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Regulators Shut Florida's BankUnited

Stocks in this article: BKUNA BX

Updated from 5:51 p.m. EDT

The Office of Thrift Supervision closed Florida's BankUnited (BKUNA) Thursday, saying it "was critically undercapitalized and in an unsafe condition to conduct business."

The Federal Deposit Insurance Corp. was appointed as receiver of the $13.1 billion Coral Gables-based bank. The bank reported losses of $1.2 billion last year as its loan quality deteriorated, the OTS said in a statement.

Regulators said BankUnited FSB has $8.7 billion in retail deposits, nearly 1,100 employees and more than 80 branches, all of them in Florida. John Kanas, the former CEO of North Fork Bank, will lead the bank's management team, the FDIC said. The bank's new ownership group includes WL Ross & Co., Carlyle Investment Management, a unit of Blackstone Group (BX), Centerbridge Capital Partners, LeFrak Organization, The Wellcome Trust, Greenaap Investments and East Rock Endowment Fund.

The new bank will be called BankUnited and will be a newly chartered federal savings bank. The new firm won't take on approximately $348 million in brokered deposits. The FDIC will pay the brokers directly, the agency said in a statement.

The FDIC estimated that the cost to its deposit insurance fund will be $4.9 billion. BankUnited FSB was the 34th FDIC-insured U.S. institution to fail this year and the third in Florida. Since the beginning of 2008, five Florida banks have failed. Across the nation, 59 have been closed in that time. Before BankUnited, the last bank to be closed in Florida was Riverside Bank of the Gulf Coast in February.

Florida trails only Georgia, which leads all states with 11 bank or thrift failures in the past two years, and California, with nine.

This article was written by a staff member of TheStreet.com.

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