First Quarter Results

Net income of $47.7 million, $1.23 per diluted common share
Net interest margin (tax equivalent) of 3.28%
Pre-provision return on average assets¹ of 1.70%
Increased quarterly dividend 5% to $0.22 per common share for the second quarter
Repurchased 351,090 shares at an average price of $48.35 per share

Enterprise Financial Services Corp (NASDAQ:EFSC) (the "Company" or "EFSC") reported net income of $47.7 million for the first quarter 2022, a decrease of $3.1 million compared to the linked fourth quarter ("linked quarter") and an increase of $17.8 million from the prior year quarter. Earnings per diluted common share ("EPS") was $1.23 for the first quarter 2022, compared to $1.33 and $0.96 for the linked and prior year quarters, respectively.

Jim Lally, EFSC's President and Chief Executive Officer, commented, "I am pleased with our start to 2022. We had solid loan growth, continued success in deposit building and improvement in our strong credit quality metrics. We continue to remain focused on delivering on our strategic initiatives and positioning our company as a best-in-class financial partner in the communities we serve."

Highlights

Comparisons to the prior year are impacted by the acquisition of First Choice Bancorp ("First Choice" or "FCBP") in the third quarter of 2021.

Earnings - Net income in the first quarter 2022 was $47.7 million, a decrease of $3.1 million compared to the linked quarter and an increase of $17.8 million from the prior year quarter. EPS was $1.23 per diluted common share for the first quarter 2022, compared to $1.33 and $0.96 per diluted common share for the linked and prior year quarters, respectively.

Pre-provision net revenue¹ ("PPNR") - PPNR of $57.0 million in the first quarter 2022 decreased $6.3 million and increased $16.3 million from the linked and prior year quarters, respectively. The decrease from the linked quarter was primarily due to a decline in Paycheck Protection Program ("PPP") loan income and lower noninterest income that typically declines from a peak in the fourth quarter. The increase from the prior year quarter was primarily due to the positive contribution from the First Choice acquisition and expansion in net interest income from organic loan and deposit growth.

Net interest income and net interest margin ("NIM") - Net interest income of $101.2 million for the first quarter 2022 decreased $0.9 million and increased $22.0 million from the linked and prior year quarters, respectively. NIM was 3.28% for the first quarter 2022, compared to 3.32% and 3.50% for the linked quarter and prior year quarter, respectively. The underlying base NIM was relatively stable in the period, excluding the impact of certain items discussed below.

Noninterest income - Noninterest income of $18.6 million for the first quarter 2022 decreased $4.0 million and increased $7.4 million from the linked quarter and prior year quarter, respectively. A decline in tax credit income from a seasonally strong linked quarter and a decline in other income were the primary drivers of the linked quarter decrease. The increase from the prior year quarter was primarily due to higher tax credit income and deposit service charge income from the First Choice acquisition.

Loans - Total loans increased $38.4 million from the linked quarter to $9.1 billion as of March 31, 2022. PPP loans declined $137.9 million. Excluding PPP loans, loans grew $176.3 million, or 8%, on an annualized basis from the linked quarter. Loan growth in the quarter was attributed primarily to the specialty lending niches. Average loans totaled $9.0 billion for the quarter ended March 31, 2022 compared to $9.0 billion and $7.2 billion for the linked and prior year quarters, respectively.

Asset quality - The allowance for credit losses to total loans was 1.54% at March 31, 2022, compared to 1.61% at December 31, 2021 and 1.80% at March 31, 2021. Loan growth and a provision benefit in the first quarter 2022 contributed to the decline in the ratio of allowance for credit losses to total loans. Nonperforming assets to total assets was 0.17% at March 31, 2022 compared to 0.23% and 0.42% at December 31, 2021 and March 31, 2021, respectively. Due to the improvement in credit quality and macroeconomic forecasts, a provision benefit of $4.1 million was recorded in the first quarter 2022, compared to a provision benefit of $3.7 million in the linked quarter and a $46,000 provision expense in the prior year quarter.

Deposits - Total deposits increased $360.3 million from the linked quarter to $11.7 billion as of March 31, 2022. The specialty deposit groups have had continued success in generating deposit growth, increasing deposits by $273.7 million in the first quarter 2022 as compared to the linked quarter. Average deposits totaled $11.5 billion for the quarter ended March 31, 2022 compared to $11.2 billion and $8.2 billion for the linked and prior year quarters, respectively. Noninterest-bearing deposit accounts represented 41.7% of total deposits, and the loan to deposit ratio was 77.4% at March 31, 2022.

Capital - Total shareholders' equity was $1.5 billion and the tangible common equity to tangible assets ratio² was 7.6% at March 31, 2022, compared to 8.1% at December 31, 2021. The decline in the tangible common equity ratio was primarily due to a $78.0 million decrease in accumulated other comprehensive income driven primarily from a decrease in the fair value of the available-for-sale investment portfolio. Enterprise Bank & Trust's regulatory capital ratios remain "well-capitalized," with a common equity tier 1 ratio of 12.2% and a total risk-based capital ratio of 13.3% as of March 31, 2022. The Company's common equity tier 1 ratio and total risk-based capital ratio was 11.0% and 14.4%, respectively, at March 31, 2022.

The Company repurchased 351,090 shares totaling $17.0 million in the first quarter 2022 for an average price of $48.35 per share. The Company has 349,383 shares available for repurchase under its common stock repurchase authorization.

The Company's Board of Directors unanimously approved a quarterly dividend of $0.22 per common share, payable on June 30, 2022 to shareholders of record as of June 15, 2022, an increase of $0.01, or 5.0%, compared to the first quarter 2022. The Board of Directors also declared a cash dividend of $12.50 per share of Series A Preferred Stock (or $0.3125 per depositary share) representing a 5% per annum rate for the period commencing (and including) March 15, 2022 to (but excluding) June 15, 2022. The dividend will be payable on June 15, 2022 to shareholders of record on May 31, 2022.

¹ Pre-provision return on average assets is a non-GAAP measure. Refer to discussion and reconciliation of these measures in the accompanying financial tables.

²Tangible common equity to tangible assets ratio is a non-GAAP measure. Refer to discussion and reconciliation of this measure in the accompanying financial tables.

Net Interest Income

Average Balance Sheets

The following table presents, for the periods indicated, certain information related to our average interest-earning assets and interest-bearing liabilities, as well as, the corresponding interest rates earned and paid, all on a tax-equivalent basis.

	Quarter ended
	March 31, 2022						December 31, 2021						March 31, 2021
($ in thousands)	Average Balance		Interest Income/ Expense		Average Yield/ Rate		Average Balance		Interest Income/ Expense		Average Yield/ Rate		Average Balance		Interest Income/ Expense		Average Yield/ Rate
Assets
Interest-earning assets:
Loans*	$	9,005,875	$	96,301	4.34	%	$	9,030,982	$	98,412	4.32	%	$	7,192,776	$	77,073	4.35	%
Securities*		1,923,969		10,969	2.31			1,753,159		10,146	2.30			1,417,305		8,818	2.52
Interest-earning deposits		1,781,272		817	0.19			1,589,008		590	0.15			679,659		189	0.11
Total interest-earning assets		12,711,116		108,087	3.45			12,373,149		109,148	3.50			9,289,740		86,080	3.76

Noninterest-earning assets		902,887						894,044						650,312

Total assets	$	13,614,003					$	13,267,193					$	9,940,052

Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing transaction accounts	$	2,505,319	$	536	0.09	%	$	2,383,059	$	491	0.08	%	$	1,887,059	$	328	0.07	%
Money market accounts		2,872,302		1,460	0.21			2,853,655		1,412	0.20			2,350,592		975	0.17
Savings		817,431		66	0.03			776,695		64	0.03			654,662		48	0.03
Certificates of deposit		607,133		797	0.53			616,347		831	0.53			537,166		1,312	0.99
Total interest-bearing deposits		6,802,185		2,859	0.17			6,629,756		2,798	0.17			5,429,479		2,663	0.20
Subordinated debentures		154,959		2,220	5.81			171,453		2,439	5.64			203,694		2,819	5.61
FHLB advances		50,000		195	1.58			50,000		199	1.58			50,000		195	1.58
Securities sold under agreements to repurchase		262,252		60	0.09			246,525		60	0.10			231,527		60	0.11
Other borrowings		22,841		82	1.46			24,270		85	1.39			28,650		100	1.42
Total interest-bearing liabilities		7,292,237		5,416	0.30			7,122,004		5,581	0.31			5,943,350		5,837	0.40

Noninterest-bearing liabilities:
Demand deposits		4,692,027						4,537,247						2,777,900
Other liabilities		93,518						112,546						122,321
Total liabilities		12,077,782						11,771,797						8,843,571
Shareholders' equity		1,536,221						1,495,396						1,096,481
Total liabilities and shareholders' equity	$	13,614,003					$	13,267,193					$	9,940,052

Total net interest income			$	102,671					$	103,567					$	80,243
Net interest margin					3.28	%					3.32	%					3.50	%
* Non-taxable income is presented on a tax-equivalent basis using a 25.2% and 24.9% tax rate in 2022 and 2021, respectively. The tax-equivalent adjustments were $1.5 million for the three months ended March 31, 2022 and December 31, 2021, and $1.1 million for the three months ended March 31, 2021.

Net interest income for the first quarter decreased $0.9 million to $101.2 million from $102.1 million in the linked quarter, and increased $22.0 million from the prior year period. NIM, on a tax equivalent basis, was 3.28% for the first quarter, compared to 3.32% in the linked quarter, and 3.50% in the first quarter 2021. The decrease in net interest income from the linked quarter was primarily due to a $2.0 million decline in PPP income as the PPP loan portfolio continues to wind down. This decline was partially offset by an increase in income from loan growth, an expanded investment portfolio and a decline in interest expense from the redemption of $50.0 million of subordinated debentures in the fourth quarter 2021.

NIM decreased four basis points from the linked quarter to 3.28% for the first quarter 2022, primarily due to a five basis point decrease in earning asset yields. The decrease in the earning asset yields was due primarily to higher levels of cash related to continued deposit growth. Excluding the impact of higher low-yielding cash balances, NIM was relatively stable compared to the linked quarter. The average loan yield expanded two basis points to 4.34% in the first quarter 2022 as compared to the linked quarter. The increase was primarily due to the repricing of variable-rate loans and the increase in short-term LIBOR and Prime rates from the Federal Reserve's 25 basis point increase in the target federal funds rate in March 2022.

Loans

The following table presents total loans for the most recent five quarters:

	Quarter ended
							September 30, 2021
($ in thousands)	March 31, 2022			December 31, 2021			FCBP^a		Legacy EFSC^a		Consolidated			June 30, 2021			March 31, 2021
C&I	$	1,498,151		$	1,538,155		$	242,740	$	1,215,338	$	1,458,078		$	1,116,229		$	1,048,839
CRE investor owned		1,982,645			1,955,087			553,490		1,381,794		1,935,284			1,467,243			1,491,244
CRE owner occupied		1,138,106			1,112,463			301,929		861,307		1,163,236			789,220			805,581
SBA loans*		1,249,929			1,241,449			160,833		1,038,925		1,199,758			1,010,727			941,075
Sponsor finance*		641,476			508,469			—		454,431		454,431			463,744			394,207
Life insurance premium financing*		636,096			593,562			—		572,492		572,492			564,366			543,084
Tax credits*		518,020			486,881			—		462,168		462,168			423,258			387,968
SBA PPP loans		134,084			271,958			206,284		232,675		438,959			396,660			737,660
Residential real estate		410,173			430,985			226,321		293,538		519,859			302,007			299,517
Construction and land development		610,830			625,526			219,600		432,627		652,227			467,586			438,303
Other		236,563			253,107			32,547		227,544		260,091			225,227			201,303
Total loans	$	9,056,073		$	9,017,642		$	1,943,744	$	7,172,839	$	9,116,583		$	7,226,267		$	7,288,781

Total loan yield		4.34	%		4.32	%						4.32	%		4.35	%		4.35	%
Variable interest rate loans to total loans		63	%		63	%						63	%		57	%		56	%

Certain prior period amounts have been reclassified among the categories to conform to the current period presentation.
*Specialty loan category
^aAmounts reported are as of September 30, 2021 and are separately shown attributable to the FCBP loan portfolio acquired on July 21, 2021, and the Company's pre-FCBP acquisition loan portfolio.

Loans totaled $9.1 billion at March 31, 2022, increasing $38.4 million compared to the linked quarter. PPP loans declined $137.9 million in the first quarter 2022 from continued loan forgiveness by the Small Business Administration ("SBA"). Excluding PPP loans, loans grew $176.3 million, or 8% on an annualized basis, from the linked quarter. The increase was driven by specialty lending, particularly Sponsor Finance that increased $133.0 million in the first quarter 2022. Average line draw utilization was 39.9% for both the quarter ended March 31, 2022 and the linked quarter, compared to 37.0% for the prior-year quarter.

Asset Quality

The following table presents the categories of nonperforming assets and related ratios for the most recent five quarters:

	Quarter ended
($ in thousands)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Nonperforming loans*	$	21,160		$	28,024		$	41,554		$	42,252		$	36,659
Other real estate		1,459			3,493			3,493			3,612			6,164
Nonperforming assets*	$	22,619		$	31,517		$	45,047		$	45,864		$	42,823

Nonperforming loans to total loans		0.23	%		0.31	%		0.46	%		0.58	%		0.50	%
Nonperforming assets to total assets		0.17	%		0.23	%		0.35	%		0.44	%		0.42	%
Allowance for credit losses to total loans		1.54	%		1.61	%		1.67	%		1.77	%		1.80	%
Net charge-offs	$	1,521		$	3,263		$	1,850		$	869		$	5,647

*Guaranteed balances excluded	$	3,954		$	6,481		$	5,109		$	3,930		$	3,873

Nonperforming assets continued to improve in the first quarter 2022, declining $8.9 million from the linked quarter. Net charge-offs were $1.5 million, or seven basis points of average loans, compared to 14 basis points in the linked quarter and 32 basis points in the prior year quarter. Due to the improvement in credit quality and forecasted macroeconomic factors, the Company recorded a provision benefit of $4.1 million for the first quarter 2022 compared to a benefit of $3.7 million for the linked quarter and a $46,000 provision for the prior year quarter.

Deposits

The following table presents deposits broken out by type for the most recent five quarters:

	Quarter ended
							September 30, 2021
($ in thousands)	March 31, 2022			December 31, 2021			FCBP^a			Legacy EFSC^a			Consolidated			June 30, 2021			March 31, 2021
Noninterest-bearing accounts	$	4,881,043		$	4,578,436		$	1,041,622		$	3,334,091		$	4,375,713		$	3,111,581		$	2,910,216
Interest-bearing transaction accounts		2,547,482			2,465,884			317,301			1,936,338			2,253,639			2,013,129			1,990,308
Money market and savings accounts		3,678,135			3,691,186			370,179			3,201,073			3,571,252			3,000,460			3,093,569
Brokered certificates of deposit		129,017			128,970			78,714			50,209			128,923			50,209			50,209
Other certificates of deposit		468,458			479,323			51,832			446,416			498,248			464,125			471,142
Total deposit portfolio	$	11,704,135		$	11,343,799		$	1,859,648		$	8,968,127		$	10,827,775		$	8,639,504		$	8,515,444

Noninterest-bearing deposits to total deposits		41.7	%		40.4	%		56.0	%		37.2	%		40.4	%		36.0	%		34.2	%
^aAmounts reported are as of September 30, 2021 and are shown separately attributable to the FCBP deposit portfolio acquired on July 21, 2021, and the Company's pre-FCBP acquisition deposit portfolio.

Total deposits at March 31, 2022 were $11.7 billion, an increase of $360.3 million from December 31, 2021, and an increase of $3.2 billion from March 31, 2021. The increase from the linked quarter was primarily due to continued success in the deposit specialty areas, particularly community associations and escrow relationships. The increase over the prior year is due to the First Choice acquisition and organic growth.

Core deposits, defined as total deposits excluding certificates of deposits, were $11.1 billion at March 31, 2022, an increase of $371.2 million from the linked quarter. The Company's participation in PPP, the interest rate environment and high personal savings rate, particularly in the New Mexico market, have contributed to the increase in deposits. Noninterest-bearing deposits were $4.9 billion at March 31, 2022, or 41.7% of total deposits. The total cost of deposits was 0.10% for both the current and linked quarters, compared to 0.13% for the prior year quarter.

Noninterest Income

The following table presents a comparative summary of the major components of noninterest income for the periods indicated:

	Linked quarter comparison									Prior year comparison
	Quarter ended									Quarter ended
($ in thousands)	March 31, 2022		December 31, 2021		Increase (decrease)					March 31, 2021			Increase (decrease)
Deposit service charges	$	4,163	$	3,962	$	201		5	%	$	3,084		$	1,079	35	%
Wealth management revenue		2,622		2,687		(65	)	(2	) %		2,483			139	6	%
Card services revenue		3,040		3,223		(183	)	(6	) %		2,496			544	22	%
Tax credit income (expense)		2,608		4,374		(1,766	)	(40	) %		(1,041	)		3,649	351	%
Other income		6,208		8,384		(2,176	)	(26	) %		4,268			1,940	45	%
Total noninterest income	$	18,641	$	22,630	$	(3,989	)	(18	) %	$	11,290		$	7,351	65	%

Total noninterest income for the first quarter 2022 was $18.6 million, a decrease of $4.0 million from the linked quarter and an increase of $7.4 million from the prior year quarter. The decrease from the linked quarter was primarily due to decreases in tax credit and other income. Tax credit income was seasonally high in the linked quarter and typically declines in the first quarter of the year. Other income in the linked quarter included $5.0 million of fees from community development investments, compared to $2.2 million in the first quarter 2022. The increase from the prior year quarter was broad-based, reflecting higher volumes in all categories. First Choice noninterest income partially contributed to the increase over the prior year, primarily in deposit service charges and SBA servicing fees included in other income.

Noninterest Expenses

Noninterest expense was $62.8 million for the first quarter 2022, compared to $63.7 million for the linked quarter, and $52.9 million for the prior year quarter. The Company did not incur any merger related expenses in the first quarter 2022, compared to $2.3 million in the linked quarter and $3.1 million in the prior year quarter, respectively. Salary and employee benefits increased $2.3 million from the linked quarter due to annual merit increases that became effective on March 1, 2022 and employer payroll taxes that are seasonally higher in the first quarter each year. The increase from the prior year quarter was primarily due to the First Choice acquisition, merit increases provided to employees throughout 2021 and an increase in deposit customer analysis expense.

For the first quarter 2022, the Company's efficiency ratio was 52.4% compared to 51.1% and 58.5% for the linked quarter and prior year quarter, respectively. The Company's core efficiency ratio³ was 52.4% for the quarter ended March 31, 2022, compared to 49.2% for the linked quarter and 55.0% for the prior year quarter.

³Core efficiency ratio is a non-GAAP measure. Refer to discussion and reconciliation of this measure in the accompanying financial tables.

Income Taxes

The Company's effective tax rate was 22% for the quarter ended March 31, 2022, compared to 21% for the linked quarter and 20% for the prior year quarter. The Company's effective tax rate has increased due to an expanded geographic footprint and the related state tax apportionment.

Capital

The following table presents various EFSC capital ratios for the most recent five quarters:

	Quarter ended
Percent	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Total risk-based capital to risk-weighted assets	14.4	%	14.7	%	14.5	%	14.9	%	15.1	%
Tier 1 capital to risk weighted assets	12.7	%	13.0	%	12.2	%	12.3	%	12.3	%
Common equity tier 1 capital to risk-weighted assets	11.0	%	11.3	%	11.2	%	11.1	%	11.0	%
Tangible common equity to tangible assets	7.6	%	8.1	%	8.4	%	8.3	%	8.2	%

Total equity was $1.5 billion at March 31, 2022, a decrease of $55.9 million from the linked quarter. The decrease from the linked quarter was primarily due to a $78.0 million decline in accumulated other comprehensive income. This was due to a net fair value decline in the Company's fixed-rate, available-for-sale investment portfolio from an increase in interest rates during the period. The Company's tangible common book value per share was $27.06 at March 31, 2022, compared to $28.28 and $25.92 in the linked and prior year quarters, respectively.

The Company's regulatory capital ratios continue to exceed the "well-capitalized" regulatory benchmark. Capital ratios for the current quarter are subject to, among other things, completion and filing of the Company's regulatory reports and ongoing regulatory review.

Use of Non-GAAP Financial Measures

The Company's accounting and reporting policies conform to generally accepted accounting principles in the United States ("GAAP") and the prevailing practices in the banking industry. However, the Company provides other financial measures, such as tangible common equity, PPNR, PPNR return on average assets ("PPNR ROAA"), financial metrics adjusted for PPP impact, core efficiency ratio, and the tangible common equity ratio, in this release that are considered "non-GAAP financial measures." Generally, a non-GAAP financial measure is a numerical measure of a company's financial performance, financial position, or cash flows that exclude (or include) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP.

The Company considers its tangible common equity, PPNR, PPNR ROAA, financial metrics adjusted for PPP impact, core efficiency ratio, and the tangible common equity ratio, collectively "core performance measures," presented in this earnings release and the included tables as important measures of financial performance, even though they are non-GAAP measures, as they provide supplemental information by which to evaluate the impact of certain non-comparable items, and the Company's operating performance on an ongoing basis. Core performance measures exclude certain other income and expense items, such as merger-related expenses, facilities charges, and the gain or loss on sale of investment securities, the Company believes to be not indicative of or useful to measure the Company's operating performance on an ongoing basis. The attached tables contain a reconciliation of these core performance measures to the GAAP measures. The Company believes that the tangible common equity ratio provides useful information to investors about the Company's capital strength even though it is considered to be a non-GAAP financial measure and is not part of the regulatory capital requirements to which the Company is subject.

The Company believes these non-GAAP measures and ratios, when taken together with the corresponding GAAP measures and ratios, provide meaningful supplemental information regarding the Company's performance and capital strength. The Company's management uses, and believes that investors benefit from referring to, these non-GAAP measures and ratios in assessing the Company's operating results and related trends and when forecasting future periods. However, these non-GAAP measures and ratios should be considered in addition to, and not as a substitute for or preferable to, ratios prepared in accordance with GAAP. In the attached tables, the Company has provided a reconciliation of, where applicable, the most comparable GAAP financial measures and ratios to the non-GAAP financial measures and ratios, or a reconciliation of the non-GAAP calculation of the financial measures for the periods indicated.

Conference Call and Webcast Information

The Company will host a conference call and webcast at 10:00 a.m. Central Time on Tuesday, April 26, 2022. During the call, management will review the first quarter 2022 results and related matters. This press release as well as a related slide presentation will be accessible on the Company's website at www.enterprisebank.com under "Investor Relations" prior to the scheduled broadcast of the conference call. The call can be accessed via this same website page, or via telephone at 1-888-394-8218 (Conference ID #3278323). A recorded replay of the conference call will be available on the website approximately two hours after the call's completion. Visit http://bit.ly/EFSC1Q2022 and register to receive a dial in number, passcode, and pin number. The replay will be available for approximately two weeks following the conference call.

About Enterprise Financial Services Corp

Enterprise Financial Services Corp (NASDAQ:EFSC), with approximately $13.7 billion in assets, is a financial holding company headquartered in Clayton, Missouri. Enterprise Bank & Trust, a Missouri state-chartered trust company with banking powers and a wholly-owned subsidiary of EFSC, operates branch offices in Arizona, California, Kansas, Missouri, Nevada, and New Mexico, and SBA loan and deposit production offices throughout the country. Enterprise Bank & Trust offers a range of business and personal banking services and wealth management services. Enterprise Trust, a division of Enterprise Bank & Trust, provides financial planning, estate planning, investment management and trust services to businesses, individuals, institutions, retirement plans and non-profit organizations. Additional information is available at www.enterprisebank.com.

Enterprise Financial Services Corp's common stock is traded on the Nasdaq Stock Market under the symbol "EFSC." Please visit our website at www.enterprisebank.com to see our regularly posted material information.

Forward-looking Statements

Readers should note that, in addition to the historical information contained herein, this press release contains "forward-looking statements" within the meaning of, and intended to be covered by, the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management's current expectations and beliefs concerning future developments and their potential effects on the Company including, without limitation, plans, strategies and goals, and statements about the Company's expectations regarding revenue and asset growth, financial performance and profitability, loan and deposit growth, yields and returns, loan diversification and credit management, shareholder value creation and the impact of the First Choice acquisition and other acquisitions.

Forward-looking statements are typically identified by words such as "believe," "expect," "anticipate," "intend," "outlook," "estimate," "forecast," "project," "pro forma" and other similar words and expressions. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made. Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those anticipated in the forward-looking statements and future results could differ materially from historical performance. Factors that could cause or contribute to such differences include, but are not limited to, the Company's ability to efficiently integrate acquisitions, including the First Choice acquisition, into its operations, retain the customers of these businesses and grow the acquired operations, as well as credit risk, changes in the appraised valuation of real estate securing impaired loans, outcomes of litigation and other contingencies, exposure to general and local economic conditions, risks associated with rapid increases or decreases in prevailing interest rates, consolidation in the banking industry, competition from banks and other financial institutions, the Company's ability to attract and retain relationship officers and other key personnel, burdens imposed by federal and state regulation, changes in regulatory requirements, changes in accounting policies and practices or accounting standards, changes in the method of determining LIBOR and the phase out of LIBOR, natural disasters, war (including the war in Ukraine) or terrorist activities, or pandemics, including the COVID-19 pandemic, and their effects on economic and business environments in which we operate, including the ongoing disruption to the financial market and other economic activity caused by the COVID-19 pandemic, and those factors and risks referenced from time to time in the Company's filings with the Securities and Exchange Commission (the "SEC"), including in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, and the Company's other filings with the SEC. For any forward-looking statements made in this press release or in any documents, EFSC claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

Except to the extent required by applicable law or regulation, EFSC disclaims any obligation to revise or publicly release any revision or update to any of the forward-looking statements included herein to reflect events or circumstances that occur after the date on which such statements were made.

ENTERPRISE FINANCIAL SERVICES CORP
CONSOLIDATED FINANCIAL SUMMARY (unaudited)

	Quarter ended
(in thousands, except per share data)	Mar 31, 2022			Dec 31, 2021			Sep 30, 2021			Jun 30, 2021			Mar 31, 2021
EARNINGS SUMMARY
Net interest income	$	101,165		$	102,060		$	97,273		$	81,738		$	79,123
Provision (benefit) for credit losses		(4,068	)		(3,660	)		19,668			(2,669	)		46
Noninterest income		18,641			22,630			17,619			16,204			11,290
Noninterest expense		62,800			63,694			76,885			52,456			52,884
Income before income tax expense		61,074			64,656			18,339			48,155			37,483
Income tax expense		13,381			13,845			4,426			9,750			7,557
Net income		47,693			50,811			13,913			38,405			29,926
Preferred stock dividends		1,229			—			—			—			—
Net income available to common shareholders	$	46,464		$	50,811		$	13,913		$	38,405		$	29,926

Diluted earnings per common share	$	1.23		$	1.33		$	0.38		$	1.23		$	0.96
Return on average assets		1.42	%		1.52	%		0.45	%		1.50	%		1.22	%
Return on average common equity		12.87	%		13.81	%		3.96	%		13.79	%		11.07	%
Return on average tangible common equity¹		17.49	%		18.81	%		5.37	%		18.44	%		14.92	%
Net interest margin (tax equivalent)		3.28	%		3.32	%		3.40	%		3.46	%		3.50	%
Efficiency ratio		52.42	%		51.08	%		66.92	%		53.56	%		58.49	%
Core efficiency ratio¹		52.43	%		49.22	%		51.30	%		51.86	%		55.02	%

Total loans	$	9,056,073		$	9,017,642		$	9,116,583		$	7,226,267		$	7,288,781
Total average loans	$	9,005,875		$	9,030,982		$	8,666,353		$	7,306,471		$	7,192,776
Total assets	$	13,706,769		$	13,537,358		$	12,888,016		$	10,346,993		$	10,190,699
Total average assets	$	13,614,003		$	13,267,193		$	12,334,558		$	10,281,344		$	9,940,052
Total deposits	$	11,704,135		$	11,343,799		$	10,827,775		$	8,639,504		$	8,515,444
Total average deposits	$	11,494,212		$	11,167,003		$	10,297,153		$	8,580,211		$	8,207,379
Period end common shares outstanding		37,516			37,820			38,372			31,185			31,259
Dividends per common share	$	0.21		$	0.20		$	0.19		$	0.18		$	0.18
Tangible book value per common share	$	27.06		$	28.28		$	27.38		$	26.85		$	25.92
Tangible common equity to tangible assets¹		7.62	%		8.13	%		8.40	%		8.32	%		8.18	%
Total risk-based capital to risk-weighted assets		14.4	%		14.7	%		14.5	%		14.9	%		15.1	%

¹Refer to Reconciliations of Non-GAAP Financial Measures table for a reconciliation of these measures to GAAP.

ENTERPRISE FINANCIAL SERVICES CORP
CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

	Quarter ended
($ in thousands, except per share data)	Mar 31, 2022			Dec 31, 2021			Sep 30, 2021		Jun 30, 2021			Mar 31, 2021
INCOME STATEMENTS
NET INTEREST INCOME
Interest income	$	106,581		$	107,641		$	103,228	$	87,401		$	84,960
Interest expense		5,416			5,581			5,955		5,663			5,837
Net interest income		101,165			102,060			97,273		81,738			79,123
Provision (benefit) for credit losses		(4,068	)		(3,660	)		19,668		(2,669	)		46
Net interest income after provision for credit losses		105,233			105,720			77,605		84,407			79,077

NONINTEREST INCOME
Deposit service charges		4,163			3,962			4,520		3,862			3,084
Wealth management revenue		2,622			2,687			2,573		2,516			2,483
Card services revenue		3,040			3,223			3,186		2,975			2,496
Tax credit income (expense)		2,608			4,374			3,325		1,370			(1,041	)
Other income		6,208			8,384			4,015		5,481			4,268
Total noninterest income		18,641			22,630			17,619		16,204			11,290

NONINTEREST EXPENSE
Employee compensation and benefits		35,827			33,488			33,722		28,132			29,562
Occupancy		4,586			4,510			4,496		3,529			3,751
Branch closure expenses		—			—			3,441		—			—
Merger-related expenses		—			2,320			14,671		1,949			3,142
Other expense		22,387			23,376			20,555		18,846			16,429
Total noninterest expense		62,800			63,694			76,885		52,456			52,884

Income before income tax expense		61,074			64,656			18,339		48,155			37,483
Income tax expense		13,381			13,845			4,426		9,750			7,557
Net income	$	47,693		$	50,811		$	13,913	$	38,405		$	29,926
Preferred stock dividends		1,229			—			—		—			—
Net income available to common shareholders	$	46,464		$	50,811		$	13,913	$	38,405		$	29,926

Basic earnings per common share	$	1.23		$	1.33		$	0.38	$	1.23		$	0.96
Diluted earnings per common share	$	1.23		$	1.33		$	0.38	$	1.23		$	0.96

ENTERPRISE FINANCIAL SERVICES CORP
CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

	Quarter ended
($ in thousands)	Mar 31, 2022			Dec 31, 2021			Sep 30, 2021			Jun 30, 2021			Mar 31, 2021
BALANCE SHEETS

ASSETS
Cash and due from banks	$	252,706		$	209,177		$	179,826		$	126,789		$	103,367
Interest-earning deposits		1,735,708			1,819,508			1,216,470			889,960			788,464
Debt and equity investments		1,993,927			1,855,583			1,717,442			1,585,847			1,463,818
Loans held for sale		4,270			6,389			5,068			5,763			8,531

Loans		9,056,073			9,017,642			9,116,583			7,226,267			7,288,781
Allowance for credit losses		(139,212	)		(145,041	)		(152,096	)		(128,185	)		(131,527	)
Total loans, net		8,916,861			8,872,601			8,964,487			7,098,082			7,157,254

Enterprise Financial Reports First Quarter 2022 Results