Exhibit 99.1
For more information, contact:
Kevin Eichner (314) 725 5500
Frank Sanfilippo (314) 725 5500
Katie Hollar (816) 221 7500
ENTERPRISE FINANCIAL REPORTS 34.6% INCREASE IN EARNINGS PER SHARE OVER PREVIOUS YEAR
(a) | Trust Income Grows 53.9% |
St. Louis, January 29, 2004 – Enterprise Financial Services Corp. (OTCBB: EFSC), the parent company of Enterprise Bank and Trust reported net income of $6.9 million or $0.70 per fully diluted share for 2003. The reported earnings per fully diluted share for 2003 represent a 34.6% increase over the same period in 2002.
“Growth in earnings per share has been our number one priority,” said Kevin Eichner, president and CEO of Enterprise Financial. “We are pleased at the results for 2003 on this and many other fronts. With the special combination of talent, strength and passion our people have for the business, we are very optimistic about our future.”
Portfolio loans grew by $104 million or 15.3% since December 31, 2002 and ended the year at $784 million. This growth was funded in part by an $80 million increase in deposits or 11.2% for the same period. Net interest income for 2003 was $32.7 million, a $1.8 million or 6.0% increase over 2002. The net interest rate margin for 2003 increased to 4.01% from 4.00% for 2002.
Total noninterest income grew by $4,815,000 for 2003 versus 2002. This increase was primarily generated from a $3,088,000 gain on the sale of three branches in April less a $150,000 write-off of related goodwill, higher gains on the sale of mortgage loans of $246,000 and increased trust income of $1,268,000. Mortgage gains grew by 14.4% and trust income grew by 53.9%. Assets under administration in Enterprise Trust were $1.15 billion at December 31, 2003 versus $866 million at December 31, 2002, a 32.8% increase. Enterprise Trust continues to be one of the fastest growing trust companies in the United States.
The provision for loan losses was $3,627,000 for 2003 compared to $2,251,000 for 2002. The allowance for loan losses of $10.59 million at December 31, 2003 represents 1.35% of outstanding portfolio loans versus 1.27% at the end of 2002.
Expense ratios continued to improve as reduced staffing levels, productivity increases, and business process improvements were implemented during 2003. The efficiency ratio improved from 76.15% for 2002 to 66.73% for 2003.
“We expect the Company’s efficiency ratio to improve even further as our anticipated growth and tight cost controls combine to significantly strengthen our productivity,” said Eichner.
Enterprise Financial operates commercial banking and wealth management businesses in metropolitan St. Louis and Kansas City, with a primary focus on serving the needs of privately held businesses, their owners and other success-minded individuals.
Please refer to Enterprise Financial’s consolidated balance sheets as of December 31, 2003 and December 31, 2002 and consolidated statements of operations for the years ended December 31, 2003 and 2002 attached for more details.
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Readers should note that in addition to the historical information contained herein, this press release may contain forward-looking statements which are inherently subject to risks and uncertainties that could cause actual results to differ materially from those contemplated from such statements. Factors that could cause or contribute to such differences include, but are not limited to, burdens imposed by federal and state regulations of banks, credit risk, exposure to local economic conditions, risks associated with rapid increase or decrease in prevailing interest rates and competition from banks and other financial institutions, as well as those in Enterprise Financial’s 2002 Annual Report on Form 10-K.
ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Balance Sheets (unaudited)
December 31, 2003 and 2002
(Dollars in thousands, except share data)
2003 | 2002 | |||||
Assets | ||||||
Cash and due from banks | $ | 26,271 | $ | 39,052 | ||
Federal funds sold | — | 33,367 | ||||
Interest-bearing deposits | 217 | 66 | ||||
Investments in debt and equity securities: | ||||||
Available for sale, at estimated fair value | 83,939 | 67,083 | ||||
Held to maturity, at amortized cost (estimated fair value of $10 at December 31, 2003 and $13 at December 31, 2002) | 10 | 13 | ||||
Total investments in debt and equity securities | 83,949 | 67,096 | ||||
Loans held for sale | 2,848 | 6,991 | ||||
Loans, less unearned loan fees | 783,878 | 679,799 | ||||
Less allowance for loan losses | 10,590 | 8,600 | ||||
Loans, net | 773,288 | 671,199 | ||||
Other real estate owned | — | 125 | ||||
Fixed assets, net | 7,317 | 7,686 | ||||
Accrued interest receivable | 3,279 | 3,459 | ||||
Goodwill | 1,938 | 2,088 | ||||
Assets held for sale | — | 36,401 | ||||
Prepaid expenses and other assets | 8,619 | 9,721 | ||||
Total assets | $ | 907,726 | $ | 877,251 | ||
Liabilities and Shareholders’ Equity | ||||||
Deposits: | ||||||
Demand | $ | 164,952 | $ | 155,597 | ||
Interest-bearing transaction accounts | 58,926 | 59,058 | ||||
Money market accounts | 371,583 | 341,590 | ||||
Savings | 4,123 | 3,421 | ||||
Certificates of deposit: | ||||||
$100,000 and over | 154,142 | 105,030 | ||||
Other | 42,674 | 51,618 | ||||
Total deposits | 796,400 | 716,314 | ||||
Subordinated debentures | 15,464 | 15,464 | ||||
Federal Home Loan Bank advances | 14,500 | 29,464 | ||||
Notes payable and other borrowings | 9,647 | 2,359 | ||||
Accrued interest payable | 1,151 | 1,264 | ||||
Liabilities held for sale | — | 50,054 | ||||
Accounts payable and accrued expenses | 5,176 | 3,522 | ||||
Total liabilities | 842,338 | 818,441 | ||||
Shareholders’ equity: | ||||||
Common stock, $.01 par value; authorized 20,000,000 shares; issued and outstanding 9,618,482 shares at December 31, 2003 and 9,497,794 shares at December 31, 2002 | 96 | 95 | ||||
Surplus | 39,841 | 38,401 | ||||
Retained earnings | 24,832 | 18,674 | ||||
Accumulated other comprehensive income | 619 | 1,640 | ||||
Total shareholders’ equity | 65,388 | 58,810 | ||||
Total liabilities and shareholders’ equity | $ | 907,726 | $ | 877,251 | ||
ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Operations (unaudited)
Years Ended December 31, 2003 and 2002
(Dollars in thousands, except share data)
2003 | 2002 | |||||
Interest income: | ||||||
Interest and fees on loans | $ | 41,221 | $ | 43,014 | ||
Interest on debt and equity securities: | ||||||
Taxable | 1,691 | 1,496 | ||||
Nontaxable | 23 | 1 | ||||
Interest on federal funds sold | 196 | 574 | ||||
Interest on interest-bearing deposits | 3 | 28 | ||||
Dividends on equity securities | 111 | 94 | ||||
Total interest income | 43,245 | 45,207 | ||||
Interest expense: | ||||||
Interest-bearing transaction accounts | 170 | 269 | ||||
Money market accounts | 3,475 | 5,001 | ||||
Savings | 24 | 84 | ||||
Certificates of deposit: | ||||||
$100,000 and over | 2,972 | 3,145 | ||||
Other | 1,560 | 3,688 | ||||
Subordinated debentures | 1,270 | 1,152 | ||||
Federal Home Loan Bank borrowings | 1,033 | 918 | ||||
Notes payable and other borrowings | 40 | 86 | ||||
Total interest expense | 10,544 | 14,343 | ||||
Net interest income | 32,701 | 30,864 | ||||
Provision for loan losses | 3,627 | 2,251 | ||||
Net interest income after provision for loan losses | 29,074 | 28,613 | ||||
Noninterest income: | ||||||
Service charges on deposit accounts | 1,782 | 1,772 | ||||
Trust income | 3,622 | 2,354 | ||||
Other service charges and fee income | 369 | 380 | ||||
Gain on sale of mortgage loans | 1,953 | 1,707 | ||||
Gain on sale of securities | 78 | — | ||||
Gain on sale of branches | 2,938 | — | ||||
Miscellaneous income | 375 | 89 | ||||
Total noninterest income | 11,117 | 6,302 | ||||
Noninterest expense: | ||||||
Compensation | 16,249 | 14,308 | ||||
Payroll taxes and employee benefits | 2,475 | 2,555 | ||||
Occupancy | 1,974 | 1,901 | ||||
Furniture and equipment | 841 | 1,002 | ||||
Data processing | 932 | 1,012 | ||||
Other | 6,770 | 7,522 | ||||
Total noninterest expense | 29,241 | 28,300 | ||||
Income before income tax expense | 10,950 | 6,615 | ||||
Income tax expense | 4,025 | 1,614 | ||||
Net income | $ | 6,925 | $ | 5,001 | ||
Per share amounts | ||||||
Basic earnings per share | $ | 0.72 | $ | 0.53 | ||
Basic weighted average common shares outstanding | 9,566,059 | 9,399,374 | ||||
Diluted earnings per share | $ | 0.70 | $ | 0.52 | ||
Diluted weighted average common shares outstanding | 9,875,141 | 9,611,108 |