Business Wire | Apr 26, 2021 04:04PM EDT

Enterprise Financial Reports First Quarter 2021 Results

Apr. 26, 2021

ST. LOUIS--(BUSINESS WIRE)--Apr. 26, 2021--Enterprise Financial Services Corp (Nasdaq: EFSC) (the "Company" or "EFSC") reported net income of $29.9 million for the first quarter 2021, an increase of $1.0 million compared to the linked fourth quarter ("linked quarter") and an increase of $17.1 million from the prior year quarter. Earnings per diluted share ("EPS") was $0.96 for the first quarter 2021, compared to $1.00 and $0.48 for the linked and prior year quarters, respectively.

Jim Lally, EFSC's President and Chief Executive Officer, commented, 'Today we announced the acquisition of First Choice headquartered in Cerritos, California. This transaction strengthens our California presence with a pro forma asset base of $3.8 billion. I am excited about how this adds to our expected growth prospects and diversification of our business, particularly in close proximity to the successful first quarter core systems integration for Seacoast. We are off to a solid start in 2021, with earnings of $0.96 per share and continued execution on the Paycheck Protection Program ("PPP") for the benefit of our customers. In addition, we issued our inaugural Environmental, Social and Governance report during March. I am pleased that we have taken the first step in reporting our ESG efforts and demonstrating the importance of our ESG objectives in meeting our mission."

Highlights

* Earnings - Net income in the first quarter 2021 was $29.9 million, an increase of $1.0 million compared to the linked quarter and an increase of $17.1 million from the prior year quarter. EPS was $0.96 per diluted share for the first quarter 2021, compared to $1.00 and $0.48 per diluted share for the linked and prior year quarters, respectively. Merger-related expenses from the Seacoast transaction reduced net income $2.4 million, or $0.07 per share. The increase in net income and EPS from the prior year quarter was primarily due to a decrease of $22.2 million in the provision for credit losses.

* Pre-provision net revenue1 ("PPNR") - PPNR of $40.7 million in the first quarter 2021 decreased $6.8 million and increased $2.6 million from the linked and prior year quarters, respectively. The decrease from the linked quarter was primarily due to a decline in tax credit revenue and PPP fees. The increase from the prior year quarter was primarily from the Seacoast acquisition that was completed in the fourth quarter and income from PPP that started in the second quarter of 2020.

1 PPNR is a non-GAAP measure. Refer to discussion and reconciliation of these measures in the accompanying financial tables.

* Net interest income and net interest margin ("NIM") - Net interest income of $79.1 million for the first quarter 2021 increased $1.7 million and $15.8 million from the linked quarter and prior year quarter, respectively. NIM was 3.50% for the first quarter 2021, compared to 3.66% and 3.79% for the linked quarter and prior year quarter, respectively.

* Noninterest income - Noninterest income of $11.3 million for the first quarter 2021 decreased $7.2 million and $2.1 million from the linked quarter and prior year quarter, respectively. The decrease was primarily due to a decline in tax credit activity caused by delays in projects, which declined $5.1 million from the linked quarter and $3.1 million from the prior year quarter.

* Loans - Total loans increased $63.8 million, or 3.6% on an annualized basis, from the linked quarter to $7.3 billion as of March 31, 2021. Year-over-year, loans grew $1.8 billion, or 33.6% from $5.5 billion as of March 31, 2020, primarily due to Seacoast loans of $1.2 billion upon acquisition and PPP loans of $737.7 million. Average loans totaled $7.2 billion for the quarter ended March 31, 2021 compared to $6.8 billion and $5.4 billion for the linked and prior year quarters, respectively.

PPP details:

Quarter ended

($ in thousands, except March 31, December September June 30,per share data) 2021 31, 2020 30, 2020 2020

PPP loans outstanding, net $ 737,660 $ 698,645 $ 819,100 $ 807,814 of deferred fees

Average PPP loans 692,161 806,697 813,244 634,632 outstanding, net

PPP average loan size 220 187 216 224

PPP interest and fee 8,475 10,261 5,226 4,083 income

PPP deferred fees 16,676 11,304 19,522 22,414

PPP average yield 4.97 % 5.06 % 2.56 % 2.59 %

Quarter ended

March 31, 2021

December 31, 2020

September 30, 2020

June 30, 2020

Financial Metrics:

As

Reported

Excluding

PPP*

As

Reported

Excluding

PPP*

As

Reported

Excluding

PPP*

As

Reported

Excluding

PPP*

EPS

$

0.96

$

0.75

$

1.00

$

0.73

$

0.68

$

0.53

$

0.56

$

0.44

ROAA

1.22

%

1.03

%

1.26

%

1.01

%

0.86

%

0.74

%

0.72

%

0.62

%

PPNR ROAA

1.66

%

1.41

%

2.07

%

1.78

%

1.81

%

1.73

%

1.87

%

1.81

%

Tangible common

equity/tangible

assets*

8.18

%

8.84

%

8.40

%

9.07

%

7.99

%

8.89

%

7.81

%

8.67

%

Leverage ratio

9.5

%

10.2

%

10.0

%

11.0

%

9.2

%

10.2

%

9.2

%

10.0

%

NIM

3.50

%

3.39

%

3.66

%

3.52

%

3.29

%

3.37

%

3.53

%

3.62

%

Allowance for

credit losses on

loans/loans

1.80

%

2.01

%

1.89

%

2.09

%

2.01

%

2.32

%

1.80

%

2.07

%

* Non-GAAP measures. Refer to discussion and reconciliation of these measures in the accompanying financial tables. Calculations not adjusted for increase in average deposits or increase in deposit expense, as applicable.

* Asset quality - The allowance for credit losses on loans to total loans was 1.80% at March 31, 2021, compared to 1.89% and 1.69% at December 31, 2020 and March 31, 2020, respectively. Nonperforming assets to total assets was 0.50% at March 31, 2021 compared to 0.45% and 0.56% at December 31, 2020 and March 31, 2020, respectively. The decline in the allowance to total loans ratio in the first quarter 2021 was primarily due to loan charge-offs of $6.5 million, the majority of which had been reserved for in a prior period. High-quality credit metrics, continued improvement in economic forecasts and relatively stable loan volumes resulted in a nominal provision for credit losses in the current quarter.

* Deposits - Total deposits increased $530.1 million, or 6.6%, from the linked quarter to $8.5 billion as of March 31, 2021. Year-over-year, deposits grew $2.5 billion, or 42.2%, from $6.0 billion as of March 31, 2020. Average deposits totaled $8.2 billion for the quarter ended March 31, 2021 compared to $7.3 billion and $5.8 billion for the linked and prior year quarters, respectively. Deposits from the Seacoast acquisition and PPP loans contributed to the increase over the prior year period. Specialty deposits increased $163.4 million over the linked quarter primarily attributable to community associations and sponsor finance. The St. Louis, Kansas City, and New Mexico regions also experienced significant growth of $132.5 million, $129.3 million, and $77.5 million, respectively, over the linked quarter. Noninterest deposit accounts represented 34.2% of total deposits and the loan to deposit ratio was 85.6% at March 31, 2021.

* Capital - Total shareholders' equity was $1.1 billion and the tangible common equity to tangible assets ratio was 8.2% at March 31, 2021, compared to 8.4% at December 31, 2020. The Bank's regulatory capital ratios remain "well-capitalized," with a common equity tier 1 ratio of 12.4% and a total risk-based capital ratio of 13.6% as of March 31, 2021. The Company's common equity tier 1 ratio and total risk-based capital ratio was 11.0% and 15.1%, respectively, at March 31, 2021.

The Company has 95,907 shares available for repurchase under the existing common stock repurchase authorization.

The Company's Board of Directors approved a quarterly dividend of $0.18 per common share, payable on June 30, 2021 to shareholders of record as of June 15, 2021.

* Liquidity - The Company maintains a high level of both on-balance-sheet and off-balance-sheet liquidity. At March 31, 2021, on-balance-sheet liquidity consisted of cash and unpledged investment securities of $1.0 billion. Off-balance-sheet liquidity totaled $1.8 billion through the Federal Home Loan Bank, Federal Reserve and correspondent bank lines. The Company also has an unused $25 million revolving line of credit and maintains a shelf registration allowing for the issuance of various forms of equity and debt securities.

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, 2021 December 31, 2020 September 30, 2020 June 30, 2020

Financial As Excluding As Excluding As Excluding As ExcludingMetrics: Reported PPP* Reported PPP* Reported PPP* Reported PPP*

EPS $ 0.96 $ 0.75 $ 1.00 $ 0.73 $ 0.68 $ 0.53 $ 0.56 $ 0.44

ROAA 1.22 % 1.03 % 1.26 % 1.01 % 0.86 % 0.74 % 0.72 % 0.62 %

PPNR ROAA 1.66 % 1.41 % 2.07 % 1.78 % 1.81 % 1.73 % 1.87 % 1.81 %

Tangiblecommon

equity/ 8.18 % 8.84 % 8.40 % 9.07 % 7.99 % 8.89 % 7.81 % 8.67 %tangible

assets*

Leverage 9.5 % 10.2 % 10.0 % 11.0 % 9.2 % 10.2 % 9.2 % 10.0 %ratio

NIM 3.50 % 3.39 % 3.66 % 3.52 % 3.29 % 3.37 % 3.53 % 3.62 %

Allowancefor

credit 1.80 % 2.01 % 1.89 % 2.09 % 2.01 % 2.32 % 1.80 % 2.07 %losses on

loans/loans



* Non-GAAP measures. Refer to discussion and reconciliation of these measuresin the accompanying financial tables. Calculations not adjusted for increase inaverage deposits or increase in deposit expense, as applicable.

* Asset quality - The allowance for credit losses on loans to total loans was 1.80% at March 31, 2021, compared to 1.89% and 1.69% at December 31, 2020 and March 31, 2020, respectively. Nonperforming assets to total assets was 0.50% at March 31, 2021 compared to 0.45% and 0.56% at December 31, 2020 and March 31, 2020, respectively. The decline in the allowance to total loans ratio in the first quarter 2021 was primarily due to loan charge-offs of $6.5 million, the majority of which had been reserved for in a prior period. High-quality credit metrics, continued improvement in economic forecasts and relatively stable loan volumes resulted in a nominal provision for credit losses in the current quarter.

* Deposits - Total deposits increased $530.1 million, or 6.6%, from the linked quarter to $8.5 billion as of March 31, 2021. Year-over-year, deposits grew $2.5 billion, or 42.2%, from $6.0 billion as of March 31, 2020. Average deposits totaled $8.2 billion for the quarter ended March 31, 2021 compared to $7.3 billion and $5.8 billion for the linked and prior year quarters, respectively. Deposits from the Seacoast acquisition and PPP loans contributed to the increase over the prior year period. Specialty deposits increased $163.4 million over the linked quarter primarily attributable to community associations and sponsor finance. The St. Louis, Kansas City, and New Mexico regions also experienced significant growth of $132.5 million, $129.3 million, and $77.5 million, respectively, over the linked quarter. Noninterest deposit accounts represented 34.2% of total deposits and the loan to deposit ratio was 85.6% at March 31, 2021.

* Capital - Total shareholders' equity was $1.1 billion and the tangible common equity to tangible assets ratio was 8.2% at March 31, 2021, compared to 8.4% at December 31, 2020. The Bank's regulatory capital ratios remain "well-capitalized," with a common equity tier 1 ratio of 12.4% and a total risk-based capital ratio of 13.6% as of March 31, 2021. The Company's common equity tier 1 ratio and total risk-based capital ratio was 11.0% and 15.1%, respectively, at March 31, 2021.

The Company has 95,907 shares available for repurchase under the existing common stock repurchase authorization.

The Company's Board of Directors approved a quarterly dividend of $0.18 per common share, payable on June 30, 2021 to shareholders of record as of June 15, 2021.

* Liquidity - The Company maintains a high level of both on-balance-sheet and off-balance-sheet liquidity. At March 31, 2021, on-balance-sheet liquidity consisted of cash and unpledged investment securities of $1.0 billion. Off-balance-sheet liquidity totaled $1.8 billion through the Federal Home Loan Bank, Federal Reserve and correspondent bank lines. The Company also has an unused $25 million revolving line of credit and maintains a shelf registration allowing for the issuance of various forms of equity and debt securities.

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, 2021 December 31, 2020 March 31, 2020

Interest Average Interest Average Interest Average Average Average Average($ in thousands) Income/ Yield/ Income/ Yield/ Income/ Yield/ Balance Balance Balance Expense Rate Expense Rate Expense Rate

Assets

Interest-earning assets:

Loans* $ 7,192,776 $ 77,073 4.35 % $ 6,780,702 $ 76,044 4.46 % $ 5,352,243 $ 67,290 5.06 %

Debt and equity 1,417,305 8,818 2.52 1,395,806 8,986 2.56 1,346,968 9,707 2.90 investments*

Short-term investments 679,659 189 0.11 347,629 120 0.14 92,248 300 1.31

Total earning assets 9,289,740 86,080 3.76 8,524,137 85,150 3.97 6,791,459 77,297 4.58



Noninterest-earning assets 650,312 617,022 572,146



Total assets $ 9,940,052 $ 9,141,159 $ 7,363,605



Liabilities and Shareholders' Equity

Interest-bearing liabilities:

Interest-bearing $ 1,887,059 $ 328 0.07 % $ 1,584,369 $ 265 0.07 % $ 1,375,154 $ 1,338 0.39 %transaction accounts

Money market accounts 2,350,592 975 0.17 2,175,111 1,016 0.19 1,811,090 4,740 1.05

Savings 654,662 48 0.03 620,248 46 0.03 542,993 143 0.11

Certificates of deposit 537,166 1,312 0.99 567,456 1,739 1.22 793,213 3,667 1.86

Total interest-bearing 5,429,479 2,663 0.20 4,947,184 3,066 0.25 4,522,450 9,888 0.88 deposits

Subordinated debentures 203,694 2,819 5.61 203,564 2,824 5.52 141,295 1,919 5.46

FHLB advances 50,000 195 1.58 244,730 603 0.98 220,453 895 1.63

Securities sold under 231,527 60 0.11 231,836 64 0.11 201,887 343 0.68 agreements to repurchase

Other borrowings 28,650 100 1.42 30,095 110 1.45 34,270 275 3.23

Total interest-bearing 5,943,350 5,837 0.40 5,657,409 6,667 0.47 5,120,355 13,320 1.05 liabilities



Noninterest-bearing liabilities:

Demand deposits 2,777,900 2,363,890 1,315,267

Other liabilities 122,321 127,843 62,948

Total liabilities 8,843,571 8,149,142 6,498,570

Shareholders' equity 1,096,481 992,017 865,035

Total liabilities and $ 9,940,052 $ 9,141,159 $ 7,363,605 shareholders' equity



Total net interest income $ 80,243 $ 78,483 $ 63,977

Net interest margin 3.50 % 3.66 % 3.79 %

* Non-taxable income is presented on a tax-equivalent basis using a 24.9% and24.7% tax rate in 2021 and 2020, respectively. The tax-equivalent adjustmentswere $1.1 million for the three months ended March 31, 2021, and $0.6 millionfor each of the three months ended December 31, 2020 and March 31, 2020.

Net interest income for the first quarter increased $1.7 million to $79.1 million from $77.4 million in the linked quarter, and increased $15.8 million from the prior year period. NIM, on a tax equivalent basis, was 3.50% for the first quarter, compared to 3.66% in the linked quarter, and 3.79% in the first quarter of 2020. The increase in net interest income from the linked quarter was primarily due to the full quarter of earnings on acquired Seacoast assets and lower interest expense on paying liabilities, partially offset by reduced income from PPP loans and purchase accounting adjustments.

NIM decreased 16 basis points from the linked quarter to 3.50% during the current quarter primarily due to a 21 basis point decrease in earning asset yields. The decrease in the earning asset yield was primarily due to higher levels of cash related to PPP funds and deposit growth (13 bps), reduced income from PPP forgiveness (11 bps) and lower levels of accretion from purchase accounting (5 bps), partially offset by the full-quarter impact of acquired Seacoast assets (8 bps).

The cost of interest-bearing liabilities declined seven basis points from the linked quarter, primarily due to the full-quarter impact of lower cost deposits from Seacoast, lower rates on time deposits, and a reduction in expense on borrowings.

Loans

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

Quarter ended

December 31, 2020

($ in March 31, Legacy September 30, March 31,thousands) Seacoast^a Consolidated June 30, 2020 2021 EFSC^a 2020 2020

C&I $ 1,048,839 $ 16,079 $ 1,086,981 $ 1,103,060 $ 1,075,421 $ 1,052,373 $ 1,180,675

CRE investor 1,491,244 107,449 1,313,456 1,420,905 1,281,567 1,298,801 1,316,501 owned

CRE owner 805,581 98,134 727,712 825,846 766,919 782,258 743,962 occupied

SBA loans 941,075 874,578 21,352 895,930 15,927 17,195 17,381

SBA PPP 737,660 85,729 612,916 698,645 819,100 807,814 - loans

Sponsor 394,207 - 396,487 396,487 367,337 383,458 440,764 finance

Lifeinsurancepremium 543,084 - 534,092 534,092 517,559 520,705 496,472

financing

Residential 299,517 9,138 308,953 318,091 321,258 326,467 346,225 real estate

Constructionand land 438,303 32,535 441,864 474,399 450,225 455,686 445,909

development

Tax credits 387,968 - 382,602 382,602 368,908 363,222 354,046

Other 201,303 764 174,114 174,878 142,086 132,072 115,582

Total Loans $ 7,288,781 $ 1,224,406 $ 6,000,529 $ 7,224,935 $ 6,126,307 $ 6,140,051 $ 5,457,517



Total loan 4.35 % 4.46 % 4.08 % 4.31 % 5.06 %yield

Variableinterestrate loans 56 % 57 % 50 % 51 % 60 %

to totalloans



Certain prior period amounts have been reclassified among the categories toconform to the current period presentation.

^a Amounts reported are as of December 31, 2020 and are separately shownattributable to the Seacoast loan portfolio acquired on November 12, 2020, andthe Company's pre-Seacoast acquisition loan portfolio.

Loans totaled $7.3 billion at March 31, 2021, increasing $63.8 million, or 3.6% on an annualized basis, compared to the linked quarter. Year-over-year, loans increased $1.8 billion, or 33.6%. The year-over-year increase was primarily due to the Seacoast acquisition and PPP loans. The largest growth categories, excluding PPP, compared to the linked quarter were investor-owned CRE, SBA, other, life insurance premium finance, and tax credits. Line draw utilization continues to decline. For the quarter ended March 31, 2021 average line draw utilization was 37.0% compared to 38.1% and 47.3% for the linked quarter and prior-year quarter, respectively.

Asset Quality

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

Quarter ended

March 31, December September June 30, March 31,($ in thousands) 2021 31, 30, 2020 2020 2020 2020

Nonperforming $ 36,659 $ 38,507 $ 39,623 $ 41,473 $ 37,204 loans*

Other real 6,164 5,330 4,835 4,874 5,072 estate

Nonperforming $ 42,823 $ 43,837 $ 44,458 $ 46,347 $ 42,276 assets*



Nonperformingloans to total 0.50 % 0.53 % 0.65 % 0.68 % 0.68 %loans

Nonperformingassets to total 0.42 % 0.45 % 0.53 % 0.55 % 0.56 %assets

Allowance forloan losses to 1.80 % 1.89 % 2.01 % 1.80 % 1.69 %total loans

Net charge-offs $ 5,647 $ (612) $ 1,027 $ 309 $ 1,183 (recoveries)

*Excludes government guaranteed balances.

Nonperforming loans decreased $1.8 million to $36.7 million at March 31, 2021 from $38.5 million at December 31, 2020. Activity during the current quarter primarily included additions of $6.2 million, reductions of $1.6 million, and charge-offs of $6.5 million. The addition of $6.2 million during the quarter was primarily from a $4.2 million retail relationship that went on nonaccrual. Other real estate increased during the first quarter 2021 due to one addition of $1.2 million partially offset by sales of $0.4 million.

The Company recorded a provision for credit losses of $46.3 thousand for the first quarter 2021 compared to $9.5 million for the linked quarter and $22.3 million for the prior year quarter. While the majority of the charge-offs in the quarter were reserved for in a prior period, a provision of approximately $3.0 million was recognized on a retail loan that defaulted in the quarter. The impact on the provision for credit losses of this loan was offset by an improvement in the economic forecast, net of qualitative adjustments.

Deposits

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

Quarter ended

December 31, 2020

March 31, Legacy September 30, March 31,($ in thousands) Seacoast^a Consolidated June 30, 2020 2021 EFSC^a 2020 2020

Noninterest-bearing $ 2,910,216 $ 666,447 $ 2,045,381 $ 2,711,828 $ 1,929,540 $ 1,965,868 $ 1,354,571 accounts

Interest-bearing 1,990,308 55,590 1,712,907 1,768,497 1,499,756 1,508,535 1,389,603 transaction accounts

Money market and 3,093,569 327,471 2,627,498 2,954,969 2,634,885 2,566,011 2,479,828 savings accounts

Brokered certificates of 50,209 - 50,209 50,209 65,209 85,414 170,667 deposit

Other certificates of 471,142 10,325 489,561 499,886 546,836 573,752 595,237 deposit

Total deposit portfolio $ 8,515,444 $ 1,059,833 $ 6,925,556 $ 7,985,389 $ 6,676,226 $ 6,699,580 $ 5,989,906



Noninterest-bearing 34.2 % 62.9 % 29.5 % 34.0 % 28.9 % 29.3 % 22.6 %deposits to total deposits

^aAmounts reported are as of December 31, 2020 and are shown separatelyattributable to the Seacoast deposit portfolio acquired on November 12, 2020,and the Company's pre-Seacoast acquisition deposit portfolio.

Total deposits at March 31, 2021 were $8.5 billion, an increase of $530.1 million from December 31, 2020, and an increase of $2.5 billion from March 31, 2020.

Core deposits, defined as total deposits excluding certificates of deposits, were $8.0 billion at March 31, 2021, an increase of $558.8 million from the linked quarter. The Company's participation in PPP continues to contribute to the increase in deposits. Money market and savings accounts increased $138.6 million compared to the linked quarter, while interest-bearing and noninterest-bearing deposits increased $221.8 million and $198.4 million, respectively. Noninterest-bearing deposits were $2.9 billion at March 31, 2021, or 34.2% of total deposits. Certificates of deposit decreased $28.7 million from the linked quarter and $244.6 million from the prior year quarter. The total cost of deposits was 0.13% for the current quarter compared to 0.17% and 0.68% for the linked quarter and prior year quarter, respectively.

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

March 31, December March 31,($ in 31, Increase (decrease) Increase (decrease)thousands) 2021 2020 2020

Servicecharges on $ 3,084 $ 3,160 $ (76) (2) % $ 3,143 $ (59) (2) %depositaccounts

Wealthmanagement 2,483 2,449 34 1 % 2,501 (18) (1) %revenue

Card services 2,496 2,511 (15) (1) % 2,247 249 11 %revenue

Tax creditincome (1,041) 4,048 (5,089) 126 % 2,036 (3,077) (151) %(expense)

Miscellaneous 4,268 6,338 (2,070) (33) % 3,481 787 23 %income

Totalnoninterest $ 11,290 $ 18,506 $ (7,216) (39) % $ 13,408 $ (2,118) (16) %income



Total noninterest income for the first quarter 2021 was $11.3 million, a decrease of $7.2 million from the linked quarter and a decrease of $2.1 million from the prior year quarter. The decrease from the linked quarter and prior year quarter was primarily due to a decline in tax credit income. Several tax credit projects that were expected to close in the quarter were delayed and did not close. In addition, projects carried at fair value recognized a reduced valuation during the quarter due to an increase in the longer-term LIBOR swap rates used in the valuation process. The decline in miscellaneous income from the linked quarter was due to income earned on community development investments in the fourth quarter 2020 that did not reoccur in the current period.

Noninterest Expenses

Noninterest expense was $52.9 million for the first quarter 2021, compared to $51.1 million for the linked quarter, and $38.7 million for the first quarter 2020. The increase from the linked quarter and prior year quarter was primarily due to having a full quarter of Seacoast operations, which totaled $10.2 million in the first quarter 2021. Merger-related expenses were $3.1 million and $2.6 million in the current and linked quarters, respectively. The Company does not expect to incur any additional material merger expenses related to the Seacoast transaction.

For the first quarter 2021, the Company's efficiency ratio was 58.5% compared to 53.2% and 50.4% for the linked quarter and prior year quarter, respectively. The Company's core efficiency ratio2 was 55.0% for the quarter ended March 31, 2021, compared to 50.9% for the linked quarter and 51.2% for the prior year quarter.

2 Core 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 20% for the quarter ended March 31, 2021, compared to 18% in the linked quarter and 19% in the prior year quarter.

Capital

The following table presents various EFSC capital ratios:

Quarter ended

March December September June MarchPercent 31, 31, 30, 30, 31,

2021 2020 2020 2020 2020

Total risk-based capital to 15.1 % 14.9 % 14.6 % 14.4 % 12.9 %risk-weighted assets

Tier 1 capital to risk weighted 12.3 % 12.1 % 11.6 % 11.4 % 11.0 %assets

Common equity tier 1 capital torisk- 11.0 % 10.9 % 10.2 % 9.9 % 9.6 %

weighted assets

Tangible common equity to 8.2 % 8.4 % 8.0 % 7.8 % 8.4 %tangible assets

The Company's regulatory capital ratios continue to expand due to the Company's earnings profile and manageable dividend payout ratio. The decline in the tangible common equity to tangible assets ratio was primarily due to continued growth in the balance sheet from PPP loans and the related deposit balances. 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 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 27, 2021. During the call, management will review the first quarter of 2021 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 1-800-353-6461 (Conference ID #2910583). 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/EFSC1Q2021earnings 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

Enterprise Financial Services Corp (Nasdaq: EFSC), with approximately $10.2 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 39 branch offices in Arizona, California, Kansas, Missouri, Nevada, and New Mexico, and SBA loan and deposit production offices in Arizona, California, Colorado, Illinois, Indiana, Massachusetts, Michigan, Nevada, Ohio, Oregon, Texas, Utah, and Washington. 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

Certain statements contained in this Current Report on Form 8-K may be considered forward-looking statements regarding Enterprise, including its wholly-owned subsidiary EB&T, First Choice, including its wholly-owned subsidiary FCB, and Enterprise's proposed acquisition of First Choice and FCB. These forward-looking statements may include: statements regarding the acquisition, the consideration payable in connection with the acquisition, and the ability of the parties to consummate the acquisition. 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 that Enterprise anticipated in its 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 possibility: that expected benefits of the acquisition may not materialize in the timeframe expected or at all, or may be more costly to achieve; that the acquisition may not be timely completed, if at all; the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive transaction agreement; the outcome of any legal proceedings that may be instituted against Enterprise or First Choice; that prior to the completion of the acquisition or thereafter, Enterprise's and First Choice's respective businesses may not perform as expected due to transaction-related uncertainty or other factors; that the parties are unable to successfully implement integration strategies; that required regulatory, Enterprise shareholder or First Choice shareholder or other approvals are not obtained or other closing conditions are not satisfied in a timely manner or at all; that adverse regulatory conditions may be imposed in connection with regulatory approvals of the acquisition; reputational risks and the reaction of the companies' employees or customers to the transaction; diversion of management time on acquisition-related issues; that the COVID-19 pandemic, including uncertainty and volatility in financial, commodities and other markets, and disruptions to banking and other financial activity, could harm Enterprise and First Choice's business, financial position and results of operations, and could adversely affect the timing and anticipated benefits of the proposed acquisition; and those factors and risks referenced from time to time in Enterprise's filings with the Securities and Exchange Commission, or the SEC, including in Enterprise's Annual Report on Form 10-K for the fiscal year ended December 31, 2020, its other filings with the SEC. For any forward-looking statements made in this Current Report on Form 8-K or in any documents, Enterprise claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

Annualized, pro forma, projected and estimated numbers in this document are used for illustrative purposes only, are not forecasts and may not reflect actual results.

Except to the extent required by applicable law or regulation, Enterprise 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.

Additional Information About the Acquisition and Where to Find It

In connection with the proposed acquisition transaction, along with other relevant documents, a registration statement on Form S-4 will be filed with the SEC that will include a joint proxy statement/prospectus to be distributed to the shareholders of Enterprise and First Choice in connection with their votes on the acquisition. SHAREHOLDERS OF ENTERPRISE AND FIRST CHOICE ARE URGED TO READ THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE JOINT PROXY STATEMENT/PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED ACQUISITION AND RELATED MATTERS. FREE COPIES OF THESE DOCUMENTS MAY BE OBTAINED AS DESCRIBED BELOW.

The final joint proxy statement/prospectus will be mailed to shareholders of Enterprise and First Choice. Investors and security holders will be able to obtain the documents, and any other documents Enterprise has filed with the SEC, free of charge at the SEC's website, www.sec.gov. In addition, documents filed with the SEC by Enterprise in connection with the proposed acquisition will be available free of charge by (1) accessing Enterprise's website at www.enterprisebank.com under the "Investor Relations" link, (2) writing Enterprise at 150 North Meramec, Clayton, Missouri 63105, Attention: Investor Relations, (3) accessing First Choice's website at https://investors.firstchoicebankca.com under the "SEC Filings" tab, or (4) writing First Choice at 17785 Center Court Drive, N Suite 750, Cerritos, CA 90703, Attention: General Counsel.

Participants in Solicitation

First Choice and certain of their directors and executive officers, and Enterprise and certain of their directors, executive officers and other certain members of management and employees, may be deemed to be participants in the solicitation of proxies from the shareholders of First Choice and the shareholders of Enterprise in connection with the merger. Information about the directors and executive officers of Enterprise is set forth in the proxy statement for Enterprise's 2021 annual meeting of shareholders, as filed with the SEC on a Schedule 14A on March 17, 2021. Information about the directors and officers of First Choice will be set forth in the Form-10-K/A, to be filed with the SEC on or about April 27, 2021 and in the proxy statement of First Choice to be filed on Schedule 14A during the third quarter of 2021. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the joint proxy statement/prospectus regarding the proposed acquisition when it becomes available. Free copies of this document, once filed, may be obtained as described in the preceding paragraph.

ENTERPRISE FINANCIAL SERVICES CORP

CONSOLIDATED FINANCIAL SUMMARY (unaudited)

Quarter ended

(in thousands, Mar 31, Dec 31, Sep 30, Jun 30, Mar 31,except per 2021 2020 2020 2020 2020share data)

EARNINGS SUMMARY

Net interest $ 79,123 $ 77,446 $ 63,354 $ 65,833 $ 63,368 income

Provision for 46 9,463 14,080 19,591 22,264 credit losses

Noninterest 11,290 18,506 12,629 9,960 13,408 income

Noninterest 52,884 51,050 39,524 37,912 38,673 expense

Income beforeincome tax 37,483 35,439 22,379 18,290 15,839 expense

Income tax 7,557 6,508 4,428 3,656 2,971 expense

Net income $ 29,926 $ 28,931 $ 17,951 $ 14,634 $ 12,868



Dilutedearnings per $ 0.96 $ 1.00 $ 0.68 $ 0.56 $ 0.48 share

Return on 1.22 % 1.26 % 0.86 % 0.72 % 0.70 %average assets

Return onaverage common 11.07 % 11.60 % 8.06 % 6.78 % 5.98 %equity

Return onaverage 14.92 % 15.73 % 10.94 % 9.28 % 8.22 %tangible commonequity

Net interestmargin (tax 3.50 % 3.66 % 3.29 % 3.53 % 3.79 %equivalent)

Efficiency 58.49 % 53.20 % 52.02 % 50.02 % 50.37 %ratio

Core efficiency 55.02 % 50.93 % 51.04 % 50.66 % 51.21 %ratio^1



Total assets $ 10,190,699 $ 9,751,571 $ 8,367,976 $ 8,357,501 $ 7,500,643

Total average 9,940,052 9,141,159 8,341,968 8,158,204 7,363,605 assets

Total deposits 8,515,444 7,985,389 6,676,226 6,699,580 5,989,906

Total average 8,207,379 7,311,074 6,666,368 6,551,734 5,837,717 deposits

Period endcommon shares 31,259 31,210 26,210 26,196 26,161 outstanding

Dividends per $ 0.18 $ 0.18 $ 0.18 $ 0.18 $ 0.18 common share

Tangible bookvalue per $ 25.92 $ 25.48 $ 24.80 $ 24.22 $ 23.38 common share

Tangible commonequity to 8.18 % 8.40 % 7.99 % 7.81 % 8.42 %tangible assets^1

Totalrisk-basedcapital to 15.1 % 14.9 % 14.6 % 14.4 % 12.9 %risk-weightedassets



^1Refer to Reconciliations of Non-GAAP Financial Measures table for areconciliation of these measures to GAAP.

ENTERPRISE FINANCIAL SERVICES CORP

CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

Quarter ended

($ in thousands, Mar 31, Dec 31, Sep 30, Jun 30, Mar 31,except per share 2021 2020 2020 2020 2020data)

INCOME STATEMENTS

NET INTEREST INCOME

Total interest $ 84,960 $ 84,113 $ 70,787 $ 73,191 $ 76,688 income

Total interest 5,837 6,667 7,433 7,358 13,320 expense

Net interest 79,123 77,446 63,354 65,833 63,368 income

Provision for 46 9,463 14,080 19,591 22,264 credit losses

Net interestincome after 79,077 67,983 49,274 46,242 41,104 provision forcredit losses



NONINTEREST INCOME

Deposit service 3,084 3,160 2,798 2,616 3,143 charges

Wealth management 2,483 2,449 2,456 2,326 2,501 revenue

Card services 2,496 2,511 2,498 2,225 2,247 revenue

Tax credit income (1,041) 4,048 748 (221) 2,036 (expense)

Other income 4,268 6,338 4,129 3,014 3,481

Total noninterest 11,290 18,506 12,629 9,960 13,408 income



NONINTEREST EXPENSE

Employeecompensation and 29,562 26,174 22,040 22,389 21,685 benefits

Occupancy 3,751 3,517 3,408 3,185 3,347

Merger-related 3,142 2,611 1,563 - - expenses

Other 16,429 18,748 12,513 12,338 13,641

Total noninterest 52,884 51,050 39,524 37,912 38,673 expense



Income before 37,483 35,439 22,379 18,290 15,839 income tax expense

Income tax expense 7,557 6,508 4,428 3,656 2,971

Net income $ 29,926 $ 28,931 $ 17,951 $ 14,634 $ 12,868



Basic earnings per $ 0.96 $ 1.00 $ 0.68 $ 0.56 $ 0.49 share

Diluted earnings $ 0.96 $ 1.00 $ 0.68 $ 0.56 $ 0.48 per share

ENTERPRISE FINANCIAL SERVICES CORP

CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

Quarter ended

($ in thousands) Mar 31, Dec 31, Sep 30, Jun 30, Mar 31, 2021 2020 2020 2020 2020

BALANCE SHEETS

ASSETS

Cash and due from banks $ 103,367 $ 99,760 $ 98,816 $ 100,804 $ 98,619

Interest-earning deposits 788,464 445,569 301,773 254,830 88,794

Debt and equity investments 1,463,818 1,448,803 1,375,931 1,387,001 1,382,149

Loans held for sale 8,531 13,564 14,032 16,029 8,430



Loans 7,288,781 7,224,935 6,126,307 6,140,051 5,457,517

Less: Allowance for loan 131,527 136,671 123,270 110,270 92,187 losses

Total loans, net 7,157,254 7,088,264 6,003,037 6,029,781 5,365,330



Fixed assets, net 52,078 53,169 56,807 58,231 59,358

Goodwill 260,567 260,567 210,344 210,344 210,344

Intangible assets, net 21,670 23,084 21,820 23,196 24,585

Other assets 334,950 318,791 285,416 277,285 263,034

Total assets $ 10,190,699 $ 9,751,571 $ 8,367,976 $ 8,357,501 $ 7,500,643



LIABILITIES AND SHAREHOLDERS' EQUITY

Noninterest-bearing deposits $ 2,910,216 $ 2,711,828 $ 1,929,540 $ 1,965,868 $ 1,354,571

Interest-bearing deposits 5,605,228 5,273,561 4,746,686 4,733,712 4,635,335

Total deposits 8,515,444 7,985,389 6,676,226 6,699,580 5,989,906

Subordinated debentures 203,778 203,637 203,510 203,384 141,336

FHLB advances 50,000 50,000 250,000 250,000 222,000

Other borrowings 229,389 301,081 239,038 227,961 205,918

Other liabilities 99,591 132,489 116,935 108,613 95,047

Total liabilities 9,098,202 8,672,596 7,485,709 7,489,538 6,654,207

Shareholders' equity 1,092,497 1,078,975 882,267 867,963 846,436

Total liabilities and $ 10,190,699 $ 9,751,571 $ 8,367,976 $ 8,357,501 $ 7,500,643 shareholders' equity

ENTERPRISE FINANCIAL SERVICES CORP

CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

Quarter ended

($ in thousands) Mar 31, Dec 31, Sep 30, Jun 30, Mar 31, 2021 2020 2020 2020 2020

LOAN PORTFOLIO

Commercial and $ 3,079,643 $ 3,088,995 $ 3,152,394 $ 3,143,197 $ 2,469,013 industrial

Commercial real 3,186,970 3,087,827 2,027,886 2,048,444 2,048,357 estate

Construction real 510,501 546,686 474,727 481,221 469,627 estate

Residential real 303,047 319,179 321,792 326,992 346,758 estate

Other 208,620 182,248 149,508 140,197 123,762

Total loans $ 7,288,781 $ 7,224,935 $ 6,126,307 $ 6,140,051 $ 5,457,517



DEPOSIT PORTFOLIO

Noninterest-bearing $ 2,910,216 $ 2,711,828 $ 1,929,540 $ 1,965,868 $ 1,354,571 accounts

Interest-bearing 1,990,308 1,768,497 1,499,756 1,508,535 1,389,603 transaction accounts

Money market and 3,093,569 2,954,969 2,634,885 2,566,011 2,479,828 savings accounts

Brokeredcertificates of 50,209 50,209 65,209 85,414 170,667 deposit

Other certificates 471,142 499,886 546,836 573,752 595,237 of deposit

Total deposit $ 8,515,444 $ 7,985,389 $ 6,676,226 $ 6,699,580 $ 5,989,906 portfolio



AVERAGE BALANCES

Total loans $ 7,192,776 $ 6,780,701 $ 6,112,715 $ 6,032,076 $ 5,352,243

Debt and equity 1,417,305 1,395,806 1,361,515 1,361,853 1,346,968 investments

Interest-earning 9,289,741 8,524,136 7,770,084 7,571,196 6,791,459 assets

Total assets 9,940,052 9,141,159 8,341,968 8,158,204 7,363,605

Deposits 8,207,379 7,311,074 6,666,368 6,551,734 5,837,717

Shareholders' equity 1,096,481 992,017 885,496 868,163 865,035

Tangible common 813,568 731,813 652,663 633,946 629,390 equity^1



YIELDS (tax equivalent)

Total loans 4.35 % 4.46 % 4.08 % 4.31 % 5.06 %

Debt and equity 2.52 2.56 2.56 2.72 2.90 investments

Interest-earning 3.76 3.97 3.67 3.93 4.58 assets

Interest-bearing 0.20 0.25 0.31 0.37 0.88 deposits

Total deposits 0.13 0.17 0.22 0.27 0.68

Subordinated 5.61 5.52 5.53 5.50 5.46 debentures

FHLB advances and 0.46 0.61 0.74 0.56 1.33 other borrowed funds

Interest-bearing 0.40 0.47 0.54 0.55 1.05 liabilities

Net interest margin 3.50 3.66 3.29 3.53 3.79

^1Refer to Reconciliations of Non-GAAP Financial Measures table for areconciliation of these measures to GAAP.

ENTERPRISE FINANCIAL SERVICES CORP

CONSOLIDATED FINANCIAL SUMMARY (unaudited) (continued)

Quarter ended

(in thousands, Mar 31, Dec 31, Sep 30, Jun 30, Mar 31,except per 2021 2020 2020 2020 2020share data)

ASSET QUALITY

Netcharge-offs $ 5,647 $ (612) $ 1,027 $ 309 $ 1,183 (recoveries)

Nonperforming 36,659 38,507 39,623 41,473 37,204 loans

Classified 114,713 123,808 84,710 96,678 104,754 assets

Nonperformingloans to total 0.50 % 0.53 % 0.65 % 0.68 % 0.68 %loans

Nonperformingassets to 0.42 % 0.45 % 0.53 % 0.55 % 0.56 %total assets

Allowance forloan losses to 1.80 % 1.89 % 2.01 % 1.80 % 1.69 %total loans

Allowance forloan losses to 358.8 % 354.9 % 311.1 % 265.9 % 247.8 %nonperformingloans

Netcharge-offs(recoveries) 0.32 % (0.04) % 0.07 % 0.02 % 0.09 %to averageloans(annualized)



WEALTH MANAGEMENT

Trust assetsunder $ 1,809,001 $ 1,783,089 $ 1,641,980 $ 1,602,358 $ 1,445,521 management

Trust assetsunder 2,427,448 2,504,318 2,433,026 2,455,111 2,139,673 administration



MARKET DATA

Book value per $ 34.95 $ 34.57 $ 33.66 $ 33.13 $ 32.36 common share

Tangible bookvalue per $ 25.92 $ 25.48 $ 24.80 $ 24.22 $ 23.38 common share^1

Market value $ 49.44 $ 34.95 $ 27.27 $ 31.12 $ 27.91 per share

Period endcommon shares 31,259 31,210 26,210 26,196 26,161 outstanding

Average basic 31,247 28,929 26,217 26,180 26,473 common shares

Averagediluted common 31,306 28,968 26,228 26,195 26,539 shares



CAPITAL

Totalrisk-basedcapital to 15.1 % 14.9 % 14.6 % 14.4 % 12.9 %risk-weightedassets

Tier 1 capitalto 12.3 % 12.1 % 11.6 % 11.4 % 11.0 %risk-weightedassets

Common equitytier 1 capitalto 11.0 % 10.9 % 10.2 % 9.9 % 9.6 %risk-weightedassets

Tangiblecommon equity 8.2 % 8.4 % 8.0 % 7.8 % 8.4 %to tangibleassets^1



^1Refer to Reconciliations of Non-GAAP Financial Measures table for areconciliation of these measures to GAAP.

ENTERPRISE FINANCIAL SERVICES CORP

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Quarter ended

($ in thousands) Mar 31, Dec 31, Sep 30, Jun 30, Mar 31, 2021 2020 2020 2020 2020

CORE PERFORMANCE MEASURES

Net interest $ 79,123 $ 77,446 $ 63,354 $ 65,833 $ 63,368 income

Less:Incremental - 856 1,235 719 1,273 accretion income

Core net 79,123 76,590 62,119 65,114 62,095 interest income



Totalnoninterest 11,290 18,506 12,629 9,960 13,408 income

Less: Gain onsale of - - 417 - 4 investmentsecurities

Less: Other - - - 265 - non-core income

Core noninterest 11,290 18,506 12,212 9,695 13,404 income



Total core 90,413 95,096 74,331 74,809 75,499 revenue



Totalnoninterest 52,884 51,050 39,524 37,912 38,673 expense

Less: Otherexpenses related - 8 25 12 12 to non-coreacquired loans

Less:Merger-related 3,142 2,611 1,563 - - expenses

Core noninterest 49,742 48,431 37,936 37,900 38,661 expense



Core efficiency 55.02 % 50.93 % 51.04 % 50.66 % 51.21 %ratio

Quarter ended

($ in thousands)

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Mar 31, 2020

SHAREHOLDERS' EQUITY TO TANGIBLE COMMON EQUITY AND TOTAL ASSETS TO TANGIBLE ASSETS

Shareholders' equity

$

1,092,497

$

1,078,975

$

882,267

$

867,963

$

846,436

Less: Goodwill

260,567

260,567

210,344

210,344

210,344

Less: Intangible assets

21,670

23,084

21,820

23,196

24,585

Tangible common equity

$

810,260

$

795,324

$

650,103

$

634,423

$

611,507

Total assets

$

10,190,699

$

9,751,571

$

8,367,976

$

8,357,501

$

7,500,643

Less: Goodwill

260,567

260,567

210,344

210,344

210,344

Less: Intangible assets

21,670

23,084

21,820

23,196

24,585

Tangible assets

$

9,908,462

$

9,467,920

$

8,135,812

$

8,123,961

$

7,265,714

Tangible common equity to tangible assets

8.18

%

8.40

%

7.99

%

7.81

%

8.42

%

Quarter ended

($ in Mar 31, Dec 31, Sep 30, Jun 30, Mar 31,thousands) 2021 2020 2020 2020 2020

SHAREHOLDERS' EQUITY TO TANGIBLE COMMON EQUITY AND TOTAL ASSETS TO TANGIBLEASSETS

Shareholders' $ 1,092,497 $ 1,078,975 $ 882,267 $ 867,963 $ 846,436 equity

Less: Goodwill 260,567 260,567 210,344 210,344 210,344

Less:Intangible 21,670 23,084 21,820 23,196 24,585 assets

Tangible common $ 810,260 $ 795,324 $ 650,103 $ 634,423 $ 611,507 equity



Total assets $ 10,190,699 $ 9,751,571 $ 8,367,976 $ 8,357,501 $ 7,500,643

Less: Goodwill 260,567 260,567 210,344 210,344 210,344

Less:Intangible 21,670 23,084 21,820 23,196 24,585 assets

Tangible assets $ 9,908,462 $ 9,467,920 $ 8,135,812 $ 8,123,961 $ 7,265,714



Tangible commonequity to 8.18 % 8.40 % 7.99 % 7.81 % 8.42 %tangible assets

Quarter Ended

($ in thousands)

Mar 31, 2021

Dec 31, 2020

Mar 31, 2020

AVERAGE SHAREHOLDERS' EQUITY AND AVERAGE TANGIBLE COMMON EQUITY

Average shareholder's equity

$

1,096,481

$

992,017

$

865,035

Less average goodwill

260,567

237,639

210,344

Less average intangible assets

22,346

22,565

25,301

Average tangible common equity

$

813,568

$

731,813

$

629,390

Quarter Ended

($ in thousands) Mar 31, Dec 31, Mar 31, 2021 2020 2020

AVERAGE SHAREHOLDERS' EQUITY AND AVERAGE TANGIBLE COMMON EQUITY

Average shareholder's equity $ 1,096,481 $ 992,017 $ 865,035

Less average goodwill 260,567 237,639 210,344

Less average intangible assets 22,346 22,565 25,301

Average tangible common equity $ 813,568 $ 731,813 $ 629,390



Quarter Ended

($ in thousands)

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Mar 31, 2020

CALCULATION OF PRE-PROVISION NET REVENUE

Net interest income

$

79,123

$

77,446

$

63,354

$

65,833

$

63,368

Noninterest income

11,290

18,506

12,629

9,960

13,408

Less: Noninterest expense

52,884

51,050

39,524

37,912

38,673

Merger-related expenses

3,142

2,611

1,563

-

-

PPNR (excluding merger-related expenses)

$

40,671

$

47,513

$

38,022

$

37,881

$

38,103

Average assets

$

9,940,052

$

9,141,159

$

8,341,968

$

8,158,204

$

7,363,605

ROAA - GAAP net income

1.22

%

1.26

%

0.86

%

0.72

%

0.70

%

PPNR ROAA - Adjusted net income

1.66

%

2.07

%

1.81

%

1.87

%

2.08

%

Quarter Ended

($ in thousands) Mar 31, Dec 31, Sep 30, Jun 30, Mar 31, 2021 2020 2020 2020 2020

CALCULATION OF PRE-PROVISION NET REVENUE

Net interest $ 79,123 $ 77,446 $ 63,354 $ 65,833 $ 63,368 income

Noninterest 11,290 18,506 12,629 9,960 13,408 income

Less:Noninterest 52,884 51,050 39,524 37,912 38,673 expense

Merger-related 3,142 2,611 1,563 - - expenses

PPNR (excludingmerger-related $ 40,671 $ 47,513 $ 38,022 $ 37,881 $ 38,103 expenses)



Average assets $ 9,940,052 $ 9,141,159 $ 8,341,968 $ 8,158,204 $ 7,363,605

ROAA - GAAP net 1.22 % 1.26 % 0.86 % 0.72 % 0.70 %income

PPNR ROAA -Adjusted net 1.66 % 2.07 % 1.81 % 1.87 % 2.08 %income

Quarter Ended

($ in thousands, except per share data)

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

IMPACT OF PAYCHECK PROTECTION PROGRAM

Net income - GAAP

$

29,926

$

28,931

$

17,951

$

14,634

PPP interest and fee income

(8,475)

(10,261)

(5,226)

(4,083)

Related tax effect

2,110

2,534

1,291

1,009

Adjusted net income - Non-GAAP

$

23,561

$

21,204

$

14,016

$

11,560

Average diluted common shares

31,303

28,968

26,228

26,195

EPS - GAAP net income

$

0.96

$

1.00

$

0.68

$

0.56

EPS - Adjusted net income

$

0.75

$

0.73

$

0.53

$

0.44

Average assets - GAAP

$

9,940,052

$

9,141,159

$

8,341,968

$

8,158,204

Average PPP loans, net

(692,161)

(806,697)

(813,244)

(634,632)

Adjusted average assets - Non-GAAP

$

9,247,891

$

8,334,462

$

7,528,724

$

7,523,572

ROAA - GAAP net income

1.22

%

1.26

%

0.86

%

0.72

%

ROAA - Adjusted net income, adjusted average assets

1.03

%

1.01

%

0.74

%

0.62

%

PPNR (excluding merger-related expenses) - Non-GAAP

(see reconciliation above)

$

40,671

$

47,513

$

38,022

$

37,881

PPP interest and fees

(8,475)

(10,261)

(5,226)

(4,083)

Adjusted PPNR (excluding merger-related expenses) -

Non-GAAP

$

32,196

$

37,252

$

32,796

$

33,798

PPNR ROAA (excluding merger-related expenses) -

PPNR (excluding merger-related expenses)

1.66

%

2.07

%

1.81

%

1.87

%

PPNR ROAA (excluding merger-related expenses) -

adjusted PPNR (excluding merger-related expenses),

adjusted average assets

1.41

%

1.78

%

1.73

%

1.81

%

Tangible assets - Non-GAAP (see reconciliation above)

$

9,908,462

$

9,467,920

$

8,135,812

$

8,123,961

PPP loans outstanding, net

(737,660)

(698,645)

(819,100)

(807,814)

Adjusted tangible assets - Non-GAAP

$

9,170,802

$

8,769,275

$

7,316,712

$

7,316,147

Tangible common equity Non - GAAP (see reconciliation

above)

$

810,260

$

795,324

$

650,103

$

634,423

Tangible common equity to tangible assets

8.18

%

8.40

%

7.99

%

7.81

%

Tangible common equity to tangible assets - adjusted

tangible assets

8.84

%

9.07

%

8.89

%

8.67

%

Average assets for leverage ratio

$

9,675,300

$

8,886,916

$

8,115,020

$

7,928,286

Average PPP loans, net

(692,161)

(806,697)

(813,244)

(634,632)

Adjusted average assets for leverage ratio - Non-GAAP

$

8,983,139

$

8,080,219

$

7,301,776

$

7,293,654

Tier 1 capital

$

914,459

$

889,527

$

745,397

$

726,574

Leverage ratio

9.5

%

10.0

%

9.2

%

9.2

%

Leverage ratio - adjusted average assets for leverage ratio

10.2

%

11.0

%

10.2

%

10.0

%

Net interest income - tax equivalent

$

80,243

$

78,484

$

64,192

$

66,537

PPP interest and fees

(8,475)

(10,261)

(5,226)

(4,083)

Adjusted net interest income - tax equivalent

$

71,768

$

68,223

$

58,966

$

62,454

Average earning assets -GAAP

$

9,289,741

$

8,524,136

$

7,770,084

$

7,571,196

Average PPP loans, net

(692,161)

(806,697)

(813,244)

(634,632)

Adjusted average earning assets - Non-GAAP

$

8,597,580

$

7,717,439

$

6,956,840

$

6,936,564

Net interest margin - tax equivalent

3.50

%

3.66

%

3.29

%

3.53

%

Net interest margin - tax equivalent - adjusted net interest

income, adjusted average earning assets

3.39

%

3.52

%

3.37

%

3.62

%

Loans - GAAP

$

7,288,781

$

7,224,935

$

6,126,307

$

6,140,051

PPP loans outstanding, net

(737,660)

(698,645)

(819,100)

(807,814)

Adjusted loans - Non-GAAP

$

6,551,121

$

6,526,290

$

5,307,207

$

5,332,237

Allowance for credit losses on loans

$

131,527

$

136,671

$

123,270

$

110,270

Allowance for credit losses on loans/loans - GAAP

1.80

%

1.89

%

2.01

%

1.80

%

Allowance for credit losses on loans/loans - adjusted loans

2.01

%

2.09

%

2.32

%

2.07

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20210426005816/en/

CONTACT: For more information contact Investor Relations: Keene Turner, Executive Vice President and CFO (314) 512-7233 Media: Steve Richardson, Vice President (314) 512-7183