Enterprise Financial Services Corp Reports Third Quarter 2024 Results

Enterprise Financial Services Corp, a financial holding company headquartered in Clayton, Missouri, has released its financial results for the third quarter of 2024. The company operates through its subsidiary, Enterprise Bank & Trust, offering a range of business and personal banking services across several states.

Financial Highlights

For the third quarter of 2024, Enterprise Financial Services Corp reported a net income of $50.6 million, translating to $1.32 per diluted common share. This marks an increase from $1.19 in the previous quarter and $1.17 in the same quarter last year. The net interest margin (NIM) stood at 4.17%, a slight decrease of 2 basis points from the previous quarter.

Net interest income rose to $143.5 million, up by $2.9 million from the previous quarter. Total loans increased to $11.1 billion, reflecting a quarterly growth of $79.9 million, while total deposits grew by $182.9 million to $12.5 billion.

Key financial ratios also showed improvement, with the Return on Average Assets (ROAA) at 1.36% and the Return on Average Tangible Common Equity (ROATCE) at 14.55%. The tangible book value per share increased by 25% on an annualized basis to $37.26.

Business and Operational Highlights

Enterprise Financial Services Corp saw a significant increase in noninterest income, which rose to $21.4 million, driven by higher tax credit income and gains from the sale of other real estate. Noninterest expense also increased to $98.0 million, primarily due to higher employee compensation and deposit servicing costs.

The company's loan portfolio grew, with notable increases in Commercial & Industrial (C&I) loans and Commercial Real Estate (CRE) loans. Asset quality remained strong, with a decrease in nonperforming assets and a stable allowance for credit losses.

Strategic Initiatives and Corporate Developments

During the third quarter, Enterprise Financial Services Corp repurchased 195,114 shares and increased its quarterly dividend by $0.01 to $0.28 per common share. The company also declared a cash dividend of $12.50 per share of Series A Preferred Stock.

Liquidity remained robust, with total available liquidity of approximately $5.8 billion, including on- and off-balance-sheet resources. The company's capital position was strong, with a tangible common equity to tangible assets ratio of 9.50%.

Management's Perspective

Jim Lally, President and CEO of Enterprise Financial Services Corp, expressed pride in the company's third-quarter performance, highlighting the stable net interest margin, increased net interest income, and growth in diluted earnings per share. Lally emphasized the company's strong balance sheet and capital position as foundations for future opportunities.

Future Outlook

Looking ahead, Enterprise Financial Services Corp remains optimistic about its ability to capitalize on market opportunities. The company continues to focus on deposit generation, loan growth, and maintaining strong asset quality. The recent Federal Reserve rate cut is expected to have a mitigated impact on income due to the company's asset-sensitive balance sheet and adjusted deposit pricing.

SEC Filing: ENTERPRISE FINANCIAL SERVICES CORP [ EFSC ] - 8-K - Oct. 21, 2024