Fitch Ratings has downgraded BankUnited Financial Corp.'s long-term issuer default, senior debt, and individual ratings, and revised the company's rating outlook to negative. The rating agency said the Coral Gables, Fla.-based financial institution has seen rapid credit deterioration because of a sharp rise in nonperforming assets to levels beyond what Fitch had expected. BankUnited had a fiscal first-quarter loss of $25.5 million. "Asset quality has been hampered by the rise in delinquencies within its option ARM portfolio, particularly loans with 2006 vintages," Fitch said. "The worsening asset quality metrics prompted the company to boost provisions by $65 million to $117.7 million for the period, compared to $58.6 million the previous quarter." As for the negative outlook, Fitch said the weak housing market could put further pressure on BankUnited's earnings and asset quality. BankUnited is downsizing its wholesale mortgage production platform.
