Enterprise Financial Services Corporation · NASDAQ:EFSC
Enterprise Financial Services — Q2 2019 Earnings Presentation
21 slides from Enterprise Financial Services's earnings presentation, Jul 22, 2019
Slide 1: 2019 Second Quarter Earnings Webcast
Exhibit 99.2 Enterprise Financial Services Corp 2019 Second Quarter Earnings Webcast
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the information in this report 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. Forward-looking statements typically are identified with use
Slide 3: Financial Scorecard Q2 2019 Compared to Q2 2018
Financial Scorecard Q2 2019 Compared to Q2 2018 Continued Growth in EPS 28% • Drive Net Interest Income Growth in 31% Dollars with Favorable Loan Growth Trends • Defend Core Net Interest Margin1 5 bps • Maintain High Quality Credit Profile 4 bps NPLs/Loans • Achieve Further Improvement in Core Opera
Slide 4: 2019 Focus
2019 Focus • Closing and Integration of the Trinity Acquisition • Achieve Organic Loan and Deposit Goals • Continued Incremental Improvement of Our Sales and Operational Processes 4
Slide 5: Total Loan Trends
Total Loan Trends 20% Total Loan Growth* $5,149 $5,017 In Millions Trinity $4,350 $682 $4,276 $4,267 Q2' 18 Q3' 18 Q4' 18 Q1' 19 Q2' 19 *Note: 4% Excluding Acquisition of Trinity 5
Slide 6: Commercial & Industrial Loan Trends
Commercial & Industrial Loan Trends 11% C&I Growth* In Millions $2,265 $2,227 Trinity $2,123 $65 $2,041 $2,036 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 *Note: 8% Excluding Acquisition of Trinity 6
Slide 7: Loan Details
Loan Details Q2 ’19 Q1 ’19 QTR Trinity Q2 ’18 LTM In Millions Change Change C&I - General $ 1,104 $ 1,129 $ (25) $ 65 $ 992 $ 112 CRE, Investor Owned - General 1,235 1,183 52 305 842 393 CRE, Owner Occupied - General 591 576 15 92 498 93 Enterprise Value Lending1 446 440 6 — 443 3 Life Insurance Pre
Slide 8: Total Loans By Business Unit
Total Loans By Business Unit In Millions Specialized Lending St. Louis Kansas City $2,335 $2,273 $2,339 $979 $991 $875 $719 $730 $783 Q2 '18 Q1 '19 Q2 '19 Q2 '18 Q1 '19 Q2 '19 Q2 '18 Q1 '19 Q2 '19 Arizona New Mexico* $682 $678 $347 $353 $358 Q2 '18 Q1 '19 Q2 '19 Q2 '18 Q1 '19 Q2 '19 * Acquisition of
Slide 9: Deposit Trend
Deposit Trend 24.7% 25.2% 24.0% 21.4% 21.3% In Millions $5,537 $5,559 Trinity $1,094 $4,588 $4,248 $4,210 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Deposits Trinity DDA % u Last Twelve Months Growth Rate = 31%, 5% Excluding Acquisition of Trinity 9
Slide 10: Earnings Per Share Trend - Q2 2019
Earnings Per Share Trend - Q2 2019 Changes in EPS $0.09 $0.32 $(0.01) $(0.01) $(0.21) $(0.10) $(0.07) $0.67 $0.68 Q1 '19 Net Interest Incremental Loan Loss Noninterest Noninterest Merger-Related Change in Q2 '19 Income Accretion Provision Income Expense Expenses Shares/ ETR 10
Slide 11: Earnings Per Share Trend - 2019 Year to Date
Earnings Per Share Trend - 2019 Year to Date Changes in EPS $0.04 $0.07 $0.71 $(0.03) $(0.46) $(0.63) $(0.19) $1.85 $1.36 2018 Net Interest Incremental Loan Loss Noninterest Noninterest Merger-Related Change in 2019 Income Accretion Provision Income Expense Expense Shares/ETR 11
Slide 12: Net Interest Income Trend
Net Interest Income Trend 3.75% 3.74% 3.77% 3.79% 3.80% In Millions $61.7 $60.8 $52.3 $50.6 $47.0 $48.1 $51.2 $48.5 $46.8 $47.6 30% Core NII Growth Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Core Net Interest Income* Incremental Accretion On Non-core Acquired Assets FTE Core Net Interest Margin* Note: * A N
Slide 13: Credit Trends for Loans
Credit Trends for Loans Net Charge-offs Total Loan Growth (1) In Millions $132 26 bps $85 $83 23 bps 16 bps 8 bps 6 bps $(9) $(15) Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Net Provision for Loans Q2 2019 EFSC Peer(2) In Millions $2.3 NPAs/Assets = 0.42% 0.63% $2.1 $1.7 $
Slide 14: Noninterest Income Trend
Noninterest Income Trend In Millions Fee Income Other Fee Income Detail $2.9 $12.0 $2.8 $0.6 $0.1 $10.7 $0.1 $0.4 $0.2 $9.7 $2.3 $0.2 $9.2 $2.9 $0.1 $2.3 $0.3 $0.3 $8.4 $0.2 $0.4 $2.8 $0.2 $0.1 $2.3 $2.4 $1.7 $1.4 $1.7 $0.3 $1.4 $0.3 $0.2 $1.7 $1.8 $1.8 $1.8 $0.2 $0.4 $2.1 $0.2 $3.4 $1.9 $3.0 $3.0 $
Slide 15: Operating Expenses Trend
Operating Expenses Trend 54.1% 52.4% 52.2% 53.3% 49.8% In Millions $49.1 $10.3 $39.8 $7.3 $30.7 $29.2 $29.9 $0.7 $1.3 $20.7 $19.4 $16.6 $16.3 $16.6 $3.2 $2.3 $2.4 $2.4 $2.6 $14.9 $10.3 $10.5 $10.4 $10.5 Q2 '18 Q3 '18 Q4 '18 Q1 '19 Q2 '19 Other Occupancy Employee compensation and benefits Merger-rela
Slide 16: Effective Tax Rate Reconciliation
Effective Tax Rate Reconciliation YTD 2019 2018 Federal Tax Rate 21.00% 21.00% State Tax, Net of Federal Benefit 2.16% 2.32% Excess Tax Benefits (1.09)% (1.56)% Tax Credit Investments (2.16)% (4.66)% Merger Expenses 1.10% —% Other Tax Adjustments (1.13)% 0.23% Pre-DTA Effective Tax Rate 19.88% 17.33
Slide 17: Positive Momentum in Earnings Per Share
Positive Momentum in Earnings Per Share $1.02 $0.97 $0.95 $0.90 Five-Year CAGR 14% $0.69 $0.67 $0.67 $0.68 $0.61 $0.59 $0.56 $0.54 $0.52 $0.50 $0.48 $0.46 $0.43 $0.41 $0.36 $0.32 $0.30 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 Q2
Slide 18: Appendix
Second Quarter 2019 Earnings Webcast Appendix
Slide 19: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures The Company’s accounting and reporting policies conform to generally accepted accounting principles in the United States (“GAAP”) and the prevailing practices in the banking industry. However, the Company provides other financial measures, such as core net interest
Slide 20: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures For the Quarter ended For the Six Months ended Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Jun 30, Jun 30, ($ in thousands) 2019 2019 2018 2018 2018 2019 2018 CORE PERFORMANCE MEASURES Net interest income $ 61,715 $ 52,343 $ 50,593 $ 48,093 $ 47,048 $ 114,05
Slide 21: Q & A
Second Quarter 2019 Earnings Webcast Q & A
Enterprise Financial Services — Q2 2019 Earnings Presentation on 6ix