29 slides from Enterprise Financial Services's earnings presentation, Jul 23, 2024
Slide 1: Enterprise Financial Services Corp 2024 Second Quarter Earnings Webcast
Exhibit 99.2 Enterprise Financial Services Corp 2024 Second Quarter Earnings Webcast
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information in this report may contain “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 may include projections b
Slide 3: Financial Highlights - 2Q24
Financial Highlights - 2Q24* • Net Income $45.4 million, up $5.0 million; EPS $1.19 • Net Interest Income $140.5 million, up $2.8 million; NIM 4.19% Earnings • PPNR** $63.3 million, up $5.9 million • Adjusted ROAA** 1.27%, compared to 1.14%; PPNR ROAA** 1.74%, compared to 1.58% • Adjusted ROATCE** 1
Slide 4: Financial Highlights, continued - 2Q24
Financial Highlights, continued - 2Q24* • Loans $11.0 billion, down $28.5 million • Loan/Deposit Ratio 90% Loans & • Deposits $12.3 billion, up $28.7 million or $192.8 million Deposits excluding brokered CDs • Noninterest-bearing Deposits/Total Deposits 32% • Nonperforming Loans/Loans 0.36% Asset •
Slide 5: Areas of Focus
Areas of Focus Organic Loan and Deposit Growth • Continue Funding Loan Growth with Customer Deposits • Build Franchise Value by Expanding Existing and Acquiring New Relationships Disciplined Loan and Deposit Pricing Focused Credit Underwriting and Monitoring Focus on Long-term Earnings Trajectory Co
Slide 6: Loan Trends
Loan Trends $ In Millions wth 5% Total Loan Gro $10,884 $11,028 $11,000 $10,513 $10,617 2Q23 3Q23 4Q23 1Q24 2Q24 6
Slide 7: Loan Details
Loan Details $ In Millions Qtr LTM 2Q24 1Q24 2Q23 Change Change C&I $ 2,107 $ 2,264 $ 2,029 $ (157) $ 78 CRE Investor Owned 2,309 2,281 2,291 28 18 CRE Owner Occupied 1,314 1,280 1,209 34 105 SBA loans* 1,269 1,275 1,328 (6) (59) Sponsor Finance* 866 865 880 1 (14) Life Insurance Premium Financing*
Slide 8: Loans By Region
Loans By Region $ In Millions Specialty Lending Midwest $3,918 $3,959 $3,734 $3,320 $3,412 $3,279 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 Southwest West $1,743 $1,833 $1,844 $1,605 $1,649 $1,415 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 Note: Excludes “Other” loans; Region Components: Midwest (St. Louis & Kansas City), S
Slide 9: Deposit Details
Deposit Details $ In Millions Qtr LTM 2Q24 1Q24 2Q23 Change Change Noninterest-bearing demand accounts $ 3,928 $ 3,805 $ 3,881 $ 123 $ 47 Interest-bearing demand accounts 2,952 2,956 2,629 (4) 323 Money market accounts 3,474 3,431 2,913 43 561 Savings accounts 565 576 665 (11) (100) Certificates of
Slide 10: Deposits By Region
Deposits By Region $ In Millions Deposit Verticals** Midwest(*)** $6,027 $6,206 $6,111 $2,901 $3,033 $2,474 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 Southwest West* $1,886 $1,984 $1,811 $1,308 $1,261 $1,154 2Q23 1Q24 2Q24 2Q23 1Q24 2Q24 Note: Region Components: Midwest (St. Louis & Kansas City), Southwest (AZ,
Slide 11: Differentiated Deposit Verticals
Differentiated Deposit Verticals 26.8% • $3.03 billion - 25% of total deposits • $3.09 billion - Average deposits for 2Q24 • $21.7 million - Related deposit costs in noninterest expense, resulting in an average deposit vertical cost of 2.82% in 2Q24 • $126.7 million - Average Deposits per Branch for
Slide 12: Core Funding Mix
Core Funding Mix Commercial Business Banking Consumer Deposit Verticals $ In Millions $4,386 $1,399 $2,733 $3,033 7% 3% 4% 28% 19% 21% 2Q24 33% 39% 30% 32% 59% 18% 7% 36% 34% 20% Net New/Closed Deposit Accounts Overview BUSINESS DEPOSIT COMMERCIAL CONSUMER BANKING VERTICALS • Estimated uninsured dep
Slide 13: Earnings Per Share Trend - 2Q24
Earnings Per Share Trend - 2Q24 Change in EPS $0.13 $0.02 $(0.01) $1.19 $1.05 1Q24 Operating Provision for Credit Noninterest 2Q24 Revenue Losses Expense 13
Slide 14: Net Interest Income Trend
Net Interest Income Trend $ In Millions Stable Net Interest Income $140.7 $141.6 $140.7 $137.7 $140.5 5.26% 5.33% 5.33% 5.33% 4.99% 4.49% 4.33% 4.23% 4.13% 4.19% 2Q23 3Q23 4Q23 1Q24 2Q24 Net Interest Income Net Interest Margin Avg Fed Funds Rate 2Q23 3Q23 4Q23 1Q24 2Q24 Net Interest Income - FTE $ 1
Slide 15: Net Interest Margin
Net Interest Margin Margin Bridge 0.05% 0.03% (0.01)% (0.01)% 4.13% 4.19% 1Q24 Loans Other Earning Asset Mix Funding Mix Cost of Funds 2Q24 Components of Interest-earning Assets Components of Interest-bearing Liabilities 6.80% 6.87% 6.87% 6.95% 6.64% 3.22% 3.26% 3.09% 2.84% 2.40% 3.14% 3.19% 6.20% 6
Slide 16: Credit Trends
Credit Trends Annualized Net Charge-offs to Average Loans Loan Growth and Average Line of Credit Utilization 44.6% 41.0% 42.0% 44.4% 45.8% 106 bps $ In Millions $501 $267 $104 $144 22 bps 12 bps 26 bps 2 bps $(28.5) 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 Organic Loans Avg Line Draw % Prov
Slide 17: Allowance for Credit Losses for Loans
Allowance for Credit Losses for Loans Key Assumptions: 2Q24 ACL as a % of • Reasonable and supportable forecast Loans ACL $ In Millions Loans period is one year with a one year reversion period. Commercial and industrial $ 4,619 $ 61 1.32 % • Forecast considers a weighted average Commercial real est
Slide 18: Noninterest Income Trend
Noninterest Income Trend $ In Millions Noninterest Income Other Noninterest Income Detail 15.3% $6.3 9.2% 7.9% 8.1% 9.9% $0.7 $25.5 $5.4 $5.1 $5.0 $2.5 $1.0 $0.4 $2.7 $1.5 $0.2 $1.4 $4.0 $4.3 $12.1 $15.5 $0.2 $1.3 $0.4 $14.3 $12.2 $2.1 $0.3 $0.2 $0.3 $2.6 $0.1 $2.5 $2.6 $2.6 $0.2 $0.6 $9.7 $2.5 $0.8
Slide 19: Noninterest Expense Trend
Noninterest Expense Trend $ In Millions Noninterest Expense Other Noninterest Expense Detail 56.2% 60.2% 58.1% 54.0% 53.1% $24.6 $23.4 $23.6 $22.7 $1.1 $23.0 $94.0 $1.1 $0.9 $92.6 $93.5 $1.1 $2.7 $1.0 $88.6 $1.9 $2.3 $86.0 $2.1 $2.1 $2.6 $2.7 $3.1 $2.9 $3.0 $1.1 $39.7 $1.6 $1.3 $45.3 $44.5 $1.4 $40.
Slide 20: Capital
Capital Tangible Common Equity/Tangible Assets TBV and Dividends per Share $0.25 $0.25 $0.25 $0.25 $0.26 9.18% 8.96% 9.01% 8.65% 8.51% $33.85 $34.21 $35.02 $31.23 $31.06 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 Tangible Common Equity/Tangible Assets* TBV/Share* Dividends per Share EFSC Capi
Slide 21: Appendix
Appendix
Slide 22: Investment Portfolio
Investment Portfolio Investment Portfolio Breakout AFS & HTM Securities $ In Millions Obligations of U.S. $1,800 $160 Government- sponsored enterprises Obligations of $1,200 $— 13% states and political TOTAL subdivisions U.S. Treasury $2.4 billion 42% $600 $(160) bills 7% $— $(320) Corporate debt Ag
Slide 23: Liquidity
Liquidity Strong Liquidity Profile EFSC Borrowing Capacity $ In Billions 42% 42% • $1.2 billion available FHLB capacity 37% • $2.6 billion available FRB capacity $5.1 $5.1 $4.4 • $140.0 million in seven federal funds lines $1.1 $1.2 $0.8 $0.1 $0.1 • $1.2 billion in unpledged investment securities $0
Slide 24: Office CRE (Non-owner Occupied)
Office CRE (Non-owner Occupied) Total $491.7 million Office CRE Loans by Location Office CRE Loans by Industry Type Southwest 28.0% Real Estate/ Rental/Leasing Midwest 86.3% 49.0% West 18.0% Specialty 5.0% Health Care Other and Social 10.2% Assistance 3.5% • Average loan-to-origination value 52% Off
Slide 25: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures The Company’s accounting and reporting policies conform to generally accepted accounting principles in the United States (“GAAP”) and the prevailing practices in the banking industry. However, the Company provides other financial measures, such as tangible common e
Slide 26: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Quarter ended June 30, March 31, December 31, September 30, June 30, ($ in thousands) 2024 2024 2023 2023 2023 SHAREHOLDERS’ EQUITY TO TANGIBLE COMMON EQUITY AND TOTAL ASSETS TO TANGIBLE ASSETS Shareholders’ equity $ 1,755,273 $ 1,731,725 $ 1,716,068 $ 1
Slide 27: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Quarter ended June 30, March 31, December 31, September 30, June 30, ($ in thousands) 2024 2024 2023 2023 2023 RETURN ON AVERAGE TANGIBLE COMMON EQUITY (ROATCE) Average shareholder’s equity $ 1,748,240 $ 1,738,698 $ 1,652,882 $ 1,648,605 $ 1,621,337 Less
Slide 28: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Quarter ended June 30, March 31, December 31, September June 30, ($ in thousands) 2024 2024 2023 30, 2023 2023 ALLOWANCE COVERAGE RATIO ADJUSTED FOR GUARANTEED LOANS Loans (GAAP) $11,000,007 $11,028,492 $10,884,118 $10,616,820 $10,512,623 Less guaranteed
Slide 29: Enterprise Financial Services Corp
og ENTERPRISE ““ Financial Services Corp s\