For the private equity industry, the future of Florida's BankUnited Financial Corp. (BKUNA) might be the most closely watched deal of the year.

The Coral Gables-based thrift, with 85 branches scattered mostly in South Florida, could serve as a fresh indicator of how private equity firms enter the banking industry. Federal regulators earlier this year declared BankUnited "critically undercapitalized" and ordered it to find a buyer or raise new capital.

Among the bidders expected to make their pitch by Tuesday's deadline is a consortium of private equity shops led by billionaire investor Wilbur L. Ross. If successful, it would be one of the largest acquisitions in the battered financial services sector made by private equity - and could signal a shift in the government's attitude toward private equity buyers of banks in the future.

To be sure, private equity might not win the bank. Regulators have traditionally favored banks against other bidders in sales of banks. In the case of BankUnited, a bid also is expected from Canada's Toronto-Dominion (TD) bank, which has significant operations in the U.S. through TD Bank and TD Ameritrade Holding Corp. (AMTD). That offer is also expected to include Goldman Sachs Group Inc. (GS).

"Everyone is watching this deal," said Harvard Business School professor Josh Lerner, who tracks the private equity industry. "This could be a template that will open the floodgates in terms of transactions."

He believes a winning bid by the consortium might help draw some of the estimated $450 billion of private equity money off the sidelines and into troubled banks. It might also show a new willingness by the government to accept private equity over other banks as new owners.

The takeover attempt by the consortium would also mark a long-held ambition by Ross to buy into the financial services sector. He hired John Kanas, the former chief executive of North Fork Bancorp, to help run BankUnited if the deal is successful. Other members of the consortium include Carlyle Group, the Blackstone Group (BX), and Centerbridge Capital Partners.

Ross, who made a name on Wall Street decades ago after buying and selling troubled steel companies, has been looking to buy for the past year, a person familiar with the matter said. He already took a 68% stake in First Bank & Trust, a tiny bank in Indiantown, Fla., for an undisclosed sum.

"He has been champing at the bit to buy a bank, and Kanas has helped to guide him when the time was right," said the person, who could not speak publicly because a bid hasn't been placed. "If Wilbur gets this deal, it will signal to everyone that its time to go back into banks." Ross did not return telephone calls to comment about BankUnited, and a spokesman for the consortium also declined to discuss the bid.

The real test will be if the government will allow Ross to complete the transaction. Private equity firms were essentially shut out of biding on Bear Stearns and Lehman Brothers last year.

There has been some speculation that the Federal Deposit Insurance Corp., which handles auctions for failed banks, is still hoping a bank might put in an 11th hour bid for BankUnited.

"One of the reasons why private equity has not been as successful in bidding on failed banks is that existing banks have a big cost advantage," said Gerard Cassidy, an analyst with RBC Capital Markets. "The FDIC is more comfortable in selling a distressed bank to another bank because they have a history and a track record of regulating them."

Private equity firms, which are not regulated by the government, have been unwilling to make assets in their holding companies vulnerable to the performance of businesses they own, which could easily occur in the case of bank ownership. The firms typically make investments by setting up legal structures that shield their holding company assets from the performance of their individual investments.

Regulators limit the stake private equity investors can take in banks without being regulated as bank holding companies.

Meanwhile, private equity has been somewhat skeptical about investing in banks after buyout firm Texas Pacific Group lost more than $1 billion when WaMu went bust.

There have only been two recent, sizable bank takeovers led by private equity: The buyout of Puerto Rico's Doral Financial Corp. (DRL) and California mortgage lender IndyMac Bancorp Inc.

"I do think that we're going to see an evolution with private equity investing in banks," Lerner said. "Much of this will depend on the pace of the recovery."

-By Joe Bel Bruno, Dow Jones Newswires; 201-938-4047; joe.belbruno@dowjones.com

(Marshall Eckblad and Matthias Rieker contributed to this story.)