beck.

A summary of the Companys Class A common stock option activity was:

|                                         |  |             |           |  
|---------------------------------------- |  | ----------- | --------- | -
|                                         |  | Class A    
|                                         |  | Outstanding
|                                         |  | Options    
|                                         |  |            
|Outstanding at December 31, 2000         |  |             | 5,490,386 |  
|Exercised                                |  |             | (361,085  | )
|Forfeited                                |  |             | (227,097  | )
|Issued                                   |  |             | 553,875   |  
|                                         |  |             |           |  
|Outstanding at December 31, 2001         |  |             | 5,456,079 |  
|Exercised                                |  |             | (269,428  | )
|Forfeited                                |  |             | (243,606  | )
|Issued                                   |  |             | 759,600   |  
|                                         |  |             |           |  
|Outstanding at December 31, 2002         |  |             | 5,702,645 |  
|Exercised                                |  |             | (996,305  | )
|Forfeited                                |  |             | (172,075  | )
|Issued                                   |  |             | 777,100   |  
|                                         |  |             |           |  
|Outstanding at December 31, 2003         |  |             | 5,311,365 |  
|                                         |  |             |           |  
|Available for grant at December 31, 2003 |  |             | 1,007,282 |  
|                                         |  |             |           |  

|                                                                     |  |                                  |      |      |  |      |      |  |  |   |      | 
|-------------------------------------------------------------------- |  | -------------------------------- | ---- | ---- |  | ---- | ---- |  |  | - | ---- | 
|                                                                     |  | For the Years Ended December 31,
|                                                                     |  |                                 
|                                                                     |  | 2003                             |      | 2002 |  | 2001
|                                                                     |  |                                  |      |      |  |     
|Weighted average exercise price of options outstanding at period end |  | $                                | 6.04 |      |  | $    | 5.44 |  |  | $ | 4.70 | 
|Weighted average exercise price of options exercised                 |  |                                  | 5.36 |      |  |      | 4.98 |  |  |   | 4.32 | 
|Weighted average price of options forfeited                          |  |                                  | 6.71 |      |  |      | 8.83 |  |  |   | 6.06 | 

In January 2004, the Compensation Committee adjusted all outstanding
options to acquire Class A common stock that were outstanding prior to the
Levitt spin-off to reflect the change in intrinsic value of the Companys Class
A common stock that resulted from the spin-off. The options were adjusted in
accordance with FASB Interpretation No. 44 whereby the aggregate intrinsic
value of the options immediately after the Levitt spin-off was adjusted to
equal the aggregate intrinsic value of the options immediately before the
Levitt spin-off and options were also adjusted so that the ratio of the
exercise price per share to the market value per share remained unchanged. The
option adjustment was accounted for as if the outstanding options prior to the
Levitt spin-off were cancelled and new options were issued at the adjusted
exercise price and number of shares. As a consequence of the above adjustments
the outstanding options increased from 5,311,365 to 6,938,247 and the weighted
average exercise price was reduced from $6.04 to $4.63 on January 6, 2004.

The method used to calculate the fair value of the options granted was the
Black-Scholes model with the following grant date fair values and assumptions:

F-45



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|        |      |         |  |            |         |          |  |                  |      |            |  |          |       |           |  |  |      |   |  |          |       |   |  |  |      |  
|------- | ---- | ------- |  | ---------- | ------- | -------- |  | ---------------- | ---- | ---------- |  | -------- | ----- | --------- |  |  | ---- | - |  | -------- | ----- | - |  |  | ---- | -
|        |      |         |  |            |         |          |  | Weighted Average
|        |      |         |  |            |         |          |  |                 
|        |      |         |  | Number of  |         |          |  |                  |      |            |  |          |       | Risk Free |  |  |      |   |  | Expected
|Year of |      | Options |  | Grant Date |         | Exercise |  | Interest         |      | Expected   |  | Dividend
|Grant   |      | Granted |  | Fair Value |         | Price    |  | Rate             |      | Volatility |  | Yield   
|        |      |         |  |            |         |          |  |                  |      |            |  |         
|        | 2001 |         |  |            | 553,875 |          |  | $                | 1.69 |            |  | $        | 3.94  |           |  |  | 5.04 | % |  |          | 50.00 | % |  |  | 3.00 | %
|        | 2002 |         |  |            | 759,600 |          |  | $                | 5.55 |            |  | $        | 11.18 |           |  |  | 4.65 | % |  |          | 47.00 | % |  |  | 1.04 | %
|        | 2003 |         |  |            | 777,100 |          |  | $                | 4.78 |            |  | $        | 9.73  |           |  |  | 3.34 | % |  |          | 50.00 | % |  |  | 1.27 | %

The employee turnover factor was 6.00% for officer incentive and
non-qualifying stock options during the year ended December 31, 2003. The
employee turnover factor was 1.00% for incentive and non-qualifying stock
options during the year ended December 31, 2002. The employee turnover factor
was 13.00% for incentive stock options and 1.50% for non-qualifying stock
options during the year ended December 31, 2001. The expected life for options
issued during 2003 and 2002 was 7.0 years, and the expected life for options
issued during 2001 was 7.5 years.

The following table summarizes information about fixed stock options
outstanding at December 31, 2003:

|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |         |           |  |           |           |       |   |      |  |  | 
|-------- | - | -------- |  | ----------------- |  | ---------------- | --------- | ------------------- | --------- | ------------------- |  | --------- | ----- | --------- | ---- | ------- | --------- |  | --------- | --------- | ----- | - | ---- |  |  | 
|         |   |          |  |                   |  |                  |           | Options Outstanding |           | Options Exercisable
|         |   |          |  |                   |  |                  |           |                     |           |                    
|         |   |          |  |                   |  |                  |           |                     |           |                     |  | Weighted- |       | Weighted- |      |         |           |  |           | Weighted-
|Class of |   | Range of |  |                   |  |                  |           | Average             |           | Average             |  |           |       |           |      | Average
|Common   |   | Exercise |  | Number            |  | Remaining        |           | Exercise            |           | Number              |  | Exercise 
|Stock    |   | Prices   |  | Outstanding       |  | Contractual Life |           | Price               |           | Exercisable         |  | Price    
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |          
|         | A |          |  | $  2.26 to   2.50 |  |                  | 1,281,013 |                     |           | .9 years            |  | $         | 2.29  |           |      |         | 1,281,013 |  |           | $         | 2.29  |  
|         | A |          |  | $  2.51 to   5.00 |  |                  | 1,197,158 |                     |           | 5.3 years           |  |           | 4.17  |           |      |         | 368,829   |  |           |           | 4.83  |  
|         | A |          |  | $  5.01 to   8.75 |  |                  | 1,341,835 |                     |           | 4.5 years           |  |           | 6.39  |           |      |         | 725,370   |  |           |           | 6.54  |  
|         | A |          |  | $8.76 to 12.23    |  |                  | 1,491,359 |                     |           | 8.7 years           |  |           | 10.44 |           |      |         | 82,995    |  |           |           | 10.95 |  
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |         |           |  |           |           |       |   |      | 
|         |   |          |  |                   |  |                  |           |                     | 5,311,365 |                     |  | 5.0 years |       | $         | 6.04 |         |           |  | 2,458,207 |           |       | $ | 4.22 | 
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |         |           |  |           |           |       |   |      | 

The following table summarizes information about fixed stock options
outstanding at December 31, 2002:

|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |  |           |  |           |           |       |   |      |  |  | 
|-------- | - | -------- |  | ----------------- |  | ---------------- | --------- | ------------------- | --------- | ------------------- |  | --------- | ----- | --------- | ---- |  | --------- |  | --------- | --------- | ----- | - | ---- |  |  | 
|         |   |          |  |                   |  |                  |           | Options Outstanding |           | Options Exercisable
|         |   |          |  |                   |  |                  |           |                     |           |                    
|         |   |          |  |                   |  |                  |           |                     |           |                     |  | Weighted- |       | Weighted- |      |  |           |  |           | Weighted-
|Class of |   | Range of |  | Number            |  | Average          |           | Average             |           | Number              |  | Average  
|Common   |   | Exercise |  | Outstanding       |  | Remaining        |           | Exercise            |           | Exercisable         |  | Exercise 
|Stock    |   | Prices   |  | at 12/31/02       |  | Contractual Life |           | Price               |           | at 12/31/02         |  | Price    
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |          
|         | A |          |  | $  2.26 to   2.50 |  |                  | 1,519,647 |                     |           | 1.8 years           |  | $         | 2.29  |           |      |  | 1,519,647 |  |           | $         | 2.29  |  
|         | A |          |  | $  2.51 to   5.00 |  |                  | 1,339,540 |                     |           | 6.1 years           |  |           | 4.21  |           |      |  | 473,164   |  |           |           | 4.84  |  
|         | A |          |  | $  5.01 to   8.75 |  |                  | 2,035,836 |                     |           | 5.5 years           |  |           | 6.37  |           |      |  | 754,075   |  |           |           | 6.36  |  
|         | A |          |  | $8.76 to 12.23    |  |                  | 807,622   |                     |           | 8.5 years           |  |           | 11.07 |           |      |  | 92,017    |  |           |           | 10.44 |  
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |  |           |  |           |           |       |   |      | 
|         |   |          |  |                   |  |                  |           |                     | 5,702,645 |                     |  | 5.1 years |       | $         | 5.44 |  |           |  | 2,838,903 |           |       | $ | 4.06 | 
|         |   |          |  |                   |  |                  |           |                     |           |                     |  |           |       |           |      |  |           |  |           |           |       |   |      | 

F-46



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The following table summarizes information about fixed stock options
outstanding at December 31, 2001:

|         |   |          |  |                 |  |                  |           |                     |           |                     |  |           |      |           |      |  |           |  |           |           |      |   |      |  |  | 
|-------- | - | -------- |  | --------------- |  | ---------------- | --------- | ------------------- | --------- | ------------------- |  | --------- | ---- | --------- | ---- |  | --------- |  | --------- | --------- | ---- | - | ---- |  |  | 
|         |   |          |  |                 |  |                  |           | Options Outstanding |           | Options Exercisable
|         |   |          |  |                 |  |                  |           |                     |           |                    
|         |   |          |  |                 |  |                  |           |                     |           |                     |  | Weighted- |      | Weighted- |      |  |           |  |           | Weighted-
|Class of |   | Range of |  | Number          |  | Average          |           | Average             |           | Number              |  | Average  
|Common   |   | Exercise |  | Outstanding     |  | Remaining        |           | Exercise            |           | Exercisable         |  | Exercise 
|Stock    |   | Prices   |  | at 12/31/02     |  | Contractual Life |           | Price               |           | at 12/31/01         |  | Price    
|         |   |          |  |                 |  |                  |           |                     |           |                     |  |          
|         | A |          |  | $  2.26 to 4.44 |  |                  | 2,474,742 |                     |           | 5.0 years           |  | $         | 2.89 |           |      |  | 1,597,866 |  |           | $         | 2.34 |  
|         | A |          |  | $  4.45 to 7.83 |  |                  | 2,684,066 |                     |           | 6.0 years           |  |           | 5.93 |           |      |  | 851,406   |  |           |           | 5.24 |  
|         | A |          |  | $7.84 to 12.23  |  |                  | 297,271   |                     |           | 5.3 years           |  |           | 8.71 |           |      |  | 105,459   |  |           |           | 9.35 |  
|         |   |          |  |                 |  |                  |           |                     |           |                     |  |           |      |           |      |  |           |  |           |           |      |   |      | 
|         |   |          |  |                 |  |                  |           |                     | 5,456,079 |                     |  | 5.5 years |      | $         | 4.70 |  |           |  | 2,554,731 |           |      | $ | 3.60 | 
|         |   |          |  |                 |  |                  |           |                     |           |                     |  |           |      |           |      |  |           |  |           |           |      |   |      | 

F-47



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

12. Income Taxes

The provision for income taxes consisted of (in thousands):

|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |        |  
|----------------------------------------------------- | ------- | - | -------------------------------- | ------ | ---- | - | ------ | ------ | - | - | ------ | ------ | -
|                                                      |         |   | For the Years Ended December 31,
|                                                      |         |   |                                 
|                                                      |         |   | 2003                             |        | 2002 |   | 2001  
|                                                      |         |   |                                  |        |      |   |       
|Continuing operations                                 |         | $ | 23,424                           |        |      | $ | 9,051  |        |   | $ | 17,960 |       
|Discontinued operations                               |         |   | 16,512                           |        |      |   | 6,825  |        |   |   | 4,640  |       
|Extraordinary items                                   |         |   |                                 |        |      |   | 2,771  |        |   |   |       |       
|Cumulative effect of a
change in
accounting principle |         |   |                                 |        |      |   | (1,246 | )      |   |   | 683    |       
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|Total provision for
income taxes                      |         | $ | 39,936                           |        |      | $ | 17,401 |        |   | $ | 23,283 |       
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|Continuing operations:                                |         |   |                                  |        |      |   |        |        |   |   |        |       
|Current:                                              |         |   |                                  |        |      |   |        |        |   |   |        |       
|                                                      | Federal |   | $                                | 15,555 |      |   | $      | 15,422 |   |   | $      | 19,488 |  
|                                                      | State   |   |                                  | 2,515  |      |   |        | 425    |   |   |        | 118    |  
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|                                                      |         |   | 18,070                           |        |      |   | 15,847 |        |   |   | 19,606 |       
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|Deferred:                                             |         |   |                                  |        |      |   |        |        |   |   |        |       
|                                                      | Federal |   |                                  | 6,429  |      |   |        | (6,094 | ) |   |        | (1,842 | )
|                                                      | State   |   |                                  | (1,075 | )    |   |        | (702   | ) |   |        | 196    |  
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|                                                      |         |   | 5,354                            |        |      |   | (6,796 | )      |   |   | (1,646 | )     
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       
|Provision for income taxes                            |         | $ | 23,424                           |        |      | $ | 9,051  |        |   | $ | 17,960 |       
|                                                      |         |   |                                  |        |      |   |        |        |   |   |        |       

The Companys actual provision for income taxes from continuing operations
differ from the Federal expected income tax provision as follows (in
thousands):

|                                                                |                                         |                                                             |                            |        |                                  |        |       |       |      |       |       |       |        |       |       |       |       |       |        |       |      |        |       |       |       |       |  
|--------------------------------------------------------------- | --------------------------------------- | ----------------------------------------------------------- | -------------------------- | ------ | -------------------------------- | ------ | ----- | ----- | ---- | ----- | ----- | ----- | ------ | ----- | ----- | ----- | ----- | ----- | ------ | ----- | ---- | ------ | ----- | ----- | ----- | ----- | -
|                                                                |                                         |                                                             |                            |        | For the Years Ended December 31,
|                                                                |                                         |                                                             |                            |        |                                 
|                                                                |                                         |                                                             |                            |        | 2003                             |        | 2002  |       | 2001
|                                                                |                                         |                                                             |                            |        |                                  |        |       |       |     
|Income tax provision at expected federal
income
tax rate of 35% |                                         | $                                                           | 21,707                     |        |                                  |        | 35.00 | %     |      | $     | 9,870 |       |        |       | 35.00 | %     |       | $     | 14,172 |       |      |        | 35.00 | %    
|                                                                | Increase (decrease) resulting from:     |                                                             |                            |        |                                  |        |       |       |      |       |       |       |        |       |       |       |       |       |        |       |      |        |       |       |      
|                                                                | Tax-exempt interest income              |                                                             |                            | (267   | )                                |        |       | (0.43 | )    |       |       | (275  | )      |       |       | (0.98 | )     |       |        | (165  | )    |        |       | (0.41 | )    
|                                                                |                                         | Provision (benefit) for state taxes,
net of federal benefit |                            |        | 2,104                            |        |       |       | 3.39 |       |       |       | (1,299 | )     |       |       | (4.61 | )     |        |       | (247 | )      |       |       | (0.61 | )    
|                                                                | Change in valuation allowance           |                                                             |                            | (1,168 | )                                |        |       | (1.88 | )    |       |       | 1,071 |        |       |       | 3.80  |       |       |        | 797   |      |        |       | 1.97  |      
|                                                                | Low income housing tax credits          |                                                             |                            | (555   | )                                |        |       | (0.89 | )    |       |       | (416  | )      |       |       | (1.48 | )     |       |        |      |      |        |       |      |      
|                                                                | Impairment and amortization of goodwill |                                                             |                            |       |                                  |        |       |      |      |       |       |      |        |       |       |      |       |       |        | 3,590 |      |        |       | 8.87  |      
|                                                                | Levitt spin-off nondeductible items     |                                                             |                            | 1,275  |                                  |        |       | 2.06  |      |       |       |      |        |       |       |      |       |       |        |      |      |        |       |      |      
|                                                                | Other  net                             |                                                             |                            | 328    |                                  |        |       | 0.52  |      |       |       | 100   |        |       |       | 0.36  |       |       |        | (187  | )    |        |       | (0.46 | )    
|                                                                |                                         |                                                             |                            |        |                                  |        |       |       |      |       |       |       |        |       |       |       |       |       |        |       |      |        |       |      
|                                                                |                                         |                                                             | Provision for income taxes |        | $                                | 23,424 |       |       |      | 37.77 | %     |       | $      | 9,051 |       |       |       | 32.09 | %      |       | $    | 17,960 |       |       |       | 44.36 | %
|                                                                |                                         |                                                             |                            |        |                                  |        |       |       |      |       |       |       |        |       |       |       |       |       |        |       |      |        |       |      

F-48



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and tax liabilities were (in thousands):

|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |         |        | 
|------------------------- | ----------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------- | - | -------------------------------- | ------ | ---- | - | ------- | ------ |  | - | ------- | ------ | 
|                          |                                                                               |                                                                                                                                                |   | For the Years Ended December 31,
|                          |                                                                               |                                                                                                                                                |   |                                 
|                          |                                                                               |                                                                                                                                                |   | 2003                             |        | 2002 |   | 2001   
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |        
|Deferred tax assets:      |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          |                                                                               | Provision for restructuring charges and write-downs                                                                                            |   | $                                | 294    |      |   | $       | 191    |  |   | $       | 404    | 
|                          |                                                                               | Allowance for loans, REO, tax certificate losses and other reserves, for
financial statement purposes                                          |   |                                  | 27,125 |      |   |         | 29,470 |  |   |         | 19,953 | 
|                          |                                                                               | Federal and State net operating loss carryforward                                                                                              |   |                                  | 2,661  |      |   |         | 5,003  |  |   |         | 3,410  | 
|                          |                                                                               | Compensation expensed for books and deferred for tax purposes                                                                                  |   |                                  | 3,754  |      |   |         | 3,915  |  |   |         | 3,147  | 
|                          |                                                                               | Goodwill impairment for books in excess of tax amortization                                                                                    |   |                                  |       |      |   |         | 1,086  |  |   |         |       | 
|                          |                                                                               | Real estate held for development and sale capitalized costs for tax purposes
in excess of amounts capitalized for financial statement purposes |   |                                  | 1,293  |      |   |         | 7,291  |  |   |         | 10,527 | 
|                          |                                                                               | Other                                                                                                                                          |   |                                  | 1,291  |      |   |         | 3,152  |  |   |         | 1,360  | 
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | Total gross deferred tax assets                                               |                                                                                                                                                |   | 36,418                           |        |      |   | 50,108  |        |  |   | 38,801  |       
|                          | Less valuation allowance                                                      |                                                                                                                                                |   | 2,470                            |        |      |   | 4,369   |        |  |   | 7,682   |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | Total deferred tax assets                                                     |                                                                                                                                                |   | 33,948                           |        |      |   | 45,739  |        |  |   | 31,119  |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|Deferred tax liabilities: |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          |                                                                               | Tax bad debt reserve in excess of base year reserve                                                                                            |   |                                  |       |      |   |         | 293    |  |   |         | 546    | 
|                          | Deferred loan income                                                          |                                                                                                                                                |   | 885                              |        |      |   | 918     |        |  |   | 688     |       
|                          | Change in investment of unconsolidated real estate subsidiary                 |                                                                                                                                                |   |                                 |        |      |   | 1,762   |        |  |   |        |       
|                          | Purchase accounting adjustments for bank acquisitions                         |                                                                                                                                                |   | 2,229                            |        |      |   | 1,356   |        |  |   |        |       
|                          |                                                                               | Accumulated other comprehensive income                                                                                                         |   |                                  | 3,297  |      |   |         | 2,278  |  |   |         | 8,555  | 
|                          |                                                                               | Prepaid pension expense                                                                                                                        |   |                                  | 2,607  |      |   |         |       |  |   |         | 2,618  | 
|                          |                                                                               | Other                                                                                                                                          |   |                                  | 1,931  |      |   |         | 3,816  |  |   |         | 833    | 
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | Total gross deferred tax liabilities                                          |                                                                                                                                                |   | 10,949                           |        |      |   | 10,423  |        |  |   | 13,240  |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | Net deferred tax asset                                                        |                                                                                                                                                |   | 22,999                           |        |      |   | 35,316  |        |  |   | 17,879  |       
|                          | Less net deferred tax asset at beginning of period                            |                                                                                                                                                |   | (35,316                          | )      |      |   | (17,879 | )      |  |   | (25,973 | )     
|                          | Acquired net deferred tax asset, net of valuation allowance                   |                                                                                                                                                |   |                                 |        |      |   | (8,175  | )      |  |   |        |       
|                          | Increase (decrease) in accumulated other comprehensive income                 |                                                                                                                                                |   | 1,019                            |        |      |   | (6,277  | )      |  |   | 7,497   |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | (Provision) benefit for deferred income taxes                                 |                                                                                                                                                |   | (11,298                          | )      |      |   | 2,985   |        |  |   | (597    | )     
|                          | Provision for deferred income taxes - discontinued operations                 |                                                                                                                                                |   | 4,073                            |        |      |   | 2,286   |        |  |   | 2,243   |       
|                          | Reduction in deferred tax asset associated with Levitt spin-off and GMS sale  |                                                                                                                                                |   | 1,871                            |        |      |   |        |        |  |   |        |       
|                          | Provision for deferred income taxes  - extraordinary item                     |                                                                                                                                                |   |                                 |        |      |   | 2,771   |        |  |   |        |       
|                          | Benefit for deferred income taxes - cumulative effect of an accounting
change |                                                                                                                                                |   |                                 |        |      |   | (1,246  | )      |  |   |        |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        
|                          | (Provision) benefit for deferred income taxes - continuing operations         |                                                                                                                                                | $ | (5,354                           | )      |      | $ | 6,796   |        |  | $ | 1,646   |       
|                          |                                                                               |                                                                                                                                                |   |                                  |        |      |   |         |        |  |   |        

Activity in the deferred tax valuation allowance was (in thousands):

|                                                               |  |                                  |        |      |  |      |        |   |  |   |       |  
|-------------------------------------------------------------- |  | -------------------------------- | ------ | ---- |  | ---- | ------ | - |  | - | ----- | -
|                                                               |  | For the Years Ended December 31,
|                                                               |  |                                 
|                                                               |  | 2003                             |        | 2002 |  | 2001
|                                                               |  |                                  |        |      |  |     
|Balance, beginning of period                                   |  | $                                | 4,369  |      |  | $    | 7,682  |   |  | $ | 7,331 |  
|Discontinued operations valuation allowance activity           |  |                                  | (418   | )    |  |      | (3,479 | ) |  |   | (323  | )
|Increase (reduction) in state deferred tax
valuation allowance |  |                                  | (1,168 | )    |  |      | 1,071  |   |  |   | 797   |  
|Other decreases and reclassifications                          |  |                                  | (313   | )    |  |      | (905   | ) |  |   | (123  | )
|                                                               |  |                                  |        |      |  |      |        |   |  |   |       |  
|Balance, end of period                                         |  | $                                | 2,470  |      |  | $    | 4,369  |   |  | $ | 7,682 |  
|                                                               |  |                                  |        |      |  |      |        |   |  |   |       |  

Except as discussed below, management believes that the Company will have
sufficient taxable income of the appropriate character in future years to
realize the net deferred income tax asset. In evaluating the expectation of
sufficient future taxable income, management considered the future reversal of
temporary differences and available tax planning

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

strategies that could be implemented, if required. A valuation allowance
was required at December 31, 2003, 2002 and 2001 as it was managements
assessment that, based on available information, it is more likely than not
that a portion of the deferred tax asset will not be realized. A change in the
valuation allowance occurs if there is a change in managements assessment of
the amount of the net deferred income tax asset that is expected to be
realized.

At December 31, 2003, the Company had State net operating loss
carryforwards (NOLs) and Federal NOLs of $50 million and $352,000,
respectively. The NOLs expire through the year 2017. Utilization of the
State NOL carryforward is restricted by State jurisdiction and management
believes that it is more likely than not that the State NOL will not be
realized.

Prior to December 31, 1996, BankAtlantic was permitted to deduct from
taxable income an allowance for bad debts which was in excess of the provision
for such losses charged to income. Accordingly, at December 31,
2003 the Company had $21.5 million of excess allowance for bad
debts for which no provision for income tax has been provided.
Included in this amount was $11.4 million of excess allowance acquired in
connection with the Community acquisition. If, in the future, this portion of retained earnings is
distributed, or BankAtlantic no longer qualifies as a bank for tax purposes,
federal income tax of approximately $7.5 million would be imposed.

13. Pension and 401(k) Plans

Pension Plan:

At December 31, 1998, the Company froze its defined benefit pension plan
(Plan). All participants in the Plan ceased accruing service benefits beyond
that date and became vested. The Company is subject to future pension expense
or income based on future actual plan returns and actuarial values of the Plan
obligations to employees.

The following tables set forth the Plans funded status and the minimum
pension liability or prepaid pension cost included in the consolidated
statements of financial condition at (in thousands):

|                                                          |  |              |        |      |  |   |        |  
|--------------------------------------------------------- |  | ------------ | ------ | ---- |  | - | ------ | -
|                                                          |  | December 31,
|                                                          |  |             
|                                                          |  | 2003         |        | 2002
|                                                          |  |              |        |     
|Projected benefit obligation at the beginning of
the year |  | $            | 22,276 |      |  | $ | 21,088 |  
|Interest cost                                             |  |              | 1,485  |      |  |   | 1,424  |  
|Actuarial loss                                            |  |              | 148    |      |  |   | 563    |  
|Benefits paid                                             |  |              | (815   | )    |  |   | (799   | )
|                                                          |  |              |        |      |  |   |        |  
|Projected benefit obligation at end of year               |  | $            | 23,094 |      |  | $ | 22,276 |  
|                                                          |  |              |        |      |  |   |        |  

|                                                   |  |              |        |      |  |   |        |  
|-------------------------------------------------- |  | ------------ | ------ | ---- |  | - | ------ | -
|                                                   |  | December 31,
|                                                   |  |             
|                                                   |  | 2003         |        | 2002
|                                                   |  |              |        |     
|Fair value of Plan assets at the beginning of year |  | $            | 17,860 |      |  | $ | 24,566 |  
|Actual return on Plan assets                       |  |              | 6,132  |      |  |   | (5,907 | )
|Employer contribution                              |  |              | 750    |      |  |   |       |  
|Benefits paid                                      |  |              | (815   | )    |  |   | (799   | )
|                                                   |  |              |        |      |  |   |        |  
|Fair value of Plan assets as of actuarial date     |  | $            | 23,927 |      |  | $ | 17,860 |  
|                                                   |  |              |        |      |  |   |        |  

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                                                                             |  |              |         |      |  |   |         |  
|------------------------------------------------------------------------------------------------------------ |  | ------------ | ------- | ---- |  | - | ------- | -
|                                                                                                             |  | December 31,
|                                                                                                             |  |             
|                                                                                                             |  | 2003         |         | 2002
|                                                                                                             |  |              |         |     
|Actuarial present value of projected benefit obligation
for service
Rendered to date                         |  | $            | (23,094 | )    |  | $ | (22,276 | )
|Plan assets at fair value as of the actuarial date                                                           |  |              | 23,927  |      |  |   | 17,860  |  
|                                                                                                             |  |              |         |      |  |   |         |  
|(Unfunded) funded accumulated benefit obligation (1)                                                         |  |              | 833     |      |  |   | (4,416  | )
|Unrecognized net loss from past experience different from
that assumed and effects of changes in assumptions |  |              | 5,924   |      |  |   | 11,650  |  
|                                                                                                             |  |              |         |      |  |   |         |  
|Prepaid pension cost (2)                                                                                     |  | $            | 6,757   |      |  | $ | 7,234   |  
|                                                                                                             |  |              |         |      |  |   |         |  



| | (1) |  | The measurement date for the accumulated benefit obligation was
December 31, 2003 and 2002. The December 31, 2002 unfunded
accumulated benefit obligation was recorded in other liabilities in
the Companys consolidated statement of financial condition.
| | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (2) |  | The December 31, 2003 prepaid pension cost was recorded in
other assets in the Companys consolidated statement of financial
condition.                                                                                                                    

For the year ended December 31, 2002, the Company recorded a minimum
pension liability in other comprehensive income associated with the unfunded
accumulated benefit obligation as follows (in thousands):

|                                                  |  |        |        |  
|------------------------------------------------- |  | ------ | ------ | -
|                                                  |  | Amount
|                                                  |  |       
|Change in prepaid pension cost in other assets    |  | $      | (7,234 | )
|Minimum pension liability in other liabilities    |  |        | (4,416 | )
|Change in deferred tax assets                     |  |        | 4,194  |  
|                                                  |  |        |        |  
|Increase (decrease) in other comprehensive income |  | $      | (7,456 | )
|                                                  |  |        |        |  

Net pension expense (benefit) includes the following components (in thousands):

|                                                  |  |                                  |        |      |  |      |        |   |  |   |        |  
|------------------------------------------------- |  | -------------------------------- | ------ | ---- |  | ---- | ------ | - |  | - | ------ | -
|                                                  |  | For the Years Ended December 31,
|                                                  |  |                                 
|                                                  |  | 2003                             |        | 2002 |  | 2001
|                                                  |  |                                  |        |      |  |     
|Service cost benefits earned during the period    |  | $                                |       |      |  | $    |       |   |  | $ |       |  
|Interest cost on projected benefit obligation     |  |                                  | 1,485  |      |  |      | 1,424  |   |  |   | 1,429  |  
|Expected return on plan assets                    |  |                                  | (1,470 | )    |  |      | (1,989 | ) |  |   | (2,381 | )
|Amortization of unrecognized net gains and
losses |  |                                  | 1,212  |      |  |      | 314    |   |  |   |       |  
|                                                  |  |                                  |        |      |  |      |        |   |  |   |        |  
|Net periodic pension expense (benefit) (1)        |  | $                                | 1,227  |      |  | $    | (251   | ) |  | $ | (952   | )
|                                                  |  |                                  |        |      |  |      |        |   |  |   |        |  



| | (1) |  | Periodic pension expense (benefit) is included as an
increase/decrease in compensation expense.
| | --- |  | -----------------------------------------------------------------------------------------------

The actuarial assumptions used in accounting for the Plan were:

|                                               |  |                     |      |      |  |      |      |   |  |  |      |  
|---------------------------------------------- |  | ------------------- | ---- | ---- |  | ---- | ---- | - |  |  | ---- | -
|                                               |  | For the Years Ended
|                                               |  | December 31,       
|                                               |  |                    
|                                               |  | 2003                |      | 2002 |  | 2001
|                                               |  |                     |      |      |  |     
|Weighted average discount rate                 |  |                     | 6.75 | %    |  |      | 6.75 | % |  |  | 7.25 | %
|Rate of increase in future
compensation levels |  |                     | N/A  |      |  |      | N/A  |   |  |  | N/A  |  
|Expected long-term rate of return              |  |                     | 8.50 | %    |  |      | 9.00 | % |  |  | 9.00 | %

Actuarial estimates and assumptions are based on various market factors
and are evaluated on an annual basis, and changes in such assumptions may
impact future pension costs. Current participant data was used for the
actuarial assumptions for each of the three years ended December 31, 2003. The
Company contributed $750,000 to the Plan during the year ended December 31,
2003. The Company did not make any contributions to the Plan during the years
ended

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

December 31, 2002 and 2001. The Company will not be required to
contribute to the Plan for the year ending December 31, 2004.

The Companys pension plan weighted-average asset allocations at December
31, 2003 and 2002 by asset category are as follows:

|                  |  |                 |        |      |  |  |        |  
|----------------- |  | --------------- | ------ | ---- |  |  | ------ | -
|                  |  | Plan Assets    
|                  |  | At December 31,
|                  |  |                
|                  |  | 2003            |        | 2002
|                  |  |                 |        |     
|Equity securities |  |                 | 57.45  | %    |  |  | 71.16  | %
|Debt securities   |  |                 | 38.13  |      |  |  | 27.70  |  
|Cash              |  |                 | 4.42   |      |  |  | 1.14   |  
|                  |  |                 |        |      |  |  |        |  
|Total             |  |                 | 100.00 | %    |  |  | 100.00 | %
|                  |  |                 |        |      |  |  |        |  

The Plans investment policies and strategies are to invest in mutual
funds that are rated with at least a 3-star rating awarded by Morningstar at
the initial purchase. If a funds Morningstar rating falls below a 3-star
rating after an initial purchase, it is closely monitored to ensure that its
under performance can be attributed to market conditions rather than management
deficiencies. Management changes or changes in fund objectives could be cause
for replacement of any mutual fund. The Plan also maintains an aggressive
growth investment category which includes investments in equity securities and
mutual funds. Both public and private securities are eligible for this
category of investment, but no more than 5% of total Plan assets at the time of
the initial investment may be invested in any one company. Beyond the initial
cost limitation (5% at time of purchase), there will be no limitation as to the
percentage that any one investment can represent if it is achieved through
growth. As a means to reduce negative market volatility, and to invoke a sell
discipline for concentrated positions, the Plan has a strategy of selling call
options against certain stock positions within the portfolio when considered
timely. At December 31, 2003, 16% of the Plans assets were invested in the
aggressive growth category.

The Plans targeted asset allocation is 72% equity securities, 25% debt
securities and 3% cash during the year ended December 31, 2004. A rebalancing
of the portfolio takes place on a quarterly basis when there has been a 5% or
greater change from the prevailing benchmark allocation.

The following benefit payments, which reflect expected future service, as
appropriate, are expected to be paid (in thousands):

|                |      |  |       |     | 
|--------------- | ---- |  | ----- | --- | 
|                | 2004 |  | $     | 830 | 
|                | 2005 |  |       | 856 | 
|                | 2006 |  |       | 909 | 
|                | 2007 |  |       | 941 | 
|                | 2008 |  |       | 977 | 
|Years 2009-2013 |      |  | 7,023 |    

There are large increases in annual benefit payouts expected in 2009 and
2010 when four key employees reach normal retirement age.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

401(k) Plan:

The table below outlines the terms of the Companys Security Plus 401(k)
Plan and the associated employer costs (dollars in thousands):

|                                       |  |                                  |       |           |  |             |       |   |  |   |       |  
|-------------------------------------- |  | -------------------------------- | ----- | --------- |  | ----------- | ----- | - |  | - | ----- | -
|                                       |  | For the Years Ended December 31,
|                                       |  |                                 
|                                       |  | 2003                             |       | 2002      |  | 2001       
|                                       |  |                                  |       |           |  |            
|Employee Salary Contribution Limit
(1) |  | $                                | 12.0  |           |  | $           | 11.0  |   |  | $ | 10.5  |  
|Percentage of Salary Limitation (2)    |  |                                  | 75    | %         |  |             | 75    | % |  |   | 20    | %
|Employer Match Contribution (3)        |  | $                                | 1,558 |           |  | $           | 1,800 |   |  | $ | 1,500 |  
|Vesting of Employer Match              |  | Immediate                        |       | Immediate |  | 5 years (4)



| | (1) |  | For the 2003 and 2002 plan year, employees over the age of 50 were
entitled to contribute $14,000 and $12,000, respectively.                                                                                                                             
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (2) |  | Highly compensated employees were limited to a maximum contribution
of 7% of salary during the 2001 plan year.                                                                                                                                           
|
| | (3) |  | During the 2003 and 2002 plan year, the employer matched 100% of the
first 3% of employee contributions and 50% of the next 2% of employee
contributions. During the 2001 plan year, the employer matched 100% of
the first 4% of employee contributions.
|
| | (4) |  | The vesting period is pro-rata over 5 years from the date of hire.                                                                                                                                                                                       

BankAtlantic Profit Sharing Plan

At January 1, 2003, BankAtlantic established the BankAtlantic Profit
Sharing Stretch Plan (the Plan) for all employees of BankAtlantic and its
subsidiaries. The profit sharing awards are paid in cash quarterly and are
based on achieving specific profitability and loan and deposit growth goals.
Included in compensation expense during the year ended December 31, 2003 was
$3.6 million of expenses associated with the Plan.

Ryan Beck Plans:

As of December 31, 2003, Ryan Beck maintains one retirement plan for
eligible employees, the 401(k) Savings Plan. In 2002 and 2001 Ryan Beck
maintained two retirement plans for eligible employees, the 401(k) Savings Plan
and the Money Purchase Pension Plan.

Ryan Beck maintained a nonvoluntary Money Purchase Pension Plan to which
Ryan Beck contributed 5% of an employees eligible earnings, subject to certain
limitations in 2002. Contributions to the Ryan Beck Money Purchase Pension
Plan totaled $729,000 and $1.4 million during the years ended December 31, 2002
and 2001, respectively. Ryan Beck contributed 8% of an employees eligible
earnings, subject to certain limitations during the year ended December 31,
2001. The Ryan Beck Money Purchase Pension Plan was liquidated into the Ryan
Beck 401(k) Savings Plan during 2003.

Ryan Becks employees may contribute up to 12% of their eligible earnings,
subject to certain limitations, to the 401(k) Savings Plan. For the period
January 1, 2001 to March 2001, Ryan Beck matched dollar-for-dollar the first 4%
of contributions for salaried employees and the first 2.5% for financial
consultants. Effective April 1, 2001, Ryan Beck suspended the matching
contributions to its 401(k) Savings Plan. In 2003, Ryan Beck matched 50% on
the first 6% of contributions for salaried employees. Additionally, Ryan Beck
awarded an additional 1% of contributions for salaried employees as a
discretionary match during 2003. Included in employee compensation and benefits
on the consolidated statement of operations was $332,420, $0, and $224,000 of
expenses and employer contributions related to the 401(k) Savings Plan during
the years ended December 31, 2003, 2002 and 2001, respectively.

During the year ended December 31, 2002, Ryan Beck instituted the Ryan
Beck & Co., Inc. Voluntary Deferred Compensation Plan for certain employees
whereby the employee can elect to defer a portion of his or her compensation
for a minimum of 3 years or until retirement. These contributions are fully
vested. The obligations under the terms of this plan are not required to be
funded. The obligations are unsecured general obligations to pay, in the
future, the value of the deferred compensation, adjusted to reflect the
performance of selected measurement options chosen by each participant. In
2003, the

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

former Gruntal Deferred Compensation Plan was merged into this plan. At
December 31, 2003 and 2002 the deferred compensation obligation payable under
this plan totaled $13.8 million and $9.7 million, respectively.

During 2002, Ryan Beck amended the Ryan Beck & Co., Inc. Supplemental
Bonus Plan in which a bonus account was established for $1.5 million. The
bonus account will amortize into compensation expense pro-rata over a four year
period. The bonus account vests and is payable 25% per year on the first
business day in January 2004 through 2007.

In connection with the Gruntal transaction, a nonqualified deferred
compensation plan was assumed by Ryan Beck covering select employees of
Gruntal. Gruntal provided an annual matching contribution and, in some cases,
special allocations, both of which would vest if the employee remained employed
for ten years from the plan year for which contributions were made. The
obligations were not required to be funded and were unsecured general
obligations to pay, in the future, the value of the deferred compensation,
adjusted to reflect the performance of selected investment measurement options
chosen by each participant during the deferral period. On April 26, 2002, Ryan
Beck froze the plan, and participants could no longer continue to make
contributions and related matches ceased. In August 2002, Ryan Beck allowed
the participants in the plan to elect to withdraw their vested benefits upon
forfeiting their unvested benefits. During September 2002, $15.9 million of
Ryan Becks mutual fund investments assigned to the plan were withdrawn,
resulting in a $2.5 million realized loss included in income from investment
banking activity in the statement of operations. All unvested amounts will
vest no later than 2011. During the year ended December 31, 2003, Ryan Beck
realized compensation expense of $3.0 million associated with the increase in
the nonqualified deferred compensation plan obligation. During the year ended
December 31, 2002, Ryan Beck realized a $1.5 million reduction in compensation
expense associated with the decrease in the plan obligation.

In July 2002, Ryan Beck established a retention plan for certain Gruntal
financial consultants, key employees and others. Pursuant to the retention
plan, the participants were granted a length of service award and a retention
award in forgivable notes in the aggregate amounts of $900,000 and $11.0
million, respectively. The participants received forgivable notes of $5.7
million, $2.9 million and $2.4 million in July 2002, February 2003 and January
2004, respectively. Each forgivable note will have a term of five years. A
pro-rata portion of the principal amount of the note is forgiven each month
over the five year term. If a participant terminates employment with Ryan Beck
prior to the end of the term of the Note, the outstanding balance becomes
immediately due to Ryan Beck.

Included in other assets at December 31, 2003 and 2002 were $15.1 million
and $14.8 million, respectively, of forgivable notes receivable to certain
employees of Ryan Beck. These notes receivable are forgivable loans and are
amortized over a five-year period from the date of the notes. Included in
compensation expense for the year ended December 31, 2003 and 2002 was $4.9
million and $3.7 million, respectively, of forgivable note receivable
amortization.

14. Commitments and Contingencies

The Company is a lessee under various operating leases for real estate and
equipment extending to the year 2072. The approximate minimum future rentals
under such leases, at December 31, 2003, for the periods shown were (in
thousands):

|                         |       |        |        |        | 
|------------------------ | ----- | ------ | ------ | ------ | 
|Year Ending December 31, |       | Amount
|                         |       |       
|2004                     |       | $      | 12,476 |       
|2005                     |       |        | 11,012 |       
|2006                     |       |        | 9,094  |       
|2007                     |       |        | 6,758  |       
|2008                     |       |        | 4,845  |       
|Thereafter               |       |        | 10,362 |       
|                         |       |        |        |       
|                         | Total |        | $      | 54,547 | 
|                         |       |        |        |       

|                                          |  |                                  |        |      |  |      |        |  |  |   |        | 
|----------------------------------------- |  | -------------------------------- | ------ | ---- |  | ---- | ------ |  |  | - | ------ | 
|                                          |  | For the Years Ended December 31,
|                                          |  |                                 
|                                          |  | 2003                             |        | 2002 |  | 2001
|                                          |  |                                  |        |      |  |     
|Rental expense for
premises and equipment |  | $                                | 17,697 |      |  | $    | 16,327 |  |  | $ | 10,315 | 
|                                          |  |                                  |        |      |  |      |        |  |  |   |        | 

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

At December 31, 2003, BankAtlantic leased 85 ATMs located in BankAtlantic
branch locations, cruise ships and various retail outlets.

In the normal course of its business, the Company is a party to financial
instruments with off-balance-sheet risk. These financial instruments include
commitments to extend credit and to issue standby and documentary letters of
credit. Those instruments involve, to varying degrees, elements of credit risk.
BankAtlantics exposure to credit loss in the event of nonperformance by the
other party to the financial instrument for commitments to extend credit and
standby letters of credit written is represented by the contractual amount of
those instruments. BankAtlantic uses the same credit policies in making
commitments and conditional obligations as it does for on-balance-sheet
instruments.

Financial instruments with off-balance sheet risk were (in thousands):

|                                                                                    |  |              |           |      |  |   |           | 
|----------------------------------------------------------------------------------- |  | ------------ | --------- | ---- |  | - | --------- | 
|                                                                                    |  | December 31,
|                                                                                    |  |             
|                                                                                    |  | 2003         |           | 2002
|                                                                                    |  |              |           |     
|Commitments to sell fixed rate residential loans                                    |  | $            | 12,962    |      |  | $ | 88        | 
|Commitments to sell variable rate residential loans                                 |  |              | 3,740     |      |  |   |          | 
|Forward contract to purchase mortgage-backed
securities                             |  |              | 8,611     |      |  |   | 39,128    | 
|Commitments to purchase other investment securities                                 |  |              |          |      |  |   | 200       | 
|Commitments to purchase fixed rate residential loans                                |  |              | 40,242    |      |  |   |          | 
|Commitments to purchase variable rate residential
loans                             |  |              | 3,500     |      |  |   | 300,643   | 
|Commitments to extend credit, including the
undisbursed
portion of loans in process |  |              | 1,418,809 |      |  |   | 1,126,384 | 
|Standby letters of credit                                                           |  |              | 31,722    |      |  |   | 35,927    | 
|Commercial lines of credit                                                          |  |              | 162,623   |      |  |   | 209,708   | 

Commitments to extend credit are agreements to lend funds to a customer as
long as there is no violation of any condition established in the commitment.
Commitments generally have fixed expiration dates or other termination clauses
and may require payment of a fee. Since many of the commitments are expected to
expire without being drawn upon, the total commitment amounts do not
necessarily represent future cash requirements. BankAtlantic has $16.8 million
of commitments to extend credit at a fixed interest rate and $1.4 billion of
commitments to extend credit at a variable rate. BankAtlantic evaluates each
customers creditworthiness on a case-by-case basis. The amount of collateral
required by BankAtlantic in connection with an extension of credit is based on
managements credit evaluation of the counter-party.

Standby letters of credit are conditional commitments issued by
BankAtlantic to guarantee the performance of a customer to a third party.
BankAtlantic standby letters of credit are generally issued to customers in the
construction industry guaranteeing project performance. These types of standby
letters of credit had a maximum exposure of $26.1 million at December 31, 2003.
BankAtlantic also issues standby letters of credit to commercial lending
customers guaranteeing the payment of goods and services. These types of
standby letters of credit had a maximum exposure of $5.6 million at December
31, 2003. Those guarantees are primarily issued to support public and private
borrowing arrangements and have maturities of one year or less. The credit
risk involved in issuing letters of credit is essentially the same as that
involved in extending loan facilities to customers. BankAtlantic may hold
certificates of deposit and residential and commercial liens as collateral for
such commitments which are collateralized similar to other types of borrowings.
Included in other liabilities at December 31, 2003 was $110,000 of unearned
guarantee fees.

BankAtlantic is required to maintain reserve balances with the Federal
Reserve Bank. Such reserves consisted of cash and amounts due from banks of
$50.1 million and $60.2 million at December 31, 2003 and 2002, respectively.

As a member of the FHLB system, BankAtlantic is required to purchase and
hold stock in the FHLB of Atlanta. As of December 31, 2003 BankAtlantic was in
compliance with this requirement, with an investment of approximately $40.3
million in stock of the FHLB of Atlanta.

The Company, through its ownership of Ryan Beck, is subject to the risks
of investment banking. Ryan Becks customers securities transactions are
introduced on a fully disclosed basis to its clearing broker. The clearing
broker carries all of the accounts of the customers of Ryan Beck and is
responsible for execution, collection and payment of funds, and receipt and
delivery of securities relative to customer transactions. Customers
securities activities are transacted on a cash and margin basis. These
transactions may expose Ryan Beck to off-balance-sheet risk, wherein the
clearing broker may

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

charge Ryan Beck for any losses it incurs in the event that customers may
be unable to fulfill their contractual commitments and margin requirements are
not sufficient to fully cover losses. Ryan Beck seeks to minimize this risk
through procedures designed to monitor the creditworthiness of its customers
and ensure that customer transactions are executed properly by the clearing
broker.

Ryan Beck, in its capacity as a market-maker and dealer in corporate and
municipal fixed-income and equity securities, may enter into transactions in a
variety of cash and derivative financial instruments in order to facilitate
customer order flow and hedge market risk exposures. These financial
instruments include securities sold, but not yet purchased and future
contracts. Securities sold, but not yet purchased represent obligations of the
Company to deliver specified financial instruments at contracted prices,
thereby creating a liability to purchase the financial instrument in the market
at prevailing prices. Accordingly, these transactions result in
off-balance-sheet risk as the Companys ultimate obligation may exceed the
amount recognized in the Consolidated Statement of Financial Condition.

15. Regulatory Matters

The Company is a unitary savings bank holding company subject to
regulatory oversight and examination by the Office of Thrift Supervision
(OTS), including normal supervision and reporting requirements. The Company
is also subject to the reporting and other requirements of the Securities
Exchange Act of 1934. In addition, BFC owns 8,296,890 shares of Class A common
stock and 100% of Class B common stock which amounts to 22% of the Companys
outstanding common stock. BFC is subject to the same oversight by the OTS as
discussed herein with respect to the Company.

BankAtlantics deposits are insured by the FDIC for up to $100,000 for
each insured account holder, the maximum amount currently permitted by law.
BankAtlantic is subject to various regulatory capital requirements administered
by the federal banking agencies. Failure to meet minimum capital requirements
can cause regulators to initiate certain mandatory and possibly additional
discretionary actions by regulators that, if undertaken, could have a direct
material effect on BankAtlantics financial statements. At December 31, 2003,
BankAtlantic met all capital adequacy requirements to which it is subject and
was considered a well capitalized institution.

The OTS imposes limits applicable to the payment of cash dividends by
BankAtlantic to the Company which are based on an institutions regulatory
capital levels. BankAtlantic is permitted to pay capital distributions during
a calendar year that do not exceed its net income for the year plus its
retained net income for the prior two years, without notice to, or the approval
of, the OTS. At December 31, 2003, this capital distribution limitation was
$67.5 million.

Ryan Beck has not paid dividends to the Company, although, subject to
regulatory and capital requirements, it may do so in the future.

Bank Atlantics actual capital amounts and ratios are presented in the
table (dollars in thousands):

|                          |  |        |         |                   |  |                  |       |       |  |             |         |                  |  |  |      |   |  |   |         |  |  |  |       |  
|------------------------- |  | ------ | ------- | ----------------- |  | ---------------- | ----- | ----- |  | ----------- | ------- | ---------------- |  |  | ---- | - |  | - | ------- |  |  |  | ----- | -
|                          |  |        |         |                   |  |                  |       |       |  | For Capital |         | To be Considered
|                          |  | Actual |         | Adequacy Purposes |  | Well Capitalized
|                          |  |        |         |                   |  |                 
|                          |  | Amount |         | Ratio             |  | Amount           |       | Ratio |  | Amount      |         | Ratio           
|                          |  |        |         |                   |  |                  |       |       |  |             |         |                 
|As of December 31, 2003:  |  |        |         |                   |  |                  |       |       |  |             |         |                  |  |  |      |   |  |   |         |  |  |  |       |  
|Total risk-based capital  |  | $      | 447,967 |                   |  |                  | 12.06 | %     |  | $           | 297,208 |                  |  |  | 8.00 | % |  | $ | 371,509 |  |  |  | 10.00 | %
|Tier I risk-based capital |  | $      | 379,505 |                   |  |                  | 10.22 | %     |  | $           | 148,604 |                  |  |  | 4.00 | % |  | $ | 222,906 |  |  |  | 6.00  | %
|Tangible capital          |  | $      | 379,505 |                   |  |                  | 8.52  | %     |  | $           | 66,802  |                  |  |  | 1.50 | % |  | $ | 66,802  |  |  |  | 1.50  | %
|Core capital              |  | $      | 379,505 |                   |  |                  | 8.52  | %     |  | $           | 178,138 |                  |  |  | 4.00 | % |  | $ | 222,673 |  |  |  | 5.00  | %
|As of December 31, 2002:  |  |        |         |                   |  |                  |       |       |  |             |         |                  |  |  |      |   |  |   |         |  |  |  |       |  
|Total risk-based capital  |  | $      | 413,469 |                   |  |                  | 11.89 | %     |  | $           | 278,176 |                  |  |  | 8.00 | % |  | $ | 347,720 |  |  |  | 10.00 | %
|Tier I risk-based capital |  | $      | 347,927 |                   |  |                  | 10.01 | %     |  | $           | 139,088 |                  |  |  | 4.00 | % |  | $ | 208,632 |  |  |  | 6.00  | %
|Tangible capital          |  | $      | 347,927 |                   |  |                  | 7.26  | %     |  | $           | 71,873  |                  |  |  | 1.50 | % |  | $ | 71,873  |  |  |  | 1.50  | %
|Core capital              |  | $      | 347,927 |                   |  |                  | 7.26  | %     |  | $           | 191,661 |                  |  |  | 4.00 | % |  | $ | 239,576 |  |  |  | 5.00  | %

The Companys wholly owned subsidiary, Ryan Beck is subject to the net
capital provision of Rule 15c3-1 under the Securities Exchange Act of 1934,
which requires the maintenance of minimum net capital and requires the ratio of
aggregate indebtedness to net capital, both as defined, not to exceed 15 to 1.
Additionally, Ryan Beck, as a market maker, is subject to supplemental
requirements of Rule 15c3-1(a)4, which provides for the computation of net
capital to be based on the number

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

of and price of issues in which markets are made by Ryan Beck, not to
exceed $1.0 million. Ryan Becks regulatory net capital was approximately
$26.2 million, which was $25.2 million in excess of its required net capital of
$1.0 million at December 31, 2003.

Ryan Beck operates under the provisions of paragraph (k)(2)(ii) of Rule
15c3-3 of the Securities and Exchange Commission as a fully disclosed
introducing broker and, accordingly, customer accounts are carried on the books
of the clearing broker. However, Ryan Beck safekeeps and redeems municipal bond
coupons for the benefit of its customers. Accordingly, Ryan Beck is subject to
the provisions of SEC Rule 15c3-3 relating to possession or control and
customer reserve requirements and was in compliance with such provisions at
December 31, 2003.

16. Legal Proceedings

On October 3, 2002, Commerce Bancorp., Inc. (Commerce) filed a
complaint against BankAtlantic in the United States District Court for the
District of New Jersey. The complaint, which seeks unspecified money damages
and injunctive relief, asserts that BankAtlantic is infringing certain
trademark rights allegedly owned by Commerce in the slogan AMERICAS MOST
CONVENIENT BANK by virtue of BankAtlantics use of the slogan FLORIDAS MOST
CONVENIENT BANK. Commerce also filed an amended complaint, which asserts
additional claims for trademark infringement based on Commerces allegation
that BankAtlantics use of the word WOW! infringes trademark rights
purportedly owned by Commerce in the phases WOW ANSWER GUIDE, COMMERCE WOW
ZONE COMMERCEWOW!ZONE COMMERCEWOW!ZONE, and WOW! THE CUSTOMER. In
order to amicably resolve the litigation the parties entered into a Settlement
Agreement dated January 20, 2004 settling the case in its entirety. Pursuant
to the settlement, the action will be dismissed with prejudice. No monetary
payments were made by either party in connection with the settlement.

On January 30, 2003, a one-count purported class action complaint was
filed in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm
Beach County, Florida by a former employee of Gruntal seeking a declaratory
judgment that Ryan Beck is liable for all pre-April 26, 2002 claims against
Gruntal by former Gruntal retail customers and retail brokers, whether pending
or to be filed in the future, not expressly assumed by Ryan Beck in its
acquisition of certain of the assets of Gruntal. The complaint does not
specify the amount of such claims. The complaint seeks to impose liability
under the theory that either (1) Ryan Beck engaged in a de factomerger with
Gruntal, or (2) Ryan Becks brokerage business is a mere continuation of
Gruntals brokerage business, or (3) Ryan Beck is the beneficiary of a
fraudulent transfer. Ryan Beck removed the case to federal court and
subsequently filed a motion to dismiss the complaint on various grounds. The
court issued an order staying this action until the resolution of the Gruntal
bankruptcy proceedings.

In April 2002, Ryan Beck acquired certain of the assets and assumed
certain of the liabilities of Gruntal. Ryan Beck has been named as a defendant
in a number of arbitration claims filed by former Gruntal clients whose claims
arose prior to the transaction date. In these actions Ryan Beck is alleged to
be successor in interest to Gruntal, which allegations Ryan Beck denies. In
some instances the former Gruntal brokers against whom the claims relate are
now employed by Ryan Beck and in other instances the brokers are not employed
by Ryan Beck. Ryan Beck did not assume any of the liabilities associated with
these actions in the Gruntal transaction. While Ryan Beck does not consider
any individual action to be material, an adverse result in a number of these
actions in the aggregate could adversely affect the Companys financial
statements. In October 2002, Gruntal filed for bankruptcy protection under
Chapter 11 of the Federal Bankruptcy Laws.

In the ordinary course of business, the Company and its subsidiaries are
parties to other lawsuits as plaintiff or defendant involving its bank
operations lending, tax certificates, securities sales, brokerage and
underwriting and acquisitions. Although the Company believes it has
meritorious defenses in all current legal actions, the outcome of the various
legal actions is uncertain. Management, based on discussions with legal
counsel, believes results of operations or financial position will not be
significantly impacted by the resolution of these matters.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

17. Parent Company Financial Information

Condensed statements of financial condition at December 31, 2003 and 2002
and condensed statements of operations for each of the years in the three year
period ended December 31, 2003 are shown below (in thousands):

CONDENSED STATEMENTS OF FINANCIAL
CONDITION

|                                             |                                      |                                            |         |      |              |   |         |   |         |  | 
|-------------------------------------------- | ------------------------------------ | ------------------------------------------ | ------- | ---- | ------------ | - | ------- | - | ------- |  | 
|                                             |                                      |                                            |         |      | December 31,
|                                             |                                      |                                            |         |      |             
|                                             |                                      | 2003                                       |         | 2002
|                                             |                                      |                                            |         |      |              |   |        
|                                             |                                      |                                            | ASSETS  |      |              |   |         |   |         |  | 
|Cash deposited at BankAtlantic               |                                      | $                                          | 22,717  |      |              | $ | 2,705   |  
|Short term investments                       |                                      |                                            | 48      |      |              |   | 18      |  
|Notes receivable                             |                                      |                                            | 43,500  |      |              |   | 35,000  |  
|Investment securities                        |                                      |                                            | 20,949  |      |              |   | 4,761   |  
|Investment in BankAtlantic                   |                                      |                                            | 489,855 |      |              |   | 467,756 |  
|Investment in other subsidiaries             |                                      |                                            | 77,558  |      |              |   | 179,413 |  
|Deferred tax asset, net                      |                                      |                                            | 5,510   |      |              |   | 8,392   |  
|Current income tax receivable - BankAtlantic |                                      |                                            | 3,326   |      |              |   | 15,300  |  
|Investment in unconsolidated subsidiaries    |                                      |                                            | 7,910   |      |              |   | 3,363   |  
|Due from BankAtlantic                        |                                      |                                            | 1,156   |      |              |   |        |  
|Other assets                                 |                                      |                                            | 6,962   |      |              |   | 6,853   |  
|                                             |                                      |                                            |         |      |              |   |         |  
|                                             |                                      | Total assets                               |         | $    | 679,491      |   |         | $ | 723,561 | 
|                                             |                                      |                                            |         |      |              |   |         |  
|                                             | LIABILITIES AND STOCKHOLDERS EQUITY |                                            |         |      |              |   |         |   |        
|Subordinated debentures and other borrowings |                                      | $                                          | 100     |      |              | $ | 65,817  |  
|Junior subordinated debentures               |                                      |                                            | 263,266 |      |              |   | 185,920 |  
|Other liabilities                            |                                      |                                            | 2,673   |      |              |   | 2,490   |  
|                                             |                                      |                                            |         |      |              |   |         |  
|Total liabilities                            |                                      |                                            | 266,039 |      |              |   | 254,227 |  
|Stockholders equity                         |                                      |                                            | 413,452 |      |              |   | 469,334 |  
|                                             |                                      |                                            |         |      |              |   |         |  
|                                             |                                      | Total liabilities and stockholders equity |         | $    | 679,491      |   |         | $ | 723,561 | 
|                                             |                                      |                                            |         |      |              |   |         |  

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

CONDENSED STATEMENTS OF OPERATIONS

|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |       |        |        | 
|------------------------------------------------------------------------------------------------ | ------------------- | ----------------------------------- | ---------- | ----- | -------------------------------- | ------ | ------- | ----- | ------ | ------ | ------- | ----- | ------ | ------ | 
|                                                                                                 |                     |                                     |            |       | For the Years Ended December 31,
|                                                                                                 |                     |                                     |            |       |                                 
|                                                                                                 |                     | 2003                                |            | 2002  |                                  | 2001  
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |       
|Dividends from subsidiaries                                                                      |                     | $                                   | 20,000     |       |                                  | $      | 22,365  |       |        | $      | 22,420  |      
|Interest income on loans receivable                                                              |                     |                                     | 1,663      |       |                                  |        | 1,716   |       |        |        | 202     |      
|Interest income on investments                                                                   |                     |                                     | 59         |       |                                  |        | 30      |       |        |        | 26      |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|                                                                                                 |                     | Total interest income and dividends |            |       | 21,722                           |        |         |       | 24,111 |        |         |       | 22,648 |       
|Interest expense on subordinated debentures, junior subordinated
debentures and other borrowings |                     |                                     | 16,344     |       |                                  |        | 17,801  |       |        |        | 18,517  |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|                                                                                                 | Net interest income |                                     |            | 5,378 |                                  |        |         | 6,310 |        |        |         | 4,131 |       
|Securities activity, net                                                                         |                     |                                     | 404        |       |                                  |        | (14,965 | )     |        |        | 3,124   |      
|Loss on debt redemption                                                                          |                     |                                     | (1,648     | )     |                                  |        | (3,125  | )     |        |        | (389    | )    
|Other expenses, net                                                                              |                     |                                     | (2,823     | )     |                                  |        | (2,137  | )     |        |        | (819    | )    
|Income from unconsolidated subsidiaries                                                          |                     |                                     | 425        |       |                                  |        |        |       |        |        |        |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|Income (loss) from continuing operations before income tax benefit                               |                     |                                     | 1,736      |       |                                  |        | (13,917 | )     |        |        | 6,047   |      
|Income tax benefit                                                                               |                     |                                     | 5,087      |       |                                  |        | 12,320  |       |        |        | 5,381   |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|Income (loss) from continuing operations                                                         |                     |                                     | 6,823      |       |                                  |        | (1,597  | )     |        |        | 11,428  |      
|Discontinued operations, net of tax                                                              |                     |                                     | 1,157      |       |                                  |        | 496     |       |        |        |        |      
|Cumulative effect of a change in accounting principle, net of tax                                |                     |                                     |           |       |                                  |        | (13,339 | )     |        |        |        |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|Income (loss) before undistributed earnings of subsidiaries                                      |                     |                                     | 7,980      |       |                                  |        | (14,440 | )     |        |        | 11,428  |      
|Equity in undistributed net income (loss) of subsidiaries excluding
BankAtlantic                 |                     |                                     | 9,645      |       |                                  |        | (2,365  | )     |        |        | (10,046 | )    
|Equity in undistributed income of BankAtlantic                                                   |                     |                                     | 22,129     |       |                                  |        | 23,112  |       |        |        | 21,148  |      
|Equity in undistributed subsidiarys discontinued operations, net of tax                         |                     |                                     | 27,963     |       |                                  |        | 22,047  |       |        |        | 8,492   |      
|Equity in income from subsidiaries extraordinary item                                            |                     |                                     |           |       |                                  |        | 23,749  |       |        |        |        |      
|Equity in income (loss) from subsidiaries cumulative effect of a change
in accounting principle  |                     |                                     |           |       |                                  |        | (1,768  | )     |        |        | 1,138   |      
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      
|                                                                                                 |                     |                                     | Net income |       | $                                | 67,717 |         |       | $      | 50,335 |         |       | $      | 32,160 | 
|                                                                                                 |                     |                                     |            |       |                                  |        |         |       |        |        |         |      

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

CONDENSED STATEMENTS OF CASH FLOW

|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |         |  
|-------------------------------------------------------------------------------- | --------------------------------------------------------------------------- | ---- | -------------------------------- | ------- | - | ---- | ----- | -------- | - |  | ------ | ------- | -
|                                                                                 |                                                                             |      | For the Years Ended December 31,
|                                                                                 |                                                                             |      |                                 
|(In thousands)                                                                   |                                                                             | 2003 |                                  | 2002    |   | 2001
|                                                                                 |                                                                             |      |                                  |         |   |     
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|Operating activities:                                                            |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Income from continuing operations                                           |      | $                                | 38,597  |   |      | $     | 19,150   |   |  | $      | 22,530  |  
|                                                                                 | Income from discontinued operations                                         |      |                                  | 29,120  |   |      |       | 22,543   |   |  |        | 8,492   |  
|                                                                                 | Income from extraordinary item                                              |      |                                  |        |   |      |       | 23,749   |   |  |        |        |  
|                                                                                 | (Loss) income from cumulative effect of a change in
accounting principle    |      |                                  |        |   |      |       | (15,107  | ) |  |        | 1,138   |  
|Adjustment to reconcile net income to net cash provided by
operating activities: |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Equity in net undistributed earnings of BankAtlantic and
other subsidiaries |      |                                  | (59,737 | ) |      |       | (64,775  | ) |  |        | (20,732 | )
|                                                                                 | Amortization and accretion, net                                             |      |                                  | 1,060   |   |      |       | 707      |   |  |        | 1,104   |  
|                                                                                 | Loss on debt redemption                                                     |      |                                  | 1,648   |   |      |       | 3,125    |   |  |        | 389     |  
|                                                                                 | Equity in earnings of unconsolidated subsidiaries                           |      |                                  | (2,077  | ) |      |       | (780     | ) |  |        |        |  
|                                                                                 | Impairment of securities                                                    |      |                                  |        |   |      |       | 18,801   |   |  |        | 3,527   |  
|                                                                                 | Gains on securities activities                                              |      |                                  | (404    | ) |      |       | (3,836   | ) |  |        | (3,124  | )
|                                                                                 | Impairment of goodwill                                                      |      |                                  |        |   |      |       | 13,339   |   |  |        |        |  
|                                                                                 | Increase (decrease) in other liabilities                                    |      |                                  | 2,539   |   |      |       | (2,897   | ) |  |        | 5,491   |  
|Changes in due from BankAtlantic                                                 |                                                                             |      | (1,247                           | )       |   |      | 7,074 |          |   |  | (6,983 | )      
|                                                                                 | (Increase) decrease in deferred tax asset                                   |      |                                  | (1,246  | ) |      |       | (4,803   | ) |  |        | 1,569   |  
|                                                                                 | Decrease (increase) in other assets                                         |      |                                  | 12,730  |   |      |       | (14,325  | ) |  |        | (7,492  | )
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Net cash provided by operating activities                                   |      |                                  | 20,983  |   |      |       | 1,965    |   |  |        | 5,909   |  
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|Investing activities:                                                            |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Repayments of loans to subsidiaries                                         |      |                                  | 5,000   |   |      |       |         |   |  |        |        |  
|                                                                                 | Increase in loans to subsidiaries                                           |      |                                  |        |   |      |       | (35,000  | ) |  |        |        |  
|                                                                                 | Additional investments in subsidiaries                                      |      |                                  | (1,077  | ) |      |       | (116,372 | ) |  |        |        |  
|                                                                                 | Purchase of securities                                                      |      |                                  | (16,700 | ) |      |       | (213     | ) |  |        | (8,511  | )
|                                                                                 | Proceeds from sales of securities                                           |      |                                  | 3,965   |   |      |       | 10,883   |   |  |        | 7,761   |  
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Net cash used by investing activities                                       |      |                                  | (8,812  | ) |      |       | (140,702 | ) |  |        | (750    | )
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|Financing activities:                                                            |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Issuance of common stock                                                    |      |                                  | 4,472   |   |      |       | 1,296    |   |  |        | 96,982  |  
|                                                                                 | Common stock dividends paid                                                 |      |                                  | (7,525  | ) |      |       | (6,992   | ) |  |        | (5,282  | )
|                                                                                 | Proceeds from issuance of junior subordinated debentures                    |      |                                  | 77,346  |   |      |       | 185,920  |   |  |        |        |  
|                                                                                 | Redemption of junior subordinated debentures                                |      |                                  |        |   |      |       | (77,062  | ) |  |        |        |  
|                                                                                 | Proceeds from notes payable                                                 |      |                                  |        |   |      |       | 30,000   |   |  |        |        |  
|                                                                                 | Repayments of notes payable                                                 |      |                                  | (16,000 | ) |      |       | (14,000  | ) |  |        | (20,975 | )
|                                                                                 | Retirement of subordinated investment notes and
subordinated debentures     |      |                                  | (50,422 | ) |      |       | (21,716  | ) |  |        | (35,042 | )
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Net cash provided by financing activities                                   |      |                                  | 7,871   |   |      |       | 97,446   |   |  |        | 35,683  |  
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Increase (decrease) in cash and cash equivalents                            |      |                                  | 20,042  |   |      |       | (41,291  | ) |  |        | 40,842  |  
|                                                                                 | Cash and cash equivalents at beginning of period                            |      |                                  | 2,723   |   |      |       | 44,014   |   |  |        | 3,172   |  
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        
|                                                                                 | Cash and cash equivalents at end of period                                  |      | $                                | 22,765  |   |      | $     | 2,723    |   |  | $      | 44,014  |  
|                                                                                 |                                                                             |      |                                  |         |   |      |       |          |   |  |        |        

(continued)

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                                         |                                                                                                                           |                                                                 |   |                                 |        |      |   |         |   |  |   |        |   | 
|------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------- | - | ------------------------------- | ------ | ---- | - | ------- | - |  | - | ------ | - | 
|                                                                         |                                                                                                                           |                                                                 |   | For the Years Ended December 31
|                                                                         |                                                                                                                           |                                                                 |   |                                
|(In thousands)                                                           |                                                                                                                           | 2003                                                            |   | 2002                            |        | 2001
|                                                                         |                                                                                                                           |                                                                 |   |                                 |        |     
|Cash paid for:                                                           |                                                                                                                           |                                                                 |   |                                 |        |      |   |         |   |  |   |       
|                                                                         | Interest                                                                                                                  |                                                                 | $ | 15,961                          |        |      | $ | 18,017  |   |  | $ | 19,038 |  
|Supplementary disclosure of non-cash investing and financing activities: |                                                                                                                           |                                                                 |   |                                 |        |      |   |         |   |  |   |       
|                                                                         | Issuance of Class A common stock upon acquisitions                                                                        |                                                                 |   |                                |        |      |   |        |   |  |   | 335    |  
|                                                                         | Transfer of direct ownership in Levitt Corporation from BankAtlantic to the
Company                                       |                                                                 |   |                                |        |      |   |        |   |  |   | 66,826 |  
|                                                                         |                                                                                                                           | Increase in notes receivable in connection with Levitt spin-off |   |                                 | 43,500 |      |   |         |  |  |   |        |  | 
|                                                                         | Reduction in stockholders equity associated with the Levitt spin off
transaction                                         |                                                                 |   | 125,573                         |        |      |   |        |   |  |   |       |  
|                                                                         | Increase in equity for the tax effect related to the exercise of stock options                                            |                                                                 |   | 2,264                           |        |      |   | 440     |   |  |   | 598    |  
|                                                                         | Increase (decrease) in stockholders equity from other comprehensive income                                               |                                                                 |   | 2,387                           |        |      |   | (11,331 | ) |  |   | 13,270 |  
|                                                                         | Issuance of Class A common stock upon conversion of subordinated debentures                                               |                                                                 |   | 211                             |        |      |   | 25      |   |  |   | 49,935 |  
|                                                                         | Decrease in other liabilities associated with the Ryan Beck deferred compensation
plan                                    |                                                                 |   |                                |        |      |   |        |   |  |   | 3,052  |  
|                                                                         | Capital contributions associated with the Ryan Beck deferred compensation plan                                            |                                                                 |   |                                |        |      |   | (828    | ) |  |   | (1,292 | )
|                                                                         | Increase in notes payable under the Ryan Beck deferred compensation plan                                                  |                                                                 |   |                                |        |      |   | 3,675   |   |  |   |       |  
|                                                                         | Increase in junior subordinated debentures and investment in unconsolidated
subsidiaries related to trust deconsolidation |                                                                 |   | 7,910                           |        |      |   |        |   |  |   |       |  

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

18. Selected Quarterly Results(Unaudited)

The following tables summarize the quarterly results of operations for the
years ended December 31, 2003 and 2002 (in thousands except share and per share
data).

|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|------------------------------------------------------------ |  | ------- | ---------- | ------- |  | ------- | ---------- | ------- |  | ----- | ---------- | - |  | - | ---------- | - |  | - | ---------- | -
|                                                             |  | First   |            | Second  |  | Third   |            | Fourth  |  |       |            |  
|2003                                                         |  | Quarter |            | Quarter |  | Quarter |            | Quarter |  | Total
|                                                             |  |         |            |         |  |         |            |         |  |      
|Interest income                                              |  | $       | 68,965     |         |  | $       | 69,221     |         |  | $     | 62,811     |   |  | $ | 60,852     |   |  | $ | 261,849    |  
|Interest expense                                             |  |         | 30,786     |         |  |         | 30,572     |         |  |       | 27,312     |   |  |   | 24,547     |   |  |   | 113,217    |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Net interest income                                          |  |         | 38,179     |         |  |         | 38,649     |         |  |       | 35,499     |   |  |   | 36,305     |   |  |   | 148,632    |  
|Provision for (recovery from) loan losses                    |  |         | 850        |         |  |         | 1,490      |         |  |       | (1,076     | ) |  |   | (1,811     | ) |  |   | (547       | )
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Net interest income after provision for loan losses          |  |         | 37,329     |         |  |         | 37,159     |         |  |       | 36,575     |   |  |   | 38,116     |   |  |   | 149,179    |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Income before income taxes                                   |  |         | 16,846     |         |  |         | 15,271     |         |  |       | 15,885     |   |  |   | 14,019     |   |  |   | 62,021     |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Income from continuing operations                            |  |         | 10,818     |         |  |         | 9,809      |         |  |       | 10,144     |   |  |   | 7,826      |   |  |   | 38,597     |  
|Discontinued operations, net of taxes                        |  |         | 3,540      |         |  |         | 7,400      |         |  |       | 8,364      |   |  |   | 9,816      |   |  |   | 29,120     |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Net income                                                   |  | $       | 14,358     |         |  | $       | 17,209     |         |  | $     | 18,508     |   |  | $ | 17,642     |   |  | $ | 67,717     |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Basic earnings per share from continuing operations          |  | $       | 0.19       |         |  | $       | 0.17       |         |  | $     | 0.17       |   |  | $ | 0.13       |   |  | $ | 0.66       |  
|Basic earnings per share from discontinued operations        |  |         | 0.06       |         |  |         | 0.13       |         |  |       | 0.15       |   |  |   | 0.17       |   |  |   | 0.50       |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Basic earnings per share                                     |  | $       | 0.25       |         |  | $       | 0.30       |         |  | $     | 0.32       |   |  | $ | 0.30       |   |  | $ | 1.16       |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Diluted earnings per share from continuing operations        |  | $       | 0.17       |         |  | $       | 0.16       |         |  | $     | 0.16       |   |  | $ | 0.12       |   |  | $ | 0.62       |  
|Diluted earnings per share from discontinued operations      |  |         | 0.06       |         |  |         | 0.12       |         |  |       | 0.14       |   |  |   | 0.16       |   |  |   | 0.46       |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Diluted earnings per share                                   |  | $       | 0.23       |         |  | $       | 0.28       |         |  | $     | 0.30       |   |  | $ | 0.28       |   |  | $ | 1.08       |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Basic weighted average number of common
shares outstanding   |  |         | 58,171,621 |         |  |         | 58,321,020 |         |  |       | 58,646,254 |   |  |   | 58,891,273 |   |  |   | 58,509,894 |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  
|Diluted weighted average number of common
shares outstanding |  |         | 64,250,488 |         |  |         | 61,898,924 |         |  |       | 61,343,946 |   |  |   | 61,852,217 |   |  |   | 62,354,430 |  
|                                                             |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |   |  |   |            |  

The third and fourth quarter earnings were impacted by the Company
prepaying $185 million of FHLB advances in the third quarter and $140 million
of FHLB advances in the fourth quarter incurring prepayment penalties of $2.0
million and $8.9 million, respectively.

The discontinued operations primarily reflect the operations of Levitt and
GMS. Levitt was spun-off to the Companys stockholders on December 31, 2003
and the Companys membership interest in GMS was sold in August 2003.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|--------------------------------------------------------------------------------- |  | ------- | ---------- | ------- |  | ------- | ---------- | ------- |  | ----- | ---------- | - |  | - | ---------- |  |  | - | ---------- | -
|                                                                                  |  | First   |            | Second  |  | Third   |            | Fourth  |  |       |            |  
|2002                                                                              |  | Quarter |            | Quarter |  | Quarter |            | Quarter |  | Total
|                                                                                  |  |         |            |         |  |         |            |         |  |      
|Interest income                                                                   |  | $       | 67,445     |         |  | $       | 81,581     |         |  | $     | 81,508     |   |  | $ | 72,853     |  |  | $ | 303,387    |  
|Interest expense                                                                  |  |         | 34,828     |         |  |         | 39,396     |         |  |       | 38,859     |   |  |   | 35,808     |  |  |   | 148,891    |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Net interest income                                                               |  |         | 32,617     |         |  |         | 42,185     |         |  |       | 42,649     |   |  |   | 37,045     |  |  |   | 154,496    |  
|Provision for loan losses                                                         |  |         | 2,565      |         |  |         | 6,139      |         |  |       | 2,082      |   |  |   | 3,291      |  |  |   | 14,077     |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Net interest income after provision for loan losses                               |  |         | 30,052     |         |  |         | 36,046     |         |  |       | 40,567     |   |  |   | 33,754     |  |  |   | 140,419    |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Income (loss) before income taxes                                                 |  |         | 12,976     |         |  |         | (14,212    | )       |  |       | 16,545     |   |  |   | 12,892     |  |  |   | 28,201     |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Income (loss) from continuing operations                                          |  |         | 8,455      |         |  |         | (9,051     | )       |  |       | 10,987     |   |  |   | 8,759      |  |  |   | 19,150     |  
|Discontinued operations, net of taxes                                             |  |         | 4,125      |         |  |         | 5,564      |         |  |       | 3,547      |   |  |   | 9,307      |  |  |   | 22,543     |  
|Extraordinary items, net of taxes                                                 |  |         |           |         |  |         | 23,810     |         |  |       | (61        | ) |  |   |           |  |  |   | 23,749     |  
|Cumulative effect of a change in accounting principle,
net of tax                 |  |         | (15,107    | )       |  |         |           |         |  |       |           |   |  |   |           |  |  |   | (15,107    | )
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Net income (loss)                                                                 |  | $       | (2,527     | )       |  | $       | 20,323     |         |  | $     | 14,473     |   |  | $ | 18,066     |  |  | $ | 50,335     |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Basic earnings per share from continuing operations                               |  | $       | 0.15       |         |  | $       | (0.16      | )       |  | $     | 0.19       |   |  | $ | 0.15       |  |  | $ | 0.33       |  
|Basic earnings per share from discontinued operations                             |  |         | 0.07       |         |  |         | 0.10       |         |  |       | 0.06       |   |  |   | 0.16       |  |  |   | 0.39       |  
|Basic earnings per share from extraordinary items                                 |  |         |           |         |  |         | 0.41       |         |  |       |           |   |  |   |           |  |  |   | 0.41       |  
|Basic loss per share from cumulative effect of a
change in accounting principle   |  |         | (0.26      | )       |  |         |           |         |  |       |           |   |  |   |           |  |  |   | (0.26      | )
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Basic earnings (loss) per share                                                   |  | $       | (0.04      | )       |  | $       | 0.35       |         |  | $     | 0.25       |   |  | $ | 0.31       |  |  | $ | 0.87       |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Diluted earnings per share from continuing operations                             |  | $       | 0.13       |         |  | $       | (0.16      | )       |  | $     | 0.18       |   |  | $ | 0.14       |  |  | $ | 0.32       |  
|Diluted earnings per share from discontinued operations                           |  |         | 0.06       |         |  |         | 0.10       |         |  |       | 0.05       |   |  |   | 0.15       |  |  |   | 0.35       |  
|Diluted earnings per share from extraordinary items                               |  |         |           |         |  |         | 0.41       |         |  |       |           |   |  |   |           |  |  |   | 0.37       |  
|Diluted loss per share from cumulative effect of a
change in accounting principle |  |         | (0.23      | )       |  |         |           |         |  |       |           |   |  |   |           |  |  |   | (0.23      | )
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Diluted earnings (loss) per share                                                 |  | $       | (0.04      | )       |  | $       | 0.35       |         |  | $     | 0.23       |   |  | $ | 0.29       |  |  | $ | 0.81       |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Basic weighted average number of common
shares outstanding                        |  |         | 57,862,267 |         |  |         | 57,973,880 |         |  |       | 58,065,396 |   |  |   | 58,085,481 |  |  |   | 57,997,556 |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  
|Diluted weighted average number of common
shares outstanding                      |  |         | 65,207,468 |         |  |         | 57,973,880 |         |  |       | 64,320,448 |   |  |   | 64,188,382 |  |  |   | 64,400,725 |  
|                                                                                  |  |         |            |         |  |         |            |         |  |       |            |   |  |   |            |  |  |   |            |  

During the first quarter, the cumulative effect of a change in accounting
principle resulted from the implementation of FASB Statement No. 142. Based on
the accounting principles of the new statement, the goodwill associated with
the Ryan Beck reportable segment was deemed impaired, resulting in the $15.1
million charge, net of tax. The second quarter loss from continuing operations
resulted from an $18.2 million impairment of equity investments, a $1.0 million
restructuring charge associated with the discontinuation of ATM relationships
and $3.9 million of acquisition related expenses. The extraordinary gain during
the second quarter resulted from the Gruntal transaction as the fair value of
net assets acquired exceeded the cost. During the fourth quarter, BankAtlantic
increased its unassigned component of its allowance for loan losses by $4.9
million and an amendment to a supplemental bonus plan resulted in a $1.4
million reduction in compensation expense.

19. Estimated Fair Value of Financial Instruments

The information set forth below provides disclosure of the estimated fair
value of the Companys financial instruments presented in accordance with the
requirements of Statement of Financial Accounting Standards No. 107,
Disclosures about Fair Value of Financial Instruments (FAS 107).

Management has made estimates of fair value that it believes to be
reasonable. However, because there is no market for many of these financial
instruments, management has no basis to determine whether the fair value
presented would be

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

indicative of the value negotiated in an actual sale. The Companys fair value
estimates do not consider the tax effect that would be associated with the
disposition of the assets or liabilities at their fair value estimates.

Fair values are estimated for loan portfolios with similar financial
characteristics. Loans are segregated by category, and each loan category is
further segmented into fixed and adjustable rate interest terms and by
performing and non-performing categories.

The fair value of performing loans, except residential mortgage and
adjustable rate loans is calculated by discounting scheduled cash flows through
the estimated maturity using estimated market discount rates that reflect the
credit and interest rate risk inherent in the loan. The estimate of average
maturity is based on BankAtlantics historical experience with prepayments for
each loan classification, modified, as required, by an estimate of the effect
of current economic and lending conditions. For performing residential mortgage
loans, fair value is estimated by discounting contractual cash flows, which are
adjusted for national historical prepayment estimates. The discount rate is
based on secondary market sources and is adjusted to reflect differences in
servicing and credit costs.

Fair values of non-performing loans are based on the assumption that the
loans are on a non-accrual status, discounted at market rates during a 24 month
work-out period. Assumptions regarding credit risk are determined using
available market information and specific borrower information.

The book value of tax certificates approximates market value. The fair
value of mortgage-backed and investment securities are estimated based upon a
price matrix obtained from a third party.

Under FAS 107, the fair value of deposits with no stated maturity, such as
non-interest bearing demand deposits, savings and NOW accounts, and money
market and checking accounts, is considered the same as book value. The fair
value of certificates of deposit is based on the discounted value of
contractual cash flows. The discount rate is estimated using current rates
offered by BankAtlantic for similar remaining maturities.

The book value of securities sold under agreements to repurchase
approximates fair value.

The fair value of FHLB advances is based on discounted cash flows using
rates offered for debt with comparable terms to maturity and issuer credit
standing.

The fair value of convertible subordinated debentures was based on quoted
market prices on NASDAQ. The fair values of other subordinated debentures,
junior subordinated debentures, trust preferred securities and notes payable
were based on discounted value of contractual cash flows at a market discount
rate.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The following table presents information for the Companys financial
instruments at December 31, 2003 and 2002 (in thousands):

|                       |                                                                                       |  |                   |           |                   |  |          |           |       |  |   |           |  |  |   |           | 
|---------------------- | ------------------------------------------------------------------------------------- |  | ----------------- | --------- | ----------------- |  | -------- | --------- | ----- |  | - | --------- |  |  | - | --------- | 
|                       |                                                                                       |  | December 31, 2003 |           | December 31, 2002
|                       |                                                                                       |  |                   |           |                  
|                       |                                                                                       |  | Carrying          |           | Fair              |  | Carrying |           | Fair 
|                       |                                                                                       |  | Amount            |           | Value             |  | Amount   |           | Value
|                       |                                                                                       |  |                   |           |                   |  |          |           |      
|Financial assets:      |                                                                                       |  |                   |           |                   |  |          |           |       |  |   |           |  |  |   |          
|                       | Cash and cash equivalents                                                             |  | $                 | 119,882   |                   |  | $        | 119,882   |       |  | $ | 250,745   |  |  | $ | 250,745   | 
|                       | Securities available for sale                                                         |  |                   | 358,511   |                   |  |          | 358,511   |       |  |   | 707,858   |  |  |   | 707,858   | 
|                       | Securities owned                                                                      |  |                   | 124,565   |                   |  |          | 124,565   |       |  |   | 186,454   |  |  |   | 186,454   | 
|                       | Investment securities                                                                 |  |                   | 192,706   |                   |  |          | 192,706   |       |  |   | 212,240   |  |  |   | 212,698   | 
|                       | Loans receivable including loans held for sale, net                                   |  |                   | 3,686,153 |                   |  |          | 3,695,028 |       |  |   | 3,372,630 |  |  |   | 3,424,471 | 
|Financial liabilities: |                                                                                       |  |                   |           |                   |  |          |           |       |  |   |           |  |  |   |          
|                       | Deposits                                                                              |  | $                 | 3,058,142 |                   |  | $        | 3,062,565 |       |  | $ | 2,920,555 |  |  | $ | 2,940,848 | 
|                       | Securities sold under agreements to repurchase                                        |  |                   | 138,809   |                   |  |          | 138,809   |       |  |   | 116,279   |  |  |   | 116,279   | 
|                       | Advances from FHLB                                                                    |  |                   | 782,205   |                   |  |          | 830,939   |       |  |   | 1,297,170 |  |  |   | 1,386,648 | 
|                       | Subordinated debentures and notes payable                                             |  |                   | 36,595    |                   |  |          | 36,285    |       |  |   | 193,816   |  |  |   | 195,413   | 
|                       | Guaranteed preferred beneficial interests in
Companys
junior subordinated debentures |  |                   |          |                   |  |          |          |       |  |   | 180,375   |  |  |   | 180,479   | 
|                       | Junior subordinated debentures                                                        |  |                   | 263,266   |                   |  |          | 257,647   |       |  |   |          |  |  |   |          | 

The carrying amount and fair values of BankAtlantics commitments to
extend credit, standby letters of credit, financial guarantees and forward FHLB
commitments are not significant. (See Note 14 for the contractual amounts of
BankAtlantics financial instrument commitments).

Derivatives

During the year ended December 31, 2000, the Company entered into a
forward contract to purchase the underlying collateral from a government agency
pool of securities in May 2005. The underlying collateral is $8.6 million of
five-year hybrid adjustable rate mortgage loans that will adjust annually after
May 2005. The forward contract was held for trading purposes and recorded at
fair value of $13,000.

During the year ended December 31, 2002, the Company utilized interest
rate swaps to manage its interest rate risk. The Company entered into callable
time deposits with its customers and entered into callable interest rate swaps.
During the year ended December 31, 2003, interest rate swap contracts with a
notional amount of $33 million were called by the counter-party, resulting in
the Company redeeming $33 million of fixed rate time deposits. There were no
interest rate swaps outstanding at December 31, 2003.

The Company also created cash flow hedges by entering into interest rate
swap contracts to hedge the variable cash flows relating to forecasted interest
payments on certain variable rate FHLB advances. The changes in fair value of
the interest rate swap contracts designated as cash flow hedges were recorded
in other comprehensive income and the receivables and payables from the swap
contracts were recorded as an adjustment to interest expense on FHLB advances
in the Companys statement of operations for the years ended December 31, 2002
and 2001. The Company terminated the above mentioned interest rate swap
contracts with a notional amount of $75 million during the year ended December
31, 2003 and recognized a $1.9 million loss included in securities activities,
net in the Companys statement of operations.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

20. Earnings per Share

The following reconciles the numerators and denominators of the basic and
diluted earnings per share computation for the years ended December 31, 2003,
2002 and 2001 (in thousands, except share data).

|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|---------------------------------------------------------- |  | -------------------------------- | ---------- | ---- |  | ---- | ---------- | - |  | - | ---------- | 
|                                                           |  | For the Years Ended December 31,
|                                                           |  |                                 
|                                                           |  | 2003                             |            | 2002 |  | 2001
|                                                           |  |                                  |            |      |  |     
|Basic earnings per share
Numerator:                        |  |                                  |            |      |  |      |            |   |  |   |            | 
|Income from continuing operations                          |  | $                                | 38,597     |      |  | $    | 19,150     |   |  | $ | 22,530     | 
|Discontinued operations                                    |  |                                  | 29,120     |      |  |      | 22,543     |   |  |   | 8,492      | 
|Extraordinary item                                         |  |                                  |           |      |  |      | 23,749     |   |  |   |           | 
|Cumulative effect of a change in
accounting principle      |  |                                  |           |      |  |      | (15,107    | ) |  |   | 1,138      | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Net income                                                 |  |                                  | 67,717     |      |  |      | 50,335     |   |  |   | 32,160     | 
|Amortization of goodwill, net of tax                       |  |                                  |           |      |  |      |           |   |  |   | 3,903      | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Net income adjusted to exclude
goodwill amortization       |  | $                                | 67,717     |      |  | $    | 50,335     |   |  | $ | 36,063     | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Denominator:                                               |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic weighted average number of
common shares outstanding |  |                                  | 58,509,894 |      |  |      | 57,997,556 |   |  |   | 42,091,961 | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share from:                             |  |                                  |            |      |  |      |            |   |  |   |            | 
|Continuing operations                                      |  | $                                | 0.66       |      |  | $    | 0.33       |   |  | $ | 0.53       | 
|Discontinued operations                                    |  |                                  | 0.50       |      |  |      | 0.39       |   |  |   | 0.20       | 
|Extraordinary item                                         |  |                                  |           |      |  |      | 0.41       |   |  |   |           | 
|Cumulative effect of a change in
accounting principle      |  |                                  |           |      |  |      | (0.26      | ) |  |   | 0.03       | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share                                   |  | $                                | 1.16       |      |  | $    | 0.87       |   |  | $ | 0.76       | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 
|Basic earnings per share excluding
goodwill amortization   |  | $                                | 1.16       |      |  | $    | 0.87       |   |  | $ | 0.86       | 
|                                                           |  |                                  |            |      |  |      |            |   |  |   |            | 

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |            | 
|----------------------------------------------------------------------------------- | ------------------------ | - | -------------------------------- | --------- | ---- | - | ---------- | --------- |  | - | ---------- | ---------- | 
|                                                                                    |                          |   | For the Years Ended December 31,
|                                                                                    |                          |   |                                 
|                                                                                    |                          |   | 2003                             |           | 2002 |   | 2001      
|                                                                                    |                          |   |                                  |           |      |   |           
|Diluted earnings per share
Numerator:                                               |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Income from continuing operations                                                   |                          | $ | 38,597                           |           |      | $ | 19,150     |           |  | $ | 22,530     |           
|Subsidiary stock options                                                            |                          |   | (251                             | )         |      |   | (24        | )         |  |   |           |           
|Interest expense on convertible debentures                                          |                          |   | 569                              |           |      |   | 1,760      |           |  |   | 3,397      |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Income available after assumed conversion
from continuing operations                |                          |   | 38,915                           |           |      |   | 20,886     |           |  |   | 25,927     |           
|Discontinued operations                                                             |                          |   | 29,120                           |           |      |   | 22,543     |           |  |   | 8,492      |           
|Extraordinary item                                                                  |                          |   |                                 |           |      |   | 23,749     |           |  |   |           |           
|Cumulative effect of a change in
accounting principle                               |                          |   |                                 |           |      |   | (15,107    | )         |  |   | 1,138      |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Income available after assumed conversion                                           |                          |   | 68,035                           |           |      |   | 52,071     |           |  |   | 35,557     |           
|Amortization of goodwill, net of tax                                                |                          |   |                                 |           |      |   |           |           |  |   | 3,903      |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Income available after assumed conversion
adjusted to exclude goodwill
amortization |                          | $ | 68,035                           |           |      | $ | 52,071     |           |  | $ | 39,460     |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Denominator:                                                                        |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Basic weighted average number of
common shares outstanding                          |                          |   | 58,509,894                       |           |      |   | 57,997,556 |           |  |   | 42,091,961 |           
|Common stock equivalents resulting from:                                            |                          |   |                                  |           |      |   |            |           |  |   |            |           
|                                                                                    | Convertible debentures   |   |                                  | 1,311,676 |      |   |            | 4,092,774 |  |   |            | 10,337,901 | 
|                                                                                    | Stock-based compensation |   |                                  | 2,532,860 |      |   |            | 2,310,395 |  |   |            | 1,883,242  | 
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Diluted weighted average shares
outstanding                                         |                          |   | 62,354,430                       |           |      |   | 64,400,725 |           |  |   | 54,313,104 |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Diluted earnings per share from:                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Continuing operations                                                               |                          | $ | 0.62                             |           |      | $ | 0.32       |           |  | $ | 0.47       |           
|Discontinued operations                                                             |                          |   | 0.46                             |           |      |   | 0.35       |           |  |   | 0.16       |           
|Extraordinary item                                                                  |                          |   |                                 |           |      |   | 0.37       |           |  |   |           |           
|Cumulative effect of a change in
accounting principle                               |                          |   |                                 |           |      |   | (0.23      | )         |  |   | 0.02       |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Diluted earnings per share                                                          |                          | $ | 1.08                             |           |      | $ | 0.81       |           |  |   | 0.65       |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           
|Diluted earnings per share excluding
goodwill amortization                          |                          | $ | 1.08                             |           |      | $ | 0.81       |           |  | $ | 0.73       |           
|                                                                                    |                          |   |                                  |           |      |   |            |           |  |   |            |           

In January 2004, the Companys compensation committee adjusted the
exercise price and number of shares of all outstanding options to acquire the
Companys Class A common stock in connection with the spin-off of Levitt to
preserve the intrinsic value of the options. This adjustment increased the
number of common stock equivalents from stock based compensation by
approximately 30%, which will dilute earnings per share in subsequent periods.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

21. Real Estate Held for Development and Sale

Real estate held for development and sale consist of the following (in
thousands):

|                                |       |   |              |        |      |   |         |         | 
|------------------------------- | ----- | - | ------------ | ------ | ---- | - | ------- | ------- | 
|                                |       |   | December 31,
|                                |       |   |             
|                                |       |   | 2003         |        | 2002
|                                |       |   |              |        |     
|Land and land
development costs |       | $ | 9,705        |        |      | $ | 161,826 |        
|Construction costs              |       |   | 7,192        |        |      |   | 23,412  |        
|Other costs                     |       |   | 1,859        |        |      |   | 12,888  |        
|Other                           |       |   | 3,047        |        |      |   | 2,057   |        
|                                |       |   |              |        |      |   |         |        
|                                | Total |   | $            | 21,803 |      |   | $       | 200,183 | 
|                                |       |   |              |        |      |   |         |        

Income from real estate operations were as follows (in thousands):

|                             |  |                    |        | 
|---------------------------- |  | ------------------ | ------ | 
|                             |  | For the Year Ended
|                             |  | December 31, 2003 
|                             |  |                   
|Sales of real estate         |  | $                  | 19,850 | 
|Cost of sales on real estate |  |                    | 14,208 | 
|                             |  |                    |        | 
|                             |  | $                  | 5,642  | 
|                             |  |                    |        | 

Real estate held for development and sale during the year ended December
31, 2003 consisted of a joint venture that was acquired in connection with the
Community acquisition and $3.1 million of real estate held for sale associated
with branch banking facilities. The joint venture was consolidated in the
Companys financial statements as of January 1, 2003.

The real estate held for development and sale during the year ended
December 31, 2002 consisted of Levitt real estate inventory and $2.1 million of
real estate held for sale associated with branch banking facilities. Levitt
was spun-off to the Companys stockholders as of December 31, 2003.

22. Investments in and advances to unconsolidated subsidiaries

The consolidated statements of financial condition and consolidated
statements of operations include the following amounts for investments in and
advances to unconsolidated subsidiaries (in thousands):

|                                                       |  |              |       |      |  |   |         | 
|------------------------------------------------------ |  | ------------ | ----- | ---- |  | - | ------- | 
|                                                       |  | December 31,
|                                                       |  |             
|                                                       |  | 2003         |       | 2002
|                                                       |  |              |       |     
|Statement of Financial Condition                       |  |              |       |      |  |   |         | 
|Investment in Bluegreen Corporation                    |  | $            |      |      |  | $ | 60,695  | 
|Investments in and loans to real estate joint ventures |  |              |      |      |  |   | 51,904  | 
|Investment in statutory business trusts                |  |              | 7,910 |      |  |   |        | 
|                                                       |  |              |       |      |  |   |         | 
|                                                       |  | $            | 7,910 |      |  | $ | 112,599 | 
|                                                       |  |              |       |      |  |   |         | 

|                                                    |  |                     |     |      |  |   |       | 
|--------------------------------------------------- |  | ------------------- | --- | ---- |  | - | ----- | 
|                                                    |  | For the Years Ended
|                                                    |  | December 31,       
|                                                    |  |                    
|                                                    |  | 2003                |     | 2002
|                                                    |  |                     |     |     
|Statement of Operations                             |  |                     |     |      |  |   |       | 
|Equity in joint venture earnings                    |  | $                   |    |      |  | $ | 583   | 
|Interest income recognized on
loan to joint venture |  |                     |    |      |  |   | 710   | 
|Earnings from statutory trusts                      |  |                     | 425 |      |  |   |      | 
|                                                    |  |                     |     |      |  |   |       | 
|                                                    |  | $                   | 425 |      |  | $ | 1,293 | 
|                                                    |  |                     |     |      |  |   |       | 

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

During the year ended December 31, 2003, investment in and advances to
unconsolidated subsidiaries consisted of the Companys investment in eleven
statutory business trusts that were formed to issue trust preferred securities.
Prior to January 1, 2003, these trusts were consolidated in the Companys
financial statements.

During the year ended December 31, 2002, investment in and advances to
unconsolidated subsidiaries consisted of the Companys and Levitts investment
in Bluegreen, Levitts investment in real estate joint ventures and
BankAtlantics 50% owned joint venture that was acquired in connection with the
Community acquisition. As of January 1, 2003, the joint venture was
consolidated in the Companys financial statements.

The Condensed Combined Statements of Financial Condition and Condensed
Combined Statements of Operation for unconsolidated subsidiaries are as follows
for 2003 and 2002 (in thousands):

|                                 |                   |   |              |         |      |   |         |         | 
|-------------------------------- | ----------------- | - | ------------ | ------- | ---- | - | ------- | ------- | 
|                                 |                   |   | December 31,
|                                 |                   |   |             
|                                 |                   |   | 2003         |         | 2002
|                                 |                   |   |              |         |     
|Statement of Financial
Condition |                   |   |              |         |      |   |         |        
|Real estate assets               |                   | $ |             |         |      | $ | 243,498 |        
|Contracts and notes receivable   |                   |   |             |         |      |   | 122,253 |        
|Junior subordinated debentures   |                   |   | 263,266      |         |      |   |        |        
|Other assets                     |                   |   | 637          |         |      |   | 145,454 |        
|                                 |                   |   |              |         |      |   |         |        
|                                 | Total Assets      |   | $            | 263,903 |      |   | $       | 511,205 | 
|                                 |                   |   |              |         |      |   |         |        
|Notes payable - BankAtlantic     |                   | $ |             |         |      | $ | 58,341  |        
|Trust preferred securities       |                   |   | 255,375      |         |      |   |        |        
|Other notes payable              |                   |   |             |         |      |   | 195,181 |        
|Other liabilities                |                   |   | 618          |         |      |   | 95,250  |        
|                                 |                   |   |              |         |      |   |         |        
|                                 | Total Liabilities |   |              | 255,993 |      |   |         | 348,772 | 
|Minority interest                |                   |   |              |         |      |   | 3,242   |        
|Partners capital                |                   |   |             |         |      |   | 908     |        
|Common securities                |                   |   | 7,910        |         |      |   | 158,283 |        
|                                 |                   |   |              |         |      |   |         |        
|Total Liabilities and Equity     |                   | $ | 263,903      |         |      | $ | 511,205 |        
|                                 |                   |   |              |         |      |   |         |        

|                                             |  |                     |         |      |  |   |        |  
|-------------------------------------------- |  | ------------------- | ------- | ---- |  | - | ------ | -
|                                             |  | For the Years Ended
|                                             |  | December 31,       
|                                             |  |                    
|                                             |  | 2003                |         | 2002
|                                             |  |                     |         |     
|Statement of Operations                      |  |                     |         |      |  |   |        |  
|Interest income from subordinated debentures |  | $                   | 14,534  |      |  | $ |       |  
|Revenue from the sale of real estate         |  |                     |        |      |  |   | 7,942  |  
|Selling, general and administrative expenses |  |                     |        |      |  |   | (6,775 | )
|Interest expense                             |  |                     | (14,109 | )    |  |   |       |  
|                                             |  |                     |         |      |  |   |        |  
|Net income                                   |  | $                   | 425     |      |  | $ | 1,167  |  
|                                             |  |                     |         |      |  |   |        |  

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

23.     Related Parties

The Abdo Companies, a company in which John E. Abdo, Vice Chairman of the
Company, is the principal shareholder and CEO, receives monthly management fees
from Levitt, which was a subsidiary of the Company until it was spun off to the
Companys stockholders on December 31, 2003. BFC received management fees in
connection with providing accounting, general and administrative services to
Levitt. The amounts paid may not be representative of the amounts that would be
paid in an arms-length transaction. Management fees paid to related parties by
Levitt were:

|               |  |                                  |         |      |  |      |         |  |  |   |         | 
|-------------- |  | -------------------------------- | ------- | ---- |  | ---- | ------- |  |  | - | ------- | 
|               |  | For the Years Ended December 31,
|               |  |                                 
|               |  | 2003                             |         | 2002 |  | 2001
|               |  |                                  |         |      |  |     
|Abdo Companies |  | $                                | 291,240 |      |  | $    | 291,240 |  |  | $ | 291,246 | 
|BFC            |  |                                  | 213,000 |      |  |      | 170,000 |  |  |   | 80,000  | 
|               |  |                                  |         |      |  |      |         |  |  |   |         | 
|               |  | $                                | 504,240 |      |  | $    | 461,240 |  |  | $ | 371,246 | 
|               |  |                                  |         |      |  |      |         |  |  |   |         | 

During the year ended December 31, 2003, BankAtlantic paid a subsidiary of
Levitt a $540,000 management fee to operate and sell a residential
construction property acquired through foreclosure. The property was sold to
an unrelated developer during the fourth quarter of 2003.

The Company is an investor in a privately held technology company located
in Boca Raton, Florida which owns 748,000 shares of the Companys Class A
Stock. The Company has a $15 million investment in 3,033,386 shares of the
technology companys common stock, which shares were acquired in October 1999
at an average price per share of $4.95. Both Alan B. Levan and John E. Abdo
became directors of the technology company in connection with the Companys
investment and individually invested in the technology company. Alan B. Levan
owns or controls direct and indirect interests in an aggregate of 286,709
shares of the technology companys common stock purchased at an average price
of $8.14 and Mr. Abdo owns or controls direct and indirect interests in an
aggregate of 368,408 shares of the technology companys common stock purchased
at an average price of $7.69. Jarett Levan has an indirect ownership interest
in an aggregate of 350 shares of such common stock, and director Bruno
DiGiulian has an indirect ownership interest in 1,754 shares of such common
stock. The Company and its affiliates collectively own approximately 7% of the
technology companys outstanding common stock. During 2001, Mr. Levan and Mr.
Abdo resigned from the technology companys Board of Directors and initiated a
lawsuit on behalf of the Company and others against the founder of the
technology company, personally, regarding his role. The Company and the other
owners of the shares of the technology company who are parties to the lawsuit
are sharing in the legal fees incurred in connection with the litigation in
proportion to their respective interests. In early 2003 the technology company
initiated a lawsuit against the Company seeking to have a restrictive legend on
its Company Class A Stock removed.

The Company and its subsidiaries utilized certain services of Ruden,
McClosky, Smith, Schuster & Russell, P.A. (Ruden, McClosky), a law firm to
which Bruno DiGiulian is of counsel. Fees aggregating $110,000 were paid by
BankAtlantic and $30,000 were paid by Ryan Beck to Ruden, McClosky in 2003. In
addition, fees aggregating $845,000 were paid to Ruden, McClosky by Levitt in
2003 prior to the spin off of Levitt from the Company. In 2002 and 2001, fees
aggregating $1.0 million and $793,000, respectively, were paid to the law firm
by BankAtlantic and Levitt Corporation. Ruden, McClosky also represents Alan
B. Levan and John E. Abdo with respect to certain other business interests.

Alan B. Levan, Jarett Levan and John E. Abdo have investments or are
partners in real estate joint ventures with developers, which developers, in
connection with other ventures, have loans from BankAtlantic or are joint
venture partners with Levitt Corporation.

Certain of the Companys affiliates, including its executive officers,
have independently made investments with their own funds in both public and
private entities in which the Company holds investments.

BFC paid BankAtlantic approximately $67,000 for each of the years 2003,
2002, and 2001 for office space used by BFC in BankAtlantics headquarters and
for miscellaneous administrative and other related expenses. BankAtlantic
provided certain administrative services to Bluegreen in 2003 without receipt
of payment for such services.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The BankAtlantic Foundation is a non-profit foundation established by
BankAtlantic. During 2003, the Foundation made donations aggregating $364,530,
including $25,000 to the Broward Community College Foundation (as the first
installment of a 4-year commitment of $100,000 to the Will and Jo Holcombe
Institute for Teaching and Learning), $15,000 to the Florida Grand Opera,
$7,500 to the Leadership Broward Foundation, $7,500 to Nova Southeastern
University (including $5,000 as the first installment of a 5-year, $25,000
commitment to the Wayne Huizenga School of Business and $2,500 to Nova
Southeastern University Libraries); $4,250 to ArtServe, $3,000 to the Broward
Performing Arts Foundation and $2,000 to the Museum of Art of Ft. Lauderdale.
In addition to the contributions made by the BankAtlantic Foundation,
BankAtlantic made certain direct contributions. In 2003 BankAtlantic made
donations of $11,500 to the Broward Community College Foundation, $10,963 to
the Urban League of Broward County, $6,000 to ArtServe, $1,160 to United Way of
Broward County and $900 to the Leadership Broward Foundation. Alan B. Levan
sits on the Boards of the Broward Community College Foundation, the Florida
Grand Opera and Nova Southeastern University, Jarett Levan sits on the Boards
of the Leadership Broward Foundation and ArtServe and the Board of Governors of
the Museum of Art of Ft. Lauderdale, John E. Abdo is President of the Broward
Performing Arts Foundation, Dr. Willis Holcombe sits on the Boards of the
Broward Community College Foundation and the Urban League of Broward County. In
addition both D. Keith Cobb and Lloyd DeVaux sit on the Board of the United Way
of Broward County.

During fiscal 2003, Jarett Levan, a director and son of director,
president and CEO Alan B. Levan, was employed by BankAtlantic as Chief
Marketing Officer and was paid approximately $211,000 for his services. Alan B.
Levans daughter, Shelley Levan Margolis, served as executive director of the
BankAtlantic Foundation and received approximately $43,000 for the year. For
the years ended December 31, 2002 and 2001, Jarett Levan received approximately
$170,000 and $145,000, respectively, while Shelly Levan Margolis received
approximately $102,000 and $88,000, respectively.

In connection with the Levitt spin-off, the Company entered into a
transitional services agreement with Levitt whereby the Company will provide
human resources, risk management and investor and public relation services and
receive compensation for such services on a percentage of cost basis.
Additionally, the Company entered into an employment matters agreement
providing for the allocation of responsibility and liability between the
Company and Levitt with respect to the welfare and benefit plans for Levitt
employees after the spin-off.

Also in connection with the spin-off of Levitt, the Company converted a
currently outstanding $30.0 million demand note owed by Levitt to the Company
to a five year term note with interest only payable monthly initially at the
prime rate and thereafter at a prime rate plus increments of an additional .25%
every six months. Prior to the spin-off, the Company transferred its 4.9%
ownership interest in Bluegreen Corporation to Levitt in exchange for a $5.5
million note and additional shares of Levitt common stock (which additional
shares were distributed as part of the spin-off transaction.) This note is due
in one year, with principal and interest payable monthly at the prime rate.
Additionally, prior to the spin-off, Levitt declared an $8.0 million dividend
to the Company payable in the form of a five year note with the same payment
terms as the $30.0 million note described above. BankAtlantic also has $18.1
million of construction loans to Levitt secured by land and improvements.

24. Segment Reporting

Operating segments are defined as components of an enterprise about which
separate financial information is available that is regularly reviewed by the
chief operating decision maker in deciding how to allocate resources and in
assessing performance. Reportable segments consist of one or more operating
segments with similar economic characteristics, products and services,
production processes, type of customer, distribution system and regulatory
environment. The information provided for Segment Reporting is based on
internal reports utilized by management. Results of operations are reported
through five reportable segments. Bank Investments, Commercial Banking, and
Community Banking are our Bank Operation segments, which are conducted through
BankAtlantic. The remaining reportable segments consist of the activities of
Ryan Beck and its subsidiaries and the parent company.The parent company
includes the operations of BankAtlantic Bancorp as well as acquisition related
expenses such as goodwill amortization and retention pool compensation expense
related to the acquisition of Ryan Beck in 1998. Interest expense and certain
revenue and expense items are allocated to the three Bank Operation reportable
segments as interest expense and overhead. The presentation and allocation of
interest expense and overhead and the net income calculated under the
management approach associated with the Bank Operation reportable segments and
the parent company may not reflect the actual economic costs, contribution or
results of operations of the unit as a stand alone business. If a different
basis of allocation were utilized, the relative contributions of the segments
might differ but the relative trends in the segments would, in managements
view, likely not be impacted.

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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The following summarizes the aggregation of the Companys operating
segments into reportable segments:

|                   |  |                                                                                
|------------------ |  | -------------------------------------------------------------------------------
|Reportable Segment |  | Operating Segments Aggregated                                                  
|                   |  |                                                                                
|Bank Investments   |  | Investments, tax certificates, residential                                     
|                   |  | loans purchased, CRA lending and real estate capital services                  
|Commercial Banking |  | Commercial lending, syndications, international,                               
|                   |  | lease finance, trade finance and a real estate joint venture
development       
|Community Banking  |  | Indirect and direct consumer lending, small business
lending and ATM operations
|Ryan Beck          |  | Investment banking and brokerage operations                                    
|Parent Company     |  | BankAtlantic Bancorps operations, costs of                                    
|                   |  | acquisitions, financing of acquisitions, and equity investments                

The accounting policies of the segments are generally the same as those
described in the summary of significant accounting policies. Intersegment
transactions consist of borrowings by a real estate joint venture and
investment banking operations which are recorded based upon the terms of the
underlying loan agreements and are eliminated. The elimination entries
consist of the intercompany loan interest income and interest expense,
consulting fees, and brokerage commission.

Depreciation and amortization consist of: depreciation on property and
equipment, amortization of premiums and discounts on loans and investments,
amortization of goodwill and core deposit intangible assets, and amortization
of the retention pool.

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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

The Company evaluates segment performance based on net segment income
after tax. The table below is segment information for income from continuing
operations for the three years ended December 31, 2003 (in thousands):

|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|-------------------------------------------------- |  | ---------- | --------- | --------- |  | ------- | -------- | ------- |  | ----------- | ------- | ------- |  | ------------- | ------- | - |  | - | --------- | -
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  | Adjusting and |         |   |  |  
|                                                   |  | Bank       |           |           |  |         |          | Parent  |  | Elimination |         | Segment
|                                                   |  | Operations |           | Ryan Beck |  | Company |          | Entries |  | Total      
|                                                   |  |            |           |           |  |         |          |         |  |            
|2003                                               |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Interest income                                    |  | $          | 251,402   |           |  | $       | 10,437   |         |  | $           | 1,722   |         |  | $             | (1,712  | ) |  | $ | 261,849   |  
|Interest expense                                   |  |            | (97,302   | )         |  |         | (1,283   | )       |  |             | (16,344 | )       |  |               | 1,712   |   |  |   | (113,217  | )
|Recovery from loan losses                          |  |            | 547       |           |  |         |         |         |  |             |        |         |  |               |        |   |  |   | 547       |  
|Non-interest income                                |  |            | 70,686    |           |  |         | 210,939  |         |  |             | 194     |         |  |               | (105    | ) |  |   | 281,714   |  
|Non-interest expense                               |  |            | (161,615  | )         |  |         | (203,524 | )       |  |             | (3,838  | )       |  |               | 105     |   |  |   | (368,872  | )
|Segment profits and losses
before taxes            |  |            | 63,718    |           |  |         | 16,569   |         |  |             | (18,266 | )       |  |               |        |   |  |   | 62,021    |  
|Provision for income taxes                         |  |            | (21,589   | )         |  |         | (6,924   | )       |  |             | 5,089   |         |  |               |        |   |  |   | (23,424   | )
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment net income (loss)                          |  | $          | 42,129    |           |  | $       | 9,645    |         |  | $           | (13,177 | )       |  | $             |        |   |  | $ | 38,597    |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment average assets (1)                         |  | $          | 4,987,418 |           |  | $       | 200,760  |         |  | $           | 98,840  |         |  | $             | 235,103 |   |  | $ | 5,522,121 |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $          |          |           |  | $       |         |         |  | $           | 7,910   |         |  | $             |        |   |  | $ | 7,910     |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Expenditures for segment
Assets                    |  | $          | 704       |           |  | $       | 1,310    |         |  | $           |        |         |  | $             |        |   |  | $ | 2,014     |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Depreciation and
amortization                      |  | $          | (7,877    | )         |  | $       | (1,711   | )       |  | $           |        |         |  | $             |        |   |  | $ | (9,588    | )
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|2002                                               |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Interest income                                    |  | $          | 297,092   |           |  | $       | 7,512    |         |  | $           | 1,745   |         |  | $             | (2,962  | ) |  | $ | 303,387   |  
|Interest expense                                   |  |            | (132,970  | )         |  |         | (1,444   | )       |  |             | (17,439 | )       |  |               | 2,962   |   |  |   | (148,891  | )
|Provision for loan losses                          |  |            | (14,077   | )         |  |         |         |         |  |             |        |         |  |               |        |   |  |   | (14,077   | )
|Non-interest income                                |  |            | 53,317    |           |  |         | 133,845  |         |  |             | (15,323 | )       |  |               | (90     | ) |  |   | 171,749   |  
|Non-interest expense                               |  |            | (134,408  | )         |  |         | (144,494 | )       |  |             | (5,155  | )       |  |               | 90      |   |  |   | (283,967  | )
|Segment profits and losses
before taxes            |  |            | 68,954    |           |  |         | (4,581   | )       |  |             | (36,172 | )       |  |               |        |   |  |   | 28,201    |  
|Provision for income taxes                         |  |            | (23,845   | )         |  |         | 2,133    |         |  |             | 12,661  |         |  |               |        |   |  |   | (9,051    | )
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment net income (loss)                          |  | $          | 45,109    |           |  | $       | (2,448   | )       |  | $           | (23,511 | )       |  | $             |        |   |  | $ | 19,150    |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment average assets (1)                         |  | $          | 4,972,740 |           |  | $       | 189,523  |         |  | $           | 100,296 |         |  | $             | 147,471 |   |  | $ | 5,410,030 |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $          | 23,602    |           |  | $       |         |         |  | $           | 1,934   |         |  | $             |        |   |  | $ | 25,536    |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Expenditures for segment
Assets                    |  | $          | 299       |           |  | $       | 2,285    |         |  | $           |        |         |  | $             |        |   |  | $ | 2,584     |  
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  
|Depreciation and
amortization                      |  | $          | (5,113    | )         |  | $       | (1,225   | )       |  | $           | (690    | )       |  | $             |        |   |  | $ | (7,028    | )
|                                                   |  |            |           |           |  |         |          |         |  |             |         |         |  |               |         |   |  |   |           |  

(1)  The adjusting and elimination entries include the average assets of Levitt

F-73



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|-------------------------------------------------- |  | ---------- | --------- | --------- |  | ------- | ------- | ------- |  | ----------- | ------- | ------- |  | ------------- | ------- | - |  | - | --------- | -
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  | Adjusting and |         |   |  |  
|                                                   |  | Bank       |           |           |  |         |         | Parent  |  | Elimination |         | Segment
|                                                   |  | Operations |           | Ryan Beck |  | Company |         | Entries |  | Total      
|                                                   |  |            |           |           |  |         |         |         |  |            
|2001                                               |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Interest income                                    |  | $          | 324,732   |           |  | $       | 1,978   |         |  | $           | 229     |         |  | $             | (2,913  | ) |  | $ | 324,026   |  
|Interest expense                                   |  |            | (171,010  | )         |  |         | (517    | )       |  |             | (18,297 | )       |  |               | 2,912   |   |  |   | (186,912  | )
|Provision for loan losses                          |  |            | (16,905   | )         |  |         |        |         |  |             |        |         |  |               |        |   |  |   | (16,905   | )
|Non-interest income                                |  |            | 37,457    |           |  |         | 44,683  |         |  |             | 3,129   |         |  |               | (334    | ) |  |   | 84,935    |  
|Non-interest expense                               |  |            | (103,353  | )         |  |         | (48,170 | )       |  |             | (13,466 | )       |  |               | 335     |   |  |   | (164,654  | )
|Segment profits and losses                         |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |          |  
|before taxes                                       |  |            | 70,921    |           |  |         | (2,026  | )       |  |             | (28,405 | )       |  |               |        |   |  |   | 40,490    |  
|Provision for income taxes                         |  |            | (26,292   | )         |  |         | 709     |         |  |             | 7,623   |         |  |               |        |   |  |   | (17,960   | )
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment net income                                 |  | $          | 44,629    |           |  | $       | (1,317  | )       |  | $           | (20,782 | )       |  | $             |        |   |  | $ | 22,530    |  
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Segment average assets (1)                         |  | $          | 4,419,230 |           |  | $       | 74,108  |         |  | $           | 99,220  |         |  | $             | 102,861 |   |  | $ | 4,695,419 |  
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $          |          |           |  | $       |        |         |  | $           | 1,107   |         |  | $             |        |   |  | $ | 1,107     |  
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Expenditures for segment
assets                    |  | $          | 297       |           |  | $       | 1,003   |         |  | $           |        |         |  | $             |        |   |  | $ | 1,300     |  
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  
|Depreciation and
amortization                      |  | $          | (3,612    | )         |  | $       | (1,580  | )       |  | $           | (7,749  | )       |  | $             |        |   |  | $ | (12,941   | )
|                                                   |  |            |           |           |  |         |         |         |  |             |         |         |  |               |         |   |  |   |           |  

The changes in the carrying amount of goodwill for the year ended December
31, 2003 was as follows (in thousands):

|                                |  |            |        |           |  |         |        |         |  |             |       |         |  |   |   |  |  |   |        |  
|------------------------------- |  | ---------- | ------ | --------- |  | ------- | ------ | ------- |  | ----------- | ----- | ------- |  | - | - |  |  | - | ------ | -
|                                |  | Bank       |        |           |  |         |        | Parent  |  | Elimination |       | Segment
|                                |  | Operations |        | Ryan Beck |  | Company |        | Entries |  | Total      
|                                |  |            |        |           |  |         |        |         |  |            
|Balance as of
December 31, 2002 |  | $          | 71,224 |           |  | $       | 1,658  |         |  | $           | 5,730 |         |  | $ |  |  |  | $ | 78,612 |  
|Loan losses acquired            |  |            | (734   | )         |  |         |       |         |  |             |      |         |  |   |  |  |  |   | (734   | )
|Sale of Cumberland              |  |            |       |           |  |         | (1,204 | )       |  |             |      |         |  |   |  |  |  |   | (1,204 | )
|                                |  |            |        |           |  |         |        |         |  |             |       |         |  |   |   |  |  |   |        |  
|Balance as of
December 31, 2003 |  | $          | 70,490 |           |  | $       | 454    |         |  | $           | 5,730 |         |  | $ |  |  |  | $ | 76,674 |  
|                                |  |            |        |           |  |         |        |         |  |             |       |         |  |   |   |  |  |   |        |  

F-74



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Bank Operations consists of three reportable segments. The table below is
segment information for income from continuing operations for the three years
ended December 31, 2003 (in thousands):

|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|-------------------------------------------------- |  | --------------- | --------- | ---------- |  | --------- | --------- | -------- |  | - | ------- | - |  | - | --------- | -
|                                                   |  | Bank Operations |           |            |  |          
|                                                   |  |                 |           |            |  |          
|                                                   |  | Bank            |           | Commercial |  | Community |           | Bank Ops
|                                                   |  | Investments     |           | Banking    |  | Banking   |           | Total   
|                                                   |  |                 |           |            |  |           |           |         
|2003                                               |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Interest income                                    |  | $               | 122,005   |            |  | $         | 103,206   |          |  | $ | 26,191  |   |  | $ | 251,402   |  
|Interest expense and overhead                      |  |                 | (90,239   | )          |  |           | (49,321   | )        |  |   | (13,634 | ) |  |   | (153,194  | )
|(Provision) recovery for
loan losses               |  |                 | 442       |            |  |           | (782      | )        |  |   | 887     |   |  |   | 547       |  
|Direct non-interest income                         |  |                 | 431       |            |  |           | 3,683     |          |  |   | 10,401  |   |  |   | 14,515    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment profits and losses
before taxes            |  |                 | 20,886    |            |  |           | 37,744    |          |  |   | 5,088   |   |  |   | 63,718    |  
|Provision for income taxes                         |  |                 | (7,077    | )          |  |           | (12,788   | )        |  |   | (1,724  | ) |  |   | (21,589   | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment net income                                 |  | $               | 13,809    |            |  | $         | 24,956    |          |  | $ | 3,364   |   |  | $ | 42,129    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment average assets                             |  | $               | 2,440,500 |            |  | $         | 1,775,770 |          |  | $ | 490,476 |   |  | $ | 4,706,746 |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $               |          |            |  | $         |          |          |  | $ |        |   |  | $ |          |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Expenditures for segment
assets                    |  | $               | 27        |            |  | $         | 48        |          |  | $ | 629     |   |  | $ | 704       |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Depreciation and amortization                      |  | $               | (7,720    | )          |  | $         | 6         |          |  | $ | (163    | ) |  | $ | (7,877    | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|2002                                               |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Interest income                                    |  | $               | 164,625   |            |  | $         | 106,746   |          |  | $ | 25,721  |   |  | $ | 297,092   |  
|Interest expense and overhead                      |  |                 | (113,908  | )          |  |           | (61,032   | )        |  |   | (15,142 | ) |  |   | (190,082  | )
|Provision for loan losses                          |  |                 | (305      | )          |  |           | (12,533   | )        |  |   | (1,239  | ) |  |   | (14,077   | )
|Direct non-interest income                         |  |                 | 5,136     |            |  |           | 5,748     |          |  |   | 9,616   |   |  |   | 20,500    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment profits and losses
before taxes            |  |                 | 44,337    |            |  |           | 25,694    |          |  |   | (1,077  | ) |  |   | 68,954    |  
|Provision for income taxes                         |  |                 | (15,332   | )          |  |           | (8,885    | )        |  |   | 372     |   |  |   | (23,845   | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment net income (loss)                          |  | $               | 29,005    |            |  | $         | 16,809    |          |  | $ | (705    | ) |  | $ | 45,109    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment average assets                             |  | $               | 2,639,070 |            |  | $         | 1,653,148 |          |  | $ | 407,361 |   |  | $ | 4,699,579 |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $               |          |            |  | $         | 23,602    |          |  | $ |        |   |  | $ | 23,602    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Expenditures for segment
assets                    |  | $               |          |            |  | $         | 10        |          |  | $ | 289     |   |  | $ | 299       |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Depreciation and amortization                      |  | $               | (4,715    | )          |  | $         | (15       | )        |  | $ | (383    | ) |  | $ | (5,113    | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  

F-75



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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|-------------------------------------------------- |  | --------------- | --------- | ---------- |  | --------- | --------- | -------- |  | - | ------- | - |  | - | --------- | -
|                                                   |  | Bank Operations
|                                                   |  |                
|                                                   |  | Bank            |           | Commercial |  | Community |           | Bank Ops
|                                                   |  | Investments     |           | Banking    |  | Banking   |           | Total   
|                                                   |  |                 |           |            |  |           |           |         
|2001                                               |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Interest income                                    |  | $               | 179,151   |            |  | $         | 118,430   |          |  | $ | 27,151  |   |  | $ | 324,732   |  
|Interest expense and
overhead                      |  |                 | (135,160  | )          |  |           | (68,864   | )        |  |   | (16,325 | ) |  |   | (220,349  | )
|Provision for loan losses                          |  |                 | 215       |            |  |           | (21,096   | )        |  |   | 3,976   |   |  |   | (16,905   | )
|Direct non-interest income                         |  |                 | 919       |            |  |           | 3,074     |          |  |   | 11,073  |   |  |   | 15,066    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment profits and losses
before taxes            |  |                 | 39,383    |            |  |           | 25,413    |          |  |   | 6,125   |   |  |   | 70,921    |  
|Provision for income taxes                         |  |                 | (14,598   | )          |  |           | (9,420    | )        |  |   | (2,274  | ) |  |   | (26,292   | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment net income                                 |  | $               | 24,785    |            |  | $         | 15,993    |          |  | $ | 3,851   |   |  | $ | 44,629    |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Segment average assets                             |  | $               | 2,571,246 |            |  | $         | 1,368,850 |          |  | $ | 323,430 |   |  | $ | 4,263,526 |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Equity method investments
included in total assets |  | $               |          |            |  | $         |          |          |  | $ |        |   |  | $ |          |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Expenditures for segment
assets                    |  | $               | 137       |            |  | $         | 3         |          |  | $ | 157     |   |  | $ | 297       |  
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  
|Depreciation and
amortization                      |  | $               | (2,534    | )          |  | $         | (319      | )        |  | $ | (759    | ) |  | $ | (3,612    | )
|                                                   |  |                 |           |            |  |           |           |          |  |   |         |   |  |   |           |  

The changes in the carrying amount of goodwill for the year ended December
31, 2003 were as follows (in thousands):

|                                |  |                 |        |            |  |           |        |          |  |   |     |  |  |   |        |  
|------------------------------- |  | --------------- | ------ | ---------- |  | --------- | ------ | -------- |  | - | --- |  |  | - | ------ | -
|                                |  | Bank Operations
|                                |  |                
|                                |  | Bank            |        | Commercial |  | Community |        | Bank Ops
|                                |  | Investments     |        | Banking    |  | Banking   |        | Total   
|                                |  |                 |        |            |  |           |        |         
|Balance as of December 31, 2002 |  | $               | 34,322 |            |  | $         | 35,977 |          |  | $ | 925 |  |  | $ | 71,224 |  
|Loan losses acquired adjustment |  |                 |       |            |  |           | (734   | )        |  |   |    |  |  |   | (734   | )
|                                |  |                 |        |            |  |           |        |          |  |   |     |  |  |   |        |  
|Balance as of December 31, 2003 |  | $               | 34,322 |            |  | $         | 35,243 |          |  | $ | 925 |  |  | $ | 70,490 |  
|                                |  |                 |        |            |  |           |        |          |  |   |     |  |  |   |        |  

F-76



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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)




ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

On
January 7, 2003, the Company dismissed KPMG LLP as its
independent public accountants effective upon completion of the audit of the
fiscal year ended December 31, 2002.
The reports of KPMG LLP on the financial statements for the past years
ended December 31, 2002 and 2001 contained no adverse opinion or
disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope or accounting principles, except that in
2001, the Company changed its method of accounting for derivative
instruments and hedging activities.

The decision to change accountants was approved by the Audit Committee of
the board of directors of the Company. In connection with its audits for the
two most recent fiscal years ended December 31, 2002 and 2001, and through the
date of this filing, there have been no disagreements with KPMG LLP on any
matter of accounting principles or practices, financial statement disclosure,
auditing scope or procedure, which disagreements if not resolved to the
satisfaction of KPMG LLP would have caused them to make reference thereto in
their report on the financial statements for such years.

The Companys Audit Committee engaged PricewaterhouseCoopers LLP as its
independent certified public accountant effective as of January 1, 2003.
During the two years in the period ended December 31, 2002 and
through January 7, 2003, the Company had not consulted with PricewaterhouseCoopers LLP regarding either (i) the application of accounting principles to a specific
transaction, either completed or proposed; or the type of audit
opinion that might be rendered on the Companys financial
statements; or (ii) any matter that was either the subject of a
disagreement, as that term is defined in Item 304 (a)(1)(iv) of Regulation
S-K and the related instructions to Item 304 of Regulation S-K, or a
reportable event, as that term is defined in Item (a)(1)(v) of Regulation S-K.




ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, we carried out an
evaluation, under the supervision and with the participation of our principal
executive officer and principal financial officer, of the effectiveness of the
design and operation of our disclosure controls and procedures. Based on this
evaluation, our principal executive officer and principal financial officer
concluded that our disclosure controls and procedures are effective in timely
alerting them to material information required to be included in our periodic
SEC reports.

Changes in Internal Controls

In addition, we reviewed our internal control over financial reporting,
and there have been no significant changes in our internal control over
financial reporting or in other factors that could significantly affect those
controls subsequent to the date of the last evaluation.

Limitations on the Effectiveness of Controls

Our management, including our principal executive officer and principal
financial officer, does not expect that our disclosure controls and procedures
and internal controls over financial reporting will prevent all errors and all
improper conduct. A control system, no matter how well conceived and operated,
can provide only reasonable, not absolute, assurance that the objectives of the
control system are met. Further, the design of a control system must reflect
the fact that there are resource constraints, and the benefits of controls must
be considered relative to their costs. Because of the inherent limitations in
all control systems, no evaluation of controls can provide absolute assurance
that all control issues and instances of improper conduct, if any, within the
Company have been detected. These inherent limitations include the realities
that judgments in decision-making can be faulty, and that breakdowns can occur
because of simple error or mistake.





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BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

Additionally, controls can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
control.

Further, the design of any system of controls also is based in part upon
assumptions about the likelihood of future events, and there can be no
assurance that any design will succeed in achieving its stated goals under all
potential future conditions; over time, controls may become inadequate because
of changes in conditions, or the degree of compliance with the policies or
procedures may deteriorate. Because of the inherent limitations in a
cost-effective control system, misstatements due to error or fraud may occur
and not be detected.

CEO and CFO Certifications

Appearing as Exhibits 31.1 and 31.2 to this annual report are
Certifications of the principal executive officer and the principal financial
officer. The Certifications are required in accordance with Section 302 of the
Sarbanes-Oxley Act of 2002. This Item of this report, which you are currently
reading, is the information concerning the evaluation referred to in the
Section 302 Certifications and this information should be read in conjunction
with the Section 302 Certifications for a more complete understanding of the
topics presented.




PART III

Items 10 through 14 will be provided by incorporating the information
required under such items by reference to the registrants definitive proxy
statement to be filed with the Securities and Exchange Commission, no later
than 120 days after the end of the year covered by this Form 10-K, or,
alternatively, by amendment to this Form 10-K under cover of 10-K/A no later
than the end of such 120 day period.




PART IV




ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) Documents Filed as Part of this Report:

(1)  Financial Statements



| |  |  | The following consolidated financial statements of BankAtlantic
Bancorp, Inc. and its subsidiaries are included herein under Part
II, Item 8 of this Report.
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Independent Certified Public Accountants Report of
PricewaterhouseCoopers LLP dated February 13, 2004.                                         
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Independent Certified Public Accountants Report of KPMG
LLP dated February 3, 2003.                                                            
|
| |  |  | Consolidated Statements of Financial Condition as of
December 31, 2003 and 2002.                                                                
|
| |  |  | Consolidated Statements of Operations for each of the
years in the three year period ended December 31, 2003.                                   
|
| |  |  | Consolidated Statements of Stockholders Equity and
Comprehensive Income for each of the years in the three
year period ended December 31, 2003.
|
| |  |  | Consolidated Statements of Cash Flows for each of the
years in the three year period ended December 31, 2003.                                   





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)



| |  |  | Notes to Consolidated Financial Statements for each of
the years in the three year period ended December 31,
2003.
| |  |  | ------------------------------------------------------------------------------------------------------------------

(2)  Financial Statement Schedules



| |  |  | All schedules are omitted as the required information is either not
applicable or presented in the financial statements or related
notes.
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

(3) Exhibits

The following exhibits are either filed as a part of this Report or are
incorporated herein by reference to documents previously filed as indicated
below:

|          |  |                                                                                                           |  |                                                                                                                                           
|--------- |  | --------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit   |  |                                                                                                           |  |                                                                                                                                           
|Number    |  | Description                                                                                               |  | Reference                                                                                                                                 
|          |  |                                                                                                           |  |                                                                                                                                           
|3.1       |  | Restated Articles of Incorporation                                                                        |  | Exhibit 3.1 to the Registrants Quarterly Report
on
Form 10-Q for the quarter ended June 30,
2001, filed on August 14, 2001.              
|          |  |                                                                                                           |  |                                                                                                                                           
|3.3       |  | Amended and Restated Bylaws                                                                               |  | Filed with this Report                                                                                                                    
|          |  |                                                                                                           |  |                                                                                                                                           
|10.1      |  | Amendments to Stock Option Plans*                                                                         |  | Exhibit 10.1 to the Registrants quarterly
report on
Form 10-Q for the quarter ended September 30,
2003 filed on November 14, 2003.       
|          |  |                                                                                                           |  |                                                                                                                                           
|10.5      |  | 1998 Ryan Beck Stock Option Plan*                                                                         |  | Appendix A, Exhibit B to the Registrants
Registration statement on Form S-4 filed on
May 26, 1998. (Registration No. 333-53107)          
|          |  |                                                                                                           |  |                                                                                                                                           
|10.6      |  | BankAtlantic Bancorp 2000 Non-qualified Stock
Option Plan                                                 |  | Form 10-K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                  
|          |  |                                                                                                           |  |                                                                                                                                           
|10.7      |  | BankAtlantic Bancorp 1996 Stock Option Plan*                                                              |  | Appendix A to the Registrants Definitive
Proxy Statement filed on April 25, 1996.                                                        
|          |  |                                                                                                           |  |                                                                                                                                           
|10.8      |  | BankAtlantic Bancorp 1998 Stock Option Plan*                                                              |  | Appendix A to the Registrants Definitive
Proxy Statement filed on March 16, 1998.                                                        
|          |  |                                                                                                           |  |                                                                                                                                           
|10.9      |  | BankAtlantic Bancorp, Inc. Restricted Stock
Award Plan for Key Employees of Ryan,
Beck & Co., Inc.*       |  | Exhibit 10.9 to the Registrants Annual Report on
Form 10-K for the year ended December 31, 1998,
Filed on March 26, 1999.                
|          |  |                                                                                                           |  |                                                                                                                                           
|10.10     |  | BankAtlantic Bancorp, Inc. - Ryan Beck
Restricted Stock Incentive Plan*                                   |  | Exhibit 10.10 to the Registrants Annual Report
on
Form 10-K for the year ended December 31, 1998.
Filed on March 26, 1999.               
|          |  |                                                                                                           |  |                                                                                                                                           
|10.11     |  | BankAtlantic Bancorp-Ryan Beck Executive
Incentive Plan*                                                  |  | Appendix B to the Registrants Definitive Proxy
Statement filed on June 22, 1999.                                                         
|          |  |                                                                                                           |  |                                                                                                                                           
|10.12     |  | BankAtlantic Bancorp 1999 Stock Option Plan*                                                              |  | Appendix C to the Registrants Definitive Proxy
Statement filed on June 22, 1999.                                                         
|          |  |                                                                                                           |  |                                                                                                                                           
|10.13     |  | BankAtlantic Bancorp 1999 Non-qualified Stock
Option Plan*                                                |  | Form 10-K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                  
|          |  |                                                                                                           |  |                                                                                                                                           
|10.15     |  | Columbus Bank and Trust Company loan
Agreement, dated as of September 17, 2001                            |  | Form 10-K for the year ended December 31, 2001,                                                                                           
|          |  |                                                                                                           |  |                                                                                                                                           
|10.16     |  | First Modification of Columbus Bank and Trust
Company Loan Agreement, dated January 23,
2004              |  | Filed on March 30, 2002.
Filed with this Report                                                                                           
|          |  |                                                                                                           |  |                                                                                                                                           
|10.17     |  | Employment agreement of Ben A. Plotkin                                                                    |  | Appendix A, Exhibit D to the Registrants
Registration statement on Form S-4 filed on
May 26, 1998. (Registration No. 333-53107)          
|          |  |                                                                                                           |  |                                                                                                                                           
|10.18     |  | Employment agreement of Lloyd B. DeVaux                                                                   |  | Form 10K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                   
|          |  |                                                                                                           |  |                                                                                                                                           
|10.19 (a) |  | BankAtlantic Split Dollar Life Insurance Plan                                                             |  | Form 10-K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                  
|          |  |                                                                                                           |  |                                                                                                                                           
|10.19 (b) |  | BankAtlantic Split Dollar Life Insurance Plan
Agreement with Alan B. Levan                                |  | Form 10-K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                  
|          |  |                                                                                                           |  |                                                                                                                                           
|10.19 (c) |  | Corrective amendment to BankAtlantic Split
Dollar Life Insurance Plan Agreement                           |  | Form 10-K for the year ended December 31, 2001,
Filed on March 30, 2002.                                                                  
|          |  |                                                                                                           |  |                                                                                                                                           
|10.20     |  | Indenture for the Registrants 8.50% Junior
Subordinated Debentures due 2027 held by BBC
Capital Trust II |  | Exhibit 4.4 to the Registrants form S-3A, filed
On October 24, 2001 (Registration 333-71594
and 333-71594-01)                            
|          |  |                                                                                                           |  |                                                                                                                                           
|10.21     |  | Amended and Restated Trust Agreement of BBC
Capital Trust II                                              |  | Exhibit 4.9 to the Registrants Registration
Statement From S-3A, filed on October 27, 2001
(Registration Nos. 333-71594 and 333-71594-01)
|          |  |                                                                                                           |  |                                                                                                                                           





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|        |  |                                                                                                                                                 |  |                                                                                                                                    
|------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------
|Exhibit |  |                                                                                                                                                 |  |                                                                                                                                    
|Number  |  | Description                                                                                                                                     |  | Reference                                                                                                                          
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.22   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust III                                                                    |  | Exhibit 10.1 to the Registrants quarterly
report on Form 10-Q for the quarter ended June
30, 2002 filed on August 14, 2002.       
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.23   |  | Indenture for the Registrants Floating Rate
Junior Subordinated Deferrable Interest
Debentures held by BBC Capital Trust III                   |  | Exhibit 10.2 to the Registrants quarterly
report on Form 10-Q for the quarter ended June
30, 2002 filed on August 14, 2002.       
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.24   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust IV                                                                     |  | Exhibit 10.1 to the Registrants quarterly
report on Form 10-Q for the quarter ended
September 30, 2002 filed on November 14, 2002.
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.25   |  | Indenture for the Registrants Floating Rate
Junior Subordinated Deferrable Interest
Debentures due 2032 held by BBC Capital
Statutory Trust IV |  | Exhibit 10.2 to the Registrants quarterly
report on Form 10-Q for the quarter ended
September 30, 2002 filed on November 14, 2002.
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.26   |  | Amended and Restated Trust Agreement of BBC
Capital Trust V                                                                                     |  | Exhibit 10.3 to the Registrants quarterly
report on Form 10-Q for the quarter ended
September 30, 2002 filed on November 14, 2002.
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.27   |  | Indenture for the Registrants Floating Rate
Junior Subordinated Notes due 2032 held by
BBC Capital Trust V                                     |  | Exhibit 10.3 to the Registrants quarterly
report on Form 10-Q for the quarter ended
September 30, 2002 filed on November 14, 2002.
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.28   |  | Indenture for the Companys Floating Rate
Junior Subordinated Notes due 2032 held by
BBC Capital Trust VI                                       |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.29   |  | Amended and Restated Trust Agreement of BBC
Capital Trust VI                                                                                    |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.30   |  | Indenture for the Companys Floating Rate
Junior Subordinated Deferrable Interest
Debentures due 2032 held by BBC Capital
Statutory Trust VII   |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.31   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust VII                                                                    |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.32   |  | Indenture for the Companys Floating Rate
Junior Subordinated Debt Securities due 2033
held by BBC Capital Trust VIII                           |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.33   |  | Amended and Restated Declaration of Trust of
BBC Capital Trust VIII                                                                             |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.34   |  | Indenture for the Companys Floating Rate
Junior Subordinated Debt Securities due 2033
held by BBC Capital Trust IX                             |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.35   |  | Amended and Restated Declaration of Trust of
BBC Capital Trust IX                                                                               |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.36   |  | Indenture for BankAtlantics Floating Rate
Subordinated Debt Securities due 2012                                                                |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.37   |  | Amendment to the BankAtlantic Bancorp, Inc.
1999 Stock Option Plan                                                                              |  | Form 10-K for the year ended December 31, 2002,
filed on March 31, 2003.                                                           
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.38   |  | Amended and Restated BankAtlantic Bancorp
2001 Option Plan                                                                                      |  | Appendix B to the Registrants Definitive Proxy
Statement filed on April 18, 2002.                                                 
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.39   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust X                                                                      |  | Exhibit 10.1 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31,
2003 filed on May 15, 2003.         
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.40   |  | Indenture for the Companys Floating Rate
Junior Subordinated Deferrable Interest
Debentures due 2033 held by BBC Capital
Statutory Trust X     |  | Exhibit 10.2 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31, 2003
filed on May 15, 2003.         
|        |  |                                                                                                                                                 |  |                                                                                                                                    
|10.41   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust XI                                                                     |  | Exhibit 10.3 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31,
2003 filed on May 15, 2003.         
|        |  |                                                                                                                                                 |  |                                                                                                                                    





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)

|        |  |                                                                                                                                               |  |                                                                                                                           
|------- |  | --------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------
|Exhibit |  |                                                                                                                                               |  |                                                                                                                           
|Number  |  | Description                                                                                                                                   |  | Reference                                                                                                                 
|        |  |                                                                                                                                               |  |                                                                                                                           
|10.42   |  | Indenture for the Companys Floating Rate
Junior Subordinated Deferrable Interest
Debentures due 2033 held by BBC Capital
Statutory Trust XI  |  | Exhibit 10.4 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31, 2003
filed on May 15, 2003.
|        |  |                                                                                                                                               |  |                                                                                                                           
|10.43   |  | Amended and Restated Declaration of Trust of
BBC Capital Statutory Trust XII                                                                  |  | Exhibit 10.5 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31,
2003 filed on May 15, 2003.
|        |  |                                                                                                                                               |  |                                                                                                                           
|10.44   |  | Indenture for the Companys Floating Rate
Junior Subordinated Deferrable Interest
Debentures due 2033 held by BBC Capital
Statutory Trust XII |  | Exhibit 10.6 to the Registrants quarterly
report on
Form 10-Q for the quarter ended March 31, 2003
filed on May 15, 2003.
|        |  |                                                                                                                                               |  |                                                                                                                           
|12.1    |  | Ratio of Earnings to Fixed Charges                                                                                                            |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|21.1    |  | Subsidiaries of the Registrant                                                                                                                |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|23.1    |  | Consent of PricewaterhouseCoopers LLP                                                                                                         |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|23.2    |  | Consent of KPMG LLP                                                                                                                           |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|31.1    |  | Certification pursuant to Regulation S-X
Section 302                                                                                          |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|31.2    |  | Certification pursuant to Regulation S-X
Section 302                                                                                          |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|32.1    |  | Certification pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002                        |  | Filed with this Report.                                                                                                   
|        |  |                                                                                                                                               |  |                                                                                                                           
|32.2    |  | Certification pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002                        |  | Filed with this Report.                                                                                                   

*Compensatory Plan

Reports on Form 8-K

Filed on December 31, 2003, reporting the distribution to the Companys
stockholders of informational materials associated with the spin-off of Levitt
Corporation.

Filed on December 16, 2003, filing pro forma financial information associated
with the spin-off of Levitt Corporation.

Filed on December 5, 2003, reporting that the Companys Board of Directors
authorized the spin-off of Levitt Corporation.





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##### Table of Contents



BANKATLANTIC BANCORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)




SIGNATURES

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

|                  |  |                            |  |                                       |  |                  |  | 
|----------------- |  | -------------------------- |  | ------------------------------------- |  | ---------------- |  | 
|                  |  | BankAtlantic Bancorp, Inc.
|                  |  |                            |  |                                       |  |                  |  | 
|February 20, 2004 |  |                            |  | By:                                   |  | /s/Alan B. Levan |  | 
|                  |  |                            |  |                                       |  |                  |  | 
|                  |  |                            |  | Alan B. Levan, Chairman of the Board,
|                  |  |                            |  | President and Chief Executive Officer

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

|                                                        |  |                                                             
|------------------------------------------------------- |  | ------------------------------------------------------------
|Signature                                               |  | Title                                                       
|                                                        |  |                                                             
|/s/Alan B. Levan                                        |  | Chairman of the Board, President and Chief Executive
Officer
|Alan B. Levan                                           |  |                                                             
|                                                        |  |                                                             
|/s/John E Abdo                                          |  | Vice Chairman of the Board                                  
|John E. Abdo                                            |  |                                                             
|                                                        |  |                                                             
|/s/James A. White                                       |  | Executive Vice President and Chief Financial Officer        
|James A. White                                          |  |                                                             
|                                                        |  |                                                             
|/s/Steven M. Coldren

Steven M. Coldren                 |  | Director                                                    
|                                                        |  |                                                             
|/s/Mary E. Ginestra

Mary E. Ginestra                   |  | Director                                                    
|                                                        |  |                                                             
|/s/Bruno Di Giulian
Bruno Di Giulian                    |  | Director                                                    
|                                                        |  |                                                             
|/s/Charlie C. Winningham, II

Charlie C. Winningham, II |  | Director                                                    
|                                                        |  |                                                             
|/s/Jarett S. Levan

Jarett S. Levan                     |  | Director                                                    
|                                                        |  |                                                             
|/s/Jonathan Mariner                                     |  | Director                                                    
|                                                        |  |                                                             
|Jonathan Mariner                                        |  |                                                             
|                                                        |  |                                                             
|/s/D. Keith Cobb

D. Keith Cobb                         |  | Director                                                    
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|/s/Willis Holcombe                                      |  | Director                                                    
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|Willis Holcombe                                         |  |