Catalyzes a Baeyer-Villiger oxidation reaction, i.e. the insertion of an oxygen atom into a carbon-carbon bond adjacent to a carbonyl, which converts ketones to esters or lactones using NADPH as an electron donor. Has a broad substrate scope and oxidizes different compounds including substituted and unsubstituted alicyclic, bicyclic-, aliphatic-ketones, ketones with an aromatic moiety, and sulfides. The highest activities are measured for 2- and 3-methylcyclohexanone, phenylacetone, bicyclo[3.2.0]hept-2-en-6-one and menthone. Cannot use NADH instead of NADPH. Is not active on benzaldehyde. kcat is 0.634 sec(-1) with phenylacetone as substrate and 0.370 sec(-1) with 2-methylcyclohexanone as substrate. Optimum pH is 7.5. Exhibits more than 50% of its optimal activity between pH 6.5 and 9.0. Displays highest stability in a pH range of 7.0-8.0. Optimum temperature is 35 degrees Celsius. At this temperature, its half-life is about 20 hours. Retains about 50% and 20% of its initial activity after 20 h and 48 h of incubation at 35 degrees Celsius, respectively. Belongs to the FAD-binding monooxygenase family.